Long-Term Care Insurance: How To Use a Policy and File a Claim
By Lisa Vogel
When a loved one needs assistance at home to continue living independently or needs to move into a care facility, long-term care insurance (LTCI) can be a big help in making that care more affordable. Unfortunately, accessing these benefits can be challenging, especially at a time when families are already feeling overwhelmed. As soon as a loved one with one of these policies begins requiring an increased level of care or meeting eligibility requirements of their policy, it is important to gather the following information and file a claim as soon as possible. Some families do not even know if their loved ones have a policy or not. The first place to start is to try to find any records of policies and/or premium payments and see if the policy is still in-force.
If a policy was purchased some time ago, it probably does not have a death benefit. This means if you do not use it, you lose it. Medicare does not cover most of the costs of care, so it is important to take advantage of LTCI benefits if you have them.
If your loved one does in fact have a LTC insurance policy, the next step is to clarify all of the specifics of that policy. Since most families are overwhelmed enough just trying to secure help for their loved one, it can be beneficial to have another person involved who can help you navigate this process.
Some care providers will even offer to call your insurance company for you or with you to help iron out coverage and payment details. For instance, if you have already hired a home care agency, or are considering possible agencies, check with them to see if they offer this as part of their services. If they do, you will need to sign an authorization that gives the agency permission to speak with your insurance company on your family’s behalf.
Whether you or your care provider contact the insurance company, there is a list of preliminary information to gather about the policy. You will want to know the answers to these questions before you submit your first claim. (And hopefully whoever bought the policy was aware of these terms at the time of purchase!)
Things to know about your long-term care policy:
- How much is the benefit? The first thing to find out is exactly how much money you can receive. LTC policies are written in a daily benefit, and this benefit might consist of a pre-set daily limit until the lifetime maximum is reached or a pre-set cash amount for each day you require care, whether you receive services on those days or not. These stipulations vary.
- How long will the benefit last? The length of the benefit could be three years, five years, or even the remainder of the policy holder’s lifetime. This is important to know for long-term planning purposes.
- What are the benefit triggers? Before a policyholder can begin receiving benefits, he or she must meet certain conditions or “benefit triggers.” Most policy triggers require a policyholder to need assistance with at least two Activities of Daily Living (ADLs). Benefits for those with cognitive impairment are handled by different companies and policies in different ways.
- What kind of care does the policy cover? Does it just cover in-home care? What about facility care like skilled nursing or assisted living? How about adult day care services? There are many types of care available, so it is crucial to know which ones you can include in your care plan.
- Is there a waiver of premium? Most policies contain this clause, which means once you start claiming care, you no longer have to pay the premium. Annual premiums typically increase every year and can be very expensive, so be sure to ask if this waiver applies.
- Is there an elimination period? Like a deductible on health insurance, this is usually a period of time (instead of a set monetary amount) that care costs will have to be paid out-of-pocket before the insurance coverage kicks in. Some plans have a zero-day elimination period so you can begin receiving benefits immediately, but others have 60-day, 90-day, or even 120-day elimination periods. If your policy has a longer elimination period, you might still end up needing to pay a large sum of money out-of-pocket. According to longtermcare.gov, “Some policies specify that in order to satisfy an elimination period, the policyholder must receive paid care or pay for services out of pocket for the duration of said period.
- Are there coverage exclusions? Many policies will not cover care needs that have resulted from drug and alcohol abuse, mental disorders and self-inflicted injuries. Make sure your loved one’s health conditions do not exclude them from receiving benefits.
Once you have all of the above information, you and your family can make a much better decision about your care options. When you are ready to file a long-term care insurance claim, you will need to obtain and fill out an initial claim packet.
You or your care provider can call the insurance company to obtain this packet of forms. Some insurance companies also make their forms available online. Each company’s insurance claim forms will be different. Some of these components may be combined or titled differently, but a claim packet will typically include the following items.
Long-term care insurance claim documents
- Policy holder statement: Also known as a claimant’s statement, individual statement, insureds statement or care support history, this set of forms will require basic information (name, address, phone number, date of birth, policy number, etc.) about the policyholder. It will also ask for explanations regarding the reasons for submitting this claim, what activities help is needed with, and how long help will be required. This component usually includes sections related to hospitalization and care history as well. This multi-page statement will need to be signed by the policyholder or their legal representative.
- Attending physician statement: This form will be completed by the policyholder’s primary care physician (or the physician at their long-term care facility) to verify that certain levels of care or assistance are medically necessary. The physician may need to attach test results, office notes, medical records, and other supporting documentation to this statement.
- Nursing assessment/plan of care: Most insurance companies will not approve a claim without a nursing assessment and/or a prescribed plan of care. Sometimes these components will be included in the physician’s statement mentioned above. Your care provider should have a nurse on staff who can conduct and write up this initial assessment which will include vitals, demographic information and medical history. The nurse will also complete the plan of care, which describes the type of care that will be given. A physician, licensed professional nurse, or social worker may have to sign to certify this information is correct.
- Provider statement: If the policyholder is currently receiving care services, each care provider (nursing facility, home care agency, etc.) will need to complete and sign these forms to verify that it is equipped to provide the necessary care. The provider will also need to submit proof of proper licensure, certification, etc.
- Authorization to release information: This form ensures compliance with the Health Insurance Portability and Accountability Act (HIPAA) and permits the insurance company to collect health care documentation from care providers in order to process the policyholder’s claim. This form must be signed by the policyholder or their financial power of attorney or legal guardian. If someone is signing this release on the policyholder’s behalf, they will need to include a legal copy of their durable POA or guardianship documentation. (Keep in mind that a health care power of attorney, also known as a health care proxy, will not be able to sign on behalf of the policyholder.)
Once the initial claim packet has been sent to the insurance company, a care coordinator or employee with their claims department will typically call the policyholder or their legal representative for a telephone interview about the information that was provided. Afterwards, it will often take 30 to 45 business days for a complete claim to be approved or denied. If the company needs additional information or is unable to reach a decision, they should contact you.
Managing long term care insurance claims is not easy, but knowing what benefits are available to you and finding an informed care provider who can help you maximize those benefits will help you choose the best care plan for your loved one and your family.
Lisa Vogel is the owner and founder of The Lisa Vogel Agency , an in-home care provider based in Stevenson, Maryland.