- The Washington Times - Tuesday, December 25, 2001

The decision to narrow eligibility for coverage in the upcoming Federal Family Long Term Care insurance program has surprised or angered some people.
For instance, grandparents and brothers and sisters of workers and military personnel will not be covered. And the underwriting requirements which determine who gets coverage will also be tougher for most eligibles.
But insurance experts said all along that coverage would be much tougher than politicians promised. They also say that narrowing the entryway into the plan will hold down premiums for those who do qualify for coverage when the program starts this fall.
To sell LTC to colleagues and score points with voters some politicians billed the federal program as an all-inclusive, low-premium model that would become the forerunner for a national LTC program. Those who truly believed their own speeches obviously never worked for a profit-making organization, which is what insurance companies try to be.
Insurance companies do best when people insure but don't wreck their cars, lose their homes to fire, wind or rain, and who live very long, healthy and independent lives. They are the profit bottom line. Underwriting is the way they separate the good risks from the not-so-good risks.
When Congress and the Clinton administration OK'd the LTC program they told the Office of Personnel Management to handle the "details" such as premiums, coverage and who gets in. Politicians sold it as a program that would cover 20 million people at premiums 15 percent to 20 percent less than they would pay for comparable individual coverage.
Now that the design is taking place, OPM says everybody applying for coverage will have to pass some level of medical underwriting to see what kind of risk they are. Federal and military personnel must fill out a short form and get a counteroffer if they don't qualify for standard policies. But everybody else including spouses either makes the cut for standard coverage or they won't be allowed to participate.
An insurance expert said that answering "yes" to the question about certain diseases, or strokes, could make people ineligible for coverage. "If former Attorney General Janet Reno [who has Parkinsons disease] was still in government she might not be eligible for the LTC program," an insurance expert said.
The National Treasury Employees Union denounced OPM for narrowing coverage, especially for domestic partners. The union said the government won't be able to attract the best people unless it offers the best benefits.
Congress may put some pressure on OPM to expand coverage, but that's unlikely to happen since enrollments are now tentatively scheduled to begin in March. Meanwhile, to check out the LTC program go to: https://www.opm.gov/insure/ltc.

Ill? Don't retire yet
It may be very difficult for older, or very sick federal retirees to get coverage under the LTC program. That's why Arthur Stein, vice president of Cassady & Company Inc. in McLean, urges federal workers who are in poor health not to quit their daytime jobs yet.
"They may be eligible to qualify for LTC coverage while they are still working and then retire," he said, "but if they retire before applying for coverage they could be out of luck."

Patriots day
September 11 will be a holiday in the future but not for pay and leave purposes. Congress and the White House agreed to set aside the day to permanently pay tribute to victims of the terrorist attacks. But it won't be a holiday for federal workers, banks or other operations.
Meanwhile, most non-emergency feds (outside the Postal Service) got a bonus holiday yesterday. Had the White House declared it a day of administrative leave feds who had to work yesterday would have gotten a 10 percent differential. But since it was made a holiday, for pay and leave purposes, most working feds will get double time for being on duty. That works out to about $30.3 million.

Retiree raise
I thrilled, then chilled, some retirees last week by giving the wrong amount for the January 2002 cost-of-living adjustment. In fact, retirees under the old Civil Service Retirement System, the military retirement system and Social Security will get a 2.6 percent increase next month. Feds whose benefits are computed under the newer Federal Employees Retirement System will get a 2 percent raise, if they are age 62 or older.

Regional pay raise
White-collar feds in the two cities will get more than the "average" 4.6 percent 2002 federal pay raise. How much extra depends on what portion of the 4.6 percent raise President Bush sets aside for locality-pay adjustments. Washington by itself has about 16 percent of the total federal operation. Cities where feds will get even more include New York, San Francisco, Los Angeles and, perhaps, Houston. Cities where they raise will be lower are likely to include Norfolk, Salisbury and Easton, Md., and Raleigh, N.C.

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