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May 22

Assisted Living

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  1. Jeffrey Bakalchuck

    Dear Phyllis:

    My mother purchased a LTC policy from Mutual of Omaha back in 2001. She had a leg amputated 3 years ago and has been receiving benefits since then. The policy provides benefits in the home but not in an institutional setting. It defines home as a place where you maintain independent residence. Assisted Living is not specifically mentioned anywhere in the policy.The policy does have an Alternative Plan of Care clause.

    We are considering moving my mom from her home to assisted living as we think it will improve her quality of life. She’ll incur extra costs(above the base cost for room and board) for the assisted living facility to provide her with assistance with ADLs. The cost of the ADL extra services is lower than the daily benefit from her policy. We would like to get the insurance company to pay for this extra care. Since that cost is lower than what her policy is currently paying, it seems like a win-win situation to me.

    My question is, what is the best to approach the insurance company.

    Many thanks for your time,
    Jeff

    1. Phyllis Shelton

      Hi Jeff – my advice is to ask the Mutual of Omaha claims representative assigned to your mother’s case to tell you the protocol for asking for the move to the assisted living facility to be considered under the alternate plan of care. It may get denied as an assisted living facility does not meet the definition of an independent residence. But you have nothing to lose by asking.

  2. Janet F

    My mother purchased a Long Term Care policy in 1990, when she was 55 years old. We are currently looking into her moving to an assisted living facility. My mother bought a pretty comprehensive policy which included facility care, home health benefits, adult day care, and hospice care. Her policy pays a set daily amount, has an increasing protection rider (which has long since hit the cap of 150%), has no elimination period, and no maximum benefit days (pays life time).

    In reviewing my mother’s LTC policy, the language used for facilities is Convalescent Care Facility, which it defines as “licensed by the state as a convalescent nursing facility, a skilled nursing facility, a convalescent hospital, a convalescent unit of a hospital, an intermediate care facility, or a custodial care facility.”

    There are additional requirements, such as primarily engaged in providing services under the direction of a physician or RN, maintaining a daily record of each patient, and administering a planned program or observation and treatment in accordance with existing standards…
    .
    When I contacted the Insurer, SHIP, about coverage for assisted living, the representative informed me that my mother’s policy doesn’t cover assisted living, that it is for a higher level of care, and needs to be a skilled nursing home. She also said my mother’s home health benefit wouldn’t cover care provided by the assisted living facility employees, as home health benefits only cover care provided by a licensed home health agency. (And as we have found, those agencies don’t help with ADL care much.)

    I read the policy and called back and informed them that my mother’s policy DOES cover “custodial care” facilities. I was then informed that I would have to check with the assisted living facilities and see if they considered themselves to be a custodial care facility – that it would depend on what the facility considered itself.
    This seems puzzling to me – as that is what assisted living facilities primarily are: custodial care (assistance with ADLs). However, they don’t come right out and call themselves that. Additionally, on the Insurers claim forms they list:

     Alzheimer’s/Dementia unit (secured)  Alzheimer’s/Dementia unit (non-secured)  Assisted living unit (secured)  Assisted living unit (non-secured)  Independent living apartment or unit  Skilled Nursing Facility  Intermediate Care Facility

    They don’t even have anything listed as “custodial care facility” or “convalescent care facility.”

    I am hesitant to rely on the “it depends on what the facility considers itself” advice. It appears that my mother’s comprehensive policy was intended to cover placement in custodial care facilities, which in today’s world is assisted living. But I am also concerned that the company might try to deny a claim under the theory that the facility doesn’t call itself a “custodial care facility.”

    Would you advise that I contact the company in writing to clarify that assisted living is covered as a custodial care facility? Or ask them to provide a list of facilities in our area that they consider eligible as “custodial care facilities.”?

    1. Phyllis Shelton

      Yes Janet the quickest way to resolve this is ask the insurance company if this facility is approved. SHIP is not the insurance company. That stands for State Health Insurance Assistance Program and it has been my experience that they are not especially skilled in answering questions about long-term care insurance. From what you have explained, an assisted living facility is covered but only the insurance company can confirm that. Depending on the insurance company, they may be able to give you a list of approved ALFs in your area. On the home care side, home health aides do provide help with ADLs and that’s all you need, not an LPN or RN. Please don’t hesitate to contact me again if you need more help.

      1. Janet F

        Thank you very much for your response. I was not entirely clear about the company. My mother’s policy was originally issued by Transport Life Insurance Company. Her policy is now managed by Senior Health Insurance Company of Pennsylvania, which I referred to as SHIP.

        1. Phyllis Shelton

          yes I am aware of that company Janet, and of Transport Life prior to that. My advice still stands. Ask the insurance company if that assisted living facility is an approved facility for benefits and if not, where are other facilities that are approved?

  3. Dianne Salyer

    My 97 year old mother just moved into assisted living. 25 years ago, she bought long term health care, and because assisted living facilities were not really well known at that time, the contract stated “nursing home.” Now Genworth is refusing to pay for her in assisted living, only because her contract says “nursing home.” The two qualified places in our community are not great. She is getting help with several things at assisted living. One comment I read on Consumers Affairs was from a woman in TX (same state that my mother bought her contract), and she has the same issue with her mother. She says a former Genworth employee said years ago the company sent out letters about the change in coverage (to allow for assisted living), and it was presented as an opt-out option. But Genworth won’t admit they did that.

    Question: Do we have any legal grounds on which to force Genworth to pay?

    1. Phyllis Shelton

      Great question Dianne. Your mother’s policy # probably starts with HFN or PFN. These were nursing home only policies that weren’t priced to pay for assisted living facilities. Her power of attorney could write a letter to the Genworth claims department saying you are moving her into a nursing home so she can get full benefits but would like to check to see if Genworth would rather pay less and her stay in the assisted living facility. Before writing the letter, check for any policy language that says “alternate plan of care” or “alternative plan of care”, anything like that. I think the policy is too old to have it but it might. If so, that gives you grounds to have Genworth pay for an alternative to a nursing home if it is cost effective.

  4. tom skinner

    My 90 year old mother in law has been paying Genworth for 30 years. The policy was written as a “Nursing Home Policy” as assisted living was not yet in existence. Genworth has agreed that she qualifies for nursing care but refused to accept any of the facilities we have proposed even though they have Florida assisted living licenses with “Limited Nursing Care” and 24 hour nursing coverage. They also refuse to provide us with a list of acceptable facilities so we must submit proposed facilities and then wait 30 days while they do their research and then refuse coverage. All this time we are paying out of pocket for assisted living. There are three facilities in our area that have “Skilled Nursing” but she does not require that level of care and would be out of place in that environment. Are there any other suggestions for finding a facility acceptable to Genworth or strategies to convince Genworth that these excellent Assisted Living Facilities meet the intent and definition of “Nursing Home”?

    1. Phyllis Shelton

      Saw your email that you received notice from Genworth that they WILL accept your mother’s claim at the facility where your mother is currently residing, after evaluating her and approving her as a dementia related exception. I’m so glad it worked out! Genworth added $1.2 billion in 2014 to its claim reserves and added $435 billion more in 2016 for the claims that last longer than 7 years. (Forbes, 11/30/16)

  5. Pam Calvert

    My dad bought a LTC policy about 20 years ago. He was in an assisted living facility in MO until April when he was hospitalized. The physician there refused to release my dad back to that facility stating he had been emotionally abused. I had 24 hours to move him. I live in TN and moved him her to an assisted living facility much like where he was in MO. Dad has to have assistance with five ADLs and medication delivery and the LTC say they will not pay for him to live where he is although all guidelines are being met except it is call an assisted living facility as was the one he moved out of. They are saying he has to go to a nursing home. Where he is is an assisted living facility but has four levels of care and he can age in place and be there until he passes. The policy holder is dug in and I need some guidance. I looked into a nursing home and it is over twice the cost and we can’t afford to pay it. It doesn’t seem fair that just because assisted living facilities weren’t around when he bought the policy that he will have to move. Is there help available? We truly are at the end of the money and we can’t find answers.

    1. Phyllis Shelton

      Hi Pam – I’m glad you found me. I think you could be running into state definitions of what an assisted living facility is. From your description, your dad does sound like nursing home level as assisted living facilities typically aren’t equipped to take care of that level of care. Another thing that could have happened is that your dad got worse after he was evaluated for his long-term care insurance benefits. Moving him to a different facility caused the insurance company to evaluate him again. This time they saw that he requires nursing home level of care, and they won’t approve him for care in an assisted living facility for his own safety. If the company was paying for “assisted living” in Missouri and not here, I don’t think assisted living facilities are excluded. It sounds like he needs to apply for Medicaid (TennCare in TN). The requirements are on my website at What Your State Lets You Keep. Basically, if he is not married, his resources must be spend down to $2,000, which it sounds like you are there. His income will go to the facility to pay for his care, except he is allowed to keep $50 a month for personal needs. If his income is higher than $2,205 a month, he has to set up a special income trust in order to qualify. I’m happy to explain all of this in more detail if you book a time with me in the FIRST column (Telephone 1) at this link.

  6. Katherine Peel

    I could use some help. My Great-Aunt wants to return home to Minnesota (currently in Michigan) and she is 80 years old. Her only remaining family there is her own age and not capable of helping, so living on her own is not a choice. She has a Long Term Care policy but they said they will not cover assisted living home in town because she only has 1 ADL she is unable to perform.

    How do I find her more flexible insurance? What are my options?

    1. Phyllis Shelton

      It is typical for LTC insurance policies to require help with at least two activities of daily living before paying benefits. Are you sure she isn’t failing two? They are bathing, dressing, transferring from bed to chair, toileting, continence and eating. Typically one would fail bathing and dressing first. If she only fails one, my guess is the second one is close behind. In the meantime, you might check to see if there are any bed and board homes, like foster homes, in the area that take care of 3 or 4 elderly people for a lower rate than an assisted living facility would charge. Does she have life insurance? If so, you could look into selling it for enough money to pay for assisted living privately until she qualifies for her long-term care insurance benefits. The website to check that out is http://www.lisa.org Another resource you might look into is http://www.aplaceformom.com This is a free service to help seniors find care solutions. Good luck – she is really lucky to have a niece like you who cares so much.

  7. Jess Fischer

    Great post.

  8. Mary Zrubek

    Dear Phyllis: Can you please help me. I live in Montana and am 70 years old. I am doing good now but would like to look into insurance assisted living or if ever need it nursing home insurance. My brother is currently in assisted living in CO and it is outrageous in cost. My father was in a nursing home for several years. Can you help me with what kind of insurance I should look in and perhaps suggestions for companies that are very good to look into? Thank you sincerely for any help suggestions you can offer me. Mary Zrubek

    1. Phyllis Shelton

      I will be happy to help you, Mary. Fortunately Montana is a little lower cost area than Colorado for LTC. I know my staff has already reached out to you to set a time for a consultation with me and I’m really looking forward to talking with you. Just email lawrence@gotltci.com if you haven’t already to work out a time.

  9. Brock Dezayas

    Assisted living as it exists today emerged in the 1990s as an eldercare alternative on the continuum of care for people, for whom independent living is not appropriate but who do not need the 24-hour medical care provided by a nursing home and are too young to live in a retirement home. Assisted living is a philosophy of care and services promoting independence and dignity.

    1. Phyllis Shelton

      That’s right Brock. Many people bought older long-term care insurance policies before assisted living facilities were introduced. Insurance carriers have been good to use the alternate plan of care provision found in most policies to pay for assisted living even when it wasn’t mentioned as a specific covered service.

      “Alternate plan of care” is intended to make a way contractually for a long-term care insurance carrier to pay outside the contract when it is cost-effective and makes sense medically for the patient. The policy language is very clear that the insurance company, the doctor and the family must agree on how this provision is used.

      A great way this provision has been used is to pay for new services that come along. As I mentioned, a great example is that it has been used often to pay for care in an assisted living facility from a policy that was sold to pay inpatient care only in a nursing home. Assisted living facilities (ALFs) are less expensive than nursing homes and patients generally are much happier in them because they don’t look anything like a nursing home. Without alternate plan of care, however, an insurance carrier could deny assisted living facility claims because an ALF isn’t mentioned as a covered service in the policy.

      So if assisted living coverage isn’t spelled out in the policy, look to see if there is an alternate plan of care provision and policyholders can ask the insurance company to pay for assisted living under that.

  10. Christine A.

    Does purchasing LTC insurance protect your assets, banking acct. etc. if you need to use assisted living or nursing home care?

    1. Phyllis Shelton

      The global answer Christine is yes but I have to qualify that with “it depends on the type of policy you buy”, and I will add two qualifiers for you to consider. First, you need to consider a long-term care Partnership policy which allows you to protect assets equal to the benefits paid out if you have to turn to Medicaid for help in the event the insurance isn’t enough. The premium is the same as for a non-Partnership policy so there is no downside to getting one. You do have to buy the appropriate inflation benefit for your age but you would want to do that anyway. You can learn more about Partnership policies by clicking here. That post will tell you the inflation requirements by age group and provide a link to a map that shows you the 40 states that are participating in the LTC Partnership. All of the states reciprocate on the asset protection except California. Second, you need to buy a meaningful benefit so you can make up the difference at claim time…otherwise a Partnership policy won’t help you. You can get some tips from “Your Customized Benefit Selection Process” but here is a quick formula: Look at the cost of care in your area, project it at 5% for 30 years, and choose a benefit that will pay the portion of that cost at that time. Do you want a plan that will pay half, 2/3, 80%? It’s most important to make sure your daily or monthly benefit pays the amount you want at claim time. How long it will pay is the secondary decision, especially if you buy a Partnership policy. If you need help going through this process and you don’t have a local professional who is knowledgeable in long-term care insurance, please complete the short questionnaire under the “Contact Us” tab. Oh yes, and a bonus answer to your question is that long-term care insurance also protects your assets if you need care at home, not just in a facility. Three-fourths of LTC happens at home and that’s really good news, isn’t it?

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