Legislators scrutinize long term care insurance

OLYMPIA — State legislators held a meeting in Spokane with Insurance Commissioner Mike Kreidler, long term care insurance professionals, and a representative of Washington nursing homes to discuss the issue of long-term care insurance and the unprecedented rate hikes that are being granted to some insurance carriers by the Office of the Insurance Commissioner.

Sen. Chris Marr, D-Spokane, called the meeting after several constituents complained that the premiums on long term care insurance policies they acquired 10 to 15 years ago are now so expensive, and the benefits have been reduced to such a minimal level, that the policies are virtually worthless.

“These people are being forced into a dilemma of either paying increasing premiums or dropping the policies,” said Marr. “The worst part is that they've invested so much into these policies and they may be forced to drop their coverage just when they’re going to need the benefits, which is what the insurance companies are hoping for.”

Marr also pointed out that because many of these insurance customers are now of an age where “shopping around” for new coverage is no longer an option, they are forced to turn to Medicaid – making their healthcare the state's responsibility.

“The insurance companies make money off of these people’s policy premiums for years, only to drop them when they become too expensive and leaving the taxpayers with the responsibility of paying for their health care,” Marr said. “It’s an unacceptable business practice that gives a black eye to the industry, and we’re not about to sit around and let it happen.”

Marr said that he would be moving forward with several proposals that were suggested during the meeting, including:

• Requesting that the Office of the Insurance Commissioner notify him of any future rate hike requests by Conseco Senior Health Insurance, which has been awarded 14 increases on long-term care policies ranging from 10-25% over the past five years;
• Legislation in the 2008 session adopting of the National Association of Insurance Commissioners Model Act and regulations, which would help protect new people entering the long-term care insurance market; and
• Creating a task force made up of representatives of the Washington Health Care Association, the American Association of Retired Persons, insurance companies and legislators with an eye toward coming up with specific recommendations to help resolve issues of public notification of rate increase requests and opportunities for consumers to comment, as well as providing incentives to grow the long-term care insurance market.

Marr said that several members of both the House and Senate have expressed interest in the legislation, and that he was optimistic that it would move forward. He is hopeful Insurance Commissioner Kreidler will lend his endorsement to the legislation.

Return to Sen. Marr's home page