Glossary of Long Term Care-Related Terms
Activities of Daily Living (ADLs): Everyday actions performed by individuals such as dressing, eating, bathing, toileting, continence and transferring. Most insurance policies covering long term care services base your qualification for benefits on your inability to perform a certain number of ADLs.
Adult Day Care: Group supervision for elderly persons, including social and recreational services and in some cases health services, in a community facility.
Alternate Level of Care Benefits: Care in a hospital inpatient setting for those persons waiting to be placed in a nursing home or while arrangements are being made for home care.
Assisted Living: Assisted Living includes services provided to support an individual in the performance of activities of daily living or to support an individual who has a severe cognitive impairment. Assisted Living Services are usually provided in a community-based residence. In Partnership policies, the level of benefit for Assisted Living varies depending upon the plan purchased. The Total Asset 100 and Dollar for Dollar 100 policies provide coverage for a community based residence, including room and board. The Total Asset 50 and Dollar for Dollar 50 provide coverage for Assisted Living Services, excluding room and board, at the same level as a home care benefit.
Assisted Living Facility: A residential facility providing ongoing care and related services for persons needing assistance in the activities of daily living.
Copayment or Coinsurance: The amount you must pay for each medical service, outpatient hospital service or hospital stay.
Custodial Care: Non-medical care that meets your personal needs. For example, custodial care includes help eating, bathing, toileting, taking medication or walking.
Cognitive Impairment: Deterioration in intellectual activity such as thinking, reasoning or remembering.
Daily Benefit Amount: The amount your insurance policy will cover for each day of services provided. Some policies pay a flat daily benefit amount, while others will pay reasonable and customary charges up to the daily benefit amount.
Deductible: The amount you must pay for health care before Medicare or private medical insurance begins to pay.
Dementia: Impairment of intellectual faculties due to a disorder of the brain.
Dollar for Dollar 50 and Dollar for Dollar 100: Dollar for Dollar Asset Protection plans protect the insured’s assets in an amount equal to the benefits paid out by the Partnership policy. Under Dollar for Dollar asset protection, unprotected assets are subject to Medicaid rules. Dollar for dollar asset protection is available with products offering less than 3 years of nursing home coverage.
The notations 50 and 100 represent the percentage of benefit paid for the home care or home and community based care compared to the nursing home benefit. In the case of the 50 designation, the home care payment will be set at 50 percent of the nursing home benefit for the Partnership policy. For example, if the nursing home benefit chosen is $200 per day, the home care benefit will be $100 per day. In the case of the 100 designation, the home care or the community based care payment will be set at 100 percent of the nursing home benefit. The amount of benefit for any policy can be increased beyond the minimum required benefit to provide a level of coverage that will meet the cost of care for your specific location.
Elimination or Waiting Period: The elimination or waiting period is the number of days you must receive long term care services before benefits will be paid under the policy. During the elimination or waiting period you will have to privately pay for the care you receive. A new elimination or waiting period may be imposed for each period of care. Shorter elimination periods increase the cost of the policy. 100 days is the maximum elimination period for Total Asset plans. 60 days is the maximum elimination period for Dollar for Dollar plans.
Expense Incurred: An expense incurred policy is one which pays benefits for the actual expenses incurred up to a certain maximum amount stated in the policy. For example, if you incur actual expenses of $200 in a day and the policy has an expense incurred daily maximum benefit of $100 per day, the policy will pay $100 for that day’s home care service.
Free Look Period: The time period after receipt of the policy during which a policyholder can cancel and get a full refund. In New York State this period is 30 days for long term care insurance.
Functional Impairment: The need for assistance to carry out a specific number of activities of daily living.
Group Insurance: A Group Insurance Policy is issued to an entity as the policyholder (such as an employer, labor union, association or a trust) and the policy is designed to cover more than one person. Group insurance may be less costly than individual insurance due to the insurer’s ability to reduce administrative costs by accessing numerous potential buyers at the same time. In addition, employers offering Long Term Care Insurance sometimes contribute to the premium cost on behalf of their employees. Some people raise concerns about purchasing Group Long Term Care Insurance because they fear that the coverage will not be available to them if they change jobs, or if the policyholder terminates the contract. In those situations, New York State requires insurers to offer Group insurers the opportunity to continue the policy as a member of the group, or to convert to an individual policy with the same or substantially similar coverage.
Guaranteed Renewable: Guaranteed renewable means that you have the right to continue the policy as long as the premiums are paid on a timely basis. An insurer cannot terminate the policy if your health declines. The insurer also cannot make any change in any provision of the policy while the insurance is in force without your agreement. An insurer cannot change the premium charged for the policy unless it is approved by the New York State Department of Financial Services, and unless it applies to all members of a class covered by the policy.
Home Care (personal care): Assistance with personal hygiene, dressing or feeding, nutritional or support functions and health-related tasks.
Home Health Care: Health services received in your home, including skilled nursing care, speech, physical or occupational therapy or home health aide services.
Hospice Care: A program of care and treatment, either in a hospice facility or in the home, for persons who are terminally ill and have a life expectancy of six months or less.
Indemnity: An indemnity policy is one which pays a benefit stated in the policy regardless of the actual expenses incurred. For example, if you incur actual expenses of $100 in one day and the policy provides an indemnity benefit of $200 per day, the policy will pay $200 for that day’s home care service.
Individual Insurance Policy: An Individual Insurance Policy is a single policy under which one individual is insured. Traditionally, individual Long Term Care Insurance is sold by insurance agents in the agent’s office or, sometimes, in the buyer’s home. Some insurers now sell individual policies through “worksite marketing” methods. The insurer will gain access to a particular group at the place of employment, and market individual policies to the members of that group. As long as the insured continues to pay the policy’s premium, an individual Long Term Care Insurance policy is guaranteed to be renewable for the life of the insured.
Inflation Protection Benefit: The Inflation Protection benefit increases the daily benefit amount and policy maximums over time to help keep pace with inflation on Long Term Care expenses. Inflation Protection is required for all Partnership policies purchased at age 79 and younger.
Maximum Policy Benefit: The period of time or dollar amount limit for which long term care benefits will be paid under the policy.
Medicaid: A governmental program for low-income individuals and families.
Medicare: A federal program providing hospital and medical insurance to people aged 65 or older and to certain ill or disabled persons.
Medicare Supplement Insurance: Private insurance designed to fill in some of the major gaps in Medicare coverage.
New York City Metropolitan Area: The counties of Bronx, Kings, Nassau, New York, Queens, Richmond, Rockland, Suffolk, and Westchester.
Nonforfeiture Benefit: A benefit designed to ensure that if an insurance policy is lapsed after a specific number of years, some of the benefits from the policy will be retained.
Partnership for Long Term Care: A public-private partnership which combines private long term care insurance with Medicaid Extended Coverage to provide New Yorkers with a lifetime of long term care benefits.
Period of Care: A specified number of days of care either in a nursing home or while receiving home care services without a break in the services for a specified number of days.
Policy Form #: An identifying number found in the lower left hand corner of each insurance policy/contract.
Preexisting Condition: A medical condition for which medical advice was given or treatment was recommended by, or received from, a licensed health care provider within six months before the effective date of coverage.
Respite Care: Services to provide family members a rest or vacation from caregiving responsibilities.
Skilled Nursing Care: A level of care that must be given or supervised by registered nurses.
Tax Qualified: The Federal government allows favorable tax treatment of long term care policies which qualify under the law. Generally, benefits you receive from tax-qualified policies will not be considered as taxable income under either federal or state law. The premiums charged for tax-qualified policies are treated as medical expenses for purposes of itemized deductions up to certain dollar limits that are indexed annually.
New York State law allows favorable state tax treatment of premiums paid for policies which qualify under the federal law and meet New York minimum standards. Any policy covering long term care services that was approved in New York and issued before January 1, 1997, qualifies for favorable tax treatment with certain limited exceptions.
Total Asset 50 & Total Asset 100: Total Asset Protection plans protect all of the insured’s assets. There is no limit to the assets the insured may keep and still receive Medicaid Extended Coverage. Total asset protection is offered with long term care insurance policies that provide 3 or more years of nursing home coverage.
The notations 50 and 100 represent the percentage of benefit paid for the home care or home and community based care compared to the nursing home benefit. In the case of the 50 designation the home care payment will be set at 50 percent of the nursing home benefit for the Partnership policy. For example, if the nursing home benefit chosen is $200 per day, the home care benefit will be $100 per day. In the case of the 100 designation the home care or the community based care payment will be set at 100 percent of the nursing home benefit. The amount of benefit for any policy can be increased beyond the minimum required benefit to provide a level of coverage that will meet the cost of care for your specific location.
Viatical Settlement: A cash lump sum paid in lieu of a life insurance policys death benefits.
Waiting Period: The number of days you must be in a nursing facility or the number of days of home health care you must receive before long term care benefits will be paid under the policy. During the waiting period, you must privately pay for the nursing facility stay or home health care services.
Waiver of Premium: After a policyholder has received benefits for the specific number of days stated in the policy, no further premiums will be due until they leave the nursing home.