Utah's Long-Term Care Health Insurance Insurance Market

Utah's Long-Term Care Insurance Market

Long-term care insurance is designed to provide specialized insurance coverage for skilled nursing care and custodial care in a nursing home, assisted living facility, or home health care situation following a serious illness or injury. Long-term care insurance typically covers specialized services that are not usually covered by comprehensive or major medical health insurance.

Long-term care insurance accounts for approximately 1.2 percent of the commercial health insurance market in Utah and provides coverage for over 37,000 members, or approximately 1.4 percent of Utah residents. These estimates only refer to commercial long-term care insurance regulated by the Insurance Department. They do not include other types of long-term care coverage offered by self-funded employers or government programs. This section summarizes various aspects of the market including state of domicile, group size, and age and gender demographics.

Long-Term Care Market by Domicile

State of domicile refers to the state in which an insurer's home office is located. An insurer can only be domiciled in one state. Foreign insurers provide nearly all of Utah's long-term care insurance. The eighty-one foreign insurers account for over 95 percent of the market, with only one domestic insurer providing long-term care coverage. Loss ratios were slightly lower for the domestic insurer.

Long-Term Care Market by Group Size

Long-term care insurance plans are sold either as an individual or a group policy. Individual policies are sold directly to individual consumers. In contrast, group policies are sold as a single contract to a group of individuals, such as a group of employees, or an association plan.

Nearly all long-term care insurers reported individual business, while only 24 companies reported group business. Group business includes small group and large group business and refers to groups of 2 or more members. Most of the premium and membership reported was for individual business. Loss ratios were higher for individual policies than for group policies.

Long-Term Care Market by Age and Gender

As Utah's population has grown, the number of individuals over the age of 65 has increased. As a result, the role of long-term care insurance coverage has grown, because the cost of health care increases as we age.

Long-Term Care membership by age and gender. Commercial health insurers reported 37,676 members with long-term care insurance in Utah during 2007. Nearly forty-six percent of the membership was under age 60, with the majority (54 percent) being sixty or older. Overall, there were slightly more women than men with long-term care coverage at every age group, except for those under 60, where more men had coverage.

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