Home for the Aged
A facility that cares for the elderly that often is not covered under a long-term care insurance policy.
Home Health Care
Care received in your home by a licensed or certified home care agency, which can include bathing, dressing, toileting, continence, eating, transferring (i.e. from bed to a chair). Some policies may also cover homemaker services which can provide assistance with cooking, cleaning, shopping, laundry, etc.
Homemaker Services
These services would include shopping, bill paying, cooking, housecleaning, laundry, and other household services that you are unable to do.
Hospice Care
Continuous care provided at home or in a facility with a homelike setting for a terminally ill person. A terminally ill person has a life expectancy of six months or less.
Indemnity Method
Method of paying benefits where the benefit is a set dollar amount and is not based on the specific service received or on the expenses incurred. The insurance company only needs to decide if you are eligible for benefits. Once the company determines you are eligible and you are receiving eligible long-term care services, the insurance company will pay that set amount directly to you up to the limit of the policy.
Inflation Rider
If you are purchasing a long term care policy and you are younger than age 75, an inflation rider on your policy is important. Most long term care policies offer both a 5% simple or a 5% compound inflation protection rider. If you purchase your policy between ages 55 and 74 the 5% simple will offer some protection, however if the compound inflation rider is within your budget, it remains the wiser choice, and is a definite must for those who purchase coverage under age 55.
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Lapse
Termination of a policy when a premium is not paid.
Limited Payment Option
A premium payment option in which the person pays premiums for a set time period. After the last premium payment, neither the company nor the person can cancel the policy. These plans are more expensive than continuous payment policies; however, their guaranteed fixed payment and no-cancel features make them attractive to some persons.
Medicaid
A joint federal/state program that pays for health care services for those with low incomes or very high medical bills relative to income and assets.
Medicare
The federal program that provides hospital and medical insurance to people aged 65 and older and to certain ill or disabled persons. Benefits for nursing home and home health care services are limited.
Medicare Supplement Insurance
A private insurance policy that covers many of the gaps in Medicare coverage (also called Medigap insurance coverage).
National Association of Insurance Commissioners (NAIC)
A membership organization of state insurance commissioners. One of its goals is to promote uniformity of state regulation and legislation related to insurance.
Noncancelable Policies
Insurance contracts that cannot be cancelled by the insurance company and the rates can not be changed by the insurance company.
Nonforfeiture
If this benefit is available and you stop paying your premium after the third year, with some companies your past premiums may still be available to pay for services.
Nursing Home Care
Care received in a facility licensed by the state that offers skilled nursing and personal care on a 24 hour basis, room and board, medication, therapies and rehabilitation services.
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Paid-up Policy
A provision for when you prematurely stop paying your premiums that your insurance policy is considered to be paid-in-full. You do not pay any additional premiums, however, the benefits you receive under the policy will be determined based upon the amount of premiums you have previously paid, and not on the level of benefits that you originally purchased.
Partnership Policy
A type of policy that allows you to protect (keep) some of your assets if you apply for Medicaid after using your policy's benefits. Only a few states have these policies.
Payment Options
In addition to the traditional options, when available, a 20-pay or Paid-Up (available up to age 75) option may give you the opportunity to pay for your policy during your income-earning years, so it can be competely paid for by the time you retire.
Pool Of Money
A pool of money policy is superior to the stated period policy. A pool of money policy will let you stretch the benefits years if you do not take out the maximum daily amount.
Personal Care (Custodial Care)
Personal care that can be provided by an individual who does not have professional training to assist individuals with needs such as bathing, dressing, cooking and eating.
Pre-existing Condition
An illness or disability for which you were treated and or advised on within a time period prior to applying for a life or health insurance policy.
Reduced Paid-up Benefits
A nonforfeiture option that "reduces your daily or monthly benefit" while retaining the full benefit period on your policy until death. An example would be: You purchased a 3 year policy with a $150 daily benefit and after a sepcified period let the policy lapse. Your daily benefit would be reduced (the exact amount of the reduction depends upon the total premiums you have paid on the policy), however you benefit period remains at 3 years. You can use the reduced paid-up beneftis at any time after your lapse up until your death.
Restoration of Benefits
Your full policy limit can be restored once if you have been receiving benefits and then recover, and need no care or treatment for 180 days...may or may not be an available benefit depending upon the company you choose.
Rescind
When the providing insurance company cancels (voids) a policy.
Respite Care
A period of time offered under some policies that allows a few hours to several days of relief care for an insured individual to allow family caregivers a break.
Rest Home
A general term for a facility that cares for elderly people. Often this type of facility is not covered under a long-term care policy.
Rider
An addition to an insurance policy that changes the provisions of the policy.
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Shared Care
This feature (when available) allows you to use your partner's benefits when yours are exhausted. If one of you dies, the surviving partner's benefits will increase by the deceased partner's remaining benefit dollars. The surviving partner's premium will be reduced by the cost of the Shared Care benefit.
Shortened Benefit Period
A nonforfeiture option that reduces the "benefit period" however retains the full daily maximums applicable until death. The period of time for which benefits are paid will be shorter. An example: you purchase a policy with a 3 year benefit period with a $150 daily benefit and after a period of time let the policy lapse. The benefit period is reduced to less than three years which is determined by how much premium you have paid into the policy, however the daily benefit remains the same. You may use the shortened benefits at any time after policy lapse up until your death..
Simple 5%/5% Inflation
Each year, both your Daily or Monthly Benefit and your Policy Limit will increase by 5% on a simple interest basis.
Skilled Care
Daily nursing and/or rehabilitative care that can only be performed by or under the supervison of skilled medical personnel (most commonly in a nursing home). Care is usually needed 24 hours a day, must be ordered by a physician and must follow a prescribed plan of care.
Spend Down
A Medicaid rule where an individual must use up most of his or her assets and income to meet Medicaid eligiblity requirements.
Stand-by Assistance
Is when a caregiver stays close in order to watch over an individual in case physical assistance if necessary.
State Health Insurance Program
A federally funded program training volunteers to provide counseling regarding the insurance needs of senior citizens. A list of State Health Insurance Programs may be found in the NAIC publication "A Shopper's Guide To Long-Term Care Insurance".
Substantial Assistance
A term used in long term care policies that means hands-on or stand-by help is required to perform activities of daily living.
Substantial Supervision
A term used in long term care policies that means that the prescence of a person is needed to direct or watch over an individual who has an congnitive impairment.
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Tax-Qualified Long-Term Care Insurance Policy
A policy that conforms to certain standards in federal law and offers certain federal tax advantages.
Third Party Notification
When a policy holder names an individual (family member, friend, attorney, etc.) who the insurance company will notify if your coverage is about to lapse due to lack of premium payment.
Toileting
Getting to and from the toilet, getting on and off the toilet and performing associated personal hygiene.
Transferring
Moving into and out of a wheelchair, chair or bed.
Underwriting
The process of examining, accepting, or rejecting insurance risks, and classifying those selected, to charge the proper premium for each.
Waiver of Home Care Elimination Period
If you receive home health care, hospice care in your home, or adult day care, your Elimination Period will be waived.
Waiver of Premium
This is a provision in a long term care policy that relieves the insured of premium payment while receiving benefits.
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