Long Term Care Law Office Blog

THE CRISIS FACING LONG TERM CARE INSURANCE HOLDERS

Written by Steven Dunn in category 
May 15, 2019

America’s seniors are living longer than at any other time in history. At the same time, the cost of senior health care has never been more expensive. With this in mind, millions of hard-working responsible Americans purchased a long-term care insurance policy thinking that when the time came, their health needs would be taken care of. What people didn’t know was that in truth, when the time came the hurdles and challenges associated with actually receiving your policy benefits would be immensely difficult to navigate. 


THE ISSUES AND STRATEGIES: 

PREMIUM INCREASES. The first problem arrives before it’s time to activate your policy. The long-term care insurance companies badly misjudged both how long people would live and the exorbitant cost of care. The result is that they significantly undercharged for their products. As time passed and this became more and more apparent, these companies had to scramble to raise premiums in order to cover these miscalculations. Long term care policyholders are now faced with serious and difficult choices. They can pay the increase in premiums which in some cases can be over 100 percent or, take a reduction in benefits for a lower premium payment or, get rid of the policy all together. The option they choose will have a serious impact on their quality of life down the road. This choice is not something that should be done without expert consultation.

Advice is required for a number of reasons. First, many people don’t really know or understand what their policy benefits are so, they’re not fully aware of what they may be giving up. Second, there are strategies for addressing the premium issue. For most policies, there is a waiver of premium provision included in the policy terms. This means that if you are benefit eligible and activate your policy, you will no longer need to pay premiums.

BENEFIT ELIGIBILITY. What people don’t understand is that in many cases they are already benefit eligible. Long-term care policies do not require the policyholder to be bed ridden before benefits are payable. For most policies, all that is required to trigger benefits is stand-by assistance with two or more of the activities of daily living. In other words, all that is required to be claim eligible is for an aide to be nearby to make sure you are safely carrying out your activities. The aide does not need to physically assist you. This is not a high bar to meet. An expert can help you determine if you are eligible for benefits. 

For those of you who have hit the point in your lives where it is time for policy activation, here is what you can expected to face when you begin the process: 

THE ELIMINATION PERIOD. If you are not familiar with this, the elimination period is similar to a deductible. The policy will say that before benefits can be paid you must satisfy this period. This means that you need to receive covered services and pay out of pocket for however long the policy dictates. The elimination period can range anywhere from zero to 180 days. Planning and strategies are required to effectively and efficiently manage the elimination period. Waiting too long to satisfy the period can mean thousands more out of pocket. If money is an issue, spreading out the process and satisfying it over time will allow you to satisfy the period in the most cost-effective manner. 

CLAIM SUBMISSION.The process formally begins with submission of clam forms to the insurance company. Sounds easy enough but, don’t be mistaken. Mistakes in claims forms happen frequently, and mistakes will mean rejections, delays and requests for re-submissions. For people who need care now, these delays can be costly and potentially life threatening.

ASSESSMENTS. Once the claim forms portion of the process is complete the next step will be an insurance mandated assessment. The insurance company is legally entitled to have their own assessment done. The insurance company will almost always exercise this right. Many seniors are proud. They hate to admit when they need help, especially to strangers. The result of this mindset is that they underplay their needs. Doing this during an assessment can leave the assessor with the impression that you are in good health. The insurance company will then conclude that you are not claim eligible and therefore will deny your claim. Engaging an expert for this part of the process is very important. An expert with experience in the process can assist with claim forms. An expert will also inform you that you are allowed your own independent assessment. This is an option you are encouraged to take. A home health provider can perform an assessment for you. It is crucial to choose a qualified and experienced provider that can properly and professionally carry out the assessment.

RECEIVING AND DOCUMENTING CARE AND GETTING PAID. Once the assessment process is complete, the insured can now begin to receive care. The invoices for care as well as proper care notes and documentation will need to be submitted to the insurance company on a regular basis. Mistakes and errors in the invoicing and documentation can result in denials, underpayments and late payments. It is imperative that the documentation be filled out correctly. Documentation should be continuously reviewed for errors so these issues can be avoided.

GET PROFESSIONAL HELP FROM THE BEGINNING. The process outlined above is complex and nuanced. Mistakes at any step in the process can and will result in denials and delays. Often times, these denials and delays can result in thousands of dollars out of pocket or, for those who don’t have the means to pay for their care out of pocket it can mean no care at all.

Our firm is well versed in this process and has dealt with all these issues. Our firm can help facilitate the care process, guiding you every step of the way. For those who have already been denied, our firm can assist in rectifying the denial and help get care started and paid for. Our firm can also assist in reinstating lapsed policies, facilitating a move to an assisted living facility or assist by recommending the best care providers in your area.

Your long-term care policy is too valuable to leave up to chance. Engaging experts is a smart investment. Don’t leave your care up to chance- get help. 

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