Baltimore Sun, October 27, 2006
As any credit union member can attest, there are myriad advantages of joining a credit union – low loan rates, personalized service and a competitive portfolio of products and services. However, one of the most important advantages, say members in regular surveys, is a certain level of trust; members trust that their credit union has their best interest in mind. With this in mind, it’s only natural that members would want to entrust their credit union with the assistance of planning complicated, serious issues such as long-term care insurance, which is becoming more and more important as Americans continue to live longer and longer. Luckily, some credit union members can obtain this valuable insurance right through their neighborhood credit union.
Through a 2001 partnership with the Credit Union National Association (CUNA) Mutual Group, the leading provider of financial services to credit unions and their members worldwide, credit unions nationwide are now offering long-term care insurance to their members, says Brent Stubbe, marketing director of the long-term care insurance program for CUNA Mutual Group, based in Madison, Wis. “From the members’ perspectives, as they get older, the risk increases that they may need long-term care insurance, and now credit unions can serve their members better by providing this service,” says Stubbe. He explains that CUNA Mutual Group has specialists who perform extensive demographic analyses to identify which members would benefit from obtaining long-term care insurance. These members are sent a letter, and they can respond by mail, telephone or via a Web site to have a long-term care insurance specialist come to their home to explain their options.
So, what is the likelihood that you will need long-term care insurance? Stubbe points out that recent tax law changes make it more and more difficult to utilize government programs for long-term health care. “Medicare will only pay for acute medical services, so long-term health care expenses are not covered by Medicare. Also, it has become increasingly difficult to qualify for Medicaid for long-term health care.” In the past, receiving Medicaid assistance required that one meet very strict financial guideline, and typically you had to “spend down” the estate in order to qualify. Qualifying has become even more difficult, notes Stubbe, so more and more Americans will benefit from long-term care insurance.
According to U.S. Department of Health and Human Services (www.medicare.gov), long-term care involves a variety of services that includes medical and non-medical care to people who have a chronic illness or disability. Most long-term care is to assist people with support services such as activities of daily living like dressing, bathing and using the bathroom. Long-term care can be provided at home, in the community, in assisted living facilities or in nursing homes. Long-term care insurance helps individuals pay for these services, and the U.S. Department of Health and Human Services estimates that by 2020, 12 million Americans will need long-term care, and most will be cared for at home; family and friends are the sole caregivers for 70 percent of the elderly, which can be financially and emotionally tough on the caregivers.
To help protect against the cost of long-term care services and alleviate the financial and emotional strain on their families, many individuals opt to purchase long-term care insurance instead of relying solely on their savings or life insurance to pay for health care needs. According to the American Association for Long-Term Care Insurance (www.aaltci.org), long-term care insurance typically helps individuals who are “severely impaired and need help with two to three ‘Activities of Daily Living (ADLs)’ or supervision due to a cognitive impairment. ADLs include bathing, dressing, toileting (including getting to the bathroom safely), eating and transferring (such as moving from a bed to a chair).”
However, long-term care insurance coverage can be complicated – and expensive – so it’s wise to purchase early and with someone you trust. “Credit unions have a unique relationship with their members, making long-term care insurance a natural fit. Consumer surveys year in and year out show that members regard their credit unions differently than the typical financial consumer. Because they share ownership of the credit union, members benefit from low interest rates on loans, fewer fees and a high level of service compared to other financial institutions. This ownership establishes an added degree of trust between members and their credit unions, and that level of trust offers many advantages in providing products like long-term care insurance,” says Rick Uhlmann, a spokesman for CUNA Mutual Group.
“When credit union members buy long-term care insurance through their credit union and CUNA Mutual Group, they are assured that they will buy high-quality insurance coverage through one of the top national carriers, as we only partner with those that are financially strong and are committed to the long-term care insurance market,” says Stubbe. “Members will also have access to knowledgeable experts in long-term care. We won’t just sell you a policy; we will create a customized coverage package based on your needs. Also, credit union members are eligible for special discounts if they choose to have their premiums deducted directly from their credit union account.” Stubbe notes that 700 credit unions currently offer long-term care insurance. “Those 700 credit unions represent 20 million members, and 35 percent of those 20 million fall into the 49 years or older demographic, which is the target demographic for long-term care insurance.”
Stubbe says that buying earlier rather than later is advantageous as premiums are lower and older individuals may have greater difficulty qualifying for long-term care insurance because of pre-existing health conditions.