Only pays for skilled care, where the patient shows signs of improvement.
Covers the costs of long-term care temporarily, up to 100 days in a skilled nursing facility after a hospitalization of three days or more, after a three consecutive day stay under treatment in a hospital. After 20 days, the patient incurs a $148.00 co-pay (2013).
Requires a person to spend down or have countable assets of $2,000 or less (depending on the state), to receive long-term care.3
The rider provides an acceleration of the death benefit to help pay for costs involved with long-term care. Excess benefits may be used for other expenses, not just those directly related to long-term care costs.
Your clients select the long-term care specified amount when they purchase the contract — between 10% and 100% of the policy’s total specified amount (in NY, KY and Virgin Islands, the amount of the long-term care specified amount must be equal to the specified death benefit at issue)
The long-term care benefits are paid out income tax free (after qualifying requirements are met)
Benefits can be used for home health care, assisted living, a nursing home, adult day care or other qualifying services
Keep in mind that as an acceleration of the death benefit, the LTC rider payout will reduce both the death benefit and cash surrender values.
Two things have to happen in order for your clients to qualify for and begin receiving monthly long-term care benefits.
Their doctor must certify that (a) they have a severe cognitive impairment, or (b) they are unable to perform two or more of these activities of daily living for a period of 90 days:
- Transferring (moving into or out of a bed, chair or wheelchair)
There is also a 90-day elimination, or waiting, period. This can be satisfied by any combination of days in a long-term care facility or days requiring home health care or adult day care services or any other qualifying long-term care service. These days of care or services don’t need to be consecutive, but they do need to be accumulated within a continuous period of 730 days.
While receiving benefits, your clients must also receive a planned program of observation and treatment. This program must (a) be under the care of a licensed health care practitioner other than the owner or an employee of the long-term care facility; and (b) be continued in accordance within generally accepted standards of medical practice for the injury or sickness.
Once your clients meet the requirements and elimination period, the rider benefits will help them cover the costs of qualified care, such as:
Home health care — includes adult day care and home health care to assist with activities of daily living or cognitive impairment (including, but not limited to Alzheimer’s disease and senile dementia)
Assisted living — for the purpose of assisting with activities of daily living or cognitive impairment
Qualified long-term care facilities — including 24-hour-a-day care and medical services to support the needs of patients
Nursing home care — includes 24-hour-a-day skilled, intermediate or custodial care under the supervision of a physician
2% of the long-term care specified amount OR Daily amount allowed by HIPAA in the given year of claim, multiplied by the number of days in the month
The maximum cumulative benefit for long-term care is the greater of actual costs incurred, or the per diem rate in the given year of a claim established by The Health Insurance Portability and Accountability Act (HIPAA), which is currently $320 per day (2013).
No. If your clients are collecting long-term care rider benefits and there isn’t enough cash value to cover the monthly costs associated with the policy, the costs will be waived and your clients will continue to receive their remaining long-term care benefits.
However, this special protection only applies as long as your clients are on claim with Nationwide and are receiving long-term care benefits. Should they recover, or for any other reason cease collecting long-term care benefits, your client may need to pay additional premiums to reinstate the policy or restore their no-lapse guarantee if the policy was not kept in good standing while on claim.
Resolving long-term care needs can be time-consuming and expensive, as well as emotionally and physically draining. Nationwide Care Guide Network® is a free telephone consultation service for clients who have purchased the LTC rider.6 It offers comprehensive assessment, resource, referral and consultation services on long-term care issues.
Here’s how it works:
Nationwide Care Guide Network is available to policyholders who have purchased the LTC rider, as well as their spouses, parents, adult children, siblings and parents-in-law
The Nationwide policyholder or caregiver may call toll-free at 1-866-442-6569, 24 hours a day, to speak with a professional care manager
The professional care manager, usually a registered nurse or social worker, will evaluate the long-term care situation and begin to offer solutions in the form of a Customized Care Plan (clients should keep in mind that care managers do not have information about Nationwide policies)
The Customized Care Plan is designed to provide all the information and guidance needed to make long-term care decisions; it assesses the personal, emotional and environmental long-term care needs and presents information on resources to help meet those needs