By Paul E. ForteChief Executive Officer

Long Term Care Partners, LLC

NARFE National ConventionReno, NV

August 30, 2012

The First Decade

2012

20102009

20082007

20062005

20042003

2002

2011

Statute: The Long Term Care Security Act of 2000

3

Core Eligibles: 8 MillionEnrollees: 270,000+

Annualized Premium: $428 Million Assets under Management: $3 Billion(as of March 31, 2012)

FLTCIP: A Public-Private Partnership

• Director of OPM• Healthcare & Insurance• Office of Inspector General• Office of Communications• Financial/Actuarial

OPM U.S. Congress

Long-Term Care Insurance Industry

Long-Term HealthServices & Supports

Industry

Other U.S. Federal Agencies(GAO, HHS, CBO, OMB, Treasury)

FLTCIP STAKEHOLDERS

UnderwriterAdministrator Non-Profits , Advocates & Unions

FLTCIP’s Evolution and Major Milestones

2008 2010 201220062005 2009 201120072001 2002 2003

2008 Web enhancements: • Online account for

enrollees• Full application

online• Claims info available

online

2008

2001: First FLTCIP contract signed with OPM; implementation begins

2001 2002 2003

2002–2003 FLTCIP 1.0—First Open Season and largest LTC awareness campaign in history

2011 Open Season (45,000 new enrollees)

201120042004

2004Enhanced Communication materials, agency outreach

2012

2009 FLTCIP contract renewed; FLTCIP 2.0 introduced

2009

2006: • New LTCFEDS.com features

added (e.g., interactive cost of care calculators, revamped FAQs and educational sections)

• New, faster claims processing system introduced

2006

FLTCIP: 10-Year Progress Report

• 270,000 current enrollees• Performance standards met or exceeded

every year• Website (LTCFEDS.com) attracts one million

visitors per year. Resources include: Premium Calculator, award-winning Online Consultant Tool, online applications

• Leader in Care Coordination, Family Support, Self-Service, Information Security, and other measures of quality

• FLTCIP expenses consistently under budget, w/gains captured by FLTCIP Experience Fund (US $3 billion)

FLTCIP: 10-Year Progress Report

• 10,000+ claims opened• 8,000 in benefit• 3,000 claims active• 170 new claims, 60 new

information/referral calls per month

FLTCIP claimants receive over $6.5 million monthly

* Projected through October 2012

Claims Activity*:

FLTCIP and NARFE: A Strong Alliance

• NARFE’s legislative efforts 2000 ratification

• NARFE forums (conferences, articles, retirement seminars, etc) provide invaluable forum to educate/raise awareness

• NARFE’s feedback plan upgrades, design changes

Result: a best-in-class long term care plan for current and future federal employees and annuitants

You Asked…We Heard: FLTCIP 2.0

Your Request… Our Response (new 2.0 features)

Improved aging-in-place options

•Stay-at-home benefit• Increased informal caregiver benefit•100% home health care reimbursement•Calendar days

More affordable enrollment

•2-year plan option•4% inflation protection option

Easier enrollment

•Open Season with abbreviated underwriting•More ways to enroll, instant price quotes,

fast response

Result: greater customer satisfaction

Long Term Care Insurance Plans May Look Similar…

…But Yours is Different

“Under the hood”: FLTCIP’s customized features

Assets held in separate account

Informal home health care benefits

Care coordination by experienced RNs

International benefits

Independent 3rd party review of claims

No war or mental health exclusion

FLTCIP’s true value requires looking below the surface

OPM oversight; NARFE input

11The FLTCIP Care Coordination team

Your FLTCIP Care Coordinators

Type of LTC Care Received in 2012 (by % of claims)

How FLTCIP Enrollees Are Using Their Benefit

Informal Caregiver20%

Adult Day Care3%

Assisted Living Facility

31%

Nursing Home16%

Home Health Care30%

Testimonials

“Lisa has been very responsive to my questions and concerns. She has provided a caring attitude and shows real concern for my mother’s condition.” Alexis

“I was very pleasantly surprised at the quality of all the Claim people and the swiftness of the claim payment process. Within 5 days of when I send in my bill, I get my payment. I wish all insurance companies were like that!” Pat

“You don’t need long

term care until your life is

already pretty stressful.

This insurance has provided us with a nurse

who is professional,

caring and answers the

questions we didn’t even

know to ask. Thanks to

Catherine for all her

help.” - Janice

“Nancy is awesome! She is so patient, understanding and informative she has made a difficult time

much easier for my family.” - Kari

“Carolee took great care and concern with my mother's long term care case assignment… it took a lot of

patience on her part but she never let any annoyance show.”- Shoshana

Realities of Long Term Care in 2012

• Aging demographic; millions of retirees unprepared • Increased longevity• High costs of care• Low personal savings

rate, loss of home equity• Inflation risk• Deficit, entitlement

cutbacks

Retirement

The need for a reliable means of financing long-term care services is greater than ever

FLTCIP: A Better Route

• LTCI: a reliable way to handle costs, achieve peace of mind

• FLTCIP program offers outstanding value, choice and independence

• Supports “aging in place”; prevents reliance on Medicaid

FLTCIP: Future Directions

• More claims being paid

• Continued education

• Research on new plan designs (FLTCIP 3.0)

• Ongoing efficiency and service improvements

• Future opportunities, challenges & unknowns: e.g., effects of ACA/health care reform, election results

Thanks Again!