Recently, I had the opportunity to speak at the Private Care Association National conference in Orlando, Florida. My talk at the conference focused on a number of different long-term insurance care issues.
One of the main issues I spoke about was the necessity of Providers understanding and taking an assignment of benefits from their clients. For those who are not familiar with the assignment of benefits, often times referred to as an AOB, the AOB is an agreement or arrangement between an insured and the Provider, by which the insured directs the insurance company pay applicable long term care insurance benefits directly to the provider, and to allow the provider access to all policy information necessary to perfect the claim. In the context of long term care, the AOB removes the client from the complicated approval and LTC insurance billing processes.
Throughout my career in the long-term care insurance space, I’ve come across a multitude of providers who for a variety of reasons, refuse to take an assignment of benefits from their clients. Often providers tell me that taking assignment adds to their back-office costs and negatively affects cash flow, or they argue that collecting payment from their client rather than from the insurance company directly is just easier to handle. “Let the client deal with the insurance company” is a common sentiment in the industry. While I understand that the assignment of benefits can seem daunting and these views on taking the assignment may have some merit to a provider that is not proficient in long term care insurance claim submissions and processing, I argue that failing to take the assignment is a serious mis-calculation on the part of providers.
Why should providers provide care under an assignment of benefits?
The simple answer is because it is good and smart business, and more importantly, it is a real and crucially needed service for the client.
An AOB is a legal device that gives providers rights that that they otherwise would not have. The AOB gives providers legal standing to bring direct legal action against the long term care insurer for a denied or short paid long term care insurance claims. Instead of worrying about collecting from the client, with an AOB, a provider can take recourse directly against the insurance company. This not only creates extra protection for the provider’s receivables, but it also removes the possibility of having to bring legal action against a client- something no provider ever wants to do. In many states there is the added benefit that if legal action is required against the insurance company and the provider prevails, the insurance company will have to cover the provider’s legal costs. Taking an LTC insurance assignment is the smartest insurance policy you can have.
Lastly and arguably the most important benefit of taking an AOB is that doing so allows a provider to be competitive in their market by offering a deeper level of advocacy to its clients. If the competition isn’t taking an AOB but you will, potential clients will see significant value in that. No client is in a position to take on the complicated LTC claims process, particularly a client who is trying to simplify her life rather than complicate it. As such, an AOB brings convenience and peace of mind to the client in knowing there a strong and competent advocate handling their long term care insurance claim. Alternatively, if you are in a local market where taking assignment is commonplace but you for whatever reason have not yet committed to doing so, then you are missing opportunities. Don’t let your competition get ahead just because you don’t think you can manage an assignment of benefits and all of its implications. The key to taking an assignment is fully understanding LTC policies, their nuances, and all that is necessary to properly advocate the claim. So what if a provider does not possess the knowledge and experience, or does not have the bandwidth to learn about and manage LTC claims for an insured?
Is there an experienced company that will take the assignment from the insured and handle all of the claims processing for the policyholders and providers?
The answer is yes. I am the founder and president of Paradigm Claims Services. Paradigm is a company that advocates for seniors and providers in the long term care insurance space. Paradigm accepts assignment from the policyholders, presents the claim to the insurance company, and processes and manages the claim throughout. Paradigm’s services will allow the policyholder to receive care without worry, and allow providers to do what they do best- provide care. For more information about Paradigm, visit the website at www.paradigm-claims.com or contact a Paradigm representative at 786-254-7688.