CHCS Services Long-Term Care Claim Denials

When you purchased your long-term care (LTC) insurance policy, you secured a promise of financial protection for future care needs. You likely trusted a well-known insurance carrier. However, for many policyholders, the entity primarily handling their claim when the time comes is not the familiar insurer but a third-party administrator (TPA) like CHCS Services, Inc.

CHCS Services plays a pivotal, albeit often behind-the-scenes, role in the administration of LTC policies for major carriers such as Prudential, CNA, CMFG Life, and State Farm, as well as various state-run long-term care insurance plans. Their actions, interpretations, and protocols can profoundly impact your access to the benefits you are owed.

At Sandstone Law Group, we understand the immense frustration and distress that arise when policyholders, who have diligently paid premiums for years, are met with delays, confusing communications, or outright denials from claims administrators like CHCS Services. We are committed to providing clear, empathetic guidance, standing firm against claims handlers and insurance companies who fail to honor their commitments.

CHCS Services' Role in Long-Term Care Plans

CHCS Services, Inc. is a third-party administrator that specializes in long-term care (LTC) insurance and eldercare programs. They provide administrative support to various insurance carriers, essentially acting as the operational arm for these insurers in the LTC space. Their services include a wide array of tasks that are critical to the claim process:

• Claims Processing: This involves the meticulous review of all incoming claim applications, medical documentation, and functional assessments.
• Care Coordination: CHCS Services may assist in setting up and managing approved care plans, including provider network management.
• Provider Network Management: They handle the verification and oversight of care providers and facilities to ensure they meet policy requirements.
• Customer Service and Communication: They often serve as the primary point of contact for policyholders regarding their claims, handling inquiries and communicating decisions.

They operate behind the scenes, working directly on behalf of the insurers. This includes evaluating claims for benefits related to nursing homes, assisted living, and critically, in-home care. The major insurance companies that collaborate with CHCS Services include Prudential Insurance Company of America, CNA, CMFG Life Insurance Company, State Farm, and various state-run long-term care insurance plans. Therefore, if you hold an LTC policy with one of these carriers, it is highly likely that CHCS Services will be the entity evaluating your claim. If you face challenges during this process, consulting with long-term insurance lawyers can help protect your rights and ensure fair handling of your claim.

Understanding Long-Term Care Claims

Long-term care insurance policies typically stipulate that policyholders must satisfy one of two primary criteria to be certified as Chronically Ill or Disabled and thus eligible for benefits:

• The individual must demonstrate a loss of the ability to perform, without Substantial Assistance, at least two Activities of Daily Living (ADLs).
• The individual must possess a severe cognitive impairment, which necessitates Substantial Supervision to safeguard them from threats to their health or safety.

The six common ADLs are:

• Bathing: The act of washing oneself by sponge bath, or in either a tub or shower, including the critical task of safely getting into or out of the tub or shower.
• Dressing: The ability to put on and take off all items of clothing and any necessary braces, fasteners, or artificial limbs.
• Eating: The act of feeding oneself by getting food into the body from a receptacle (such as a plate, cup, or table) or through specialized means like a feeding tube or intravenously.
• Transferring: Sufficient mobility to move safely into or out of a bed, chair, or wheelchair, or to move from place to place, whether by walking, using a wheelchair, or by other assistive means.
• Toileting: The ability to get to and from the toilet, to get on and off the toilet, and to perform associated personal hygiene.
• Continence: The capacity to maintain control of bowel and bladder function, or, when unable to maintain control, the ability to perform associated personal hygiene (including the care of a catheter or colostomy bag).

If a person requires “substantial assistance” in two or more of these specified areas, they may qualify for benefits under their long-term care insurance policy. “Substantial assistance” can encompass either hands-on assistance or standby assistance, depending upon the precise wording of the policy.

If an individual is cognitively impaired and requires oversight that may include cueing through verbal prompting, gestures, or other demonstrations by another person, and such supervision is demonstrably necessary to protect them from threats to their health or safety, they may also qualify for benefits under an LTC insurance policy.

Why CHCS Services' Administration Poses Unique Challenges for Claimants

The fact that CHCS Services operates behind the scenes as a TPA for multiple insurers means their administrative approach can create specific hurdles for policyholders.

1. Potential for Conflicts of Interest and Financial Incentives to Deny: As highlighted in cases like Jaffe v. Prudential Insurance Company of America, allegations have been made that TPAs like CHCS Services, under Master Services Agreements (MSAs) with insurers, may have financial incentives to deny claims. If a TPA's compensation or performance metrics are tied to reducing payouts or extending appeal processes, this can lead to prolonged appeals and benefit denials that are not in the policyholder's best interest. This alleged conflict can manifest as an overly aggressive approach to claims review.
2. Strict Adherence to Internal Protocols, Prioritizing Cost Control: While acting on behalf of the insurer, CHCS Services operates with its own set of internal protocols and interpretations of policy language. These protocols often prioritize efficiency and cost-containment for their insurer clients, leading to a highly stringent and sometimes unforgiving review process. Any minor deviation from their expected documentation or care plan can become a reason for delay or denial.
3. The "Behind-the-Scenes" Factor and Lack of Transparency: Because CHCS Services is not the direct insurer, policyholders may initially find it confusing to understand who is making critical decisions about their claim. This can create a perception of a less transparent process, making it harder for claimants to get clear answers or understand the true reasons behind a denial.

Common Tactics Leading to CHCS Services Claim Denials

Mirroring the strategies of the insurers they represent, CHCS Services often employs specific tactics that lead to the denial of legitimate long-term care claims:

1. Excessive and Repetitive Documentation Requests: CHCS Services may burden claimants with voluminous and often repetitive requests for information. They might ask for documents already submitted, or demand highly granular details about your care and functional limitations. This tactic, often referred to as "death by paperwork," is designed to create confusion, induce delays, and exhaust policyholders and their families, hoping they will abandon their claim.
2. Rigorous Interpretation of Functional Triggers: Even though LTC is based on functional impairment (ADLs and cognitive impairment), CHCS Services may apply stringent interpretations of these definitions. They might dispute the level of assistance you require, send their own nurse or representative to assess your abilities, or claim that your treating physician's certification is insufficient. Their internal reviewers may conclude you do not meet the minimum ADL triggers, even when your medical documentation clearly indicates otherwise.
3. Strict Enforcement of Provider Qualifications: CHCS Services rigorously enforces policy clauses regarding who can provide covered care. They may deny claims if a caregiver is not formally licensed, if a facility is not on an "approved list," or if the services provided are deemed not to meet the policy's specific definitions (e.g., distinguishing between "custodial" and "skilled" care). This is a frequent issue, especially with home care provided by family members or independent caregivers.
4. Reliance on Internal/Contracted Reviewers and Questionable Independent Medical Exams (IMEs): Like many claims administrators, CHCS Services may rely on internal medical professionals or contracted third-party physicians to review your medical records. These reviewers may issue opinions that contradict your treating physician's assessment, often without personally examining you, leading to denials. This tactic helps them control the medical narrative.
5. Systemic Delays and Communication Breakdown: Due to the sheer volume of claims they handle, CHCS Services can be prone to administrative backlogs. Communication can be slow, inconsistent, or confusing, leaving policyholders uncertain about the status of their claim or what further steps they need to take. These delays often create significant financial strain, especially during the elimination period.

CHCS Services' Legal History

LTCG (the parent company under which CHCS Services now operates as illumifin) has been implicated in several legal cases concerning the denial of long-term care insurance claims. These instances highlight the nature of disputes policyholders may face:

1.  Wedding v. CalPERS (Class Action Settlement): LTCG served as the third-party administrator for the California Public Employees' Retirement System (CalPERS) Long-Term Care Program. In this role, LTCG was implicated in a class-action lawsuit alleging that CalPERS improperly raised long-term care insurance premiums by 85% in 2012, despite prior promises of rate stability. The lawsuit culminated in a settlement, which was finalized on September 28, 2023. This settlement allowed policyholders to choose between a refund of 80% of premiums paid or continued coverage with adjusted terms.

2.  Turley v. Prudential Insurance Company: This case involved an 86-year-old Alzheimer's patient who was repeatedly denied LTC benefits by Prudential and CHCS Services, despite clear medical documentation of her condition. This case exemplifies how administrators may deny claims even when the medical evidence of impairment is substantial.

3.  Jaffe v. Prudential Insurance Company of America: In this case, the plaintiff alleged that CHCS Services, operating under a Master Services Agreement (MSA) with Prudential, had financial incentives to deny claims, leading to prolonged appeals and benefit denials. This lawsuit specifically brought into question CHCS's role in claims evaluations and the potential for conflicts of interest within its administrative processes.

Common Reasons for CHCS Services Claim Denials

Building on the tactics discussed, denials from CHCS Services often manifest in these specific categories:

• Failure to Meet Eligibility Requirements: This is a primary reason, where CHCS Services concludes you do not meet the minimum number of ADL triggers or the severity of cognitive impairment required by your policy. They may dispute the functional necessity of your care.
• Documentation and Paperwork Issues: Denials frequently occur due to allegedly "incomplete or missing paperwork," or because daily care logs are deemed insufficient or inconsistent.
• Provider Qualification Problems: Your claim may be denied because your care provider or facility does not meet CHCS Services' strict interpretation of policy requirements for licensing, certification, or "approved" status.
• Elimination Period Not Satisfied: Denials can occur if CHCS Services determines that the elimination period was not fully satisfied according to their specific counting rules (e.g., due to breaks in care, using unqualified providers, or differing interpretations of "days of service").
• Policy Exclusions or Limitations: Although less common in the practice space for pre-existing conditions, other policy exclusions (e.g., specific types of care not covered, territorial limitations) can be cited.

Why Sandstone Law Group is Your Advocate Against CHCS Services

Fighting a claims administrator like CHCS Services can feel like an overwhelming task. They are a large, experienced entity representing the financial interests of major insurers, and their alleged financial incentives can create a biased playing field. You do not have to navigate this process alone. While an appeals process may be offered, whether to pursue an internal appeal or immediate legal action is a case-specific consideration that demands legal advice.

Sandstone Law Group focuses on challenging long-term care denials, including those handled by CHCS Services. We are committed to:

• Understanding the TPA Playbook: We have extensive experience dealing with CHCS Services and other third-party administrators. We understand their tactics, their internal processes, and their common reasons for denial, including alleged financial incentives.
• Aggressive Advocacy: We stand firm and aggressive against claims administrators and insurance companies that fail to honor their commitments. Our goal is to ensure you receive the benefits you are owed.
• Building a Robust Case: We meticulously review your policy, gather compelling medical records and financial documentation, and build a strong argument that directly counters CHCS Services' denial reasons. We emphasize the "functional necessity" of your care as defined by your policy.
• Strategic Legal Counsel: We provide clear guidance on the best path forward, whether that involves preparing a detailed administrative appeal or pursuing litigation when necessary. We ensure your rights are protected and that all procedural requirements are met.
• Holding Insurers Accountable: We represent policyholders who purchased LTC plans years ago and are now finding that companies are "not honoring them". We are dedicated to fighting for justice and ensuring accountability for delayed or denied benefits, particularly where there are concerns about conflicts of interest in claims handling.

If you are facing a CHCS Services claim denial or are struggling with delays and endless paperwork, do not concede your rightful benefits.

Contact Sandstone Law Group Today

If your long-term care claim administered by CHCS Services has been wrongfully denied, or you are experiencing frustrating delays and confusing communications, it is time to seek legal guidance. Such actions by claims administrators and insurers are not merely administrative hurdles; they are a profound betrayal of the financial security you carefully planned for.

At Sandstone Law Group, we are not intimidated by large administrators like CHCS Services or the complex legal challenges they present. We take on cases that others may shy away from, prepared to fight relentlessly to hold these companies accountable when they fail to honor the long-term care plans you purchased.

Contact us today at 602-615-0050 to schedule a consultation. Let us uncover the truth, enforce your rights, and make sure your insurer delivers the protection they promised.