About Long Term Care Insurance







Cost of Care



A Guide

To familiarize you with phrases commonly used in conjunction with long term care insurance policies, the following is a list of common terms with a link to their definitions.

Activities of Daily Living (ADLs)
Acute Care
Adult Day Care
Adult Foster Care
Alternate Care Facility
Alternate Plan of Care Benefit
Alzheimer's Disease
Alzheimer's Units
Assisted Care Facility (ACF)
Bed Reservation Benefit
Benefit Period
Care Coordinator
Care Management
Caregiver, Primary
Caregiver(s), Secondary
Catastrophic Illness
Chronic Care
Cognitive Impairment
Continuing Care Retirement Community
Couples Discount

Custodial Care
Daily Benefit
Elimination Period
Home Health Care
Home Modification
Homemaker Services
Hospice Care

Inflation Protection
Intermediate Nursing Care
Means Test
Medicare Supplement ("Medigap") Insurance
Nonforfeiture Benefit
Nursing Home
Personal Care
Plan of Care
Pre-existing Condition
Preferred Health Discount
Privileged Care Coordinator

Respite Care
Skilled Nursing Care
Skilled Nursing Facility (SNF)
Survivorship Benefit Option
Third-party Notification
Unintentional Lapse Protection
Waiver of Premium

Activities of Daily Living (ADLs): Everyday functions and activities individuals usually do without help. ADL functions include bathing, continence, dressing, eating, toileting, and transferring. Many policies use the inability to do a certain number of ADLs (such as 2 out of 6) to decide when to pay benefits.

Acute Care: Care for illness or injury that develops rapidly, has pronounced symptoms, and is finite in length. An example is medical care for a short time to cure a certain illness and/or condition.

Adult Day Care: Social, recreational and/or rehabilitative care services provided for someone who can benefit from daytime supervision. This is an alternative between care in the home and in an institution. It refers to health support and rehabilitation services provided in the community to people who are unable to care for themselves independently during the day but are able to live at home at night.

Adult Foster Care: A live-in arrangement where one adult lives with and is cared for by an unrelated individual or family. This arrangement may be certified by the state or managed independently.

Alternate Care Facility: A licensed residence other than a skilled nursing facility where care services are delivered (e.g., hospice, assisted care or Alzheimer's facilities).

Alternate Plan of Care Benefit: Payment for a special arrangement or services to allow the insured to receive benefits for services outside the coverages of a long term care policy (e.g., in-home safety devices, home delivered meals, stays in special types of facilities, additional equipment benefits).

Alzheimer's Disease: A progressive, degenerative form of dementia that causes severe intellectual deterioration.

Alzheimer's Units: Special living units within skilled nursing facilities or assisted living facilities specifically providing care and services for those with Alzheimer's disease.

Aphasia: Loss of the ability to use or understand language.

Assessment: A determination of physical and/or mental status by a health professional based on established medical guidelines.

Assisted Care Facility (ACF): A non-medical facility that provides room, board, laundry, some forms of personal care, and usually recreational services. Often licensed by state departments of social services, these facilities exist under several names including domiciliary care facility, sheltered house, board and care home, community-based care facility, and residential care facility.

Bed Reservation Benefit: Pays for reserving your bed in a care facility should you need to leave for a certain period of time during a covered stay.

Benefit Period: The length of time that a policy will pay the daily benefit (usually calculated by multiplying the daily benefit amount times the days of covered care).

Care Coordinator: A health care professional whose training includes managing and arranging for long term care services. This person can be a doctor, nurse, social worker or other similarly trained and licensed professional.

Care Management: Services typically provided by a nurse or social worker, to assess, coordinate and monitor the overall medical, personal, and social services needed by an individual requiring long term care.

Caregiver, Primary: The key person (usually a relative) overseeing and/or providing care for a person who is incapacitated.

Caregiver(s), Secondary: Relatives or others who assist part-time in giving care.

Catastrophic Illness: An illness that causes sudden temporary or permanent change or significant disruption to a person's normal lifestyle.

Chronic Care: Care for an illness continuing over a protracted period of time or recurring frequently.

Cognitive Impairment: A deficiency in a person’s short or long term memory; orientation as to person, place and time; deductive or abstract reasoning; or judgement as it relates to safety awareness.

Continuing Care Retirement Community (CCRC): A residential community providing a variety of living arrangements and services, which may range from independent living apartments to assisted care facility (ACF) and skilled nursing facility (SNF) care.

Couples Discount: A discount applicable if both partners are eligible and apply for coverage.

Custodial Care: Services that can be given safely and reasonably by a trained or capable non-medical person, designed mainly to assist with ADLs, such as bathing, eating, dressing, and other routine activities.

Daily Benefit: The amount of insurance benefit in dollars per day a person chooses for long term care expenses (typically between $50 and $250-selected by the applicant).

Dementia: Deterioration of mental faculties due to a disorder of the brain.

Elimination Period: A type of deductible; the length of time the insured must pay for long term care services before the insurance policy begins to make payments. The longer the elimination period in a policy, the lower the premium.

Home Health Care: At home services for occupational, physical, respiratory, speech therapy, or nursing care. Also included are medical, social worker, home health aide, and homemaker services.

Home Modification: Physical adaptations to a home that enable a person to stay and function in that environment.

Homemaker Services: Services designed to provide household support. They may include light housekeeping, laundry, shopping, cooking, home management and similar services.

Hospice Care: Is usually provided at home and provides care to alleviate physical, emotional, or spiritual discomforts near the end of life.

Inflation Protection: An optional policy feature that provides for increases in benefit levels over time to help pay for expected inflation in the costs of long term care services.

Intermediate Nursing Care: Assistance needed for stable conditions that require daily, but not 24-hour, nursing supervision. This care is initially ordered by a physician and supervised by registered nurses. It is less specialized than skilled nursing care, often involves more personal care, and is generally needed for a longer period of time.

Lapse: Termination of a policy when a renewal premium is not paid.

Means Test: Measures of income and assets to determine eligibility for government benefit programs such as Medicaid.

Medicaid: A means-tested medical and health welfare program supported by federal, state and local funds, and administered by each state to provide health care for eligible poverty level individuals.

Medicare: The federal program providing hospital and medical insurance to people aged 65 or older and to certain younger ill or disabled persons. Benefits for nursing home and home health care services are limited.

Medicare Supplement ("Medigap") Insurance: A private insurance policy that supplements Medicare benefits by covering co-payments and deductibles for medical and hospital expenses. These policies do not provide coverage for personal or custodial care.

Nonforfeiture Benefit: An optional benefit that provides you with a reduced, paid up personal benefit account.

Nursing Home: A licensed facility that provides room and board and a planned, continuous medical treatment program, including 24-hour-per-day skilled nursing care, personal care, and custodial care.

Personal Care: Assistance provided by another person to help with walking, bathing, eating and other routine daily tasks.

Plan of Care: A written, individualized plan prescribed by a physician or developed by other qualified health care professionals that specifies the type and frequency of all services required by the recipient of the care.

Pre-existing Condition: An illness or disability for which you were treated or advised within a time period before applying for the policy.

Preferred Health Discount: A discount received on policy premiums available to applicants who are determined to be in good health.

Privileged Care® Coordinator: A trained health care professional, a local expert in long term care services or a facilitator who will help insure your safety and comfort, in the setting that's right for you, including your home.

Respite Care: Long term care services provided at home or in a facility to temporarily relieve the family or friends who normally provide care for an impaired individual.

Skilled Nursing Care: Nursing and rehabilitative care that is performed by skilled medical personnel, usually available 24-hours-a-day and ordered by a physician under a treatment plan. It can be either in a facility setting or at home. (Note: Medicare and Medicaid both have their own definitions of "skilled nursing care" which do not necessarily match those in long term care insurance policies.)

Skilled Nursing Facility (SNF): A state-licensed institutional setting that provides skilled care by skilled medical personnel. This care is available 24-hours-a-day and is ordered by a physician under a treatment plan.

Spend-down: The process whereby an individual uses up most of his or her income and assets to meet Medicaid eligibility requirements.

Survivorship Benefit Option: A benefit that waives premiums due on a surviving partner's policy after both partners have had policies in force for a certain period of time and other criteria are met.

Third-party Notification: A process that lets you name someone who the insurance company would notify if your coverage is about to lapse due to a failure to pay premium. The notice can go to a relative, friend, or professional such as a lawyer or accountant, for example.

Unintentional Lapse Protection: A policy provision to reinstate coverage that has lapsed (providing that back premiums are paid) when the lapse is due to cognitive impairment or loss of functional capacity.

Waiver of Premium: A provision in an insurance policy that relieves the insured from having to pay premiums while receiving benefits.