Despite strong bipartisan support, federal workers could be years away from getting long-term care insurance, at group rates, as part of their benefits package.
If such a program were approved today -- and it won't be -- it could be 12 to 18 months before coverage was available to active and retired federal civilian workers and military personnel. If action is delayed until next year, which is likely, it might be mid- or late 2001 before coverage is available.
Democrats and Republicans on Capitol Hill are engaged in talks about how long-term care insurance would work. Each side would like to get credit for introducing a long-term care insurance program for federal workers that someday might be widely imitated by other employers.
The White House wants to let the Office of Personnel Management negotiate premiums with insurance companies and to have the authority to require certain benefit levels. Republicans generally favor a free-market approach: Insurance companies would bid for business -- offering a variety of benefit and premium levels -- with OPM providing guidance and information.
The Clinton administration and Rep. Joe Scarborough (R-Fla.), chairman of the House civil service subcommittee, have indicated support for including military personnel and their family members in any federal long-term care insurance program. Scarborough has introduced a long- term care bill. His subcommittee has jurisdiction.
The idea of including the military was proposed by Rep. Constance A. Morella (R-Md.). Bringing in the military would double the potential pool of policyholders. The military is generally younger -- and healthier -- than the government's civilian work force, which could help hold down rates.
Members of both political parties agree that policyholders should pay the entire premium for long-term care insurance. There have been estimates that premiums would range from a few hundred to a few thousand dollars a year. Right now, those estimates are mostly smoke and mirrors because nobody knows what benefits might be offered. In addition, the premium structure would be based on age and, in the case of retirees, might require that individuals meet certain standards (or even pass a physical) to get coverage. The point is that the details -- which are critical to premiums -- haven't been ironed out.
Republicans first introduced the idea of a long-term care insurance program for the federal family. The GOP plan was rejected by federal unions and groups representing retirees. They think the GOP's marketplace approach is designed to let insurance companies call all the shots. They prefer the White House plan -- just introduced in the Senate by Sen. Barbara A. Mikulski (D-Md.) -- which would give OPM a major say in rates and benefit levels.
In the United States, only about 6 million people now have long-term care insurance. Depending on the policy, the policies pay benefits (indexed to inflation) of $100 to $175 a day (typically). Premiums are based on the daily benefit level, the age at which an individual enrolls, health considerations and when benefits begin. Some policies don't kick in for 90 days; others pay sooner. Some pay for a fixed period, say a year or more; others pay benefits for life. Obviously, premiums vary greatly.
When she introduced her long-term care bill (the administration plan), Mikulski said the average cost of long-term care is $40,000 a year for nursing homes. In many parts of the country, the cost is much higher. The administration plan was introduced earlier this year in the House by Rep. Elijah E. Cummings (D-Md.).
Assuming long-term care legislation clears the House this year, what the Senate will do remains an open question. The Senate has shown less interest in matters affecting federal employees, and this is a short-session of Congress, with lots of time outs.
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Thursday, June 10, 1999