- The Washington Times - Wednesday, April 3, 2002

We buy homeowners insurance, though thankfully most of us will probably never experience major damage from a house fire. We buy car insurance, though most will never experience more than a minor fender bender and shopping cart dings.

We recognize potential hazards and we act accordingly to be prepared for the unforeseen accidents that may lie ahead.

But what about long-term care insurance? I would guess you, like many, do not have this type of insurance, even though statistically there is a much higher probability you will need long-term care at some point in your life.

The early enrollment period has just began for an important new government benefit for federal employees, members of the uniformed services and their extended families the Federal Long-Term Care Insurance Program, sponsored by the Office of Personnel Management (OPM). At first glance, some may not share my enthusiasm for a new government employee benefit for the 20 million individuals who comprise the federal team and their families. However, it is time to take a closer look at this unique opportunity for families to plan for the future.

The Federal Long-Term Care Insurance Program will not be funded by taxpayers. It is entirely self-funded. OPM has negotiated with private insurance providers to offer lower rates to federal enrollees than rates typically offered in the private market. With this plan, enrollment approval is more likely than ever before.

There are several solid reasons to support this plan. Increasing numbers of highly qualified and motivated professionals are recognizing there is no better time to serve their country and make a difference. The new availability of long-term care insurance is but another consideration for top-notch individuals who are considering a career in the federal service.

Fiscal responsibility and compassion demand that we make purchasing long-term care insurance as convenient as possible. Without long-term care coverage, many of us will find ourselves on the road to publicly funded health care through Medicaid, the program designed to meet basic medical and long-term care needs of the impoverished. When faced with the costs of long-term care, many who were never offered long-term care insurance policies as employees must turn to Medicaid as a last resort.

Sadly, all too many of us know someone who has spent down and given away the assets they accumulated over a life of hard work in order to impoverish themselves to be eligible for government assistance when faced with the need for long-term care. After a lifetime of careful planning and responsible behavior, they are forced to give up a piece of their dignity, their independence, their individuality, and their privacy as they move to dependence on government welfare programs. There is a better way.

Individuals who purchase insurance to cover their long-term care immediately increase the options they have regarding the care they receive. Many nursing homes accept only a limited number of Medicaid patients, so space may not be available when care is needed. Additionally, the setting in which Medicaid pays for care is often not what we might prefer, such as adult day care centers, assisted living facilities, or the comfort of our own homes. If individuals take advantage of the opportunity to purchase the right insurance, such as the coverage being sponsored by OPM, they will allow themselves greater control over where and how they receive their care.

Employees will purchase coverage because it is in their best personal interest. About 40 percent of people currently receiving long-term care are under the age of 65. An average cost per year for a stay in a nursing home is $50,000. While Medicaid will cover long-term care expenses, it fails to kick in until an individual has depleted his or her personal savings to just $2,000. Without long-term care insurance, the retirement nest egg will find the same fate as Humpty Dumpty.

At the heart of this matter is a firm belief in personal responsibility. The belief that those of us who have the ability to work should be responsible for our livelihood and for meeting our own needs. By providing employees with the option to purchase their own insurance, we are empowering millions of federal employees with the freedom to live independently from government assistance. This philosophy is fully in line with the principles of compassionate conservatism espoused and followed by President Bush.

This new federal benefit plan will set the standard for employers and long-term care insurance plans to follow. Its participants will set an example of how long-term care insurance is integral to responsible financial planning. Finally, it will empower federal employees with a tool to make their futures more secure while preserving their care choices.

Kay Coles James is the director of the Office of Personnel Management, which sponsors the Federal Long-Term Care Insurance Program.

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