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Long Term Care Insurance for “Assisted Living” works in Personal Care Homes Too! | Keystone Elder Law – Mechanicsburg, PA

In January 2011, Pennsylvania made it illegal to refer to “assisted living” except in the context of a licensed Assisted Living Residence (ALR). Why they did that is a long story, and there are only a few communities actually licensed as an ALR. Most places which once were legally referred to as “assisted living” are now licensed as Personal Care Homes (PCH).

If this is news to you, even the expert columnists and advertising departments of the Patriot News haven’t yet caught on. And the people who work or live in a PCH break the law every day without harmful intentions. So who cares?

Insurance companies care. In June 2011, a healthy client asked me to review a Long Term Care Insurance (LTCI) policy she was wisely considering buying with proceeds from her husband’s life insurance. She asked the insurance salesperson if the LTCI policy would pay for her care in a local PCH. The salesperson said “yes” in good faith, but the language of the policy was more narrow. Because I had experienced denial by an insurer of a LTCI claim for care in an assisted living facility because my client’s LTCI policy only covered care provided in “a nursing home,” I sought pre-purchase clarification. A series of responses from this reputable insurance company documented their intention to exclude coverage of services offered by a PCH.

I reported this to the Department of Insurance. After one year of advocacy, the Department clarified that if a policy says it will pay for care in an assisted living facility, it must pay in a PCH. After my inquiry, the Department said they would require insurance companies to change language of their policies to clarify that care in a PCH is covered if the policy pays for assisted living.

I hope this story does not seem like I was “making a mountain out of a molehill.” At least for purposes of LTCI, I was making a claim insurable in a PCH out of “assisted living.” Words generally do matter when it comes to LTCI, even if in this example our advocacy got a loophole closed. Are you among the wise and fortunate who have a LTCI policy? If so, we can help you make sure you know what your LTCI covers and build a plan for you to get the best care around it!

Dave Nesbit