Annuity/LTC hybrids gain traction

One piece of the healthcare reform bill, the CLASS Act, has attracted a lot of attention, though there’s already significant change afoot in long-term care (LTC) as an employee benefit. Employee Benefits News picks up on the story:

Before the Community Living Assistance Services and Supports Act folded into landmark health care reform legislation raised public consciousness of long-term care insurance, LTC got a shot in the arm with provisions of the Pension Protection Act (PPA) that took effect this year.

So-called combo long-term care products, which blend LTC with annuities and life insurance, could be popularized under changes to the PPA because of clearer pricing. Carl Friedrich, a consulting actuary and principal for Milliman, also has noted that the LTC portion of a combo plan often costs 35% to 50% of standalone coverage.