You may have purchased a long-term care (LTC) insurance policy years ago to protect your future health and financial security. After filing it away and paying the premiums, it may have felt like you had taken care of an essential part of your retirement planning.
But now, whether you’re nearing the age where you might need long-term care or helping a parent navigate the process, that policy can suddenly feel more like a complicated legal document than a safety net. The big question becomes: does your long-term care insurance really cover what you think it does?
Assuming your LTC policy will pay for everything—such as home health care, assisted living, or nursing home costs—without closely reviewing the fine print is a common and costly mistake. Every policy has its own definitions, exclusions, and benefit triggers, and failing to understand them could delay or even derail your claim.
To avoid unpleasant surprises and ensure you get the long-term care benefits you’re entitled to, take the time to read through the policy now. If you’re struggling to understand the coverage, facing a denied long-term care insurance claim, or need help dealing with the insurance company, Sandstone Law Group is here to help.
Call (602) 615-0050 to speak with a long-term care insurance attorney who can explain your rights, review your policy, and help you fight for the benefits you deserve.
Locate Your Long-Term Care Insurance Policy and Read the Fine Print
Seriously—the thick packet of paperwork isn’t just for show. It’s a legally binding agreement between you and the insurance company. Relying on the sales brochure, your memory of the agent’s pitch, or a summary sheet isn’t good enough — you need the actual policy document. If you can’t find it, contact the insurance company or the agent who sold it and request a complete copy immediately. Insist on the full policy form, including any riders or amendments added over the years. Save any marketing brochures or other sales material you received, because it could become relevant for interpreting ambiguous provisions of the policy down the line.
What Does Your Long-Term Care Insurance Actually Cover? Understanding Key Terms
Alright, you’ve unearthed the document. Now the fun begins. Your policy likely throws around terms like “Home Health Care,” “Assisted Living Facility,” and “Nursing Home Care.” You cannot assume these terms mean what you think they mean in plain English. Insurance policies operate on their own precise, internally defined vocabulary. You must find the “Definitions” section and see exactly how your policy defines these critical terms.
Home Health Care and Long-Term Care Insurance: What’s Covered and What’s Not
Many people prefer the idea of receiving care in the comfort of their own home. But what does home health care coverage entail according to your specific contract? Look closely at who is allowed to provide the care.
Some policies are very restrictive, requiring services from a licensed nurse or a therapist affiliated with a state-licensed and potentially Medicare-certified home health agency.
Others might be more flexible, covering services from certified nursing assistants (CNAs), home health aides (HHAs), or sometimes even trained, non-licensed caregivers – though coverage for family members providing care is less common and usually comes with very specific requirements and limitations.
Next, scrutinize what services are covered. Does it detail “standby” or “hands-on” assistance with Activities of Daily Living (ADLs) like dressing, bathing, toileting, or eating? Does it cover community-based services, or homemaker services, such as light housekeeping, laundry, or meal preparation? Sometimes, these services are only covered if they are provided in conjunction with covered personal care services on the same day, or you will find these services provider as a rider to the policy itself.
Also, check for limits. Does the policy cap the number of home care hours per day or per week? Is there a lifetime maximum on benefits, and do those benefits change depending on the services you are seeking? Does it pay a lower daily benefit amount for home care compared to care in a facility? Understanding these nuances is vital if staying at home is your goal.
Does Your LTC Insurance Cover Nursing Homes and Assisted Living? Know the Differences
If home care isn’t feasible or sufficient, where can you go? Most traditional LTC policies cover stays in a licensed nursing home (often called a Skilled Nursing Facility or SNF). But again, check the definition. Does it require the facility to provide 24-hour nursing supervision, maintain certain staffing ratios, or meet specific state licensing criteria?
Coverage for Assisted Living Facilities (ALFs) can be a major point of confusion. ALFs offer a wide range of services and levels of care, and insurance coverage hasn’t always kept pace. Some policies might not cover ALFs at all, or only cover facilities that meet a narrow definition that resembles a nursing home lite. Does the ALF need a specific state license? Must it provide assistance with a certain number of ADLs? Does it need to have nurses available? Policies are often ambiguous and an ALF could be covered under your policy, even if the insurance company says that it is not. Do not trust the insurance company for policy interpretation, because they may interpret it intentionally in a manner to avoid payment of an otherwise valid claim.
Long-Term Care Insurance Benefit Triggers: ADLs and Cognitive Impairment Explained
It is an unfortunate reality that simply feeling the need for assistance—or even having a doctor confirm it—does not automatically result in insurance coverage. Most policies include specific requirements, known as benefit triggers, that must be met before any benefits are provided.
These triggers act as formal signals that coverage can begin. In most cases, a person must meet one of two main conditions, and this must typically be verified by a licensed healthcare professional.
Trigger #1: Inability to Perform Activities of Daily Living (ADLs)
This trigger requires the inability to perform a certain number of Activities of Daily Living (ADLs) without “substantial assistance.” Your policy will explicitly list which ADLs it considers—typically the standard six, but this can vary depending on your specific policy and whether the policy is meant to comply with HIPAA for tax purposes:
- Bathing
- Dressing
- Toileting
- Transferring
- Continence
- Eating
The policy should specify how many Activities of Daily Living (ADLs) you must be unable to perform on your own—most commonly, this means needing help with 2 out of the 6 standard ADLs. However, some policies may require assistance with 2 out of 5, or even 3 out of 6.
Substantial assistance is typically defined as either hands-on help, where someone physically assists you, or standby assistance, where someone is nearby to cue or steady you for safety. This definition has been litigated in courts and the definition can be implicated by federal or state statutory requirements.
In addition, the policy will often require that this loss of function is expected to last for a minimum period—commonly 90 days—to ensure the need isn’t due to a short-term or temporary condition. How to interpret this 90-day period varies depending on the policy and is sometimes interpreted by insurance companies wrongly to deny claims.
Trigger #2: Severe Cognitive Impairment
The second common trigger is suffering from a severe cognitive impairment. This typically applies to conditions such as Alzheimer’s disease, vascular dementia, or other organic brain disorders that impair memory, reasoning, or judgment.
Each policy will define what qualifies as severe (or not), but it generally involves both a clinical diagnosis and evidence that the impairment requires “substantial supervision” to protect the individual—or others—from threats to health and safety.
This isn’t simply about misplacing your keys or forgetting a name now and then; it refers to a level of cognitive decline significant enough that it makes living independently unsafe. That said, “substantial” is yet another litigated policy term, which insurance companies sometimes interpret in a manner to avoid the payment of otherwise-valid claims.
How to Get Approved for Long-Term Care Benefits: Certification and Paperwork Essentials
In nearly all cases, a licensed healthcare practitioner must examine you and provide written certification that you meet the specific benefit trigger criteria outlined in your policy. The insurance company will require this documentation, often submitted using their own designated forms. Additionally, insurers typically reserve the right to have their own nurse or physician review your records or even conduct an “independent” assessment.
Understanding these requirements in advance can help you gather the appropriate evidence and be better prepared when it’s time to file a claim. Some important terms to know as you prepare for the process:
- A BEA (Benefit Eligibility Assessment) is an in-person (or more increasingly virtual) evaluation conducted by a nurse or third-party contractor on behalf of a long-term care insurer to determine whether the insured meets the policy’s benefit triggers—typically based on ADL dependence or severe cognitive impairment. A BEA can include physical and cognitive testing, often using checklists or proprietary scoring tools. The Helper Bees is a common vendor insurers use for BEAs. Results are submitted to the insurer as part of the claim file and heavily influence benefit approval or termination decisions. Insurers may conduct BEAs without prior medical records or without informing treating physicians, raising questions of fairness or completeness. BEAs are often challenged in litigation when the assessor spends limited time with the claimant, lacks specialty knowledge (e.g., assessing a neurological disorder with no training), or contradicts treating physician opinions.
- A PAQ (Personal Assessment Questionnaire) is a form or written questionnaire sent by a long-term care insurer to the insured (or their representative) to gather detailed information about the insured’s functional abilities, care needs, daily activities, living arrangements, and caregiver support. These are typically used at the initial claim stage or during ongoing benefit reviews, which often happen annually if your policy is a tax qualified policy under HIPAA. It will include questions about Activities of Daily Living (ADLs), cognitive status, and caregiver services. Responses are used to support or challenge the need for ongoing benefits. Note: Some insurers use these forms to elicit inconsistencies or suggest improvement in function, which can lead to termination of benefits—so it’s crucial to complete a PAQ carefully and honestly, often with legal guidance.
- A Physician Certification of Chronic Illness, sometimes called a Chronically Ill Certification (CIC), is a formal statement completed by a licensed health care practitioner—typically a physician, nurse, or licensed social worker—confirming that an individual meets the definition of “chronically ill” under a long-term care insurance policy. This certification, if subject to Internal Revenue Code § 7702B(c)(2) for a tax-qualified policy under HIPAA, affirms that the insured either (1) is unable to perform at least two activities of daily living (ADLs) for a period expected to last at least 90 consecutive days due to a loss of functional capacity, or (2) requires substantial supervision due to severe cognitive impairment. The form typically documents diagnoses, functional limitations, and anticipated duration, and is a critical component in qualifying for and maintaining LTC benefits. This form is mandatory for triggering and maintaining benefits under most LTC policies. But if the form is incomplete or vague, insurers may delay or deny benefits. You may have certain rights about how to provide CIC under your policy depending on state or federal statute, so legal guidance is advisable in providing this certification.
Brace Yourself for the Elimination Period—It’s Not as Simple as You Think
Think of your policy’s elimination period like a deductible measured in time rather than money. You must cover costs out-of-pocket for a defined number of days—often 30, 60, or 90—before your benefits kick in. While this can vary depending on the policy, this is how policies often work.
Importantly, policies differ significantly in how these days are counted. Some use calendar days, starting from the date you meet the trigger criteria, while others count only days when you actively receive covered care services. This detail can significantly impact your financial planning.
How Much Will Your LTC Policy Pay? Daily Benefits, Lifetime Caps, and Inflation Protection
Once you’ve qualified and waited through your elimination period, your policy specifies a daily or monthly benefit amount to cover care costs. Many policies set a lifetime maximum payout or create a pool of money, defining how long your coverage will last.
Additionally, inflation protection can significantly affect the real value of your policy over time. Compound inflation protection, though pricier, usually offers the best long-term value by adjusting your benefit to keep pace with rising care costs. Without adequate inflation protection, your initial benefit amount might fall short when you finally need care.
Beware the Fine Print: Common Exclusions and Limitations
Every LTC policy contains exclusions and limitations, meaning it might not cover specific scenarios or services. Common exclusions include care related to substance abuse or intentionally self-inflicted injuries. Don’t give up when you get such a denial. Instead, call a long-term care lawyer to determine if your policy wrongfully denied your rightful coverage.
When the Answer is “No”: Dealing with a Long-Term Care Claim Denial
Suppose you or a family member requires long-term care, meets the policy’s stated requirements, and submits a claim—only to receive a denial from the insurance company. This outcome is not uncommon. Do not accept the denial without first thoroughly understanding the reasoning behind it.
Common reasons for LTC claim denials include:
- Belief that benefit triggers haven’t been met.
- Care provider or facility doesn’t meet the policy’s definition.
- Service received isn’t a covered service under the policy.
- Elimination period not satisfied correctly.
- An exclusion applies.
- Missing documentation or information in the claim submission.
- Policy lapse due to non-payment of premiums.
If your long-term care (LTC) claim is denied, the first step is to get the denial in writing. Insist on receiving a formal denial letter that clearly outlines the specific reasons for the decision and references the relevant language from your policy.
Next, review your policy carefully and compare the denial reason against the actual terms. Consider whether the insurer has accurately interpreted the policy language.
If possible, talk to a long-term care lawyer before deciding to appeal. Depending on the policy, the reasons for denial, and other factors such as the governing law, you may not have to appeal before seeking legal recourse. Insurers often invite appeals that are not required by the law or even by the policy. The decision to appeal should be made carefully with legal counsel.
Navigating a claim denial requires persistence and close attention to detail. While insurance companies follow certain procedures, their interpretations of complex policy language aren’t always final and can sometimes be successfully challenged.
Secure Your Future: Make Your LTC Policy Work For You
A long-term care insurance policy is more than just a financial product—it’s a strategic investment in your future well-being, offering the promise of dignity, independence, and access to quality care in your later years.
However, that promise is only meaningful if the policy provides the coverage you actually need, when you need it. Assuming your policy will perform as expected without careful verification is a risky oversight.
To protect yourself and your loved ones, it is essential to conduct a thorough review of your long-term care insurance coverage before a health crisis occurs.
Understanding the full scope of your policy is the first step toward ensuring it fulfills its intended purpose. If you encounter ambiguous terms, unexpected exclusions, or face a denied claim that seems unjustified, professional assistance can be invaluable.
At Sandstone Law Group, we assist clients in interpreting complex policy language and challenging wrongful long-term care insurance claim denials. For guidance or a policy review, contact our office at (602) 615-0050.
