Tag Archives: Insurance Claims

Home Care Equals One-Third of All Long-Term Care Claims Paid in 2006

Home Care Equals One-Third of All Long-Term Care Claims Paid in 2006

A recent American Association for Long-Term Care Insurance study revealed that total long-term care insurance claims rose to $3.3 billion for 2006.1 This figure represents the highest amount of benefit payments to Americans for a one-year period ever.

Of the total, 34 percent of the insurance benefit payments made by eight of the nation’s largest insurers covered home care expenses. Additionally, 30 percent of benefits paid were for assisted living costs and the remainder, 36 percent, was allocated toward nursing home care. The largest single claim paid to date was more than $875,000. In fact, the largest claims paid by leading insurers ranged from well over $350,000 to one approaching $900,000.

The data also revealed that approximately eight million Americans now own long-term care insurance obtained individually or through their employer. The researchers concluded that the increasing amount of benefits paid to policyholders is proof of the growing need for long-term care insurance.

To encourage more consumers to buy long-term care insurance, The National Association of Insurance Commissioners has developed the following consumer guidelines to help you select the right policy:

·   The policy should cover at least one year of nursing home or home health care, including intermediate and custodial care. Nursing home or home health care benefits should not be limited primarily to skilled care.

·   The policy should also provide coverage for Alzheimer’s disease if the policyholder develops it after purchasing the policy.

·   Inflation protection is critically important. The policy should offer a choice between:

o   Automatically increasing the initial benefit level on an annual basis.

o   A guaranteed right to increase benefit levels periodically without providing evidence of insurability.

·   Your insurer should offer you a coverage summary that describes the policy’s benefits, limitations, and exclusions, and also allows you to compare it with others. They should also provide a long-term care insurance shopper’s guide that helps you decide whether long-term care insurance is appropriate for you.

·   There should be a guarantee that the policy cannot be canceled, non-renewed, or otherwise terminated because you get older or suffer deterioration in physical or mental health.

·   The insurer should permit you to return the policy within 30 days of purchasing to receive a full premium refund.

·   No requirements should exist that policyholders:

o   First be hospitalized in order to receive nursing home benefits or home health care benefits

o   First receive skilled nursing home care before receiving intermediate or custodial nursing home care

o   First receive nursing home care before receiving benefits for home health care

1 2007 LTCi Sourcebook published by the American Association for Long-Term Care Insurance

Consider Short-Term Health Insurance

Consider Short-Term Health Insurance While Looking for a New Job

If you find yourself in between jobs, you have already discovered that finding affordable health insurance is no easy task. While COBRA provides you the right to continue your previous employer’s coverage, the monthly premiums can be downright unaffordable.

Many people find short-term health insurance, also called temporary insurance, to be an affordable alternative to COBRA. This coverage helps bridge the gap between having an employer-sponsored plan and waiting for your next job.

Leaving a job often means leaving group medical coverage behind, a risky move if you don’t have other insurance options. Short-term insurance policies help remove the gamble, but they typically only protect against unforeseen sickness or injury.  Pre-existing conditions are usually excluded.

Premiums for short-term coverage are usually much cheaper than the premiums paid for COBRA. However, the costs can still seem high for a person who just lost their job. It may be tempting to forgo insurance altogether, but financial security is the main reason people buy short-term health insurance in the first place.

Without coverage, an unexpected trip to the hospital could send a person deep into debt. In fact, several published studies cite medical bills as a leading cause of bankruptcy. Short-term health insurance is designed to cover these catastrophic events.

Beyond financial protection, temporary insurance can also help prevent future insurance claims from being rejected under HIPAA, or Health Insurance Portability and Accountability Act, laws.  If an individual maintains creditable insurance coverage without more than a 63-day break in coverage, they are considered to have maintained continuous coverage, and exclusions for pre-existing conditions would not apply.  This applies even if the short-term policy excluded coverage for those same pre-existing conditions.  Approved short-term insurance policies are considered creditable coverage.

The terms of short-term medical plans usually run from 30 days to a maximum of one year, depending on state requirements. Some policies are designed to provide coverage for a specific number of days with premiums paid upfront, while other policies offer flexible monthly payment plans.

Since temporary insurance is only designed to last a few months, policyholders still need to plan for a long-term solution. If you find a new job and enroll in your new employer’s group insurance plan, make sure to find out when the new coverage starts. While it’s not a long-term solution, people in transition should consider temporary insurance as an interim solution to ease financial and healthcare concerns.