Recently, long-term care insurers have focused a substantial investment of resources in evaluating and assessing the feasibility of wellness programs aimed at keeping policyholders healthier and at home as they age. This goal meets the stated desires of almost all policyholders, and also delays and/or lessens the severity of any long term care insurance claims that policyholders might be eligible for. Many of these wellness programs utilize predictive analytics of various types, including algorithmic data analysis, predictive models and artificial intelligence. Regulators and lawmakers have been focused on these types of Insurtech offerings, and have been particularly attentive to potential discrimination issues that might arise.
During the National Association of Insurance Commissioners (NAIC) Spring Conference last week, the NAIC LTC Task Force met to discuss various topics and we wanted to share a summary of the discussion:
The bulk of the meeting was the Task Force receiving an update from each of its subgroups:
The National Association of Insurance Commissioners (NAIC) is out this week with its strategic priorities for 2021, including a renewed commitment to long-term care insurance (LTCi).
NAIC says “state insurance regulators will continue on-going efforts to improve the consistency around LTCi rate review processes; examine insurer reserve adequacy; facilitate innovative product offerings; engage with federal policymakers on LTCi policy; and educate consumers on LTCi products and alternative benefit options.” NAIC’s LTCi (EX) Task Force is expected to deliver its proposal to the organization’s Executive Committee by the 2021 Summer National Meeting.
On January 26, California Insurance Commissioner Ricardo Lara announced six appointments to the state’s new Long Term Care Insurance Task Force. The Task Force was established after the passage of AB 567 and is tasked with, among others, exploring the feasibility of developing and implementing a culturally competent statewide public insurance program for long-term care services and support. More information on the Task Force can be found here. California’s efforts appear to follow a recent trend of policymakers exploring or implementing public programs aimed at long-term care services, including Washington State’s Long Term Care Trust Act and some of the ideas recently discussed at the Federal level, including by U.S. Rep. Thomas R. Suozzi (D-NY).
Industry stalwarts Karen Smyth (Vice President of Long Term Care Operations at Wilton Re) and Jeff Ferrand (Vice President of Fraud Services at LTCG) have significant experience developing and implementing anti-fraud, waste, and abuse programs at the carrier and TPA level.
Please listen to the below podcast with Chris Petillo and Jessica Loesing as they discuss Karen’s and Jeff’s views on, among other questions, how fraud, waste, and abuse manifest in the LTCi space, and potential efforts carriers and TPAs can use to prevent and detect fraud, waste, and abuse. Karen also shares her experience as a witness in a criminal trial involving LTCi insurance fraud and Jeff shares his past experience as outside counsel prosecuting insurance fraud cases. Finally, stick around to hear some of the creative and industrious ways Karen and Jeff have been passing the time with their families (at home) during the pandemic.
2020 is an unusual election year, with many high-level outcomes still undetermined weeks after the polls closed. Despite this uncertainty, insurance industry stakeholders need to look ahead to the future. Thought leaders from Faegre Drinker’s insurance team participated in a post-election roundtable — and have helpful insights to share as we head into 2021.
The Alaska Division of Insurance recently ordered long-term care insurers to suspend enforcement of family member exclusions until December 15, 2020, or until such time that Governor Mike Dunleavy determines that the declared public health disaster emergency resulting from COVID-19 no longer exists. See Order R20-10 (November 16, 2020). In the Order, the Division expresses its determination that insureds be able to access their benefits notwithstanding family member policy exclusions due to the increased risk of exposure attendant to home health care providers traveling between households. The Division has extended similar orders during the pandemic, so this Order may be extended beyond December 15. Although the industry has become accustomed to COVID-19-related accommodations pursuant to orders from state regulators, the Division’s decision to suspend family member exclusions is a first during the COVID-19 pandemic and may present administrative and compliance challenges.
The NAIC Innovation and Technology (EX) Task Force met on November 4 to discuss proposed changes to the anti-rebating language in the NAIC’s Model Unfair Trade Practices Act (MDL-880). Drafting leaders used the meeting as an opportunity to address comments received in response to the August 10 draft, including comments from the American Council of Life Insurers (ACLI). The final comment period is open now through Wednesday, November 18, after which a final version of the amendment will be made available. The Task Force hopes to vote to adopt the final draft at the December 4 meeting.