OPM to begin offering long-term care benefits next year

Federal employees will have the opportunity to purchase long-term care insurance at discounted rates beginning in October 2002, the Office of Personnel Management said Friday. In September, Congress passed the Long-Term Care Security Act (H.R. 4040), which directed OPM to solicit bids from private insurers to offer long-term care coverage to federal employees and their spouses, children and other close relatives at discounted group rates. Federal workers, active-duty military personnel and both civilian and military retirees are all eligible for the benefit. The government will not subsidize long-term care premiums, but OPM expects the long-term care rates to be 15 to 20 percent lower than market rates because of the group policy status, officials said. Employees can keep the benefit even after leaving the federal government. OPM's proposed plans will pay for care received in nursing homes, assisted living facilities, hospice facilities or in-home care that is arranged with plan coordinators. Care provided by temporary caregivers when full-time caregivers, such as a family member, are unavailable is also covered. Under the proposal, premiums will vary based on age, term and contribution size. Participants can choose a 3- or 5-year policy or lifetime coverage and can opt for various payment plans. Participants will have to wait 90 days before their benefits kick in, though they can pay more to have a shorter waiting period, and premiums will be waived once a claim is filed. Inflation protection will be available including compound inflation, which would automatically increase the weekly benefit amount by a set percentage annually, but leave the premium unchanged. Under the future purchase option the weekly benefit will increase with inflation. "This will provide a nice dose of security and peace of mind to families across the country," said Frank Titus, OPM's assistant director for long-term care. OPM's program will be the largest employer-based long-term care insurance program in the country, with a potential of 20 million beneficiaries.