“When the Long-Term Care Insurer Refuses to Pay,” by Dan Bosko, Next Avenue
“I put in a claim with mom’s long-term-care insurer (a major player in the business), expecting approval reimbursing us in short order for the caretaker’s work. Much to my shock, the claim was rejected. Here was the sticking point and the insurer’s grounds for denial: According to the policy, the caretaker I’d hired did ‘not provide services to (my mother) as an employee of an entity that has an agreement as a provider of home health care services or hospice services under the Medicare program or that is licensed or accredited by state law as a Home Health Care Agency or hospice.’ And, the insurer said, ‘she is not a licensed therapist, a registered nurse, licensed practical or vocational nurse operating within the scope of such a license.’ … After months of dogged efforts, I finally prevailed. The insurer wrote me that the company would make a one-time exception in my mother’s case, subject to re-evaluation at some point later on. In the end, my mom defied all expectations and lived for several years more. The insurer paid out almost the maximum promised by the policy. So, thankfully, my mother was able to live out her final years in the comfort of her home.”
LTC Comment (from Stephen A. Moses, President, Center for Long-Term Care Reform):
Bottom line: this policyholder demanded benefits to which her mother was not entitled under the provisions of the insurance contract. Because the carrier relented and paid anyway, other policy holders will pay a price due to higher premiums or, potentially, the insurer’s insolvency. The greater damage in this story is that consumers may think they don’t need LTC insurance because it doesn’t pay when it shouldn’t. Faulty reasoning.