By Ryan McNeill, Attorney at Law
Many financial planning experts recommend purchasing long-term care insurance. Long-term care policies may cover part of the cost of at home health care, assisted living, nursing home care, or some combination of the above, depending on the plan. At the point in time you need to use the coverage – either for a single incident or a permanent change in your health – you must file a claim to receive your benefits.
According to the American Association for Long Term Care Insurance (AALTCI), in 2015 insurance carriers paid $8.16 billion in long-term care claims to more than a quarter of a million plan holders. In many cases, these claims are filed by family members on behalf of the person needing care. It is good practice to have completed a durable power of attorney and have that on file so the insurance company can legally speak with your representatives. You may also wish to send them a copy of your health care power of attorney, just to be certain you cover all contingencies.
Following these steps may improve the chances of your claim being paid when initially filed:
- Carefully review the terms of your insurance coverage to determine exactly what services are covered and in what environments. Older policies may restrict coverage to care received in a nursing home and exclude care at an assisted living facility or at-home care. If you have misplaced your copy of the policy, you may request one from the insurance company.
- Understand how your insurance policy determines your eligibility for benefits. This is called the “benefit trigger.” Your doctor will need to provide documentation based on the specific rules. Today’s policies typically use a standard measure based on your ability to perform activities of daily living (ADL). These activities include bathing/showering, personal hygiene (brushing teeth, styling hair, etc.), dressing, toilet hygiene, eating, and functional mobility. Mental or cognitive capacity (impacted by Alzheimer’s, dementia or stroke) or other activities may also be considered triggers. The triggers will be defined in your policy.
- Does the policy specify an elimination period where you pay out of pocket for care until coverage kicks in? A 90-day period is popular on many policies. Also look for a definition of how days are counted; for example, if you have in-home care every other day (50% of the time), your policy may only count the days you have care toward the 90.
- Make sure you and your doctor(s) have a care plan defined before filing your claim. Insurance companies want to know details about your current and expected future care. You will also want to make sure the facility and care providers you choose are considered eligible under your policy.
- Have all your receipts and documentation of related care available. Communicating with the insurance company in writing is best; if you have phone conversations, document the date and time, name of the person you speak with and details.
Once the claim has been filed (along with the appropriate documentation), the insurance company will likely interview you or, if you are unable to be interviewed, the primary nurse or caregiver, before approving payment of the claim.
If your claim is denied by the insurance company, carefully review the reason for denial. If it is simply missing paperwork or something you can remedy, do so and refile the claim. If you believe you have complied with the terms of the policy but have still been denied, you may wish to speak with an elder law attorney to understand your rights.