As long term care prices soar, majority accept higher premiums or cut coverage
Most participants in the Federal Long Term Care Program are moving ahead with the higher premiums or opted to alter their coverage after the Office of Personnel Management’s summer enrollee decision period.
As of Oct. 7, more than 96 percent of enrollees who responded to the OPM’s enrollee decision period, which ran from July 18 through Sept. 30, chose to accept the increase or take one of the special benefit reduction options, an agency spokesperson told Federal News Radio in an email.
Less than 4 percent of those who responded chose to discontinue their coverage or take the “paid-up” option, the spokesperson said.
This comes after OPM announced in July that premiums could rise for policyholders by as much as 126 percent. The premium hikes were expected to affect 264,000 active and retired federal employees, who are expected to pay an average of $111 more per month for the same coverage they have now.
About 65 percent of affected FLTCP policyholders, or about 170,000 enrollees, responded and opted to make a change to their coverage during the decision period, a spokesperson for John Hancock Life and Health Insurance Company said. More than 91,000 enrollees did not respond and therefore accepted the premium increase, the John Hancock spokesperson added.
“We’ve heard from some worried members who do have long-term care insurance. Some are considering ways to scale back coverage in a bid to cut costs,” National Treasury Employees Union President Tony Reardon said in a statement. “Others are resigned to paying significantly more but worry about how long they could afford to do so because periodic rate hikes seem to have become the norm.”
OPM said it “received a large number” of phone calls and written questions. Because it expected a higher volume of calls, the agency adjusted its staffing levels to handle the extra traffic. FLTCP members waited an average of 12 seconds on the phone, the OPM spokesperson said.
“As each enrollee was affected differently, the questions varied, but most wanted to know the reasons behind the increase and more about their options,” an OPM spokesperson said. “Call-center representatives were specially trained to explain the reasons for the rate increase and help enrollees evaluate their personalized options so they could make a choice.”
Some federal employees have told Congress that they plan to enroll in FLTCP anyway so they don’t lose coverage but hope another fix will come along, a congressional aide told Federal News Radio.
Lawmakers inboth chambershavepressedOPM for more details on why long term care rates have jumped so high. They asked OPM in September to extend the enrollee decision deadline past Sept. 30, but the agencysaid it had no plansto push back the open season. The House Oversight and Government Reform Committee expects to hold a hearing in November some time after the election.
The program provides long term health services for federal employees and their annuitants, as well as Postal employees and active and retired members of the military. Before this year’s decision period, more than 274,000 people paid for long term care benefits.
OPM awarded the new contract in April to the incumbent provider John Hancock Life and Health Insurance Company, the only bidder to provide long-term care services to the federal workforce.
The agency last awarded a contract for these services to John Hancock in 2009, when premiums rose on average by 17 percent and as much as 25 percent overall. OPM is required by law to issue a new contract every seven years.
During the last enrollee decision period in 2009, 30 percent of affected FLTCP participants had made a selection at this point in the process, the John Hancock spokesperson said.
The Senate Homeland Security and Governmental Affairs Committee also held a hearing on the topic when premiums last rose in 2009.
Congressman Hurt receives the 2016 Legislative Award from VCOC President COL Steve Truner
Alexandria, Va. - Ten members of the Virginia congressional delegation joined more than 100 attendees at the 31st annual Virginia Congressional Appreciation Luncheon, hosted by the Virginia Council of Chapters (VCOC) of the Military Officers Association of America (MOAA), Wednesday at the Capitol Hill Club in Washington.
The Virginia congressional delegation discussed key state and national defense-related legislative issues with leaders representing 16 MOAA chapters from the Commonwealth. The MOAA members took the opportunity to express their gratitude for all Congress accomplished this past year to support currently serving and retired uniformed servicemembers, veterans, and military families and surviving spouses.
The legislators in attendance included Reps. Rob Wittman, R-1st District; Scott Rigell, R-2nd District; Randy Forbes, R-4th District; Robert Hurt, R-5th District; Bob Goodlatte, R-6th District; David Brat, R-7th District; Don Beyer, D-8th District; Morgan Griffith, R-9th District; Barbara Comstock, R-10th District; and Gerry Connolly, D-11th District.
The VCOC recognized Congressman Hurt with its annual legislative award for his faithful support and loyal service regarding veterans and military compensation and benefits legislation. In 2015, Hurt introduced the Veterans Administration Legislative and Objective Review (VALOR) Act, which requires the Department of Veterans Affairs (VA) to undergo a biannual, independent audit by a non-governmental entity.
Retired Air Force Lt. Gen. Dana Atkins, president and CEO of MOAA, took the opportunity to thank Congress for championing veterans issues saying, “They do their very best to find the middle ground that our nation can support.” He went on to summarize some of the challenges Congress faces, which put personnel accounts at risk. Citing a recent Congressional Budget Office report, Atkins described almost $270 billion worth of pressure mounting on the defense budget caused by the Budget Control Act and cost overruns associated with military operations and maintenance accounts and procurement and acquisition.
Atkins highlighted MOAA's efforts to bring transparency for servicemember compensation. He said the National Defense Authorization Act's recommended 1.6% pay raise lags behind the private sector by at least one-half percentage point using the employment cost index. The general went on to caution that when aggregated, “if an E-5 comes to the Washington area, over the course of four years, they would have lost $4,500 in compensation, and an 0-3 who comes to the Washington area over the course of four years would lose $7,500 in compensation. This is a national issue that our congressional leaders are facing, and I applaud them for their hard work.”
Atkins applauded the VCOC members for their ability to work with their congressional leaders “in sharing the issues in an unemotional and unbiased way so the lawmakers can champion on their behalf.”
Col. Steven Turner, USAF (Ret), VCOC president, presented the Minuteman Award to Col. Brian Anderson, USAF (Ret), deputy director, Council and Chapter Affairs, for outstanding support and loyal service to VCOC members in the past year. The award, established in 1988, recognizes annually a MOAA national member or group. Anderson was presented with the replica of the Minuteman and will retain the statue for one year.