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Custom Life Insurance Accessibility to the Elderly Essay

During the last twenty years, the trend has been towards an increase in the number of life insurance policies taken by both men and women throughout the United States. Furthermore, it may be observed that the sharpest increases in life insurance accessibility is registered among the elderly (individuals aged 65 and above). This paper attempts to uncover the reasons behind this sustained increase in life insurance policy accessibility among elderly Americans. Governmental, societal, and organizational factors will be considered in eliciting a definitive explanation to the aforementioned phenomenon. Ultimately, it will be made clear that improved governmental healthcare measures coupled with changing lifestyles and supply-side factors (primarily marketing efforts) have all contributed to the increased popularity of life insurance services by elderly Americans.

First and foremost, it becomes important to recognize that throughout the last twenty years the trend in government spending on healthcare has sustainably increased (which is by no means a surprise, especially considering that this has been the trend ever since publically funded healthcare programs came into existence). It reveals a continued effort on government’s part to look after the health of people, and a consequent continuous improving of their quality of life. This commitment has undoubtedly rewarded, and not only in the United States, but throughout the world. For the past twenty years, and even long before then, scientific and technological breakthroughs in the field of medicine have allowed individuals to improve their health and their quality of life. These breakthroughs, coupled with increased government spending in healthcare, have inevitably led to people living longer.

Another major point to consider is that in 2010 health care in the United States was reformed by President Barak Obama’s own initiative. The idea behind this reform was to improve health care benefits and increase the quality of health care services across the country. Costs sustainably increased in this sphere, especially in governmentally funded programs such as Medicare. Since its foundation in 1965, Medicare has provided health insurance for the elderly (aged 65 and older), but as the program’s costs increased, President Obama insisted that in order to make the program viable and efficient changes needed to be made. The reforms that Obama spoke about became a reality in 2010 when Medicare, along with the entire health care system, was reformed. The rationale behind the reform was to decrease insurance payments/costs in order to increase the coverage. Some sectors did not react positively to this reform, as they feared it would compromise the quality and availability of health insurance for the elderly. The reality is that with this reform, Medicare has been restructured and optimized. The program has become more efficient and by 2020 it will increase prescription-drug benefits and other additional health insurance enhancements. 

Medicare is the only publically funded health program for the elderly in the United States. However, this program has always been criticized given that it “reimburses only limited amount of long-term care costs, and most elderly people do not have private long-term care insurance” (De Nardi, French & Jones, 2010, p. 3). This means that according to its original concept, Medicare was a program that required the elderly to make copayments for receiving medical treatment. Furthermore, the program was problematic insomuch it failed to fully cover prescription-drug costs for the chronically ill. Senior citizens, under the original regimen, were covered for $2,700 USD per year only. If the patient exceeded that amount in prescription-drug costs, coverage stopped. Paradoxically, it would restart if presciption-drug costs reached $6,154 USD. 

Within the new reform, which aims at restructuring the program, the governmnt expects to decreasae public spending by more than $60 billion over the next ten years. This obviously preoccupies certain sectors of society, especially the elderly, but there is no reason for worrying. In the long run, these additional funds will be transferred to their traditional Medicare benefits. Home health care costs will be decreased, as well as payments to hospitals, but the government’s intention is to focus on providing all of the country’s senior citizens enhanced medical insurance (including investment in preventive services) and enhanced prescription-drug benefits. 

Another advantage for the elderly is that they will receive additional preventive health insurance benefits. The new Medicare contemplates preventive services as a means to further decrease health insurance costs. This is a new service that all Medicare beneficiaries will be entitled to, and it will be free of charge. The logic behind this additional service is not only to decrease public spending, but also to foment healthier living and feeding habits for the elderly. Senior citizens are at higher risk of developing diseases and becoming disabled. This is something that Medicare is meant to combat, because it is not enough to offer medical insurance, one should also contribute to the imrpovement of the elderly’s quality of life. 

A new, personalized prevention benefit for Medicare beneficiaries covers anannual wellness visit, health risk assessment, and personal care plan, with no cost sharing. Starting 1 January 2011, Medicare will also cover clinical preventive services with A and B ratings at no cost to beneficiaries.

Medicare has not been entirely perfected with this new reform introduced by President Barak Obama in 2010, but it seems clear that significant benefits have been created for the elderly. In this regard, it is important to recall that one of the major problems with the progam is connected with the prescription-drug benefits it bestowed on benefitiaries. The original Medicare covered only $2,700 USD per year. Inexplicably, after that the amount of coverage would seize until the costs reached $6,154. Government claims that even though full coverage will not be made available (as there are not enough funds to do so), with the savings produced by the reform (over $60 billion USD over the next ten years) it will be possible to subsidize some of the costs that beneficiaries will have to sustain between the $2,700 USD and the $6,154. Government claims that, by 2019, Medicare will be in the position to cover 75% of the costs situated between that gap (U.S. Department of Health and Human Services, 2012). Studies have been conducted in order to determine whether it would be possible for government to do this. The results confirm the government’s assertions, but they also point out what has already been mentioned: funding will be decreased in other areas.    

Considering societal factors, it becomes quintessential to point out that even though it is true that changes in lifestyle are more effective in reducing mortality rates, it is equally true that the population of the United States is gradually ageing. In 2009, the older population (aged 65 or older) “represented 12.9% of the U.S. population, about one in every eight Americans. By 2030, there will be about 72.1 million older persons, more than twice their number in 2000”. Chronic diseases, disabilities and other health concerns are more prevalent among senior citizens; this reality initially explains the reason medical care expenditures continue to run high in the United States. It also explains why life insurance accessibility has increased sustainably during the past twenty years. Americans are not only living longer and higher quality lives; a significant portion of the country’s population is the elderly (and this trend will continue in years to come).

Leading a discussion on the way societal factors, namely lifestyle changes, have contributed to improving people’s health (thus leading to higher accessibility to life insurance among the elderly), it is important to consider two specific factors: breast cancer and smoking. First of all, physicians recommend all women at risk to pursue lifestyle modifications in order to potentiate their health. The most frequent recommendations include the following: “healthy diet, adopting physically active lifestyle, achieving a healthy weight and maintaining it for life, limiting alcohol, avoiding smoking, and minimizing duration of use of postmenopausal hormone replacement therapy”. Studies show positive correlations between alcohol consumption and breast cancer incidence. Smoking has demonstrated to have a positive correlation with all types of cancer (including breast cancer). Finally, diets based on low-fat foods have been proven to help in lowering the risk of contracting breast cancer. In the case of smoking, changing lifestyle has led (in some cases) to decreased tobacco consumption. This has also been induced by government action, especially in the state of California which has managed to significantly reduce smoking by levying higher taxes on tobacco.

This policy has been further complemented by the other ones. For instance, by the state legislature implemented an initiative to ban smoking in closed spaces of gathering (such as restaurants and hospitals). In Ireland, for example, increased tax rates on cigarettes have been complemented with a ban to smoke at work place settings (i.e. office buildings and other business locales). The results clearly indicate that this is also an effective way to combat smoking prevalence. In Ireland, for example, “the work place smoking ban resulted in a 79% decrease in exhaled carbon monoxide, an 81% reduction in salivary cotinine and significant reductions in self-reported respiratory symptoms”.

Finally, after having considered factors that have mainly affected the demand side of life insurance packages, it is also necessary to consider the supply side. Specifically, organizational factors affecting insurance companies (and their ability to improve the quality of the services offered, as well as the accessibility to life insurance) must be considered in order to finally combine all of the factors that account for the increased accessibility to life insurance among elderly Americans.

First of all, quality improvement should be reviewed (as it pertains to services offered, namely life insurance). Quality improvement has always been a priority in the healthcare as well as insurance industry (which is closely entwined with the former). In an attempt to foment quality improvement within the industry, organizations have started to pursue a new model. It aims at elevating the coverage and quality of service while decreasing the costs. In other words, the main objective of insurance companies today is to offer higher quality life insurance packages at lower annuities and premium fees. This is a challenge shared by the industry in its entirety; national policy requires that health care services improve in quality, economy, and coverage. However, through the use of specific data collection methods, vital information related to the organization’s efficiency (including communications, inventories, and technological infrastructure) and quality of service (including customer satisfaction, physical infrastructure capabilities, and screening score percentages), insurance companies can improve their target market’s assessment and ultimately develop a more appealing value offer.

The second factor of great importance to be considered is marketing. Marketing is a business orientation that allows businesses to communicate, deliver, and exchange their value offers in an effective way. Marketing strategy may ultimately enable a company to secure sustainability, growth, and overall integral development. Marketing efforts are instrumental for any product’s success. In today’s world, successful marketing strategy comprehends a highly integrated synergy that highlights the importance of a straightly aligned marketing communications strategy (generally known as integrated marketing communications). Inside of this marketing synergy, there is also the need for effective and efficient promotion mix and message strategies.

Furthermore, in considering the 4 P’s it becomes evident from the very beginning that the offered business’s key elements are the following: product and promotion. The team recognizes that place and price are also important elements in guaranteeing the success of the offered employment networking service, but those two will naturally evolve just as long as the team manages to develop a high quality product and promote this product efficiently. In today’s world, the Internet has become the virtual environment in which all businesses engage in business transactions (as well as marketing efforts). The problem is that there are countless other services available in the World Wide Web. This is precisely why promotion becomes so important for the business’s success. It is fundamental that those interested in searching for an employment networking service are enticed by visible, efficient, and attractive promotion. Once they have coped with promotion they will consider the price element, but in the end they will decide whether or not the price is justified if the product meets their highest standards of quality. This is why the team is convinced that apart from promotion, the success of the business will be determined by the quality of the product itself.

In order to better understand the way in which insurance companies have proceeded in terms of marketing in recent years, MetLife will be considered. Having reviewed some brochures that the company hands out among its prospective customers, the first thing that must be mentioned is that the company attempts to create a value offer that focuses on interpersonal relationships. In this sense, the company (and its representatives in particular) is showcased as being friendly to people (in this case the elderly). Throughout the brochures, images of young, healthy, and happy individuals are presented. It is also important to note that these images imply the idea of diversity; African Americans, white Americans, and ethnic minorities (including Latin Americans) are included, thus stating that all Americans are welcome and will receive equal treatment. Continuing the previously idea, it becomes clear that the company attempts to enhance its value offer by attempting to relate with today’s society and befriend it. MetLife attempts to present itself as a company that cares about people, a company that cares about their needs. Also, it should be mentioned that MetLife’s marketing efforts place the focus on the Americans. The average (elderly) American is, therefore, the company’s top priority, and all life insurance options are designed in accordance with the needs of the elderly. In this sense, MetLife relinquishes all power to people.

Going beyond merely social considerations, and entering the realm of cultural ones, the observed brochures identify a series of cultural values that have characterized the American social establishment since its foundation. Some of these values include responsibility, excellence, tradition, perseverance, freedom, equality, integrity, and honesty. MetLife is a company that is built on long established market positions, including the brand value that it has earned over the history of high quality insurance services that dates back to 1868. The American society almost always votes in favor of quality, and it also believes in tradition. MetLife realizes this, and this has been the focus of the company’s marketing efforts. It also goes without saying that the images included in the company’s brochures are consistent with the aforementioned values; the images evoke commitment to excellence and towards people.

At the beginning of this paper it was claimed that improved governmental healthcare measures, coupled with changing lifestyles and supply-side factors (primarily marketing efforts), have all contributed to the increased popularity of life insurance services by the elderly Americans. Having reviewed the facts, it becomes clear that the sustained increases in accessibility to life insurance, especially among the elderly American population, owes to all of the aforementioned practices. Perhaps the most important factor has been the continuous commitment of government towards improving the quality and coverage of health care services. However, it is equally clear that social factors such as changing lifestyles have not only resulted in healthier people, but have also become significant in explaining why there are more elderly Americans soliciting life insurance today (relative to the amount of the elderly Americans soliciting life insurance twenty years ago). Finally, it is very important to point out that insurance companies such as MetLife have also contributed to the increased accessibly to life insurance packages. Life insurance is a private service; thus, insurance companies are private capitalist enterprises that strive to maximize the revenue and minimize the cost. In achieving this organizational optimization, MetLife has created an image that highlights quality, tradition, and commitment towards the needs and desires of the elderly Americans. The public has responded; needs have been met by a highly attractive value offer, and the inevitable results of it have manifested themselves in increased accessibility to life insurance.

Custom Life Insurance Accessibility to the Elderly Essay

Code: Sample20

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