Why isn't my father receiving the right amount of money from his long term care insurance company?
My father moved into an assisted care facility in April and filed a claim with his long term care insurance company. It took 4 months for it to be approved and for payment to be sent. His policy states that he will be paid $114.59 a day for his long term care, not up to that amount but $114.59. He also received a letter on March 3, 2011 stating that he would receive $114.59 per day. When he received his payment they had only paid him what the rest home charged which was $109.00 per day. Shouldn't he be paid the $114.59 as it states in the policy regardless of the charges of the rest home?
Expert Answer
There are two types of payments from long term care insurance policies. The most common one is reimbursement-based. This pays for costs that are actually incurred by the beneficiary. In your father's case, he only paid $109 per day, so that is what he is reimbursed for. The other type is indemnity-based, sometimes called cash-based. With this type, the policy pays the maximum daily (sometimes monthly)rate as long as the beneficiary received some covered care during that time period. If your father has an indemnity policy, it should pay $114.59. You need to read the policy. You will probably find that it is reimbursement-based.