Popularity Contest

This is the story of two federal insurance plans that met with very different welcomes.

Dental and vision insurance finished its first enrollment period at the end of last month with 690,000 enrollees. That number was way beyond the 250,000 participants officials anticipated. The Web site that handled enrollments became bogged down because so many people were using it.

Federal employees, apparently, were hungry for the coverage despite the fact the government isn't subsidizing premiums. For regular health insurance, the government pays for about 70 percent of premiums.

Then there is federal long-term care insurance, which was introduced in 2002. Long-term care insurance covers assistance with the basic tasks of life such as bathing, dressing and preparing meals, including services available in nursing homes. As of September 2006 -- four years since the plan's inception -- about 214,000 people had signed up.

Why is there a 476,000-person gap in enrollment between the two offerings? The interest group AARP released a study last month that found most people don't know the cost of long-term care and overestimate Medicare's portion of it. Fifty-nine percent of the 1,456 people surveyed believed Medicare would pay for an extended nursing home stay. But it doesn't. Fifty-two percent said Medicare would pay for assisted living costs. It doesn't, except in cases where people have depleted their assets.

Only 9 million Americans have long-term care insurance. In fact, the federal program is the largest group plan in the country and lawmakers have looked to it as a model.

The Government Accountability Office released a report this week detailing, among other things, the challenge of marketing the federal long-term care program. Insurers say direct-mail is the most effective way to market the coverage, but the Office of Personnel Management was unable to provide addresses for all eligible employees; only 40 percent received information about the program in the mail.

If you didn't get the mailing, then here are some statistics that may turn your head: According to the Federal Long-Term Care Insurance Program, average nursing home costs are about $52,000 per year. Those for assisted living facilities are about $25,300 annually, and home care costs more than $20,000. By the year 2030, those costs will rise to about $190,600; $109,300 and $68,000; respectively.

The monthly rates for the government's long-term care insurance range from $6 to $605.10, depending on age and the breadth of the coverage.

But this type of insurance, like dental and vision coverage, may not be cost-effective for everyone. A useful source of information is the Shopper's Guide to Long-Term Care Insurance, published by the National Association of Insurance Commissioners.

Dental and vision insurance enrollment ended with the close of open season last month, but you can sign up year-round for long-term care coverage. Anyone interested in the federal program can apply here.