Matt Lesser

State Senator Matt Lesser Leads Debate and Passage of Legislation Requiring Affordable Options for Long-Term Care Policies

Today, State Senator Matt Lesser (D-Middletown), Chair of the Insurance & Real Estate Committee, led debate during the Senate Session on legislation that will ensure insurance coverage for seniors in Connecticut. Senate Bill 1046, ‘An Act Concerning Long-Term Care,’ requires the Insurance Commissioner to develop a set list of affordable benefit options for long-term care policies.

“Sky-rocketing long-term care insurance rates are a national crisis and a hardship for families across Connecticut,” said Sen. Lesser. “This bill closes a critical loophole that allows insurance companies to layer on increase after increase.”

SB 1046 puts consumer protections in place to prevent customers from financial harm. The legislation imposes measures on insurers, HMOs and other organizations issuing and selling long-term care insurance, action made necessary by the spiking cost of long-term care insurance for many residents in recent years and decades. Long-term care is designed to protect residents from the cost of nursing homes, elder care assistance and health care made necessary as an individual ages, but fluctuations in the market have caused significant turmoil for policyholders in recent years facing significant increases in premiums year after year.

Under existing law, insurance companies are required to phase in increases of over 20% over three years. A loophole allows them to come back multiple times during that three-year period, increasing rates multiple times. The legislation also requires the insurance commissioner to design plans with standardized affordable benefits – protecting cost-sensitive residents from being manipulated.

Under Senate Bill 1046, insurers filing for a rate increase of 20% or more will be prohibited from filing an additional rate increase during this period. They will have to wait until the three years of that policy is complete.

SB 1046 also requires the commissioner to develop and prescribe a minimum set of affordable benefit options to be offered by long-term care insurers that file for rate increases of 20% or more. Insurers must give policyholders the option of reducing their benefits to reduce their premium rate before implementing a rate increase.

Policyholders paid for their policies; for them to lose coverage just as they will require services will negatively impact their health, as would eschewing other important financial obligations to cover the cost of extreme premiums. Several seniors testified to the Legislature citing 15% annual increases and reductions of quality of plans in recent years, highlighting an increased financial strain that requires action.