BY ELLEN ALIBERTI, MS, CCM, RN
The statistics that are associated with aging in the U.S. today are staggering enough. The numbers are particularly alarming when you understand that every day 10,000 Americans are turning 65 years of age, and that this phenomenon, often referred to as the Age Wave, will continue until 2025. However, when you add consideration for the functional limitations and disease burden that also characterizes aging, the projections for those who will need ongoing care coordination and long-term care (LTC) supportive services are even more staggering. According to the Centers for Medicare & Medicaid Services (CMS), 70% of people over the age of 65 will need long-term care services.1 The experience of one long-standing LTC insurance demonstrates the average length of time a person will need LTC is 3.8 years, and, furthermore, the cost of LTC services is anticipated to double in the next 20 years.2
Based on this data alone, an astute case manager can see the benefit of a client having LTC insurance and, therefore, also appreciate the title of this article. However, appreciating that someone has LTC insurance coverage and understanding the intricacies of these benefits are two different things. I invite you to enhance your knowledge about LTC.
Knowledge Check #1
What LTC Insurance IS and IS NOT?
Long-term care insurance is not medical insurance or life insurance. It is a type of coverage for which not everyone who applies gets approved, and it is not recommended for people below a certain income. The thought is that people who have less than $50k in assets to protect would “spend down” and be eligible for state-funded LTC coverage if the need arises. Long-term care insurance in essence is coverage for assistance with activities of daily living (ADLs), and most policies cover all levels of assisted care including home care both personal and professional, assisted living facility (ALF) care and skilled nursing facility (SNF) care. LTC insurance provides insured individuals and their families freedom of choice in how and where to get LTC services. Having this type of coverage affords individuals and their caregivers tremendous peace of mind that they have options and answers when the time comes that help is needed.
Knowledge Check #2
What Triggers LTC Benefit Activation?
LTC benefits are determined by one’s inability to perform ADLs independently. The majority of LTC policies require limitations in two out of six basic ADLs (bathing, continence, dressing, eating, toileting and transferring) OR severe cognitive impairment to trigger benefit. Anyone can initiate a claim, but most policies will require a clinician attestation of ADL impairment and possibly a medical screening by an insurance employee as part of determining eligibility. Some of the insurance companies that specialize in LTC plans also provide care coordinators to beneficiaries to help coordinate care and services. As a case manager, you would want to understand what is required for the initial clinician attestation and the frequency of subsequent attestations, if indicated. You also will want to verify the number of ADL limitations that meets eligibility criteria, as this could be two or three depending on the carrier.
Knowledge Check #3
What Levels of Care Are Covered in LTC Policies?
LTC policies typically cover custodial, intermediate and skilled levels of care; as case managers, we ought to understand the basic requirements for each level of care, what levels of care are covered by your client’s medical insurance and under what circumstances and for what period of time or dollar amount. Keep in mind that LTC policies activate based on functional limitations, not a medical diagnosis or skilled need. Furthermore, the insured may opt to receive skilled level of care at home or a combination of different levels of care, which really allows the case manager tremendous leeway in assisting clients with the development of individual plans of care.
There are a few other policy features concerning custodial or personal care provision at home that need to be evaluated. For example, does the policy allow the insured to use benefit dollars to pay family members to render personal care, or must it be provided through a license agency? Although not a feature in most LTC policies, a few offer a provision of a certain percentage of the monthly maximum to be used at the client’s discretion after eligibility criteria are met. This provision can significantly extend lifetime maximum benefit and keep clients at home, which is where 90% of elderly people want to remain in their frail years. Finally, some policies have an assistive device or home modification benefit, which is typically a fixed dollar amount but can be used for many items not covered through a clients’ medical insurance such as grab bar installation or building a wheelchair ramp. It does not hurt to ask about these benefits when advocating for your client.
Knowledge Check #4
What Key LTC Policy Features/Benefits Must a CM Evaluate?
As mentioned previously, LTC is not medical or life insurance, but nonetheless it has key features of both products that are integral to your understanding of them. First up is the elimination period, which is the length of time a client must wait after having been certified as meeting eligibility criteria to receive benefit. The most common elimination period is 90 days, but insured may select from a 0-90 day elimination period, so it makes sense to verify. Additionally, some policies may cover home healthcare from day one, and may count the home healthcare days of confinement against the elimination period for facility setting care (ALFs and SNFs). So the point here is to evaluate the elimination period extensively to understand each aspect in order to help your clients optimize their LTC dollars.
Knowledge Check #5
What Potential Indemnity Considerations Need to Be Evaluated?
LTC policies use several methods for paying benefits. Case managers need to determine what the daily or monthly maximum is and if the amount differs based on setting. In addition to a daily or monthly maximum, many policies have a lifetime maximum, which, if divided by the daily/monthly maximum, can determine how long the policy benefits will last. In addition, some of the older LTC policies had a lesser dollar maximum amount for home care versus nursing home. In today’s LTC market, the dollar amounts for the varied levels of care must be equivalent. Many LTC policies offer an inflation protection, which, for policies that have been in effect for a number of years, can increase the maximum limits significantly, so it is important to verify if that is a policy feature. Another factor that must be evaluated is if the policy insures more than one person, and, if it does, what are the limitations on the policy maximum that must be reserved for the other policy owner? Lastly, one must evaluate if there is a waiver of premium when an insured is receiving benefit, and, if it is a joint policy, are both insureds premiums waivered or just the one on benefit?
Knowledge Check #6
What Is A State Partnership LTC Policy?
State Medicaid programs fund the majority of LTC placements in the United States, and with the burgeoning numbers of elderly people coupled with the projections of the numbers requiring LTC for an average of four years, they are searching for innovative ways to share the cost of care. The Federal Deficit Act of 2005 allowed states to enter into partnerships with those who purchase a qualified LTC policy. Plans must meet certain qualifications but basically allow insureds to become eligible for Medicaid LTC coverage without spending down their assets equal to the amount of their LTC policy. Take, for example, a client who has $300,000 in assets and purchases a $200,000 lifetime maximum LTC policy. Once they use their $200,000 in LTC insurance, they only need to spend down $100,000 of their assets to be Medicaid eligible. Come to think about it, Long Term Care State Partnership Policy is a WIN-WIN for the state and the resident, not to mention the case manager!
In closing, approximately 8.1 million Americans are protected with long-term care insurance, and 15% of claims are lasting more than 5 years.3 This means that more and more of the patients we care for as case managers will have LTC insurance as part of their advance care planning. As case managers, we have an obligation to understand the unique framework of our client’s policies in order to optimize their benefits, maintain their dignity and preserve their desire of where and how they will receive care.
Medicare & You, National Medicare Handbook, Centers for Medicare and Medicaid Services, Revised 2014
Claims data for Genworth, Life Insurance Company and affiliates-December 1974-January 2014.
2014 Long Term Care Sourcebook/ accessed on 4-23-19 at aaltvi.org
Ellen Aliberti, MS, CCM, RN, is the 2017 recipient of CMSA National’s Case Manager of the Year award and currently serves a a volunteer leader for the Case Management Association of Las Vegas. She is is a clinical educator at HealthCare Partners Nevada..
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