Long-term care insurance provides cost assistance for those who need caregiver support or help with daily living activities. Individuals who are already sick often face challenges when purchasing long-term care insurance, such as paying significantly higher premiums, or may be denied coverage altogether. In April, the FDA approved direct-to-consumer testing to assess genetic risk for 10 conditions, including Alzheimer’s disease. The increased availability and affordability of genetic testing can help healthy individuals to assess their risk of developing certain diseases, but may also make it more difficult for them to access services like long-term care insurance.
The Wharton School’s Jean Lemair and Arupa Gangulay of the Hospital of University of Pennsylvania recently sat down to analyze the emotional and economic impact of genetic testing for disease risk, with a focus on long-term care insurance. Throughout their conversation they explore several big questions: What does the information these tests provide really mean? Will people only buy long-term care insurance if they think they have higher risk of certain diseases? Can insurers ask people if they took the test?
Lemair and Gangulay explain that if the only people who purchase long-term care insurance are those with increased risk of disease, the market won’t be sustainable. Without low-risk people in the pool, prices will rise and many people who need long-term insurance will no longer be able to afford it. In their words, genetic testing creates a dichotomy: “We want insurance, but we cannot get insurance if we reveal why we want insurance.”
Furthermore, genetic testing for Alzheimer’s disease risk is not highly predictive and results can be misleading, caution Lemair and Gangulay. If a person discloses his increased risk of Alzheimer’s disease, he may be denied long-term care insurance, even though he may never need assistance. On the other hand, an individual who tests negative for a mutation may opt not to purchase long-term care insurance. But just because she does not have increased risk for Alzheimer’s disease, does not mean she won’t require caregiver support due to another condition.
Ultimately, Lemair and Gangulay warn that a low-cost test that predicts predisposition to expensive diseases creates a “perfect storm” for companies selling long-term care insurance and, in turn, the consumers who need it.
You can listen to the podcast or read the transcript here.
Like the experts interviewed in this podcast, the Norton & Elaine Sarnoff Center for Jewish Genetics and the National Society of Genetic Counselors caution that the health risk tests sold by 23andme provide incomplete – and potentially misleading – information and do not require genetic counseling, a vital part of the testing process.
