Long term care insurance policies provide benefits for elderly and other infirm policyholders when they can no longer take care of themselves. Successfully submitting a long term care insurance claim for benefits can be an uphill battle, however, as insurance companies look to protect their bottom line by poking holes in claims to avoid paying benefits.
Schwartz, Conroy & Hack, PC Partners Evan Schwartz and Michail Hack recently hosted a webinar entitled “Long Term Care Insurance Claims – What You Need to Know.” Below are some of the topics they discussed.
Long Term Care Insurance Policies
Most long term care policies are issued to individuals or jointly to spouses (or partners). Joint policies typically have a maximum benefit for both spouses combined; so if the total benefit is $500,000, and one spouse needs that entire amount, it will exhaust the benefits.
Policies issued in the 1990s and early 2000s were extremely generous – much more so than they are today – providing lifetime benefits, cost-of-living adjustments, and other premium features. Insurance companies oversold these generous policies, failing to appreciate how few would lapse and how long people would live and need care. Insurers who sold these policies are now trying to limit their liability by disputing claims. Many of the cases we handle involve these older policies.
Examine Your Policy Closely
Before you consider filing a claim, it is critical to examine what your policy covers, how much the benefit is, and what you must do to qualify for benefits.
Policies typically pay for nursing homes, assisted living facilities, home care, adult day care, home modification/adaptation services, and care coordination services. Your policy will lay out those details. For instance, if you have a home care benefit, does the care need to be provided by a licensed home care provider, or could a family member provide the care and get reimbursed?
Qualifying for Benefits
The policy language is particularly important to determine what is needed to qualify for benefits. Generally speaking, you must have physical or cognitive limitations that prevent you from living independently. Benefits are typically triggered when you can no longer perform either two or three activities of daily living (ADLs) from a list of five to seven ADLs, or if you meet the criteria for a cognitive impairment as defined in your policy.
Activities of Daily Living
Activities of daily living vary slightly from policy to policy, but generally they include: eating, bathing, dressing, toileting, continence, and transferring. Every policy defines the individual ADLs slightly differently, so it is important that you understand your policy’s definitions to determine if you qualify. For instance, in one policy, bathing is defined as the ability to wash oneself in a tub, shower or sponge bath. But another policy defines bathing as not only the ability to wash oneself, but also the ability to get in and out of the tub safely without assistance. Under the second policy, more people would satisfy the bathing disability requirement to qualify for benefits. They may not be able to get in and out of the tub, or they may not be able to do so without assistance because they are a fall risk.
Cognitive Impairment
Cognitive impairment is a benefit trigger in and of itself. While every policy is slightly different, it is generally defined as deterioration or loss in your intellectual capacity such that continuing supervision is required to protect yourself or others, and that this has been established by clinical evidence and standardized tests that reliably measure your short-term and long-term memory, orientation to place, time and person (as in who you and others are), and deductive or abstract reasoning. If you or a loved one has gotten to the point where you are leaving the stove on, leaving your front door wide open or forgetting to turn off the bath, then you may be a danger to yourself. Cognitively impaired people may fail to recognize their family members and may get belligerent around them, presenting a danger to others. Some policies require that cognitive impairment interferes with the activities of daily living in order to qualify for benefits.
Successfully Submitting a Claim
When you are ready to submit a claim, you must notify the insurance company, which will send forms and authorizations for you to fill out and sign. The insurance company will require that your claim have medical support from a physician who is qualified to diagnose your problem, whether it be orthopedic, neurological or cognitive in nature, and that there be a plan of care in place that is compatible to the benefits provided under the policy. Having a doctor who is qualified to attest that you are unable to perform the ADLs or are cognitively impaired and is willing to work with you on your claim is crucial to getting benefits. Your doctor’s diagnosis and report should be backed up with appropriate objective evidence, such as MRIs, X-rays or CT scans, as appropriate. In the case of cognitive impairment, a neuropsychological evaluation, which typically takes six to 12 hours to complete, is the gold standard for demonstrating functionality with regard to abstract reasoning, executive functioning, long and short-term memory, and other cognitive parameters.
In-Home Evaluation
Before determining whether you are entitled to benefits, the insurance company will frequently send a nurse or otherwise qualified representative to your home to evaluate you and your claim for benefits. You as the claimant should also provide a statement about how your physical or cognitive impairments are impacting your daily life and ADLs. Do not exaggerate, but do not hold back. It is not uncommon for claimants to sabotage their own claims out of pride; they are embarrassed to admit that they can’t do certain things, and they underreport some of their limitations. In addition, it is important to have someone besides the claimant present during the in-home visit to ensure thorough and accurate evaluation. That can be a family member, close friend or professional.
Schwartz, Conroy & Hack, PC represents businesses and individual insurance policyholders in claims and litigation against insurance companies. We make sure insurance companies keep the promises they made to policyholders like you. For more information on long term care insurance claims watch our complimentary webinar.
Contact us today for a free consultation.
Evan S. Schwartz
Founder of Schwartz, Conroy & Hack
800-745-1755
ESS@schlawpc.com