Healthcare Policy Update: The LTC Crisis – Risky Benefits Podcast: Season 3, Episode 9

June 28, 2022

long term care crisis

This week on Risky Benefits, Trustmark Executive Director of Product Innovation, Adam Bezman, is on mic with Rick to talk about how the long term care crisis can affect your employees, what new Long Term Care legislation we can expect, and why insurance solutions might be the right stop gap measure to ease the burden of the Long Term Care crisis. 

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More About Our Guest:

Adam Bezman

Adam Bezman

Executive Director of Product & Innovation

Adam joined Trustmark in March 2016. As Executive Director of Product & Innovation, he is responsible for all life and disability products, as well as well as the development of all new products. Adam has more than 20 years of product development experience in the health and food industries at Life Fitness, a division of Brunswick, and Kraft Foods. He received his Bachelor of Arts degree in economics and speech communications from Indiana University and his MBA from the University of Chicago.


Rick Farris 0:01
Hey, thank you for listening in to Risky Benefits. A podcast that informs you on all things benefits. We’ve got to sing around here. Benefits isn’t your main business. It’s ours. Hey, everyone, thank you for listening to Risky Benefits and welcome to this week’s episode. Our guest this week is Adam Bezman, Executive Director of Product and Innovation at Trustmark. But before we meet Adam, and get into the conversation for today, let’s talk about the agenda for what we’re going over. First, we’re going to review what is the care crisis. The next thing we’re going to talk about is new long term care legislation, why it matters and Trustmark solutions. So without further ado, Adam, great to have you today. Thank you for coming on. And why don’t we start by you telling us a little bit about yourself and what you do for Trustmark?

Adam Bezman 0:52
Sure. So thanks for having me, Rick. So I am responsible for our product development and management at Trustmark on our life insurance and disability products. So that really entails development of any new products that we are working on, and management of our existing portfolio and obviously trying to maximize those products.

Rick Farris 1:15
That’s awesome. So Adam, if you don’t mind me asking how did you fall into that specialty?

Adam Bezman 1:23
So you know, interestingly enough, I’ve been I’ve been at Trustmark for about six years now. But I’ve been doing product development for about 20 years. So you know, I went to graduate school to get my MBA. And interestingly, I thought when I applied to grad school that I was going to be focused on finance. And when we started school, the first week, we had a whole bunch of panel sessions, where you know, people who were doing these jobs came in and talk to us about what it was really like, which was really useful. And I sat in on a lot of stuff that was interesting, and really got to one of the last panel sessions and there was nothing I was really interested in. And a friend of mine was going to one on brand management. And I said yeah, okay, I’ll I’ll tag along with you. And I listened to what they were talking about in terms of what, their job was, and it hit me that “Oh, wow,” this is actually what I want to be doing. This is the career I’ve been looking for. I didn’t know this job existed. So I’ve been in, you know, brand management and product development now for the last 20 years or so. When I came out of school, I went to work for Kraft Foods, and got to work on some fun stuff like macaroni and cheese. And then from there, maybe a little karmic balance, I went from focusing on food to focusing on exercise, I went to a division of Brunswick called Life Fitness, and was responsible for the development of commercial and consumer cardio equipment like treadmills, ellipticals, stuff like that. And from there, I landed at Trustmark. So been doing, you know, everything from consumables to durables, and now insurance.

Rick Farris 3:22
Well, I can’t say much about the product itself. But my kids would definitely say, Adam, that you did a good job on the mac and cheese deal. So, nice job there. I know, kids all over America, would second that comment. No, that’s really cool. And super interesting. makes me wish that I hadn’t skipped the job fair back in school. You know, maybe I would have gotten here quicker. But no, I’m teasing. I’m teasing. Well, that’s awesome. So you took that knowledge, you moved into product development on the insurance side, and you obviously are intelligent and smart guy, you had that finance background, too. So we are going to get into this conversation around long term care. And I think that’s where a lot of your kind of finance, educated background and even just product development are really going to come into play here within the context of this conversation. So let me just go ahead and dive right into it. There’s been a lot of conversation, obviously, around long term care. Some have deemed it the care crisis. Can you tell us a little bit about that when people say care crisis? Can you put that into context for for our listeners?

Adam Bezman 4:37
Yeah. So there’s really a lot there. Right. So it’s kind of like where do you begin when it comes to the care of crisis? So you know, really, when you when you look at it, the challenge with long term care is that most of us are going to need it eventually. Right? So the US government, we can debate whether or not the US government is good at a lot of things, but one thing the US government is really good at is collecting data. So you know, the government keeps track of usage of long term care. And from that, we know that if you reach the age of 65, if you’re fortunate enough to live that long, there is a 70% chance that you’re going to need care at some point before your goal on. Okay. So you know, that obviously, you look at that and say, wow, wow, that’s, that’s the majority of people who are reaching that age, then you start to shift and look a little bit at our population. So the US Census Bureau has been looking at this, and says, in about 10 years, I want to say it’s like 2033, 2034, something like that, the US for the first time in our history is going to have more people over the age of 65, than under the age of 18. So we have an aging population. So we have a population that’s aging, and we know aging, people need care. And so really, what you have there is the ratio of working adults to retired adults are shrinking. So not only is the population aging, but you’ve got fewer people to take care of them. So like, that’s kind of where the problem starts. Now, when you get into care and the need for care. The challenge with that is care is really expensive, you know, the care, the cost varies dramatically. Depending on where you live, you know, the costs from one state to another, you know, can be pretty significant variance. But you know, the median cost when you look at the US as a whole, for a private nursing home room is six figures, it’s over $100,000 A year right now, you know, and so we just talked about how the number of people needing care is really high, and it’s going to increase because our population is aging, while the number of people available to provide that care is going to be decreasing, because more retired people to fewer working people. So you know, basic economics shows us that when demand goes up and supply decreases, those prices aren’t going to go up even more, I mean, $100,000 a year is already a lot of money, but that’s probably only going to get worse. So, you know, that’s when thinking of, you know, being taken care of in a nursing home. But there, there are obviously other options, you know, we actually know that most people and I know I would fall into this category would prefer to be taken care of at home, you know, people want to stay in their home, I don’t, I don’t think most people want to go to a nursing home. And, but when you look at home care, that’s really expensive, too, you know, a home health aide, on average makes $24 an hour, which, you know, you put that in, you know, if you have somebody for 12 hours a day, that’s going to cost you as much as a nursing home costs. So there’s, you know, there’s not a whole lot of ways to get around the expense of long term care. So you’ve got all these people needing it, it’s really expensive. And we aren’t planning for it. You know, less than 10% of adults have discussed a care plan with a financial advisor.

And, you know, Limra, which is into, you know, industry advisor for the insurance industry, you know, does a study every year to look at life insurance and long term care and how people are kind of thinking about it. And long term care expenses, when they looked at it, are the second highest financial concern that people have behind money for retirement. So, you know, obviously, people are going to be concerned with money for retirement, for it to be higher on the list than like their medical expenses, and their monthly bills and student loans. I mean, all things that we hear about all the time, it’s obviously waiting on a lot of people. And so when you put all of that together and you realize all these people need care, it’s really expensive. What ends up happening a lot is you know, people can’t afford professional care. And then the happens is you’re relying on a family caregiver to take care of you. And you know, the AARP actually did a really good study. They did one in 2016 and then another in 2020. That looks at the burden on caregivers. And you know really what they point out very simply is more than half of caregivers feel like they don’t have a choice in the matter. You know, they have a family member they have to take care of them. But they’re To this huge strain on their emotional and physical well being in their finances, you know, you don’t, you don’t think about it. But if you are caring for someone, what often happens is you’re giving up some of the time that you used to be working. So there’s all this stress associated with it when a family member needs to do it. And, you know, there’s just there’s not a lot of great solutions out there, which is why, you know, you said, is there a care crisis? And I would say, yeah, it is, it is a crisis, you’ve got the all the demographic shifts the expense behind it, the difficulty of having family do it. And there’s not a lot of long term care insurance out in the market anymore. You know, we know, there used to be hundreds of carriers who provided long term care insurance. And it’s now down to about a dozen, because a lot of those carriers had challenges. And you know, we could, that’s a whole separate conversation about all the problems Long Term Care carriers had with with insurance. So it just makes it really challenging for people to prepare for this.

Rick Farris 11:09
Now, that’s super insightful, and very helpful. I appreciate it. You know, I know we’re gonna get into this. But a couple questions are just coming out, even while I’m thinking about it just with carriers dropping out and some of the concerns that people have. So I’ll make sure when we get down to the product specific questions, I’ll ask some of those. But if you don’t mind, before we get there, maybe what we do is just hit on the legislation, because I know that recently, new legislation was passed in Washington state around long term care. And I’m fairly certain that a lot of our listeners that, especially if they’re not, you know, working as a consultant, or or we’re in some similar facet within our space, they may not be aware of what what happened in the state of Washington, would you mind maybe just walking us through that for the for the listeners?

Adam Bezman 11:56
Absolutely. Yeah. So what the what the state of Washington did, is really interesting that the state of Washington created this, this fund that is called the Washington cares fund. So, you know, we talked about the care crisis in Washington is really one of the first states to kind of see this coming, and to act on it. Because what happens when people don’t have the money to pay for the care that they need? Is they ended up on Medicaid. Okay. So, you know, when when we get into retirement, you know, a lot of people start thinking of, okay, well, I’m gonna have Medicare to help pay for my medical expenses as I get older. But what a lot of people don’t realize is Medicare doesn’t cover long term care. So what happens is people have to use their assets, their savings, to pay for their care. And when they’ve drained all those savings when they have less than $2,000 in assets, that’s when Medicaid is going to come in. So Washington was looking at this and kind of modeling out and saying, Okay, we’ve got this aging population. And let’s, let’s look at the the expenses that are coming down the road, and realize that they aren’t going to have the money in Medicaid to pay all these claims. So what they did is they passed legislation that created this Washington cares fund. So in a kind of a nutshell, what this does, is employees are going to pay a tax, it’s an income tax, it’s .58% of their income, that they are going to pay into this fund. And that tax is going to start to be collected in 2023. So you pay money into this fund. It’s untapped. So whatever your income is, you’re going to pay .58% of it, if you work in the state of Washington. And what that will do is after you are invested in the program, and we don’t, there’s a whole lot of elements of how you get vested in the program in terms of number of years, you need to pay in and some other requirements. But the net of it is, if you need long term care, you’ll be able to collect $100 a day for up to a year. So you know, pretty easy math there. 365 days you can collect $36,500 maximum. So you know, there’s a lot more details around all the qualifications, but that’s really the benefit in a nutshell. Now, the state also put an opt out in there. So for people who didn’t want to participate in the program, they gave them the option of saying, if you own your own private Long Term Care coverage, before November 1st of 2021, you have the opportunity to opt out of the program and not pay this tax. So what that did is it’s just created this huge screen sample, because, you know, you can look at the Benefit Amount and look at the tax and figure out pretty quickly, you know, for higher earners, the tax is not a good idea, you’re going to pay a lot more in tax, then you’re likely ever going to collect and benefit. So, a lot of employees, a lot of employers, were looking for a private Long Term Care solution after this legislation passed, and there was, you know, call it a five month, you know, four to six months window, maybe in which people were trying to purchase this private coverage, which, you know, was just really challenging because, going out, you know, I mentioned before, there’s not a lot of private Long Term Care carriers in the market. And, you know, even hybrid products that offer life insurance and long term care, there was such a huge influx of activity, that a lot of carriers actually had to turn business away, there wasn’t time to, you know, set up a program for an employer or to do the underwriting necessary. So people were caught kind of flat footed of, I don’t really want to opt into this program, but I don’t have an opportunity to opt out because there’s not enough time.

So, you know, there’s a, there’s a lot of details of, you know, that the state of Washington is still trying to iron out, you know, as I mentioned, the that are not going to be collecting the tax until next year, the the original plan had been that they were going to begin collecting it this year. But I think they realized that they really weren’t ready to do so. So they’re still working through a lot of things in terms of, you know, how they’re going to continue to certify that people own their private coverage, if they’ve opted out. You know, how it works. When somebody moves out of state, there’s, there’s a whole bunch of details that, you know, they that still need to be ironed out there. But that’s kind of the program in a nutshell, you know, a big nutshell of what the state of Washington did.

Rick Farris 17:10
Oh, thanks for that, Adam. So, I mean, that kind of leads, if I were a listener, especially a business owner, or, you know, anyone out there in our space, who’s listening to this, I guess one of the next questions I would have is, okay, I don’t live in the state of Washington, where, when can I expect this to hit my state? And, you know, what does that look like?

Adam Bezman 17:32
Yeah, so let me dust off my crystal ball here and try to figure out what state legislatures are going to do, right. So I do not have that expertise as to what, any state legislature is going to do. But, you know, when we look at it, like, what I always do is say, Okay, let’s go back to why the state of Washington did this. They did this because they looked at Medicaid funding and said, We’re not going to have enough, okay, that we aren’t going to have enough money to pay for all these people who need care. I am not I’ve not studied the demographics of the state of Washington, but I’m going to go out on a limb and say they are not radically different than the population makeup of other states. Right. So if we assume that other states are similar and have people across similar ages to the state of Washington, other states are going to run into this problem. And, you know, one of one of the challenges with it is, you know, while I’m not an expert on legislatures, I do know that state governments, I think all of them, it’s not all of them, it’s almost all of them, you know, can’t run their budgets at a deficit, they have to actually balance their budgets every year, unlike the federal government. So when they look at this, they can’t just say, oh, you know, will will borrow money and kick the can down the road on this, they actually have to be able to pay for this on an annual basis. So we are actually seeing some activity with other states. You know, whether or not that activity will turn into anything is really difficult to know, I do think other states will do something. I don’t know if they will do something that looks like what the state of Washington did, or if they will do something different. You know, the states that I would say are kind of furthest down the road at looking at this right now. So California is probably the next furthest along. California actually has a long term care task force that they’ve created. That right now is looking into this exact problem. So their task force is supposed to make a recommendation by the end of this year. And then it’s going to lead to be followed up with an actuarial so gotta have whatever the recommendation is to figure out, you know, what would it actually cost to do all of this. And at that point after that actuarial study is done, which I think they might get another year to do that, it’ll get kicked over to the legislature to decide if they want to do anything with it. So, you know, obviously, the legislature spent money on the task force and decided to do this. So I would think there’s a good chance they will act on recommendations, but who knows, and, you know, I don’t know if the political landscape in California is going to change by the time they get around to doing that, you know, some of the other states that are beginning to talk about this in their state legislatures and, you know, form a task force or are discussing putting task forces together, I would say, you know, New York, Michigan and Illinois are kind of the next three, you know, beyond that, there’s been discussions and a bunch of states, but it’s, it’s really difficult to know, kind of who is going to be next. But, you know, again, getting back to what I mentioned at the beginning, Medicaid is not unique to Washington, right? That’s, that’s going to be a problem everywhere. So, you know, the, there’s a lot of conversations with states about this. You know, I’ve heard and I’ve been involved in a lot of conversations with, you know, brokers who we work with and employers for, you know, really trying to get ahead of what their state might do. But it’s just tricky. Because, you know, when it’s handled at the state level, it means every state’s going to look at it differently and handle it differently.

Rick Farris 21:43
Now, that’s great, I think, you know, to your point. I’ve talked with a lot of people over the last month about this specifically, and even even earlier than that. And what’s interesting is, is you could sit back and wait and say, well, let’s wait and see what happens with legislation within my state. Right. And, and I’m sure some people will do that. I think the challenge, though, is is to your point, we know it’s an issue. So if it’s an issue, you know, we might as well go ahead and start thinking about what your solutions are in, start adding that into your financial planning, start adding that into your benefits planning. To try to help your employees get get a leg up on it, I guess the major concern, and it’s this question has been asked of me is, well, what if I get a solution or something that I think that’s a solution, and then the state comes through, and they don’t recognize it when they when they do create a program and start creating mandates? And, you know, I think there’s just a lot of question like that. But, you know, I don’t know if you have any insight as to how you might respond to something like that, Adam?

Adam Bezman 22:55
Yeah. Yeah. That’s, that’s a very fair question. And we get that question all the time. Right. So, you know, there’s, there’s a couple of ways that I think of it, you know, first is going back to what we talked about at the beginning about how expensive care is, you know, my my personal opinion is waiting for the government to do something is not the best, the best option for most people, right? If you have the ability to plan for this in any way, I think it’s best to plan for it on your own, you know, either for employers to help their employees plan for it, or for employees to plan for it, you know, if their employers are not taking, you know, not taking action on their own. The know, the reality is, you know, we we talked about what the state of Washington did, and people get really concerned of, well, I want to make sure whatever I purchase will qualify me to opt out. There’s no saying that other states are actually going to allow you to opt out of a program that they do, you know, the state of Washington actually saw, I think about five times as many opt outs as they expected. And, you know, I don’t know what that’s going to do to their funding of the program. But other states might look at that and say, well, maybe we don’t want to allow people to opt out. Or maybe we’re going to allow for a cap, you know, we won’t allow it for a full locked out, will allow for a partial lump doubt or, you know, a reduced tax that you’re paying. But it’s really difficult to know what a state is going to do. The other part that I look at is, you know, we talked about how expensive this is, most people are going to need to look at several funding solutions to help with us, right. So one of those funding solutions is your retirement savings. You know, obviously everybody should be saving for retirement. But you can’t plan for the worst case scenario with retirement or at least most people can most people Can’t put that much money away, right? So you’ve got retirement savings, insurance is another piece of the puzzle, if you can buy insurance, you know, we talked about the challenges with that. And we can talk about that a little more in a bit. But there are insurance options out there. And getting coverage to help with some of that, again, is a really good way to think of it. And it doesn’t mean that you have to plan for every single dollar with insurance, but it’s part of the solution. You know, it’s just like, my homeowners insurance, I have a deductible, you know, I’m not planning on if there’s a fire to my house that it pays from dollar one, but I’m depend on my savings for some of it, and then the insurance will kick in to cover the rest because I don’t have enough to just replace my home. And then if the government does something, that’s another part of the solution, you know, it’s not, I wouldn’t look at it as I need to figure out how I can opt out, it’s, you know, that that may be an option down the line, but I need to plan for this, because I don’t want to wait for the government to do it for me, and whatever the government does, likely won’t be enough to cover all my needs anyway, you know, it would be very much like looking at social security and saying, Well, there’s my retirement plan, I don’t need to do anything, because the government’s got to get it out for me. Right. So it’s a scary thought it is. And there, there are probably some people who think that way, and I would advise against it. But you know, it’s a, it’s a piece of the puzzle, right? So you can say, Okay, I’m going to get, I think I will get this much income from Social Security. So I need to plan for the gap. It’s the same thing here, you need kind of a multi pronged solution to plan for this.

Rick Farris 26:48
No, that’s great. I mean, it’s good feedback. So in essence, don’t wait to be told that you need to find a solution for this, it just needs to be a part of your planning process. Because, yeah, irrespective of you know, what the government does do, you’re going to need the funding. And to your point, finding that funding from one general location is going to be pretty tough. Right. And I guess that’s really where insurance kicks in.

Adam Bezman 27:12
Yeah. And another thing to consider, you know, Washington, Washington did was interesting with the legislation is, originally they weren’t planning on letting people opt out once the legislation was passed, but then they decided to do that. So that’s where you have this mad scramble. Again, it’s possible in other states to look at it and say, well, we might allow people to opt out, but we’re only gonna allow people who already owned something prior to the legislation passing to opt out. So you know, you may not have that mad scramble, because it’s too late by the time they pass the legislation. So again, waiting on the government, and waiting until they are doing something is not a great plan, because we saw in the state of Washington, for all the insurance that was sold in the state, and it was a lot, there was a lot, there were a lot more people and employers who wanted to get plans in place who weren’t able to just because the volume was too great for insurers to handle.

Rick Farris 28:15
Yeah. And it seems like, you know, and I’ve told people this, there’s a pot of enrollers out there, and when they’re all taken up, you know, it gets really tough to try to enroll more business, because what people don’t realize is most enrollers are already booking their enrollments, you know, in January for July through, say, October, or June through October. So if if that huge population of enrollers is already kind of booked up, and all of a sudden you roll through and decide at the last minute that the entire state is going to try to have a knee jerk reaction, because they didn’t get ahead of it, so to speak, and try to do something, say in September. Well, good luck. I mean, good luck finding the molars because they’re already saturated. So I think that’s just something that people in Washington, it’s not that people weren’t thinking about it. But when they realize Holy crap, we have to move on this. All those enrollers were already booked up that year. And it was amazing what the insurance carriers and others were able to do to get the job done. But let’s just say, from the outside looking in, it could have been a lot smoother. had people have just scheduled in advance to get the work done, so to speak. Yeah, absolutely.

Adam Bezman 29:28
Yeah, I could not agree more.

Rick Farris 29:30
Well, that’s awesome. So let’s go ahead and move this a little further. So we’ve kind of identified what the need is and, and what’s happening within the market, right. And we’ve motivated people to really want to kind of do something about it. Let’s talk about one of the solutions that’s out there. So what product does Trustmark offer that can help with this?

Adam Bezman 29:50
Yeah, so we we actually have two solutions at Trustmark that can help with this. So Trustmark we’ve been selling Universal Life and Long Term Care Are for quite a while. So our universal life and Long Term Care is a hybrid, what is referred to in the industry is a hybrid solution. So what that means is it’s providing both life insurance and long term care benefits. So it’s a really a way to get basically a two for one solution. And you know, one of the reasons that’s really important is one of the downfalls or concerns that people have with purchasing Long Term Care is they look at it and say, Boy, I could spend all this money on this insurance, and I might never need it. So I might pay all of this money, and never get anything out of it. Now, I always I think that is kind of a funny way to look at it. I understand the perspective, we always want to get value for our money. But you know, I mentioned before I own home insurance, but I certainly hope my home never burns down and I never have to use it. So I wouldn’t, I wouldn’t look at my home insurance and say, Boy, that was a waste. That was a waste, right? It’s clearly Yeah, it’s it’s clearly good planning and peace of mind. But at the same time that it is a concern that people have run long term care insurance. So getting the life insurance, along with the long term care really helps alleviate that concern, because now you know, you’re going to collect on the life insurance eventually, or you know, your beneficiaries will collect on it, but you know, it will be used. So having those two together really, really helps a

Rick Farris 31:31
lot. Yeah, like, sorry, go ahead. Yeah,

Adam Bezman 31:35
no, no, no, no. So we I had mentioned, we have two solutions. So that is one of them. Our other solution is a brand new product that actually our first effective dates are going to be August 1 of this year. So we are just out talking about this product right now, is something that we call Trustmark Life Plus Care. And it is also a hybrid solution. The difference is it’s a different structure for how the life insurance works, and how the care benefits work. So instead of a long term care structure, it’s a chronic care structure, which, you know, you hear those two things and say, well, what’s the difference? You know, really, the difference is going to depend on the carrier and how the insurance is offered. But the way we’ve structured it, you qualify for the benefits on our long term care, chronic care the same way on both products. So from that perspective, when you need care, the qualifications exactly the same, you know, meaning somebody who has to have six ADL limitation or has severe cognitive impairment. The difference is with our new product is we’re trying to look into the future and see how people are going to need care. We talked about, you know, people want to be taken care of at home, and there’s a lot of people are being taken care of by family caregivers. This new product allows for benefits to be paid either if you’re receiving professional care, or if you have family taking care of you, which is a big difference from long term care, because typically, long term care is only going to pay out if you’re receiving professional care, not a family members taking care of you. But as we talked about, there are their real burdens to family caregivers, and the financial burden is a big part of that. So having a product that allows people to, you know, help out family members, if somebody is taking care of them provide some advantages to so they’re two really strong solutions, you know, the different ones are going to fit different groups better. But really two great ways of being able to address that problem.

Rick Farris 33:53
That’s awesome. Okay, cool. Now, you know, I’ve been talking with a lot of people about the your products in particular, I mean, trust Mark does a great job, obviously, on the back office a rated a lot of good qualities there. Like the people there like the culture. So I mean, I can’t speak highly, highly enough about the company. So the products in and of themselves I also like, and I’m glad you were able to come on and just talk through some of this. Just curious, but was there any any real? Talk to us about why you decided to create a hybrid solution with the universal life? I? The reason I’m asking this are one of the reasons I’m asking this is you hear a lot of concern. People say, Well, what if I sell these products to my, my, my employees, and then the carrier backs out? Well, one of the things I’ve said to people is is Yeah, but trust mark and many other carriers have been selling life insurance and universal life insurance for years, and they’ve not backed out. So I think putting the long term care rider as a as a The extra value add on to that policy creates more stability than say, even some of those pure Long Term Care offerings you’ve gotten out there. But I’m curious, Adam, to hear how you might respond to that.

Adam Bezman 35:10
Yeah. So I think, Rick, how you talked about it is great. You know, a couple of points, I would add to that, you know, we already talked about how you’re guaranteed to collect a benefit, right, by having a hybrid product, right, which is appealing to employees, but there’s also the element of people are going to purchase it at a much younger age. So people, you know, what we see with our product is sales are actually equal among people in their 20s, their 30s, their 40s, and 50s. So it’s really a product that appeals to a much broader group by being a hybrid product, because you have people who are younger, who are more focused on life insurance, you have people who are getting a little older, who maybe have most of their life insurance needs taken care of, but are focused on long term care. So it does a nice job of solving for that. Now, you asked about, okay, but the concern is, are they going to be able to pay in the long run because people have seen what happens with long term care insurance. And, you know, anyone who has experience with that has seen, you know, instances of huge rate increases, and, you know, those types of problems. So, one of the huge advantages of having a hybrid product is it is very different from traditional long term care in a couple of ways. First of all, the benefit that we pay out is an indemnity benefit. So indemnity I don’t think I knew what that term meant before I got into the insurance industry. But what indemnity means is, we’re paying a flat dollar amount. So we’re looking at your benefit. You know, if you buy $100,000 life policy, we will pay out 4% a month for long term care. So $4,000 a month. So a traditional long term care policy reimburses for expenses. Okay. Now, we talked about the cost of care has been growing and growing at this exponential rate. So insurers who wrote those policies, maybe didn’t plan appropriately, you know, one of the things they didn’t they didn’t account for is how quickly those costs were going to increase. That is with this type of product is not a concern, we know what we are going to have to pay out. And we understand exactly what our liability is. So from a carrier perspective, we’ve got a fixed amount that we know the policy can pay out. And that’s it. So we’re able to price it appropriately and plan for it appropriately. Unlike those standalone long term care policies. You know, the other big advantage, though, that it provides employees that most people don’t think about, I know, I certainly never thought about before I got into this is a lot of people actually need care when they are younger, we think of long term care is something that, you know, was generally needed as we age, we talked about all the people when they’re 65, and up who are going to need it. But 40% of the people who are getting care at any given time are actually under the age of 65. So they’re in their working years. And that is not when we are thinking about needing Long Term Care Insurance, right. So having a hybrid solution. Also, you know, I always say it, it gets you coverage before, you know that you might actually need. So you know, let’s say you’re in a bad car accident, when you’re 40. And you need care for six to nine months, this will actually pay you a benefit, you know, you’ve you’ve got the coverage because you purchased it early. The other advantage, obviously, buying it early is life insurance. And long term care is much less expensive when you purchase it when you’re young. So you pay a lot less by buying it when you’re young, and you can buy it when it’s much more affordable. Instead of waiting until you’re older to do it.

Rick Farris 39:19
No great points. Very good. So maybe I could ask the question that some of the listeners are probably thinking, Adam, and I know you’re partial because you guys obviously helped build it. But why Trustmark solution if you know someone out there is looking at different solutions and their spreadsheets or they’re just trying to figure out hey, which one of these should I should I land on? What’s your pitch?

Adam Bezman 39:42
So one of the things that really makes us unique is our products are designed with care benefit that stays level throughout the life of the policy. But we’ve got the option in there so you can build it where the death benefit actually reduced. says later in life. So we know with life insurance, we typically need a lot when we’re young, because we have responsibilities and expenses that need to be taken care of, when we’re older, there’s not usually that big of a need for life insurance, you know, we’ve paid off the house, the kids are, you know, on their own at that point. So, with this design, what we’re able to do is deliver a much more affordable product for most people, because we’re going to give you the care benefits that you need later in life, and the life insurance you need earlier in life. And really delivered the most value by, you know, giving you a death benefit that reduces later in life, when you’re less likely to need a large death benefit. So there’s a lot of value employees can get out of that. And we’re really unique in the industry in offering that. Another element that is really important is we have what’s called a restoration feature on our product that is on almost every policy we sell. And what that restoration feature does is it immediately restores the death benefit if you use it for long term care, meaning that instead of having a life insurance policy, where you can just accelerate the benefit for long term care, and then the death benefits gone, in this case, you can actually evolve, you have a death benefit. And if you use long term care, your death benefit isn’t going to shrink, just because you’re using your long term care. So it really gives you a two for one solution. Yeah, it’s those two things, when you really put them together, just drive so much value for the employee. And frankly, it makes it an easier product for employers to explain to their employees, just explaining that you got to for one, you know, you this is, this is a product that you know, that you will get use out of, and you might get a lot of use out of it. You know, the the other really big thing is, you know, this is this is our calling card, that Trustmark, this is our flagship product, it’s really what we are known for in the industry, I realized Trustmark may not be a household name for most people. But we really are if you know, if you look at the voluntary industry, you know, we are specialists in this industry. And we are we are known for our life and long term care product. And it’s it’s helped a lot of people over the years and really become a trusted solution in the marketplace.

Rick Farris 42:35
That’s awesome. Well, Adam, I’ve really appreciated the opportunity to speak with you about this. I know some of our clients and people that we work with out there have been asking, Hey, what’s FBMC strategy on this and, you know, if you’re interested out there, we definitely have a strategy that we’re working with our clients and our customers on. And with and, you know, from even even below 100 lives, trust Mark, we generally have been focusing more on the 100 plus Adam, I’ll just say that. And then you know, we’ve got other partners that we use for the for below that. But I think when you’re really thinking about the population, you’re trying to help really identifying what you’re doing and what you’re trying to accomplish based on size requirements. And you know what industry they’re in, these are all things that you take into consideration, and Trustmark got a great a great option for you. So I would encourage any one of the listeners out there to look in that direction. You know, Adam, I generally reserved, just kind of a final question for people who come on, and I’ll throw it out there at you. What else is there that you would like our listeners to know?

Adam Bezman 43:41
Yeah, I would say create a plan, you know, both for yourself and your loved ones. It’s really important, you know, if you have parents, talk to them about this, understand where they are financially, and what obligations you may need to help with the I get that these are not comfortable discussions. But it becomes a lot more uncomfortable when the need arises. And nobody’s prepared for it. So you know, if you have these discussions, you know what’s coming, and you can start thinking about how you might plan for it.

Rick Farris 44:17
Awesome. Well, great advice. And thank you very much, Adam, very grateful to have you on today. I’m sure a lot of our listeners are going to be very grateful to hear this, because it’s probably more detail and more information than they’ve gotten about the legislative mandates kind of what’s going on some possible solutions, the that’s probably the most information they’ve gotten. So thank you. Appreciate it, man.

Adam Bezman 44:38
Well, thank you for having me, Rick, I really appreciate the conversation.

Rick Farris 44:41
Absolutely. And I’d also like to go ahead and thank all of our listeners today. If you have any questions, please contact us or look for information on our And remember, you can find us and subscribe on any podcast app. Thanks and have a great day. Thank you for listening to Risky Benefits if you’re interested in learning more please visit We hope you’ll join us next time on Risky Benefits

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