McCormack Speaks

October 16, 2017
by McCormack Speaks

A Deeper Look at Long-Term Care Insurance

Professor Marc Cohen has spent many years following the market for long-term care insurance – from its days of broad-based popularity to its current appeal among primarily affluent policyholders. Cohen recently talked about that market and ideas about how insurance coverage could change in the future. The following is an edited version of his comments.

picture of a stethoscopeWhy should people care about long-term care insurance, especially if the potential risk may be many years away?

That’s a real challenge. A lot of people misunderstand LTSS and most believe incorrectly the government pays for care, or they don’t understand government pays for care only after people impoverish themselves. For most, the risk is 30 to 40 years in the future and about half will not develop significant long-term care needs. But the risk is highly unpredictable for an individual. You don’t know if you’re going to be struck with Parkinson’s or dementia. Most people also underestimate the cost of home care or nursing homes.

See more Q & A.

September 30, 2017
by McCormack Speaks

Affluent Policyholders Dominate Market for Long-Term Care Insurance

This originally appeared in the Gerontology Institute blog written by Steven Syre.

More than ever, private long-term care coverage is an insurance product likely to be purchased by affluent customers.

New research by Marc Cohen, co-director of the LeadingAge LTSS Center @UMass Boston, and co-author Eileen Tell found that four of every five buyers of long-term care coverage earned $50,000 per year or more in 2015. People in that income category accounted for just 20 percent of long-term care sales in 1995.

The shift corresponds with significant increase in the cost of the coverage over time. “Fewer middle income people are attracted to the product at current prices,” Cohen and Tell wrote in the latest edition (issue 45) of Long-Term Care News, a publication of the Society of Actuaries.  Read more.

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