Legislative committees in Connecticut are actively working to reform the state’s long-term care insurance (LTCI) landscape, spurred by rising costs and consumer concerns. Several bills have advanced, aiming to offer relief to policyholders and increase scrutiny of the industry.
Committee-Approved Bill
The Insurance and Real Estate Committee recently approved a bill with broad support. This measure includes several key provisions:
- Capping annual rate increases for long-term care insurance policies at 10%.
- Mandating a review by the state’s insurance commissioner of the department’s rate filing process.
- Establishing a tax credit for policyholders equal to 20% of their annual premiums.
- Requiring the insurance department to explore an alternative coverage pool for policyholders.
In addition, the proposal would cap rate increases based on the Consumer Price Index for policies 15 years or older.
“It’s a huge issue; so many people have been touched by it,” said Sen. Jorge Cabrera, D-Hamden, co-chair of the committee. “It’s a top priority not only for me, but also for a lot of people in the [state Capitol] building.”
The bill is a revised version that was originally introduced, with the 10% rate increase cap added after receiving feedback from residents. Although it now moves to the Senate floor, the Finance, Revenue and Bonding Committee will likely need to approve it due to the tax credit component.
Additional Proposals
The Insurance Committee has also advanced a second bill, crafted by the Aging Committee, that provides a tax deduction for policyholders and requires public hearings for rate increase requests exceeding 10%.
“We’re passing a lot out of committee to give ourselves options,” said Rep. Kerry Wood, D-Rocky Hill, co-chair of the Insurance Committee. “We’re giving ourselves enough tools to figure out what the best path forward is.”
Furthermore, the legislature’s Government Oversight Committee has put forth its own proposal. This bill seeks to impose accountability measures on LTCI sellers and offer consumer protection. It would require the state’s Office of Health Strategy to issue a report on current regulations, suggest improvements to the rate filing and approval process, mandate public hearings for rate increase requests over 10%, and require notifications to prospective buyers about the risk of rate hikes and caps on rate increases for certain policies. This committee also proposes a study by the state’s Insurance Department on an alternative pool for long-term care policyholders.
“It’s a high priority, we have to do it,” said Rep. Ron Napoli, D-Waterbury, a co-sponsor of the bill. ““The fact that people’s premiums are increasing by over 50% is just outrageous. It shouldn’t be happening. It’s a high priority this year that we come up with something tangible to give ratepayers some relief.”
Growing Concerns
Nearly 100,000 people in Connecticut have long-term care insurance. A CT Mirror review reveals that over 17,000 policyholders have experienced premium increases of 50% or more between January 2019 and October 2024. Several major insurers, like Genworth Financial, Metropolitan Life Insurance Company, and Transamerica Life Insurance Company, requested premium hikes repeatedly from 2019.
When providers seek premium increases, thousands of consumers can be impacted. For instance, in 2019, Genworth Financial requested a 40% rate hike on more than 9,000 Connecticut policyholders; in 2021, Transamerica requested a 20% increase on 8,000 policies. In 2022, Genworth implemented rate hikes for over 2,000 individuals, averaging 97%, with increases ranging from 79% to 173% based on the policy.
As costs have climbed, grievances filed with the Connecticut Insurance Department have increased. The office received over 700 complaints in the past six years, mostly centered on rising premiums. Despite the challenges, lawmakers are optimistic about achieving meaningful reform this year.
“You can tell when something becomes really important because you’re seeing various iterations of the same subject coming up in different committees,” Cabrera said. “That tells you, right there, that it’s top of mind for a lot of people.”
