The New York Times is reporting on an alarming trend in long-term care insurance: Policy holders with legitimate claims are being denied repeatedly, possibly in the hopes that they will simply give up or die before the claim is processed. From the NYT:
Mary Rose Derks was a 65-year-old widow in 1990, when she began preparing for the day she could no longer care for herself. Every month, out of her grocery fund, she scrimped together about $100 for an insurance policy that promised to pay eventually for a room in an assisted living home.
But when she filed a claim with her insurer, Conseco, it said she had waited too long. Then it said Beehive Homes was not an approved facility, despite its state license. Eventually, Conseco argued that Mrs. Derks was not sufficiently infirm, despite her early-stage dementia and the 37 pills she takes each day.
After more than four years, Mrs. Derks, now 81, has yet to receive a penny from Conseco, while her family has paid about $70,000.
Conseco and Bankers Life “made it so hard to make a claim that people either died or gave up,” said Betty J. Hobel, a former Bankers Life agent in Cedar Rapids, Iowa.
“When someone is 70 or 80 years old,” she said, “how many times are they going to try before they just give up?”
Must read article for anyone who has a loved one with a long-term care policy.—MEGHANN MARCO
Aged, Frail and Denied Care by Their Insurers [NYT] (Thanks, Erin!)