Tuesday, November 6, 2001

The government hopes to launch its federal family long-term care (LTC) program even before the targeted October 2002. That means it would pay federal and postal workers to do a little advance homework now.
Getting earlier coverage won’t mean much to most feds. And that’s a blessing. This is one policy, like your life, fire or auto insurance, that you DON’T want to collect. But for workers and family members who need the protection, LTC is a financial lifeboat, the difference between relative comfort and poverty.
When doing the LTC math, ask yourself this question: How long could you afford to shell out $200 a day, or more, for a qualified adult-sitter? Someone to help you or a loved one eat, dress and get around?
For all but the filthy rich, the choice is an LTC policy or an asset-draining descent into poverty until you can qualify for federal assistance.
Nursing home care can run $60,000 a year or more. Medicare covers only the first months’ bills in a Medicare-approved nursing home. Medicaid is available only after you have spent all your money.
Doug Lockwood, a Vice President of American Century, notes that the “average stay in a nursing facility is 2.9 years [and] eight years for an Alzheimer’s patient.”
When it becomes available, the federal family LTC will look something like this: Benefits ranging from $400 to $2,000 per week will be offered. Benefits will run three years, five years or for life. Premiums, yet to be established, will be based on your age at enrollment, amount and length of benefit and when benefits start (after 30 days, 60 days or 90 days).
The bottom line is that some younger federal workers will probably be able to get the same or better coverage from a private insurance company. Older federal workers and retirees, however, may find the federal family program not only a bargain, but the only plan in which they can enroll.
Congress ordered the program to start by next October, but officials hope to offer coverage more quickly than that.
The Office of Personnel Management got final competitive bids on Oct. 15. It will be announcing details of the program including all-important premiums and a commencement date soon.

Health insurance D-Day
Starting next week, federal and postal workers, retirees and even ex-spouses of current and former feds will begin picking their year 2002 health plan.
They have a dozen fee-for-service and HMOs from which to select. The government pays about 72 percent of the total premium.
The federal program allows retirees to remain covered at group rates with full benefits for life. Most private companies which offer health insurance cut off retirees at 65. The federal program covers half the people in the Washington area.
Premiums are going up this year, with some of the biggest increases in Blue Cross-Blue Shield. It’s the most popular plan in the federal program, and it will be dropping its high-option plan in favor of a basic, lower-premium plan for 2002.
During the open season we’ll have a series of columns on the best buys. To get a head start on changes in health plans, check out the Office of Personnel Management’s Web site at www.opm.gov and The Washington Consumers’ CHECKBOOK Guide to Federal Health plans at www.checkbook.org/newhig2/hig.cfm.

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