Your parents told you “they never wanted to be a burden” and had the foresight to purchase a Long Term Care Insurance policy. But what happens when you or your loved one needs to file a claim for benefits?
Often, when people are in the midst of a health crisis, the process of filing a long term claim can be daunting. Our hope is to provide you with some valuable advice for filing your Long Term Care Insurance Policy claim to help get you the benefits that were proactively planned for.
Review the Policy:
Before initiating a claim it is important to review the policy to get a clear understanding of the terminology and benefits of the individual policy. The face sheet of the policy often gives you a general overview of the policy benefits.
The pages that follow, however, are extremely important to read and understand. The verbiage used may be ambiguous and confusing.
It is not “by accident” that the language in these policies is at times ambiguous and vague.
It is by fully understanding these nuances in policy language that you can maximize your benefit and ensure getting a claim approved which is called “getting on claim”.
Speak to a Professional
If you do not have the policy in its entirety, calling the insurance agent who sold you the policy is a good first point person. The agent may also give you relevant information about initiating the claim, phone numbers, etc.
Now you need to contact the Insurance Company but before you do it’s critical to know what questions you may be asked since this is the way the company determines if the individual meets the long term care criteria.
The policy may offer a Care Management Benefit, as well. If it does, determine if you can hire your own or if you need to use theirs. Also, ask if there are any incentives to using the company’s care manager. Keep in mind, they are hired by the insurance carrier and may have their own agenda when assessing needs and developing a plan of care.
If the policy allows for an independent care coordinator; take advantage of this option as this person can also be your advocate for getting person on claim. They can ultimately save you time and money and educate you about the process.
Even if the policy does not cover the cost of an independent care coordinator, a consultation with a private Care Advisor may be worth considering.
What “Triggers” or Qualifies You To Initiate a Claim?
Typically, to qualify for benefits a person must be certified by a licensed health care provider (Doctor, Physician Assistant, Nurse, or Licensed Clinical Social Worker) that the person is in need of assistance with 2 out of 6 ADL’s (Activities of Daily Living), or have a significant documented cognitive impairment.
All too often during the initial claim process, families might not know the lingo necessary to qualify their loved one for a claim.
What NOT To Do When Filing a Claim
A big mistake people make are emphasizing IADL’s (Instrumental Activities of Daily Living) care needs such as shopping, cooking, housekeeping, driving, and medication management. Although these issues are noteworthy they are not ‘care needs’ that will qualify for care in the LTC policy. It is essential to communicate the need for assistance based on two of the ADL’s below or cognitive impairment.
ADL skills are considered:
- Bathing: washing yourself by sponge bath; or in either a tub or shower, including the task of getting in or out of the shower
- Dressing: putting on and taking off all items of clothing and any necessary fasteners, braces or artificial limbs
- Transferring: moving into or out of bed, chair, or wheelchair
- Toileting: getting to and from the toilet, getting on and off the toilet, and performing associated personal hygiene.
- Eating: feeding yourself by getting food into the body from a receptacle (such as a plate, cup or table) or by a feeding tube intravenously
- Continence: the ability to maintain control of bowel and bladder function; or when unable to maintain control of bladder or bowel function, the ability to perform associated personal hygiene (including caring for a catheter or colostomy bag).
- Cognitive Impairment: A deterioration or loss in intellectual capacity which places the “identified person” in jeopardy of harming yourself or others unless they receive assistance. The cognitive loss must be established by clinical evidence and standardized tests which reliably measure: short or long term memory. Impairment with deductive or abstract reasoning; or judgment as it relates to safety awareness.
Who Determines if you Qualify for Services?
This is another important component to be aware of when attempting to qualify for the claim. Some long term care companies have their own practitioners (nurses or social workers) who meet with the client to do a face to face assessment of care needs. Other LTC companies require the individual’s primary physician to document care needs on their long term care forms.
Other policies offer you the option to hire your own independent care advisor to complete an independent evaluation of care needs and develop a plan of care. In any of these situations it is critical that you or another person is present to advocate on your loved ones behalf. We have often encountered that the person in need of help may innocently minimize their need for care; wishing to remain as independent as possible, or they might lack insight or be embarrassed by acknowledging their need for assistance. This can undermine the claims process by appearing to “well” to qualify for a claim.
Another issue that may arise is when a person is in the early stages of dementia, they may present as alert and oriented and more competent than they really are based on their presentation at time of interview. Having a family member or representative present is essential to provide relevant information and examples of a person’s cognitive impairment.
Providers of medical or nursing care are often asked to complete documentation and may need some “education” on how the form should be completed. This is another area where the assessments may not accurately describe a person’s cognition or the reasons a person may need ADL assistance.
Is there an Elimination Period that Needs to be Met?
The elimination period is the length of time that a person must wait before the policy pays/reimburses the cost of care. Some policies may have no elimination period while others can have 100 days or more.
The elimination period is like a deductible but there may be specific criteria that must be satisfied before benefits begin.
Many times in policies there might be nuances that allow for different ways to satisfy the elimination period. For example, in some policies hospitalization does not count toward elimination period but time spent in a subacute rehabilitation facility or homecare covered under Medicare might qualify for some of the elimination days.
In addition, some policies offer incentives of reducing or waiving the elimination period if they use the LTC policies care coordinators or preferred providers. Other policies might have a formula that allows one hour of paid care a week to qualify for 7 days of the elimination period. These are just some common examples of the differences in each policy but are crucial to understand to make decisions accordingly.
What is the Daily Benefit?
The daily benefit is the amount of money the company will pay per day towards care. Some people may have purchased policies that have an inflation rider. If this is the situation the daily benefit may have increased over the years. Policies also vary in how they will pay benefits and to whom. Some policies pay the provider directly if there is an assignment of benefits form on record. Other policies will only reimburse directly to the insured. Some policies allow for spouses to share a pool of money. All these individual benefits should be explored from the start.
In addition it is important to understand what type of provider qualifies as acceptable care. Does the care have to come from a Licensed Home Care Agency? Does the Assisted Living facility need to be approved by the Insurance Company? One of the biggest upsets is when families have been paying privately for care to satisfy the elimination period only to learn later that the care they are using was not considered an approved provider.
What is the benefit period?
This is how long the policy will cover the cost of care. It is described by years but is actually a pool of money that is available. In other words if the policy states a $200 a day daily benefit, but the cost of needed care is $100 a day, that policy would cover cost of care for 10 years. Some newer policies called indemnity plans offer cash payment to be used at person’s discretion. This means that if person has a $200 a day benefit, a check would be paid to the individual to use for anything. Payments would continue as long as the person met long term care criteria or benefit period ends.
It may be a good idea to look at your parent’s policy as well as your own to become familiar with their benefits. As you can see there is a great deal of information that needs to be understood. Having that information may make the claim process less challenging and help to insure a good outcome.
Jennifer Rogak, LCSW-R and Linda Schwarzmann, LCSW-R are co-founders of Senior Options Systems LCSW, LLP, a care management and counseling organization that specializes in assisting clients/ families with their long term care claims. They maintain their life and health insurance license to keep current with the complex and ever changing insurance industry. Their broad knowledge base of interpreting policies, getting clients on claim, and facilitating the coordination of care makes the LTC claim process more manageable. They are passionate about helping people get what they are entitled to and coordinating services when people need it most.