Important work happening at Milliman
LTC in China
The 2024 Society of Actuaries (SOA) China Symposium had a focus on retirement topics, and Missy Gordon presented on the complexities of LTC insurance, including the inherent risks as well as the challenges faced in the U.S. market and lessons learned along the way. The presentation concluded with insights and innovations that could potentially pave the way for the future of LTC in new and developing markets. Missy later presented with Sharon Huang to several companies in Beijing, including Taikang Insurance Group, which posted a Chinese transcript of the presentation on their WeChat page, “Taikang Era of Longevity Institute.”
LARA/Wellness
The Milliman LTC Advanced Risk Analytics (Milliman LARA) team supports a variety of carriers and vendors in the LTC wellness space. The Milliman LARA team assists insurers in analyzing the results of their wellness pilots, and in planning future initiatives. We source, develop, and calculate the industry-leading LARA morbidity risk scores for carriers to utilize when developing and analyzing their wellness offerings.
Upcoming studies
Guidelines
Milliman continues to invest in the LTC Guidelines, with ongoing research efforts exploring expansion of the Guidelines to include additional assumptions and the development of benchmark dashboards to share with our clients. The initial data call for the next iteration of the Guidelines is expected in the first half of 2025.
Valuation survey
Thank you to all of those who participated in Milliman’s eighth LTC valuation survey. The report summarizing the results of the survey was released to participants in September and included a comparison to prior years. The report will be released publicly in March 2025.
As a reminder, companies that participated in the survey can request a meeting that will summarize their responses relative to those of all other respondents. If you’d like to know more, please contact [email protected], Juliet Spector ([email protected]), Tim Kempen ([email protected]), or Evan Pollock ([email protected]).
Rate increase survey
Thank you to all of those who participated in Milliman’s third LTC rate increase survey. The report summarizing the results of the survey was released to participants in October and included a comparison to prior years. The report will be released publicly in April 2025. Survey results will also be presented at the 2025 Intercompany Long-Term Care Insurance Conference in March as part of a LTC regulatory session
As a reminder, companies that participated in the survey can request a meeting that will summarize their responses relative to those of all other respondents. If you’d like to know more, please contact [email protected], Courtney Williamson ([email protected]), Andrew Duxbury ([email protected]), or Mike Bergerson ([email protected]).
Industry news
LTC reform update
There are a few updates on LTC reforms in several states:
- Washington: In November’s general election, Washingtonians had the option to vote for or against Initiative 2124, which proposed making the WA Cares Fund voluntary rather than mandatory. Voters rejected the initiative, maintaining WA Cares Fund’s mandatory structure. Additionally, at the end of 2024, Milliman completed an actuarial study on the WA Cares Fund for the Washington Office of the State Actuary: WA Cares Fund Actuarial Valuation as of June 30, 2024.
- Massachusetts: Milliman continues to work with the Massachusetts Executive Office of Health and Human Services (EOHHS) to perform a feasibility study evaluating long-term care financing solutions for the state of Massachusetts. The study is due to be released in early 2025.
- New York: In January 2025 Bill S1179, which would establish a New York long-term care trust program, was reintroduced in the State Senate. The bill was sponsored by Senator Shelley B. Mayer and (as of the drafting of this newsletter) is in the Senate Health Committee.
We will continue to monitor developments and long-term services and supports (LTSS)-related activity in other states, such as California, Minnesota, Pennsylvania, and others over the course of 2025.
NAIC LTC Actuarial Working Group
The National Association of Insurance Commissioners (NAIC) LTC Actuarial Working Group met throughout 2024 to discuss potential changes to the Long-Term Care Insurance Multistate Rate Review Framework (LTCI MSA Framework). In late 2024, the working group approved changes to move to a single rate review methodology by removing the Prospective Present Value Method (aka Texas Method). The working group also rebranded the now single rate review methodology the “MSA Approach.”
CLTC
The annual meeting of the Certification for Long-Term Care (CLTC) Insurance took place in September 2024 in Charlotte, North Carolina. Milliman Principal Chris Giese spoke on trends in product design, leading an innovative, hands-on workshop. Milliman Principal Robert Eaton spoke on a panel with other industry leaders, where they discussed actuarial pricing trends, including for worksite hybrid life and LTC products.
LTCIF
Juliet Spector presented with Royce Purinton from GE NALH on August 27 at the Long-Term Care International Forum (LTCIF) monthly webinar. The topic was, "LTCi Wellness Programs: Measuring ROI and Quantifying Financial Outcomes."
Please reach out if you would like the slides.
LTC Discussion Group
Jeff Anderson and Juliet Spector presented to the LTC Discussion Group on September 10, 2024. They discussed key themes critical to program success and important considerations for designing, evaluating the risks of, and measuring the results of LTC wellness programs. As stakeholders become more skilled at managing the practical details of LTC wellness initiatives and enhance their infrastructures to collect and process meaningful quality and savings metrics for their target populations, defining the key features that hinder or support the success of LTC wellness programs will become easier. In doing so, providers and stakeholders will refine and implement more sophisticated models to better manage LTC paid claims and policyholder experience.
Please reach out if you would like the slides.
Faegre Drinker LTC Summit
Four of our Milliman principals attended the Faegre Drinker LTC Summit in Chicago. Faegre Drinker did a great job presenting top-notch LTC content and networking opportunities. Milliman sponsored the keynote speaker and Robert Eaton spoke on artificial intelligence (AI).
M&A work
On November 20, 2024, Manulife Financial Corporation (Manulife) announced a $4.0 billion reinsurance agreement with Reinsurance Group of America (RGA). This agreement includes $1.8 billion of LTC reserves and continues the momentum from Manulife’s deal that was closed in February 2024 to reinsure $4.4 billion of LTC reserves. Compared to the earlier transaction, the agreement with RGA covers a younger LTC block with a greater proportion of active life reserves. Both reinsurance transactions done by Manulife had the LTC block packaged with another block (whole life, structured settlements). Although the announcements of deals cited values in Canadian dollars, the numbers are reported in U.S. dollars here.
LTC has recently increased in interest in mergers and acquisitions (M&A) discussions and we expect it to be a topic of discussion among attendees at the ReFocus Conference in February 2025.
Milliman publications and news
2024 Milliman Long-Term Care Insurance Survey | Broker World
The 2024 Milliman Long-Term Care Insurance Survey is the 26th consecutive annual review of stand-alone long-term care insurance (LTCI) published by Broker World magazine. It analyzes the marketplace, reports sales distributions, and describes available products.
More discussion of worksite sales, including a comparison of worksite sales distributions versus non-worksite sales distributions was in Broker World magazine’s September/October issue.
Milliman Health Vision 360
Milliman principal Juliet Spector and Char Hu of the Helper Bees presented at the Milliman Client Forum (Milliman HealthVision 360) on how LARA risk scores can help identify and prioritize LTC policyholder risk. Char then presented on how the Helper Bees can pair these risk scores with their solution to deliver value and return on investment (ROI) to a long-term care block. Slides are available upon request. We hope you can join us for the 2025 forum in Orlando, Florida, this September.
Milliman 2024 Worksite Life Insurance Survey Report, featuring hybrid life and LTC products
Robert Eaton, Bill Mehilos, and other Milliman consultants produced the Milliman 2024 Worksite Life Insurance Survey Report. Importantly, this report documents the rise of worksite-sold hybrid life and LTC products, with evolving feature sets including: acceleration of benefits, extension of benefits, restoration of benefits, and inflation protection. The survey report is updated annually and has noted a steep rise in the sales of LTC hybrid policies through the worksite in the past five years.
Milliman in the community
Milliman’s annual Social Impact Report
As 2023 marked Milliman's fifth year as a signatory of the United Nations Global Compact, the company has continued its commitment to the compact's 10 leading principles. With a focus on upholding global human rights, sustainability, and anti-corruption, these principles shape Milliman's corporate strategy, policies, and procedures. Milliman practices address global challenges and strive to "create transformational change in communities worldwide.”
The United Nations Development Program (UNDP)-Milliman Global Actuarial Initiative (GAIN) wrapped up the first year of a partnership to build actuarial expertise in 10 developing countries. Milliman ambassadors have introduced a model of intervention and support in these countries, focusing on the recruitment and retention of local actuarial staff within the countries. Efforts are underway to assist more countries as they help insurers, governments, and pension funds predict and manage risk and offer innovative and affordable solutions.
The Milliman Giving Fund continues to make an impact by fostering economic development, expanding access to education, and providing necessary healthcare opportunities. In 2023, the fund impacted over 900,000 people worldwide based on donations from over 300 Milliman employees and alumni. Milliman is a significant corporate donor to Project WISE, an organization that provides clean drinking water and other resources to children attending government schools in Addis Ababa, Ethiopia, and Kolkata, India. Other efforts include sponsoring the Actuarial Foundation's math motivators program and working to strengthen the health system for the Navajo Nation.