NARFE President Testifies on Federal Long Term Care Insurance Program Premium Increases

Many federal employees are facing steep hikes in their long term care insurance premiums. The National Active and Retired Federal Employees Association provided suggestions at a Congressional hearing for ways to address the situation.

Richard G. Thissen, president of the National Active and Retired Federal Employees Association, testified before the House Oversight and Government Reform Subcommittee on Government Operations on Wednesday, November 30, on recent premium increases for enrollees in the Federal Long Term Care Insurance Program (FLTCIP).

rtunity to testify.”

The hearing comes as a result of FLTCIP premiums increasing on November 1 by 83 percent, on average, and by as much as 126 percent for nearly 40 percent of enrollees, according to NARFE.

In his written testimony, Thissen states:

This is not what NARFE envisioned for the program 16 years ago, when the Federal Long Term Care Act was signed into law by President Bill Clinton. NARFE took pride in the fact that we played the leading role in ensuring that millions of families in the federal and military communities would have access to long-term care benefits without being sent to the poorhouse.

Today, however, the prospect of financial disaster is inching closer, as enrollees face premium increases of hundreds of dollars per month – on top of the substantial premiums they already are paying. We hope this hearing explores not only why this happened, but how to prevent this from happening again in the future. Public servants planning for their future deserve that much.

While NARFE supports specific reforms to the Federal Long Term Care Insurance Program, the association believes that Congress should address “broader reforms to long-term care financing that could address the needs not only of federal employees and retirees, but of all Americans” including a public-private partnership to meet the long-term care needs of all Americans.

NARFE is recommending specific reforms to FLTCIP:

  1. Require the program to offer hybrid long-term care policies that combine a whole life insurance policy with long-term care coverage
  2. Require the program to offer options with actual, guaranteed limits on premium increases by utilizing reinsurance to limit losses and protect against the risk of inaccurate actuarial assumptions
  3. Require (or allow) the program to offer high-deductible (or longer waiting period) plan options
  4. Provide an employer contribution toward coverage
  5. Provide a federal income tax exclusion for premiums paid for long-term care insurance
  6. Allow for a premium refund when premiums increase as dramatically as they have this year
  7. Improve oversight of the program
  8. Ensure that FLTCIP qualifies as a Long-Term Care Partnership Program

About the Author

Michael Wald is a public affairs consultant and writer based in the Atlanta area. He specializes in topics related to government and labor issues. Prior to his retirement from the U.S. Department of Labor, he served as the agency’s Southeast Regional Director of Public Affairs and Southeast Regional Economist.