OPM to suspend applications for Federal Long Term Care Insurance Program

Those looking to enroll in the Federal Long Term Care Insurance Program (FLTCIP) will soon have to wait a couple of years before applying.

The Office of Personnel Management said it will suspend all new applications to the program starting on Dec. 19. The suspension will last for the next two years, but those who apply ahead of the start date may still see their applications go through. During that time, current FLTCIP enrollees cannot apply to increase their coverage. The suspension will otherwise not affect the coverage of current enrollees.

OPM said the suspension will give the agency time to try to mitigate the increasing costs of FLTCIP premiums, which have risen at high rates over the course of many years.

Most recently, in 2016, premium rates rose 83% on average, and up to as much as 126% for some enrollees. The average monthly increase amount was $111. The increase caused more than 96,000 FLTCIP enrollees to keep their premiums the same by reducing their insurance benefits, OPM said in 2016 testimony. In 2009, FLTCIP enrollees saw their premium rates increase by an average of 17%, and as much as 25% in some cases.

Individuals’ premiums for FLTCIP are based on their age when they apply. But the premium rates at the time of applying are not guaranteed for enrollees, and are susceptible to change in the future.

The contract for the insurance program, with John Hancock Life and Health Insurance Company, typically lasts seven years before getting a renewal. The program normally gets a premium hike each time the contract turns over. During the open period for new contract proposals earlier this year, only the current underwriter John Hancock submitted a bid. The current FLTCIP contract will expire on April 30, 2023.

The upcoming suspension on applications will allow OPM “to assess the benefit offerings and establish sustainable premium rates that reasonably and equitably reflect the cost of the benefits provided,” the agency said in a Nov. 18 notice. OPM added that it will only suspend applications when it is in the best interest of the program.

Many are eligible to apply for FLTCIP coverage, including federal employees, U.S. Postal Service employees and annuitants, as well as active and retired members of the uniformed services, and qualified relatives of feds. John Hancock has historically sponsored the program, and Long Term Care Partners, LLC, has administered it.

Currently, FLTCIP covers about 267,000 enrollees, and the program receives about 6,000 new enrollees each year. That’s less than 0.1% of the 11 million individuals eligible for the program, excluding spouses and…