Takeaways
Understanding your long-term care insurance policy and its specific requirements (benefit triggers, covered services, elimination periods) is crucial to preventing claim denials.
Common reasons for claims denials include insufficient medical documentation, preexisting condition exclusions, failure to meet elimination period requirements, and administrative errors.
To help prevent denials, make sure you thoroughly understand your policy, confirm that your care providers meet policy requirements, maintain detailed medical and care records, and accurately track the elimination period.
If a claim is denied, you have the right to appeal and should carefully review the denial letter, file an appeal promptly with supporting evidence, and seek help from state insurance departments or elder law attorneys if necessary.
State-level consumer protections also offer safeguards such as limitations on preexisting conditions, written explanations for denials, and appeal rights.
Long-term care insurance can provide necessary financial support when someone needs help with daily activities such as bathing, dressing, or eating, whether they live at home, in an assisted living facility, or in a nursing home. However, when the time comes to use the benefits, some policyholders are surprised to find their claims denied. Understanding why denials happen and how to avoid them can save families significant stress and expense.
Why Long-Term Care Insurance Claims Get Denied
Long-term care insurance claims may be denied for various reasons, including those described below.
Lack of Medical Documentation
One of the most common reasons for denial is insufficient medical evidence to show that the insured meets the policy’s “benefit trigger.” Most policies require that a doctor or licensed health care professional certify that the person needs help with at least two activities of daily living (ADLs), such as eating, bathing, or dressing, or that the person has a severe cognitive impairment. If medical records don’t clearly document these limitations, insurers may reject the claim.
Preexisting Condition Exclusions
Some older long-term care policies exclude coverage for preexisting conditions for a certain period after the policy begins. If the need for care arises during that exclusion period, or if the insurer believes the condition existed before coverage began, the claim may be denied.
Not Understanding What’s Covered
Many denials occur because policyholders assume that all types of care or facilities are covered. For instance, some policies cover only licensed home health agencies, not independent caregivers or family members. Others may exclude assisted living facilities unless they meet specific licensing or staffing standards.
Failure to Meet Elimination Period Requirements
An elimination period is like a deductible measured in time rather than money; it’s the number of days the policyholder must pay for care before the insurer starts to pay. If documentation doesn’t show continuous care during that period, the insurer may delay or deny payment.
Administrative or Technical Errors
Sometimes denials stem from paperwork mistakes, missing signatures, or incomplete claim forms. Even small administrative issues can cause delays.
How to Prevent Claim Denials
Having an insurance claim denied can be a hassle and can lead to a long appeals process or unplanned care expenses. Here’s how to help prevent claims from being denied.
Understand Your Policy Before You Need It
Review your policy carefully, ideally with the help of a trusted family member, attorney, or financial advisor. Take note of the following:
What types of care and facilities are covered
The definition of “benefit triggers” (ADLs or cognitive impairment)
Elimination periods and daily or lifetime benefit limits
Exclusions or limitations for certain conditions
Keep copies of your policy, correspondence, and any amendments in one place so they’re easy to access later.
Confirm That Your Provider Meets Policy Requirements
If your policy only covers licensed providers, verify that your caregiver or long-term care facility meets those qualifications. Before beginning care, call your insurer to confirm that the provider is eligible under the policy terms.
Maintain Detailed Medical and Care Records
Ensure your doctor, home health agency, or facility keeps detailed notes about your limitations and the level of assistance you need. Ask for copies of care plans, assessments, and progress reports. They can make a difference during a claims review.
Track the Elimination Period Accurately
Keep receipts, caregiver timesheets, and invoices for all care provided during the elimination period. Gaps in documentation can delay benefit payments.
If Your Claim Is Denied
Fortunately, a denial doesn’t necessarily mean the end of the road.
Read the Denial Letter Carefully
The insurer must explain the specific reason for denial. This letter is your roadmap for next steps, whether it’s providing more documentation, clarifying a misunderstanding, or filing a formal appeal.
File an Appeal Promptly
Most insurers have internal appeal procedures with strict deadlines. Follow them closely and include supporting evidence such as updated medical records, physician statements, and care logs.
Seek Help if Needed
If the appeal fails, consider reaching out to your state’s Department of Insurance, which oversees long-term care insurance regulations. Many states have consumer protection units or ombudsman programs that can review your case and help mediate disputes.
Certified long-term care insurance specialists can provide guidance and can assist in filing claims and appeals. Elder law attorneys can also provide guidance and can represent you in appeals.
Consumer Protections
Long-term care insurance is regulated at the state level, but many states have adopted model laws based on standards set by the National Association of Insurance Commissioners (NAIC). These regulations include protections such as:
Clear definitions of benefit triggers and covered services
Clarifications regarding limitations on preexisting condition exclusions
Requirements that insurers provide written explanations for claim denials
Appeal rights for denied claims
Knowing your rights under state law can help you hold insurers accountable.
The Bottom Line
A long-term care insurance denial can feel overwhelming, especially when you or a loved one needs care right away. However, in many cases, denials can be avoided or overturned with preparation, documentation, and persistence.
By understanding your policy, keeping thorough records, and knowing your appeal rights, you can increase the chances of receiving the benefits you’ve paid for and planned on receiving.
Additional Reading
For additional reading on topics related to long-term care insurance, check out the following articles: