 LTC Bullet: LTC Good News Friday, March 18, 2022 Seattle— LTC Comment: A few things are going right for the long-term care insurance business lately. We’ll cover one of them after the ***news.*** *** ILTCI CONFERENCE NEWS: The Intercompany Long Term Care Insurance Conference at the Raleigh, North Carolina Convention Center, March 20-23, 2022 is only days away. Organizers say: “Join us and reconnect with over 700 of your colleagues from across the industry whom you haven’t seen since 2019! Choose from 49 educational break-out sessions across seven tracks. Look into the crystal ball with our Keynote Speaker, futurist Anders Sorman-Nilsson. Our closing session with Plug and Play Tech Center will host the first ever “LTC Innovators Invitational Challenge,” featuring nine aging-in-place innovators! The full schedule of the conference, including the breakout sessions is now available. Please visit ILTCI Conference Schedule to view our exciting program.” To all those able to attend, we at the Center for Long-Term Care Reform say “have a great conference!” *** *** JOIN US. Since 1998, the Center for Long-Term Care Reform has conducted and published dozens of national and state-level studies and published 1330 LTC Bullets. We’ve helped to win crucial federal Medicaid statutory changes in 1993 (mandatory estate recovery) and 2005 (capping the home equity exemption). We’ve analyzed and refuted virtually every study and article advocating a government takeover of long-term care. Now we’re proposing a simple, cost-saving solution to the long-term care mess government created. Won’t you join us and support these achievements, goals, and future potential? Become a regular or premium member. Or ask your company or organization to become a corporate member, with benefits accruing to you at no extra expense. Contact Damon at 206-283-7036 or damon@centerltc.com for details. Review our Membership Levels and Benefits schedule here. Let’s get this done! Thanks for your consideration and support. *** *** RECENTLY PUBLISHED ARTICLES by Steve Moses. We hope you’ll read these articles, join the Center for Long-Term Care Reform, and help us solve the long-term care financing problem. The Center’s “Membership Levels and Benefits” schedule is here. Join individually or urge your company or association to join as a corporate member so you can receive all the benefits of membership at no cost to you. Universal access to top quality care for all Americans (the Center’s mission) is achievable. Join us and make it happen! *** “Trappings
of LTC system leave operators trapped,” by Stephen A. Moses,
McKnight’s Long-Term Care News, February 23, 2022. LTC BULLET: LTC GOOD NEWS LTC Comment: The news about private long-term care insurance isn’t always so great. The number of companies in the business has declined over the past couple decades from ten dozen to one or less. So, when we see Genworth getting a financial upgrade or new companies dipping a toe into the field, it’s refreshing. Recently, we learned that LTCG, long a good friend and corporate supporter of the Center for Long-term Care Reform, has also had good news. Today’s LTC Bullet covers that news and adds a little background “color” from CEO Peter Goldstein. On February 24, illumifin,* a leading insurance third-party administration and software provider, announced it is purchasing LTCG, the leading TPA for the private long-term care insurance business. Industry press covered the story and supplied details: Illumifin, a Greenville-headquartered insurance third-party administration and software provider, has signed an agreement to acquire LTCG, a provider of administrative solutions and clinical services to the long-term care insurance industry. The transaction is expected to close within the next 60 days, according to a news release. (Ross Norton, “Illumifin to acquire LTCG to expand third-party administration capabilities, February 25, 2022) LTCG Chief Executive Officer Peter Goldstein explained at the time of the announcement: Given our 25-year history as the leading partner for long-term care insurers and our deep customer relationships, the integrated company will allow us to build more strategic partnerships with our clients and help them enhance the customer experience for both policyholders and distributors. (“Illumifin to Acquire LTCG to Expand Third-Party Administration Capabilities,” Business Wire, February 24, 2022) LTC Bullets spoke with CEO Goldstein this week to get the backstory about this transaction. He told us LTCG has been “experiencing tremendous growth.” The company just announced an expanded partnership with Lincoln Financial, taking on the claims administration for MoneyGuard, the industry’s leading hybrid product. The CNA group business is on its way back to LTCG and Transamerica will go live with over 300,000 policies and 14,000 claims later this year. Market share is growing again after years of slower expansion. From the macroeconomic standpoint mergers and acquisitions are strong despite the pandemic. LTCG is not the same company it was five years ago, Goldstein explained. The long-term care insurance business has evolved. Carriers are adapting to the market reality, especially rapidly increasing claims. With so many closed books of business and smaller operations, they look to TPAs like LTCG to manage this complex risk by outsourcing work they lack the scale or systems to manage in house. This translated into “significant momentum” and expansion of services for LTCG. Bottom line, when Goldstein reviewed the marketplace last year, it seemed like a good time to consider a sale. He explained that LTCG was always investor owned with private equity backing the management team. Sale of the company was therefore not unexpected. It had been done three times before. It’s a common pattern. Private equity buys high potential companies, adds value through targeted investments, and then sells a bigger, more diversified company. The typical hold period is five to seven years, which was about where LTCG is now. Furthermore, absent a major transformation in the long-term care insurance business overall, Goldstein believes LTCG needs to expand into other areas, such as life insurance, annuities, and Med Supp. From that perspective, illumifin is the perfect company with which to merge. illumifin is a new name for an old company with many years of experience under various corporate identities. It supports a lot of the same insurance companies as LTCG. Goldstein clarified “illumifin gives us a whole new set of services to bring to our valued clients, especially with the growth of hybrid life and annuity LTC products.” I asked what the sale means for Peter personally. He said, “As part of this process, I thought I might finally retire as it’s been 25 years at LTCG.” But because of the new opportunity and upside potential, he agreed to stay on, becoming president of illumifin and joining its board of directors. He looks forward to partnering with CEO Phil Ratcliff whom he has known for several years. The LTCG leadership team will stay in place as the company “paints on a larger canvas.” We congratulate LTCG and illumifin on this merger and wish all involved every ongoing success. * illumifin’s official name begins with a lower case “i.” We observed that formality in this article, except when quoting other sources that used an initial capital “I.” |