Long term care insurance and the rates have not been and will not be easy to predict.
In 2002 the US Government started a program where US Government employees could purchase optional Long Term Care Insurance.
Employees were encouraged to buy early to lock in their rates. Of course medical costs went up, and the bonds didn't get the returns they expected. So employees found out that the promise to not raise rates was a fiction. The insurance company had a contract with the Government and when that contract was renewed all bidders could recalculate the rates. So even though the same company won the contract in 2009 and in 2016 the rates went up:
- 2009, the premium rates jumped approximately 25 percent for more than
146,000 beneficiaries that had enrolled in an inflation protection
and then in 2016
- Federal employees enrolled in the Federal Long Term Care Insurance
Program got hit with an extreme case of sticker shock this week, when
the Office of Personnel Management said that next year’s premiums
would rise by an average of 83 percent.
Congress is calling for an investigation because:
“So this indicates a massive miscalculation in previous premiums and
also maybe unaffordable for many people.”
The experts can't accurately predictL
recent analysis of the program, using updated assumptions based on
identified trends and actual claims experience, indicated that the
current FLTCIP premiums would not be sufficient to meet the future,
projected costs of the benefits