Long-term care

The Office of Personnel Management is working to make a long-term care insurance program available to government employees and their family members by October 2002. In the meantime, OPM has provided some preliminary information on what the program will look like — and it's mostly good news.

OPM says the program will offer comprehensive insurance that will cover several types of long-term care that people may need because they are unable to care for themselves. This will include nursing home care, assisted living facility care, formal and informal care in your home, hospice care and respite care.

Eligible participants under the law include federal employees and members of the uniformed services, federal retirees (who retire on an immediate annuity), retirees of the uniformed services and military reservists at the time they qualify for an annuity. However, feds who leave government employment before qualifying for an immediate annuity but who are eligible to receive one later (typically at age 62) are excluded.

But why are they excluded? The compensation trend within the federal government has actually been to encourage mobility between the public and private sectors. Employees covered by the Federal Employees Retirement System can take their Social Security and Thrift Savings Plan accounts if they take a job in the private sector. The idea is to make employees feel that they can leave government whenever they want to and take most of their benefits with them.

Well, apparently provisions of the Long Term Care Security Act ignore this trend. So if a fed, say someone who is 35 and whose parents are 60, leaves government for a private-sector job and has not enrolled in the long-term care program, he's out of luck. That fed keeps his TSP money and Social Security coverage and is entitled to a deferred annuity but can't ever qualify for long-term care insurance unless he comes back to work for Uncle Sam. That's a disincentive to leave government, which is contrary to the current policy. Somebody really goofed! Who's eligible for coverage? Adult children and spouses of employees and annuitants, parents, parents-in-law and step-parents of employees are covered — and OPM said more relatives might be covered in the future. The irony is that although OPM is thinking of extending coverage to individuals who never were feds or members of the armed forces, federal employees who retired on a deferred annuity won't be eligible. Go figure.

This coverage isn't being provided as a fringe benefit. You'll have to pay for it — all of it. OPM hopes to negotiate a premium structure with insurance companies that is 20 percent cheaper than what you'd pay if you purchased a policy by yourself. Let's hope OPM succeeds.

Zall is a retired federal employee who since 1987 has written the Bureaucratus column for Federal Computer Week. He can be reached at miltzall@starpower.net.