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By Mr. KOHL (for himself and Mr. Wyden):
S. 1177. A bill to improve consumer protections for purchasers of long-term care insurance, and for other purposes; to the Committee on Finance.
Mr. KOHL. Mr. President, I rise today to express my support for the Confidence in Long-Term Care Insurance Act of 2009. With America aging at an unprecedented rate, and with the high and rising costs of caring for a loved one, the financing of long-term care must be addressed if we are going to get health care costs under control. I am proud to be an original cosponsor of this bill. I wish to also thank my colleague Senator Wyden for his leadership on addressing the financing of long-term care.
We all know that long-term care is expensive. The cost of an average nursing home is nearly $75,000 per year. However, according to the Congressional Research Service, most Americans do not realize that neither Medicare nor Medicaid will cover these costs unless their household savings are nearly eliminated. States share the responsibility of providing Medicaid funding for long-term care with the federal government, and are also looking for ways to reduce their expenses. As of today, 43 states are in the process of launching ``Partnership'' programs, which provide incentives to consumers who purchase private long-term care insurance. But in the rush to ease the burden of long-term care costs on state budgets, we fear that some key concerns are being overlooked.
We have a duty to make sure these policies, which may span many decades, are financially viable. Several long-term care insurance providers have applied for TARP funds in recent months, raising questions about their solvency. In addition, many insurance companies have been raising their policyholders' monthly premiums, which can be devastating for older persons who are living on a fixed income. Many Americans living on modest or fixed incomes, who have held policies for many years, have seen premium rates double when a company encounters financial difficulties. For such consumers, the choices are stark and very limited: they can either dig deeper and pay the increased premiums, or let their policy lapse, leaving them with no coverage if they ever need care.
Last year, I was joined by several Senate and House colleagues in releasing a GAO report on whether adequate consumer protections are in place for those who purchase long-term care insurance. The report found that rate increases are common throughout the industry, and that consumer protections are uneven. While some states have adopted requirements that keep rates relatively stable, some have not, leaving consumers unprotected.
The Confidence in Long-Term Care Insurance Act takes several important steps to ensure that premiums increases are kept at a minimum, insurance agents receive adequate training, and that complaints and appeals are addressed in a timely manner. We should also make it easier for consumers to accurately compare policies from different insurance carriers, particularly with regard to what benefits are covered and whether the plan offers inflation protection. States should also have to approve materials used to market Partnership policies. The Confidence in Long-Term Care Insurance Act will institute many of these needed improvements.
In closing, I urge my colleagues to support the Confidence in Long-Term Care Insurance Act of 2009. It is estimated that two out of three Americans who reach the age of 65 will need long-term care services and supports at some point to assist them with day-to-day activities, and enable them to maintain a high-quality, independent life. Long-term care insurance is an appropriate product for many who wish to plan for a secure retirement. But we must guarantee that consumers have adequate information and protections, and that premiums won't skyrocket down the road. I thank Senator Wyden for his commitment to ensuring we address the important issue of long-term care financing. I look forward to working with my colleagues to enact the legislation we are introducing today.
Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.
There being no objection, the text of the bill was ordered to be printed in the Record
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