Carol A. Barbour
President, Friends Life Care Partners
Carol celebrates her 30th year with Friends Life Care in 2016 and has served as the CEO/President since 1991. She was a member of the team that created the CCaH business model and has lead the growth of the organization to be the largest CCaH in the US with over 2,400 members—she is considered by many to be one of the most successful executives in the CCaH industry today.
M1. Describe the current design trends in regard to popularity in the market for levels for co-payment percentages and membership fees.
Of the approximately 30 CCaH plans in operation as of 2016, the majority offer pricing comparable to a Type A Life Plan Community, that is entry fees and ongoing monthly fees that do not change as the member moves through the continuum of care. Most of these offer a variety of copayment options while still maintaining the unlimited lifetime benefit. While our enrollment experience with this pricing model was quite robust in the 1990s, the velocity of enrollment slowed in the early 2000s; this lower rate has been experienced by many, if not all, the newly developed, “Type A” CCaH plans. A few theories for this decline include:
- The availability of comprehensive long term care insurance policies in the early 2000s;
- The cost of CCaH in comparison to long term care insurance;
- The availability of hybrid products such as life insurance proceeds that can be used for long term care expenses;
- The lack of a Best Rating for CCaH plans;
- The marketing challenge for a product that requires education of the target market (the “I’m not ready yet” syndrome);
- The challenge for some potential clients to paying the membership fee without the benefit of the sale of real estate to fund the payment.
Several CCaH providers have responded to the marketing challenges by creating contract options that significantly lower the up-front membership fees and monthly fees by placing dollar limits on daily and lifetime benefit costs—essentially following the practices of the long-term care insurance industry. The homecare only product has become a more frequent selection among consumers who wish to lower their initial advance payments. A few progressive CCaHs now offer flexible pricing models that allow the consumer to determine the total dollar amount or number of days that they want their CCaH plan to cover for their care. Depending on the state-specific regulatory environment, such contract designs may or may not include a membership fee. The experience of Friends Life Care with this contract design in the Philadelphia market shows a relatively high level of market acceptance with triple digit enrollment rates for the past several years.
It should also be noted that the contract designs with no limits on daily or lifetime benefits will have very different actuarial implications for the provider versus contract designs that incorporate daily or lifetime benefit limits. The unlimited lifetime benefit contract option requires higher fees and presents a greater actuarial risk exposure. However, if your CCaH market is willing to absorb these fees, then growing as large an enrollment as possible is the best method to mitigate these actuarial risks in lieu of benefit limitations.
What has your organization’s experience been in this regard? What contract designs are consumers most interested in?
M2. Can one identify the three most effective marketing tools for generating leads and is it likely to vary by provider?
Gone are the days when it was possible to get someone’s attention with a simple direct mail letter, perhaps reinforced by an advertisement in the local newspaper. Today we all have websites; we’re barraged with advertisements on social media, when we do a search on the internet, snail mail, radio, television, blogs…we are never without our smart phones. Our attention spans are shorter than ever. All this is to say that a multi-channel approach to marketing is required now more than ever. There is no single silver bullet for generating leads.
I would also say that gone are the days of static websites. We want the information when we want it and where we want it. Consumers are demanding far greater transparency than ever before. They don’t have any patience for calling to request more information…they want it now!
We’d love to hear what your experience has been in your market!
M3. List some pros and cons for engaging a third party underwriter for member enrollment.
Underwriting is one of the keys to the long term success of the CCaH plan. It’s important to establish criteria that help you manage the actuarial risk while not being so rigorous that you deny enrollment to people whose care needs could be well managed. This is a very challenging task. Some of the pros and cons of the two approaches include the following:
|Third Party Underwriting|
|Experts in Underwriting||The out of pocket cost can be quite high|
|Objectivity||Can lengthen the admissions process|
|Continual training specifically in underwriting||Little control over the process|
|Use sophisticated cognitive assessment and screening tools||Clinicians performing the assessments may not represent your organization in the way you would like|
|Highly trained clinicians who perform the assessments to obtain medical information|
|Provides a comprehensive software program with customized reports|
|In House Underwriting|
|Less costly||Sacrifice objectivity|
|Less time from application to decision||Staff not trained in underwriting|
|Direct access to the underwriters for questions and concerns||Potential for pressure from sales staff to accept applicants|
|Medical records retrieval is extremely challenging|
Please feel free to share your experience and add to this list!
M4. What techniques and tools are useful to maintain consistency among your care coordinators?
Not only does there need to be consistency among care coordinators, there needs to be consistency in regard to what is promised in the Continuing Care Agreement with CCaH members and what is delivered. The social workers, nurses, occupational therapists, health & wellness specialists who we hire to serve as care coordinators are good at what they do not only because of the training in their specialty area but also because they are kind and caring people. They establish meaningful relationships with the CCaH members assigned to them. But we must also remember that they are the gatekeepers for providing care. Objective assessment tools for determining eligibility for receiving care must be implemented from the outset; being liberal with care decisions in the beginning will no doubt haunt the CCaH plan at a later date.
The key to establishing objectivity and consistency is the use of assessment tools accompanied by training, supervision and good judgment of the care coordinators and their supervisory staff. There are some assessment tools in the marketplace that are appropriate for this populations (SLUMS, Caregiver Burden Survey, and so forth), but in many cases the CCaH provider will need to develop tools to fit this purpose.
What tools are you using to achieve and maintain consistency?
M5. Will a CCaH plan undercut interest in people moving into my Life Plan Community (aka CCRC)?
First, full disclosure: Friends Life Care is an independent organization. We are not affiliated with a bricks and mortar CCRC.
Having said that, every research study I have ever seen quotes a percentage between 85% and 95% of older adults indicating that they prefer to remain in their own homes. CCRCs were never intended to have “mass market” appeal; simply by virtue of the membership fees required to move onto a campus, the target market is limited.
It has been our experience that the people who enroll in CCaH are making a LIFE STYLE CHOICE; they simply prefer to remain in their own homes. Some people who plan to move to a CCRC will enroll in CCaH while they are on the waiting list for the CCRC. It has also been our experience that CCaH is attractive to a more moderate income population than is served by CCRCs (50% of our membership reports annual incomes less than $100K).
In general, I believe it’s fair to say that by offering a CCaH alternative, the sponsoring CCRC will have the opportunity to serve the 85%-95% of the market who they otherwise would not reach.
I believe there are a couple CCaH plans that have experienced a significant number of CCaH members actually moving into the CCRC. We hope they’ll add to this thread with their experience!