Long-Term Care Insurance Essential Guide


Welcome to our Long-Term Care Insurance essential guide, prepared to give you all important information about Long-Term Care insurance and common practices used by insurance companies to deny those claims.

Do you have a long-term care insurance policy? What would happen if you could no longer perform certain basic daily tasks that are essential to self-care? Who would take care of you? Unfortunately, this scenario is increasingly common for our aging community. Consider:

  • A majority of people over the age of 65 will need some type of long term care.
  • A higher percentage of older women will need care than their male counterparts.
  • The length of time that care is required varies, of course, and is also on average longer for women than men.
  • About 14% of the population will need long term care for more than 5 years.

But do not let these statistics frighten you.

You can plan ahead by investing in a long term care (LTC) insurance policy, as many Americans do as they begin to think about retirement. That way, in the event you need daily support, you can rest assured as it’s part of your insurance portfolio.

Unfortunately, many insurance companies are primarily focused on financial gain rather than promises that they made to their policyholders. As a result, insurers are incentivized to find every means possible to deny or delay insurance benefits.

This guide will provide or explain:

  • A description of Long Term Care (LTC) insurance;
  • What activities of daily living (ADLs) are and what you have to prove;
  • The claim process;
  • How to get organized before submitting a claim; and
  • What to do if your claim is denied.

What is Long-Term Care Insurance?

Many different companies offer long-term care insurance. In general, LTC insurance is designed to cover the cost of providing care assistance with activities of daily living (ADLs).

LTC insurance provides coverage for the costs of care which are not typically covered under Medicaid, Medicare, or health insurance. Accordingly, insurance experts (i.e. those selling the policies) advise that individuals planning for retirement purchase an LTC policy when they are between 45 and 55 years of age.

Each policy is different and the benefits provided within each will vary.  As they say, the devil is in the details or, in the case of LTC policies, in the complex clauses contained within them.  LTC policies often include provisions for a range of benefits, which may or may not apply. You will need to analyze at the specific provisions of your policy to see what is covered, but some of the benefits may include:

  • Care in the home, including a live-in caregiver;
  • Care at a residential facility, nursing home, or similar;
  • Adult day care;
  • Caregiver support, including light housekeeping;
  • Physical and rehabilitation therapy;
  • Occupational and speech therapy;
  • Nursing care;
  • Costs of assisted living;
  • Help with bathing and dressing;
  • Alzheimer’s specialist care, including a wide range of support services

The list above is not exhaustive, but demonstrates the range and variation of benefits that a LTC insurance policy holder may be entitled to depending on the terms of their specific policy.  

The Importance of ADLs

Benefit triggers are conditions that the insured must prove or trigger in order to qualify for a benefit.  In the case of LTC insurance policies, a typical example is that the insured must prove they are unable to perform two of six activities of daily living (ADLs) or be shown to have a severe cognitive impairment, prior to qualifying for benefits.

The most common ADLs include:

  • Eating
  • Bathing
  • Dressing
  • Continence
  • Going to the bathroom or toileting
  • Transferring/Mobility – getting in or out of bed, or a chair

As you can see, these ADLs are routine daily activities that a healthy person should be able to perform without assistance.  Being able to perform ADLs is a good indication that you are capable of independent living, and that is why they are used to determine eligibility.

There are a variety of different policies and benefits. LTC insurance typically provides a per diem amount to cover the costs of care needed to assist you with these activities of daily living. Most, but not all, LTC policies have a 30 to 90 day waiting or elimination period before benefits start. It is essential that you understand the fine print of your policy because each insurer’s LTC policy is different and each contains specific language that spells out the terms and conditions of the insurance and qualifying for benefits. 

For this reason, obtaining the advice of an insurance lawyer early in the claim filing process as possible is the best practice. Donahue & Horrow LLP not only understands the detail and nuanced language within the LTC policies, we have experience in collecting key data and information to mount a successful challenge to any claim denial. Our track record of success speaks for itself.

Compelling Ancillary Benefits of Long-term Care Insurance Policies

Many of the benefits of owning a LTC policy extend beyond the policy itself to things like the well-being of family members who otherwise might be responsible for your primary care. Some of these ancillary benefits include:

  • The relief to family members and children from the burdens of providing daily care support, so they can continue living their lives as normal;  
  • Reducing the out-of-pocket cost of your long-term care. Without a policy, out-of-pocket costs can quickly deplete savings and other assets, reducing the overall quality of life not only for yourself, but for loved ones left behind, and
  • In some cases, long-term care insurance premiums are tax-deductible – the specifics will depend on the type of policy and the date on which it was first purchased.  You will want to consult your tax professional for guidance.

To be clear, LTC insurance policies can contain significant benefits, but many policyholders are not prepared for the battle that may lay ahead of them should their claim be denied. Even more challenging, an insured may have to demonstrate they suffer from at least two deficits on the ADL list (require assistance with eating, bathing, dressing etc.) and if his or her claim is denied will be required to support the claim despite while at the same time the insured is faced with a medical impairment; it’s simply not a level playing field.

Let our team of experienced long-term care insurance lawyers fight on your behalf. We offer case consultations completely FREE of charge. We will discuss the circumstances of your case, explain your options, and answer any questions that you may have. If you decide to pursue action we will take your case on a contingency fee basis, which means we are only paid when we recover compensation on your behalf.

Long-Term Care Insurance Essential Guide – Claim Denials, Some of the Likely Reasons

As with all insurance policies, the devil is in the details. With a wide range of insurance companies offering LTC plans, policy language may vary significantly. Policies are also often written in a style that many consumers find difficult to read. Because of this, many policyholders do not spend enough time thoroughly reviewing policy details before they sign the contract or file a claim. Or said another way, policyholders do not understand the terms of the contract when filing a claim.

Without reading the specifics of the insurance company’s denial decision, we cannot know why your claim may have been denied. Insurance companies deny claims for several reasons, with some of the more common ones including:

  • Insufficient documentation to support the claim;
  • Improper billing for care provided;
  • Care must be provided by a licensed caregiver and yours is not;
  • Care provided by a family member, which some policies explicitly do not allow;
  • Exaggeration of the extent of the condition when reviewed by the insurance investigator;
  • Material misrepresentation in the original application; and/or
  • Policy lapse, i.e. the policyholder stopped paying for coverage prior to the claim.

Whatever the reason for the insurance company’s denial decision, if you think that their decision was wrong, you should contact an experienced attorney to review the denial.

Some of the Tactics Employed By Insurance Companies

Insurance companies actively manage their bottom line by hiring unscrupulous investigators who question everything – including medical records – and take aggressive steps to deny claims. Their primary concern is typically not the health and wellbeing of their policyholders; they are protecting their financial bottom line. At Donahue & Horrow LLP, we have unmatched experience fighting unfair and underhanded tactics. Our strong track record of recovery on behalf of our clients speaks for itself.

While insurance companies evolve their techniques to deny or delay claims, we update our tactics for pursuit and recovery. Recent trends in insurance company denial of claims include:

  • Lack of evidence to support the claim;
  • Insurance firms increasingly rely on surveillance tools and techniques that are subsequently used out of context to deny a claim;
  • Detailed examination of health records – doctor’s visits, medications, etc for an extended time period leading up to the claim; 
  • The patient’s physician will be discredited based on an insurance company physician, also called an “independent” medical examiner (IME). It is common for an IME to rely on the medical records of an attending physician while conveniently not speaking directly with the attending physician; and
  • Detailed social media evaluation to determine if claims of assistance are inconsistent with what appears on Facebook, etc.

Other Considerations

LTC policies are written by different insurers, and even different classes of policies written by the same insurer, are different. Primary variances include:

  • Amount of and length of payout;
  • Waiting time period;
  • Taxability of benefits; and
  • Exclusions

Long-term care insurance and private disability plans are diverse, complex, and replete with all manner of exclusionary conditions. Each insurer writes their own unique policies in language that may serve their own corporate purposes and not necessarily policyholders. If you believe your insurance company is inappropriately and unfairly defining limits of your benefits policy, contact Donahue & Horrow LLP. The sooner you contact us, the better. We know the tricks of the trade that insurance companies use to deny claims. We help policyholders like you to avoid the pitfalls. We provide consultation for FREE.

Key Provisions In California Law

The state of California has specific and unique regulations that govern insurance claims. Some of the most important are listed below.

California Fair Claims Settlement Practices Regulations

California leads the way legislatively to help treat insurance policyholders more fairly by national insurance companies. Some of the specific language in place includes “California Code of Regulations,” Title 10, Chapter 5, Subchapter 7.5:

  • “Where an insurer denies or rejects a first-party claim, in whole or in part, it shall do so in writing and shall provide to the claimant a statement listing all bases for such rejection or denial and the factual and legal bases for each reason given for such rejection or denial which is then within the insurer’s knowledge.”
  • “(d) Every insurer shall conduct and diligently pursue a thorough, fair and objective investigation and shall not persist in seeking information not reasonably required for or material to the resolution of a claim dispute.”
  • “(g) No insurer shall attempt to settle a claim by making a settlement offer that is unreasonably low.”

Getting Organized

A denial of a claim is the last thing you need when a loved one needs assistance with care at home or in a facility. So, it’s crucial that you organize your documentation before submitting your claim. Here are a few important suggestions prior to submitting your claim.

Not all policies are created equal.

Read the fine print – what a policy contains will largely be dictated by the timeframe in which it was formed. Significant changes have occurred in the long term care insurance industry and as costs have escalated, the provisions in the respective policies have become more restrictive.

Understand what your policy does and does not cover.

Older policies might provide benefits for nursing home expenses, or home care benefits – but not both. More recent policies will often cover both. If you are limited with two or more ADLs, like eating, dressing, or bathing, it’s generally accepted that that will be sufficient to meet your policy criteria for LTC benefits. Policies issued after the year 2000 require that benefits can’t be denied without an assessment from a licensed medical care provider. Familiarize yourself with the details; it will reduce the chances of a denied long term care claim.

Written confirmation required

Your physician must provide written confirmation that you cannot perform certain daily activities. Without written confirmation, your claim will be denied.

Include lots of evidence. The more the better.

This can include medical test results, x-rays, MRIs, daily care notes from physical therapists, in-home care provider notes, and your own daily diary that chronicles your restrictions.

All post-submission communications must be in writing.

Once you submit your claim, make sure all communication is done in writing. If that’s not possible, get the name of the insurance representative and follow-up in writing confirming the conversation and main points that were discussed. This will provide you with an audit trail should you need it to defend a claim denial.

The Waiting Game

Once you have submitted your claim, be ready for your insurer to request an assessment in person or by telephone. If that happens, be sure to have a family member or caregiver present during such interviews.

Insurance companies are famous for stalling claims. Their hope is that you will give up. Don’t.

Fight for what you deserve. Many insurers intrinsically understand that the policyholder is in distress and vulnerable. They will use those vulnerabilities to their advantage. That’s where Donahue & Horrow LLP can help to get what you have faithfully paid for – and rightfully deserve.

Here are a few well-known strategies that insurance companies use to stall or deny a claim:

  • They’ll loosely interpret the terms of the policy to their advantage.
  • They’ll say they did not receive certain documents.
  • They commonly use their own doctors to justify a denial of your claim.
  • They will conveniently refrain from telling you about the scope of your benefits.

Your Long Term Care Insurance Claim Has Been Denied. Now what?

The attorneys at Donahue & Horrow LLP are highly experienced at helping claimants fight against long term care insurance denials. If you believe that your claim has been inappropriately denied, you may be the victim of a bad faith denial. The sooner you contact us the faster we can get to work on your behalf. Remember – the initial consultation is FREE.

Time is of the essence if you’ve received a denial. Your insurance provider is hoping you will take the denial at face value and give up. Instead, consider the following:

  • When you need daily assistance and you are coping with a lot of pain, you could easily forget important details over time that are crucial to your lawsuit. Memorialize everything in writing.
  • Your denial will have specific instructions including the timeline for an appeal. It is important that you appeal within the allocated time or you risk having to start the claims process over again.
  • Make sure you have all updated medical records ready for the insurance company to review. This should include any objective testing, such as MRIs, X-Rays, CT Scans.
  • Get a letter from your physician and all licensed healthcare professionals involved in your care, to affirmatively state that you or your loved one needs assistance with activities of daily living (ADLs). There are typically six activities of daily living that come under the qualifications of proof of long term care insurance benefits. You typically need only qualify for two to satisfy them.
  • Keep a daily journal of your challenges with your ADLs. Note down what happened, where it happened, and when. A video or audio record of your challenges can be hard to refute. We highly recommend this approach.
  • Write a brief statement as to why you now need assistance with your activities of daily living. Explain what changed. An experienced long-term care insurance claim denial lawyer can be very valuable with this step, as attorneys know what types of information and statements the insurance companies will find credible.
  • You can also include a brief statement from close family members about how your life has changed and why you can no longer do the things you once did. All the better if these people, such as a spouse or child, now help you with your ADLs.
  • Provide information about any assistance you are currently receiving. For instance, if you pay for care out of your own pocket, include the invoices, and a statement from the person providing the care describing what duties they perform for you. Bear in mind, this documentation must be 100% accurate.

Call Donahue & Horrow:

With Donahue & Horrow LLP, you will receive compassionate and highly skilled legal representation. We know how hard it can be for a family and their loved ones to suddenly and unexpectedly need day-to-day at-home assistance. Facing the daily – and hourly – challenges of long-term care can be emotionally and financially devastating. We believe that denial is unacceptable when a person has faithfully paid for their long-term care insurance benefits. When you reach out to us, we know that your dignity and respect are on the line. We will fight tenaciously to make sure you get what you deserve. Our team has helped hundreds of clients in California, successfully recovering over $160 million in benefits. Contact us today.