Long-Term Care Insurance Resource Center

The basic tasks necessary for independent living. These are often used to determine LTCI eligibility. The six ADLs are:

• Bathing
• Dressing
• Toileting
• Eating
• Grooming
• Transferring (e.g., moving from a bed to a chair)

A type of residential facility that offers assistance with ADLs but not intensive medical care. Some LTCI policies cover stays in ALFs, depending on the specific policy.

The length of time for which the LTCI policy will pay for covered services. It can range from a few years to lifetime coverage, depending on the policy.

Criteria that must be met for LTCI benefits to be paid out. Common triggers include needing help with a certain number of ADLs or being diagnosed with a cognitive impairment (e.g., Alzheimer’s).

A condition that impacts memory, reasoning, and the ability to perform daily activities, such as Alzheimer’s disease or other forms of dementia. Cognitive impairment often serves as a “benefit trigger” that allows the policyholder to start receiving benefits, even without meeting the ADL requirements.

• Cash Benefit: A policy that provides a daily cash amount for care, which the insured can use for any type of service, including home care.
• Reimbursement Benefit: A policy that reimburses the insured for actual expenses incurred for covered services up to the daily limit.

The series of steps required for a client to receive LTCI benefits, including submitting documentation (e.g., care notes, physician’s statements), assessing eligibility, and waiting for approval from the insurance company.

A waiting period (often 30, 60, or 90 days) that must pass before LTCI benefits kick in. The client must pay for care out-of-pocket during this period, though prior care or hospice services may count towards the elimination period.

Coverage for in-home care services, such as assistance with ADLs, that are typically provided by caregivers, home health aides, or nursing staff. Not all policies offer home care benefits, so it’s important to verify coverage.

A document that allows a family member, caregiver, or Power of Attorney to communicate with the insurance company about the policyholder’s claims or care needs. This release is required by the Health Insurance Portability and Accountability Act (HIPAA) to protect privacy.

An optional feature on LTCI policies that automatically increases the Maximum Allowable Amount (MAA) or daily benefit to keep up with inflation, typically by 3-5% annually. This helps ensure that the policy keeps pace with rising care costs.

A range of services designed to help individuals with chronic illness, disability, or age-related limitations. LTC may be provided in-home, in a nursing home, or in assisted living facilities.

The limit on how much the insurance company will pay per day, week, or month for covered services. The MAA varies by policy and may be subject to an annual increase if the policy includes an inflation rider.

• Nursing Home: Covers stays in facilities that provide 24/7 skilled medical care.
• Assisted Living: Covers stays in facilities that provide non-medical, but supportive services such as help with ADLs and meals.

A type of policy structure where the client has a lump sum of benefits that can be used for any type of care (home care, nursing home, etc.). The amount can be used flexibly until it’s exhausted.

The individual who owns the LTCI policy. This may or may not be the same person receiving care, especially if a Power of Attorney (POA) is in place.

A legal document that designates an individual to make financial and legal decisions on behalf of another person. In the context of LTCI, the POA may need to manage the insurance claims process if the policyholder is unable to do so themselves.

Health issues that the policyholder had before purchasing the LTCI policy. Some policies may exclude coverage for specific pre-existing conditions or require a waiting period before benefits apply.

The amount paid regularly (monthly, quarterly, or annually) to maintain the LTCI policy. Premiums can vary depending on the type of policy, the insured’s age, and other factors.

A tax-advantaged LTCI policy that meets federal guidelines for tax purposes. It allows for tax deductions for premiums paid and may provide other tax benefits.

A type of LTCI policy that pays a fixed amount for each day of care, reimbursing the policyholder for actual care expenses. The client must provide proof of the actual expenses incurred.

• Skilled Care: Medical care provided by licensed professionals (e.g., registered nurses, physical therapists).
• Custodial Care: Non-medical care that helps with daily living activities, typically provided by caregivers, such as assistance with bathing, dressing, and eating.

A type of insurance that offers coverage for shorter durations (e.g., 1-2 years) of long-term care, typically focusing on more temporary needs such as recovery from surgery or illness. This is different from standard LTCI, which usually covers longer-term care needs.

Some LTCI policies offer benefits to the surviving spouse or another family member after the policyholder’s death, covering continued care or other expenses. This is not a standard feature but may be included in certain policies.

A type of LTCI policy that provides benefits only if the insured uses the care. If no care is needed during the benefit period, the insurance company may not pay out benefits, and the policyholder may not receive a refund.

A provision that waives policy premiums once the insured individual begins receiving LTCI benefits. The insured no longer has to pay premiums as long as they are receiving covered care.