Recently I worked with my brother-in-law to file for benefits on his long-term care policy. His policy was with MetLife (one of the largest insurance companies in the United States.) You would think filing a claim on a long-term care policy would be easy. How wrong that assumption is. Hopefully, our experience can help you navigate filing for benefits and avoiding potential road bumps with your long-term care policy claim.
In 2003, he had purchased a plan with $300,00 in coverage for long-term care in a policy from MetLife. Until now, he had not utilized it despite being eligible for an extended period. All these years, he had somehow managed and muddled along with the help of neighbors and friends. Until it became too much, and he realized he needed in-home help. It was time to file a claim to collect benefits from the Long Term Care policy he has paid for all this time. He contacted MetLife; and of course, he was immediately denied receiving monthly long-term care benefits. He has an illness called Chronic Peripheral Neuropathy. Peripheral Neuropathy is a condition affecting the nerves in his limbs first and worsening from there. His disease had become so severe that even walking was exceedingly difficult for him. His balance was impaired, and he had several falls in a short period.
Since my brother-in-law held the policy directly, he had contracted MetLife himself to file a claim rather than receiving the help of an advisor who could assist him. He had to do all the work of reporting his condition and obtaining and completing the necessary paperwork from his doctors. He was lost as to what to do next.
Know the type of policy you own.
When we started to realize how bad the situation was, I decided to get involved. After all, I am an insurance specialist in this space; I thought it might be easy to assist. I initially studied his policy to see if it was reimbursement or indemnity. Let me explain the difference:
Reimbursement: One must furnish bills from a licensed long-term care facility and wait for reimbursement. Think of this as an expense statement at work. You spend the money first, submit the receipts, and hope to get paid back for legitimate expenses. Reimbursement is complicated, requires work every month, and not a guaranteed amount will be returned. That is a lot of extra work for someone who is chronically ill or their family. The policy could also have limits to the type of service allowed for reimbursement. Not to mention you must pay the bill first, so you must have the money to pay upfront.
Indemnity: Once your claim is approved, benefits would start after the elimination period, elimination period explanation to be covered later in this blog. There is a pre-set dollar amount, so you know exactly how much you are getting at any time. An indemnity plan pays the maximum daily (or monthly) benefit. The benefit allows putting money in the bank for future needs. You are not limited to what you can spend this money on either. If you need a wheelchair ramp this month and a new roll-in shower next month, you can use the benefit as necessary. If you are buying a policy today, my advice is to pick the indemnity policy.
Luckily, he had an indemnity plan according to the paperwork I had reviewed with his policy. Now, to help him obtain his eligible benefits proving eligibility.
How are you determined eligible for payment of benefits by the insurance carrier? There are three requirements:
- Verification of chronic illness.
- Licensed Health Care Practitioner has certified in writing that you have been chronically ill and will continue to be so for at least 12 months.
- Plan of care for Qualified Long Term Care Services is in place.
Chronic Peripheral Neuropathy is an illness that causes weakness, numbness, and pain. My brother-in-law has a diagnosed disease that has the word chronic literally in the name. You would think that would be sufficient to file a claim. It is not.
The MetLife employee had a primary duty to deny all claims. To make matters more complicated, we received a letter from MetLife asking for receipts from the caregiver (as if he had a reimbursement policy). As we already uncovered, he has an indemnity plan. I, luckily, had spent some time reviewing the policy and knew the fine print. We copied and provided pages from his policy confirming that he did not need to submit bills to receive the basic daily amount. That settled that request. Now, what else could they need?
Our next quest was obtaining letters from his doctors. We received a letter from his neurologist stating that he was chronically ill. According to the carrier, a medical doctor’s stand-alone verification statement still did not qualify him for benefits. This action was not enough for MetLife. The letters are considered only verification of chronic illness by the carrier. So, back to the drawing board. He needs his benefit, and we need to find a way to prove it.
Find a qualified advocate.
We realized we needed to bring in the experts. We hired Amada Senior Care to help. We needed assistance with the requirements of certification of chronic illness and to create a plan of care. Amada Senior Care happens to be a resource for both caregiving and long-term care insurance claims advocacy.
You must spend your money with a qualified long-term care organization and have them report directly to the insurance company. When you hire an advocate, you never need to get stuck waiting on hold to speak with a carrier representative. A good advocate has built-in professional relationships with most carriers and administrators and knows the ins and outs of how to get benefits approved. They will also walk you through the completion of claims forms.
Enter our advocate. Amada recommended a plan of treatment. Created weekly reports, documented his Activities of Daily Living (ADLs). The required number of ADLs is two. Amada recommended more than the required amount to help prove our case, preferably at least three ADLs.
This did the trick! It took the weekly reports, documented ADLs, and letters from doctors to get it done. Only then was MetLife willing to send their representative to complete their observation of his disability in his home.
Qualifying for long-term care.
I need to explain how to qualify for long-term care. There are two distinct ways you can qualify for long-term care. The first way to qualify is to prove that cognitive impairment has begun. This can be the extreme cases such as Alzheimer’s but more generic dementia. The other situation would be the inability to perform two of the qualifying Activities of Daily Living (ADL). In my brother-in-law‘s situation, we are discussing physical impairments versus mental.
ADLs include the below:
- Bathing: Washing oneself utilizing tub or shower, getting in or out of the tub or shower.
- Dressing: Putting on and taking off items of clothing.
- Transferring: Sufficient mobility to get in and out of bed or bed or chair. The act of moving from place to place.
- Toileting: Getting to and from the toilet, getting on and off the toilet, performing personal hygiene.
- Continence: Control of bowel and bladder function as related to personal hygiene.
- Eating: Feeding oneself by getting food into the body from a plate or cup, or table.
The second way to qualify is to have a doctor diagnose severe cognitive impairment.
Explanation of elimination periods.
We filed the initial claim forms in July 2020. The outside qualified assistance company, Amada, was hired shortly thereafter. MetLife gave final approval by letter on January 7th, 2021. My brother-in-law’s policy had a 100-day elimination period. Remember me mentioning elimination periods earlier? The elimination period means he had to be both chronically ill, and remain chronically ill, for 100 days while waiting to receive his benefit. They will not pay benefits during an elimination period. He also had to be expected to remain chronically ill for at least 12 months after an elimination period. You cannot break an arm and get a long-term care benefit because that lasts only a few months. The illness is expected to be a lifetime or at least a year. The carrier may reassess it annually.
We had some trouble convincing the claims representative and pursued the issue. We were able to have his chronic illness backdated to November 2019 with the assistance of the advocate. So, the 100-day elimination period from the date of eligibility benefits becomes payable. We are now awaiting a check!
Find the right Long-Term Care policy.
This process is complicated. Not only shopping for the right plan; but challenging to file a claim. So, if you need assistance helping your client find an appropriate long-term care policy, EMG Insurance Brokerage can help. We are a full-service brokerage company based in Houston, Texas. We have financial advisors and independent insurance professionals in all 50 states. We know it is essential advisors have access to quality products, expert advice, and cost-effective solutions. Connect with us by phone, online, or in-person, or schedule a consultation with your sales director today on how to grow your business.
Thomas Archer, CLU, ChFc
CEO, EMG Insurance Brokerage