Long Term Health Care: BUYER BEWARE!
If you are considering purchasing Long Term Health Insurance for yourself or a loved one, or already have, I strongly suggest you read my experience.
In 2003 while working at a state university, my employer offered us the option of purchasing Long term Health Care (LTHC) through Prudential Insurance. I was in my 40s and had Rheumatoid Arthritis (RA) which is incurable, progressive and degenerative. I had already several hand surgeries and foresaw a future of knee and hip replacements, so I jumped at the opportunity to get it at a reduced group rate.
I diligently paid my $3k+ annual premium year after year for 20 years and felt a great sense of comfort and reassurance that when (not if, for me) I needed assisted living I’d have at least some coverage.
During those years I saw two or three financial advisors and each reviewed my LTHC policy and each told me my coverage was top notch based on the per diem rate paid for care. One even stated that they sold LTHC policies and he couldn’t offer me anything better. I felt very secure and confident that I had made a good decision to purchase and continue to pay on my LTHC policy.
As the years progressed, I checked with Prudential as to whether my policy covered home aid care as well as in a facility. They assured it me did but whatever funds I used for that would be deducted from the total payout allowance or lifetime cap, per my policy.
Flash forward twenty years and my health took some additional hits, specifically to my lower back or lumbar spine, quite common as we age. My pain impeded my ability to walk and added difficulties such as putting on, and removing, socks. I began researching home aids and Continued Care and Assisted Living facilities. I contacted Prudential to check on my coverage for an aid. They set up an appraisal of my current condition which was conducted via zoom byb athird part, not a physician.
I subsequently received a letter from Prudential informing me that my claim was rejected. I did not meet the criteria of “chronically ill” for the policy to take affect and pay for either Continued Care, Assisted Living or a home aid.
In order to qualify for benefits one must be “chronically ill” which I certainly am having RA and severe osteoporosis, and severe spinal stenosis with some disc bulging. All of which are chronic conditions. However, I was informed that their definition of chronically illness for the purpose of eligibility of benefits, meant:
1. Being unable to fulfill at least two of the following activities of daily living for at least 90 days:
- Bathing
- Eating
- Toileting
- Dressing
2. Requiring substantial supervision and assistance in order to protect themselves against health and safety threats because of physical or cognitive impairment [emphasis added].
Note that the “eating” requirement means not being able to eat when food is placed in front of you. I can think of few conditions that would qualify: advanced ALS? CP? Becoming a quadriplegic? Dementia, Alzheimer’s or some strokes. There may be other possibilities, but I can’t think of any. According to this criteria, it doesn’t seem not even Michael J. Fox would qualify. I certainly don’t. And if I did, I’d opt for death with dignity not prolonged care.
Over the twenty years I maintained this policy, I paid in excess of forty-eight thousand dollars ($48,677.90) in premiums. $3,417.76/year.
Nearly $50k that now seems to have been a total waste (unless I develop one of the above-named ailments.)
The criteria called “chronically ill” is apparently a legal term and would thus likely apply to any and all LTHC policies you might consider purchasing. Be sure to check before you buy, or if you already have.
Buyer Beware!
UPDATE:
According to statistics published by the American Association for Long-Term Care Insurance, being approved for long-term care coverage is impossible for many people. Below, you’ll notice that as your age increases, your chances of being denied coverage also increase:
- Applicants between the age of 50 and 59 are declined 13.9% of the time.
- Applicants between the age of 60 and 99 are declined 22.9% of the time.
- Applicants between the age of 70 and 79 are declined 44.8% of the time.
- Applicants aged 80 and older are declined 69.8% of the time.
I have 60 days to appeal. Stay tuned!
UPDATE: 4/28/23
Well, I was TOLD I had 60 days to appeal and requested my doctor help with my appeal. As it was coming close to 30 days, I phoned Prudential to confirm I had sixty days. An employee named Marisha put me on hold for a good length of time and came back and said it was 60 days. Five or 10 minutes later, Marisha called me saying that she had checked with a supervisor and it was THIRTY days, not 60 days to appeal.
Due to the confusion and getting different answers from different employees, and even the same employee, I asked Marisha where to find the time limit to file an appeal IN WRITING. I was told to look at my policy, under the heading Appeals (Pg 30 of my policy). To my great surprise, it does not state any tim elimie to file an appeal.
I called back and miraculously got Marisha on the phone who recalled our previous conversations. I told her the policy specifies NO time limit to file an appeal. Marisha confirmed: “There is no time limit in writing.”
Questions: Is an insurance policy a contract? If so, wouldn’t all conditions, including time limits, be required? How can a contractual agreement — for a product or services one is paying for — be so open-ended?
UPDATE: My policy includes short term, but 90-days or more, home care, such as after a surgery. I was told how much that coverage is and that they deduct whatever is spent on short-ter care from the total lifetime cap. I recenrlt inquired about using it, as I am facing hip replacment surgery.
I was told the same 2 out of six criteria apply to that as well. I have a documented history of falls and fainting, especially while on pain meds, and some falls have led to fractures. So it seems that would possibly meet the criteria defined as “substantial supervision and assistance in order to protect themselves against health and safety threats because of physical or cognitive impairment.”
However, they do not start the approval process, of course, until you need such services. Then they have to do an assessment based on medical records and an in-person interview. So, that process could conceivably (and very conveniently) take 90 days or a good chunk of that time to complete since doctors have more imporatnt htings ot od thna fill ot forms.
I received a bill recently for a premium that’s due on this policy. Sure was a difficult decision to continua throwing good money after bad.
