NARFE: 'Stunned and angered' at spike in federal long term care insurance

The Office of Personnel Management has announced a large spike in premiums that federal employees will have to pay for long term care insurance—and one of the largest federal employees organizations has responded in anger.

“[P]remiums in the Federal Long Term Care Insurance Program (FLTCIP) will increase by an average of 83 percent, beginning November 1,” the National Association of Active and Retired Federal Employees said in a statement. “NARFE is stunned and angered at the increases and said changes must be made in the program to avoid such increases in the future”

John Hancock, which for seven years has been the sole insurance company to carry the federal program, wrote the large increases into its contract proposal—and OPM has approved them as “justified,” according to NARFE.

However, in announcing the increases, OPM has also noted that enrollees will be able to select options that will reduce the impact of the premium increase. The new options are scheduled to be mailed out to enrollees through July 27.

Reader comments

Mon, Sep 19, 2016 Livermore, CA

OPM is using fuzzy math to calculate the increases. For example, my premium is to raise from $100 to $225. 225/100= 225%. Yet, OPM is claiming this is a 125% increase. So, when it states that the average increase is 83%, it really is 183%, almost double. This is why so many are outraged. After paying into this for 15 years, OPM allows this company to do this to those who supported it. Of yes, they will give you a lower raise if only you will accept substandard care after paying for full care for 15 years. For ONLY a 157% increase, they will limit my care to 5 years or $419,750, whichever comes first. For a 162% increase, they will reduce my daily benefit amount by $41 or 83% of what I've paid for all these years. So, I would have to pay $41 a day or $1230 a month even with the insurance. For no increase, they would limit my term to 5 years or $313,224. For a 205% increase, they would reduce my daily benefit by $41 or 83% of my current benefit. Finally, if I stop paying the ridiculous premiums, they will limit my maximum benefits to a total of $14,816. At $241a day, that would last 61 days before I would have to pay out of pocket. Then, I would pay until I was out of money at which point you tax payers would have to support me in a substandard state paid for stinking facility. At that point, it would be time to consider pulling the plug. It seems that the days of happy retirement are gone. Work until you drop dead like my great grandfather who dropped dead on the job at 68.

Thu, Sep 15, 2016 Tom

It is highway robbery. OPM is feckless and horrible. Is this the same OPM that let all of our security information go to the Chinese hackers? Incompetent fools!

Tue, Aug 9, 2016 Marge & Rich Gritz Oregon

Both myself and husband's premiums to continue with current coverage went up substantially. Mine went from $111 to $252. That is NOT 126% or less as it was predicted, it is 225%! Given we don't know what will happen given possibility of unending increases we are debating our choices. Would certainly support legal action as this LTC is not what we signed on for when it first came out and a lot of our money has gone down the hole. Moreover I suspect payouts by the insurance co. to date have been minimal. We're all just now reaching the ages when claims will be more frequent. This is a ripoff.

Tue, Aug 9, 2016 San Diego

I bought this policy based don the fact that OPM was to be a watchdog for preium raises. My husband has a private policy which has never increased a premium in 15 years. I have had two increases in only 8. My premium went from $710 to over $1600 a month! As I am older, switching to a private policy now is probably not in my best interest. I worry that in 7 years, there will be another increase, and then another and another. I feel cheated and stupid. I agree with contacting Congress.

Mon, Aug 8, 2016 Steve Oregon

Please contact your agent to discuss your options. Do not just drop your policy, you will lose all money paid into it if you do. Talk to your agent about the CNFO. If heor she does not know about this option, you need to talk to someone who does. I have helped many people deal with LTC rate increases, send me an email if you need help.

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Edward A. Zurndorfer Certified Financial Planner
Mike Causey Columnist
Tom Fox VP for Leadership and Innovation, Partnership for Public Service
Mathew B. Tully Legal Analyst

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