Long-term care insurance (LTCI) pays a benefit when the insured cannot perform a defined number of activities of daily living (typically two out of six: bathing, dressing, toileting, transferring, continence, eating) OR has cognitive impairment. The benefit can be used for assisted living, memory care, nursing home care, adult day care, and often in-home care. The benefit amount, duration, and covered settings vary by policy.

Check financial files, safe deposit boxes, and old tax returns (LTCI premiums are sometimes deducted). Search the mail for premium notices. Check with an insurance agent or financial advisor who worked with your parent. Some states have a Long-Term Care Insurance Policy Locator — contact your state insurance department. If you know the insurer but cannot find the policy, contact the company directly with your parent’s information.

Most LTCI policies pay benefits when the insured cannot perform two or more activities of daily living (ADLs) without substantial assistance, OR when they have a cognitive impairment (such as Alzheimer’s or dementia) that requires substantial supervision. A licensed healthcare professional must certify that these conditions exist. The certification process typically requires a physician statement and sometimes a functional assessment by a nurse.

The elimination period is the LTCI equivalent of a deductible — a waiting period (typically 30, 60, or 90 days of care) that must pass before benefits begin. During the elimination period, the family pays for care privately. Once the elimination period is satisfied, the policy begins paying. Know your parent’s elimination period before needing care — it affects cash flow planning significantly.

Most LTCI policies pay a daily benefit (e.g., $150, $200, or $250 per day) or a monthly benefit. The total monthly benefit equals the daily amount times 30. Policies purchased decades ago often have lower benefit amounts that may not cover current care costs in full — the benefit may cover a portion of care costs with private funds making up the difference. Inflation protection riders increase the benefit over time.

Contact the insurance company as soon as care begins — do not wait. Request a claim packet. Complete the forms with physician certification and functional assessment documentation. The insurance company will typically send their own nurse assessor to evaluate the insured. Once approved, submit monthly invoices or facility statements for reimbursement. Some policies pay the insured directly; others pay the care provider directly. The process typically takes 30 to 60 days.

Appeal the denial immediately. Request the specific reason for denial in writing. Gather additional medical documentation that addresses the stated reason. Involve the treating physician in the appeal. If the appeal fails, file a complaint with the Texas Department of Insurance. Consider consulting an insurance attorney who specializes in LTCI claims. Many initial denials are overturned on appeal with proper documentation.

Yes, most long-term care insurance policies cover memory care because cognitive impairment is a standard benefit trigger. Even if the insured can perform most ADLs physically, cognitive impairment alone qualifies for benefits under most policies. Confirm with the insurer that the specific memory care facility meets the policy’s licensed provider requirements — most modern memory care communities qualify.

An inflation protection rider increases the LTCI benefit amount over time, typically by 3% or 5% per year compounded. This rider is critically important because care costs have risen substantially over decades. A policy purchased 20 years ago with a $150/day benefit would be worth $270/day with a 3% compound rider — much closer to current Texas care costs than the original benefit amount.

Most modern LTCI policies cover in-home care as well as facility-based care. Covered in-home services may include: licensed home health aides, skilled nursing visits, occupational and physical therapy, and adult day services. Older policies may have more restrictive definitions of covered home care. Review the policy language carefully, and if unclear, ask the insurance company to confirm in writing what home care services are covered.

Unfortunately, a lapsed policy provides no benefit. If premium payments were missed, the policy may have entered a nonforfeiture benefit period (some policies include this as a standard feature or rider), which provides a reduced benefit for a shorter period in exchange for past premiums paid. Contact the insurer to determine the policy’s current status — some lapsed policies have a grace period for reinstatement.

Yes. Inform the facility that long-term care insurance will be paying some or all of the monthly cost. The facility will need to provide monthly invoices or care statements to the insurance company. Some facilities have staff who are familiar with the LTCI billing process and can assist. In some cases, the facility is paid directly by the insurer; in others, the family receives the reimbursement and pays the facility.