National Association of Insurance and Financial Advisors

NAIFA and ACLI: LTCI Can Help Fill Coverage Gap for Alzheimer's Costs

Alzheimer’s disease is one driving force behind escalating long-term care costs that are creating financial burdens for an aging U.S. population. In fact, Alzheimer’s is the leading cause of long-term care insurance (LTCI) claims, but LTCI now covers only 4% of nursing home expenditures for seniors.

“There is clearly a large gap in the market, which long-term care insurance can fill,” write NAIFA CEO Kevin Mayeux and ACLI President and CEO Susan Neely in a statement for the record to the U.S. Senate Finance Committee on Health Care chaired by Sen. Pat Toomey (R – PA).
LTCI policies, including hybrid and combination life insurance or annuity products, protect American families from the financial risks associated with long-term care events. That risk is significant. A study published in the journal Health Affairs projects that 27 million Americans will require long-term care by 2050.
Mayeux and Neely propose that action by lawmakers and regulators is required to help Americans face the financial burden of long-term care.
“ACLI and NAIFA applaud Chairman Toomey’s leadership in putting forth a proposal that would assist families to prepare for their long-term care needs by allowing them to have limited access to their retirement savings to help pay for long-term care insurance,” Mayeux and Neely wrote in the statement. “With this sort of flexibility, more families would have protection of retirement savings and be far better positioned to meet long-term care expenses.
“ACLI and NAIFA also continue to work with the recently organized U.S. Treasury interagency task force on long-term care insurance. We understand that the task force has been reviewing various proposals to reform federal laws and regulations concerning long-term care insurance, including, among other options, federal policy options presented by the NAIC to Congress for its consideration in April 2017.”
NAIFA and ACLI also suggest:
  • A national educational campaign to inform consumers about the need for and benefits of LTCI
  • Tax incentives to expand consumer access to LTCI through workplace and retirement plans
  • Laws or regulations that would allow LTCI incidental benefits to support independent living and aging in place before current eligibility requirements, including a severe cognitive impairment, are met
  • Revised federal regulations on inflation protection to allow LTCI policies to better meet the needs of consumers.
Mayeux and Neely’s statement will become part of the official record for the subcommittee hearing, “Alzheimer’s Awareness: Barriers to Diagnosis, Treatment and Care Coordination,” which is scheduled for Nov. 20, 2019, at 2 PM (eastern).
  • Posted November 20, 2019 IN

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