NAIC LTCI Task Force Adopts Revised RBO Checklist, Receives Update on Industry Trends

NAIC’s Long-Term Care Insurance (LTCI) Task Force recently adopted a revised checklist for regulators to use when drafting and reviewing LTCI reduced benefit options (RBO) policyholder communications. The checklist is meant to provide regulatory guidance only (i.e. does not carry the weight of law) and can be used with the RBO Communication Principles. Following the most recent exposure, the task force established a drafting group made up of consumer groups and regulators from California, Pennsylvania, Vermont, and Virginia. The drafting group incorporated some changes in response to stakeholder feedback – those changes are highlighted in Attachment Two of the Meeting Materials.

Fred Andersen (MN) provided an update on industry trends in light of regulators’ review of year-end 2021 reserve adequacy filings. Here were the main takeaways from Andersen’s report:

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See You Soon! ILTCI 2023 Annual Conference

In just over a week, members of Faegre Drinker’s LTCi team will attend the 2023 Intercompany Long Term Care Insurance Conference in Denver. We are proud to once again support ILTCI as a diamond-level sponsor of the conference and our team will be presenting on a number of panels throughout the Conference. We look forward to connecting with our colleagues and friends throughout the industry. Make sure to check out our team members on the following panels!

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Evaluating Long-Term Care Health Programs

As long-term care insurance (LTCi) claims continue to climb, insurance carriers are also facing the increasing need for additional ways to manage their long-term care insurance (LTC) blocks and find health programs that best work for their policyholders. There are many factors that go into evaluating if an LTC health program is going to be beneficial. A new article, “Evaluating LTC Population Health Programs,” published in Long-Term Care News (February 2023) by the Society of Actuaries takes a closer look at two different methods to measure the impact of health programs.

Authors include Robert Eaton, Juliet Spector, Jeff Anderson, Joe Long, Brian Hartman and Missy Gordon.

LTCi Benefits Paid Grow in 2022

A record $13.25 billion was paid out to policyholders by long-term care insurance companies in 2022, according to new numbers out last week from the American Association for Long-Term Care Insurance (AALTCI). That is in comparison to $12.3 billion in 2021 and $11.6 billion in 2020. AALTCI says benefits were paid to about 345,000 policyholders last year, an increase from 336,000 claimants in 2021 and 325,000 in 2020. The reported amounts represent claims for those owning traditional, stand-alone long-term care insurance, according to AALTCI. The Association says LTCi benefits are “mostly paid to individuals receiving benefits for qualifying care in their own home or in an assisted living facility.”  For more information on this and other AALTCI reports, visit the Association’s website.

Court Reinforces the Filed-rate Doctrine in Collins et al v. Metropolitan Life Ins. Co.

On February 3, 2023, the United States District Court for the Eastern District of Missouri granted MetLife’s motion to dismiss for failure to state a claim in Collins et al v. Metropolitan Life Ins. Co. In granting MetLife’s motion to dismiss, the Court reinforced both the filed-rate doctrine and the requirement for plaintiffs to exhaust administrative remedies before turning to the judicial process.

The Plaintiffs in this case, who were citizens of Missouri and Illinois, brought suit against MetLife for recovery of premiums paid for inflation protection under long-term care insurance policies. Plaintiffs had purchased a “5% Automatic Compound Inflation Protection Rider” (Inflation Rider), which contained a clause stating that the insured’s benefit will “automatically increase each year with no corresponding increase in premiums.” Plaintiffs claimed that after purchasing this product, their annual base premiums doubled in amount, and thus alleged that MetLife made fraudulent misrepresentations and concealed material facts about the effect of the inflation Rider on their premiums.

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HIPAA Regulation of Online Tracking Technologies

In a December 2022 bulletin published by the Office for Civil Rights at the U.S. Department of Health and Human Services (HHS), HHS made clear that the use of third-party tracking technologies by covered entities and business associates is subject to HIPAA privacy and security rules. The use of tracking technologies developed by third-party vendors is increasingly common, and much of the LTCi industry is subject to HIPAA privacy and security rules as either covered entities or business associates. HHS noted in the bulletin that covered entities and business associates “are not permitted to use tracking technologies in a manner that would result in impermissible disclosures of [protected health information (“PHI”)] to tracking technology vendors or any other violations of the HIPAA Rules.” And, as applied to the use of tracking technologies, HHS’s view of what constitutes PHI may be broader than expected.

What Are Tracking Technologies?

Tracking technologies (including cookies, pixels, and other similar technologies) collect information about individuals who interact with an entity’s website or mobile application (“mobile app”). Businesses use a variety of tracking technologies on websites and mobile apps to improve functionality and learn more about users’ activities. Tracking technologies developed by third parties generally involve the sharing of data back to that third party, so when a HIPAA-covered entity or business associate uses these tracking technologies, they must be cognizant of what data is being shared, to who, and for what purpose.

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Faegre Drinker Long-Term Care Summit V Recap

Faegre Drinker held its fifth Long-Term Care Insurance Summit in Chicago this fall. The event kicked off on October 18 with an informal, fun, and engaging social get-together, while the overall format for the interactive meeting was selective, informative, and fast-moving. Carrol Golden, Executive Director of the Specialty Centers at the National Association of Insurance and Financial Advisors (NAIFA), shares a recap of the event.

The first day, Faegre Drinker Partner Steve Serfass shared welcome remarks and introduced Peter Lucas, CEO of Davies, and John Sieb, Business Head and COO – Long Term Care at Prudential and invited them to share their views about the most significant issues and opportunities facing the LTCi community today. Peter urged that while embracing new concepts and insights, the industry should not lose focus on the basics of good policy and claim administration, and he also addressed the importance of creating attractive career paths and opportunities for young and mid-level professionals while mentoring them to become the next generation of leaders. As he discussed the importance of proactive block management, John stressed three strategic pillars: data and analytics, digital TP and claims management.

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Election Night for Insurance Geeks: November 2022

Election outcomes affect every industry. Insurance, however, is unique in the range of elected policymakers who can impact it directly — insurance commissioners, governors and Congress (not to mention state legislatures and other statewide officials). So as insurance stakeholders settle in the night of November 8 with popcorn and other traditional fare, what are our “ones to watch?”

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