Long
Term Care Insurance Glossary
Definitions
are intended to define terms widely used throughout the long term
care and long term care insurance industries and are not intended
to be legally binding.
Accelerated
Death (Living Benefits) Benefit Rider
A life insurance policy benefit rider that permits a policyholder
to receive a portion of the policy's death benefit before the policyholder's
death if and when certain conditions are met.
Activities
of Daily Living (ADLs)
Everyday functions and activities individuals can do without help.
ADL functions include bathing, dressing, continence, transferring,
eating and toileting. Most long term care insurance company policies
use the inability to do a certain number of ADLs (such as 2 of 6)
to decide when to pay benefits per the insurance contract.
Adult
Day Care
Care during the day for adults, usually at community or senior center.
Aging
in Place
Happens when an elderly individual continues to live and receive care
at home, instead of being institutionalized.
Alzheimer's
Disease
A progressive, degenerative form of dementia that causes severe intellectual
and cognitive deterioration. There is no cure for alzheimer's disease.
Assessment
per the Long Term Care Insurance contract
A determination of an individual's mental and physical well being
by a health care professional is based on generally accepted medical
guidelines. A qualified long term care insurance policy must have
the assessment based on the opinion of licensed health care practitioner.
Assisted
Living Facility
A residential living setting that provides individualized health services
and personal care and for those who require assistance with activities
of daily living.
Bed
Hold Benefit on Long Term Care Insurance Policy
the cost of reserving an insured's bed in a nursing home or assisted
living facility will payed by the long term care insurance policy
while the individual temporarily leaves the facility up to a specific
number of days.
Benefit
Period
The maximum period, in years or days, that an individual is entitled
to receive benefits from a qualified long term care event.
Care
Coordinator
A health professional who works with the insured and the insurance
company to create a plan of care when a long term care need arises.
The Care Coordinator is provided by as a service of the long term
care insurance company.
Caregiver
(Primary)
The main person (example:a relative) who is providing and managing
for a person who is infirmed.
Caregiver
(Secondary)
On a part-time basis others who help to provide care.
Chronically
Ill Individual
A licensed health care practitioner will certify a person as chronically
ill when within the preceding 12 month period as the person is(1)
unable to perform without substantial assistance from another person
at least 2 out of 6 activities of daily living for a period of at
least 90 days due to loss of functional ability or (2) the person
requires substantial supervision to protect oneself from threats to
safety and health due to cognitive impairment.
Continuing
Care Retirement Community
A residential retirement community is a living place with a variety
of living and medical services which are provided to residents who
are in need of supervision and/or continuous care.
Cognitive
Impairment
A deficit in a person's long term or short or memory, orientation
as to person, place and time, abstract and deductive reasoning, or
judgment as it relates to their awareness of safety.
Compound
Inflation Protection
An option offered on a long term care policy to increase the maximum
daily and lifetime benefits each year by a set percentage on a compound
basis. This is available for an additional premium. This is a more
costly option than
Custodial
Care
Care to help individuals meet personal needs such as bathing, dressing
and eating. Someone without professional training may also provide
care.
Durable
Medical Equipment
Is equipment such as a hospital bed, wheelchairs, crutches, ramps
and prosthetics used for in-home care.
Elimination
Period (Deductible)
A deductible; the length of time that you must pay for covered services
before the insurance company will begin paying claims. The longer
the elimination period in a policy, the lower the premium. The elimination
period may also be called the waiting period.
Facility
Qualifications
Specific standards required by government regulations and by the long
term care insurance company for a particular type of facility, such
as a nursing home or adult day care center, to operate in a state
and provide care or services that will be covered in a long term care
policy. Standards will include licensing requirements, care services
that must be provided, hours of operation, as well as training and
experience of caregivers. Facility qualification standards may vary
by state as well by long term care insurance policy.
Free
Look Provision for new Long Term Care Insurance Policies
The provision that allows the policy owner to inspect the policy for
a specified period of time. Often the time period is 10, 15 or 20
days and the recently accepted applicant has the right to return the
policy to the insurer, if desired, for a refund of the entire premium
paid. Qualified long term care policies are required by federal law
to provide a free look period of 30 days. When the policy is returned
within 30 days, the company must refund the entire premium.
Guaranteed
Renewable Long Term Care Policy
The long term care insurance company guarantees that the insured is
able to renew the policy for life, as long as the insured pays the
premiums. The long term care insurance company may increase the premiums
on guaranteed renewable policies for all policies of that particular
type and class, but may not increase the premium for an specific individual's
policy. A qualified long term care insurance contract must be guaranteed
renewable according to federal law.
Home
Health Aide
A person who is giving home health care services at home under the
supervision of a doctor, nurse, or respiratory, physical, occupational,
speech therapist. A helper or companion is usually not considered
a home health aide.
Home
Health Care Services
Services for physical, occupational, speech therapy, respiratory or
nursing care. Included are medical, home health aide, social worker,
and homemaker services.
Community Based and Home Health Care
Nursing and related care provided to patients at home by a home health
agency are included in this type of care. Policies covering community
based and home care should describe the types of care and the types
of agencies that are covered and should specify exactly how this type
of care can be provided. Community Based and Home Health Care usually
includes adult day care, home health care, and homemaker services.
Hospice
Facility
Individuals with terminal illnesses will be provided care at this
facility. The hospice patient will typically not receive the type
of care that will bring about recovery. Hospice care is intended to
provide comfort and in many times spiritual support for the terminal
patient and their families.
Informal
Care
Care that is received at home by family. A care coordinator or medical
authority may oversee the care.
Intermediate
Care
Nursing and rehabilitative care may be provided by a medical professional
based on a doctor's orders. Skilled medical personnel may be provide
the care or just supervise. A licensed practical nurse or nurse's
aide provides this care to an individual who has limited functional
ability but does not require full time care. Managing medication is
a common reason for a care a patient to need this type of care. Care
is not provided on a continuous basis but rather intermittently—
physical therapy is an example. Intermediate Care is not included
under Medicare.
Lifetime
Maximum Benefit
The lifetime maximum benefit of a long term care policy is the maximum
amount that a long term care insurance company will pay for expenses
during the life of a policy. A pool of money is often how the lifetime
maximum benefit is described in that insured can draw against the
pool until it is dry. When the lifetime maximum benefit is exhausted,
the policy will pay no more benefits.
Lifetime
Community and Home Based Care Maximum
Covered expenses for adult day care, home health care and homemaker
services are maximized to a specific dollar amount that an insurance
company will pay for.
Lifetime
Therapeutic Devices Maximum
Durable medical equipment has a maximum amount that an insurance company
will pay.
Long
Term Care (LTC)
Accident, illness, cognitive impairment or advancing age will cause
this type of care to be needed for assistance with daily living. Care
is provided either at home or in a facility. A range of formal and
informal services for health, personal care and social needs may be
included in Long Term Care. Long Term Care can be provided both formally,
by medical and health professionals, or informally by unskilled caregivers.
Long
Term Care Facility
— See "Nursing Care Facility"
Maximum
Daily Benefit (MDB)
The pre set amount that the long term care insurance policy will pay
up to for each day during a claim period. The maximum daily benefit
is specified in the long term care insurance policy. The purchase
of a benefit increase rider would increase the benefits of the policy
on an annual basis.
Maximum
Benefit Period (MBP)
A long term care insurance policyholder has a maximum amount of time
that benefits will be able to be collected during a qualified long
term care event. The time period is usually specified in a yearly
basis. In the event that insured had a policy that specified a three-year
Maximum Benefit Period but was in care for over three, only the first
three years of care would be covered by the long term care insurance.
Medicaid
A joint federal/state government program that pays for health care
services for those with low incomes or those with very high medical
bills in proportion to assets.
Medicare
The federal program providing medical and hospital insurance to people
age 65 and older and to certain disabled persons who qualify. Benefits
for home health services and nursing home are severely limited.
Medicare
Supplement Policy
(Medigap Policy)
A private insurance policy that supplements what Medicare does not
pay.
Non-Forfeiture
Benefit
Upon lapse of the policy due to non-payment the policy feature that
provides reduced paid-up insurance, extended term or a shortened benefit
period for all or part of the premium after the policy has been in
force for a specified period of time.
Nursing
Care Facility (Nursing Home)
A facility providing skilled, intermediate or custodial nursing care
which is government regulated.
Personal
Care
— See "Custodial Care"
Premium
The periodic payment that the policy owner must make to the insurance
company to start the policy in force and to keep the policy in force.
Rate
Class of an Insurance Company
A group of insureds with similar insurability levels. Unhealthy people
who are more likely to need long term care are placed in a unhealthy
class and receive a disadvantaged rating (higher rates). For example,
the price of a long term care insurance policy typically decreases
as an individual's rate class increases.
Respite
Care
A type of care that is provided to long term care patients, at home,
by others for a few hours or a few days while allowing typically informal
caregivers some time away from their care responsibilities.
Restoration
of Benefits on a Long Term Care Policy
Adds benefit dollars back into a policyholder's lifetime maximum benefit
after recovery from a long term care illness for which benefits were
paid.
Riders
Changes from the standard insurance policy that add value.
Sandwich
Generation
This term describes individuals who unfortunately care for their children
as well as their aging parents.
Simple
Inflation Protection
Provides for an policy holder's long term care maximum daily benefits
and lifetime maximum benefits to increase each year by a set amount.
The Increase is based on the initial benefit and will increase by
the same amount each year. This rider is available for additional
premium. Compound inflation protection is a more expensive rider.
Skilled
Care
Referred to as nursing care, this level of care is the highest care
an individual can receive without being hospital confined. Skilled
Care is almost always based in an institution. The patient requires
constant medical supervision from medical professionals who are supervised
by a licensed physician.
Care
is available on a round-the-clock basis. Skilled Care services such
as occupational, physical and speech therapy are generally included
as skilled care. Medicare defines skilled care as daily care treated
by a physician.
Skilled
(nursing) care is the only type of long term care Medicare covers
(on a limited basis).
See
also "Custodial Care" and "Intermediate Care."
Stand
By Assistance
The need for a person to assist another person performing activities
that are basic to daily living. Unlike a person who needs continuous
supervision, a person who requires standby assistance is required
to have a caregiver at a very close distance to the patient at all
times to prevent injury to the individual while the individual is
performing the activity of daily living (ADL).
Therapeutic
Devices
Ramps and devices such as grab bars which help an individual perform
the basic activities of daily living without a caregiver's assistance.
Underwriting
Examining, accepting or rejecting insurance risks by the long term
care insurance company and classifying those selected. The reasoning
is to charge the proper premium for each potential policyholder.
