Elimination Period
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UPDATED: Jul 17, 2023
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UPDATED: Jul 17, 2023
It’s all about you. We want to help you make the right legal decisions.
We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.
Specific provisions in a typical long term care insurance policy govern your eligibility for benefits. These are defined below, with additional comment for clarification where needed.
_________
In order to be eligible for certain Benefits, you must also satisfy an Elimination Period, as described below.
“Elimination Period” is the number of days after the Original Coverage Effective Date of this Policy during which You must be: (1) Chronically Ill; and (2) receiving Primary Services (other than Hospice Care and Respite Care), before certain Benefits become payable. These days need not be consecutive. The Elimination Period for this Policy is shown on the Schedule of Benefits page. Except as stated below, Benefits will not be paid for Covered Services You receive during the Elimination Period.
No Elimination Period is required in order to receive Benefits for Hospice Care, Respite Care, Needs Assessment or Informal Caregiver Training. Receipt of these services will not count toward satisfying the Elimination Period.
You only have to satisfy the Elimination Period once. Once You have satisfied a day of the Elimination Period, that day is satisfied for the life of the Policy.
| COMMENT: The Elimination Period in this long term care Policy is like a waiting period or a deductible period in your typical health insurance policy. Subject to the exceptions stated above, no long term care benefits are covered under the Policy during this period. You are responsible for paying all long term care costs incurred during the Elimination Period.
This is an important aspect to consider when buying a long term care insurance policy. Elimination periods range from 10 days to one year. Generally, you can decide what the length of your Elimination Periodwill be, but it affects the cost of the premium. The shorter the elimination period, the higher your premium will be; the longer the elimination period, the lower the premium will be. A typical elimination period is around 60 days, but if you elect an elimination period of 6 months to one year, you might reduce your premium by as much as a third. Your decision on the length of the Elimination Period must take into consideration your ability to pay for long term care expenses AND, along with it, the quality/cost of the long term care facility you would consider. In many situations an older person only needs care for a short period of time. A long Elimination Period could mean you would not receive any Benefits at all. But the real purpose of long term care insurance is not to cover the costs of a short period of care, but to prevent the potentially financially devastating costs of a long period of expensive care. That’s why it is called long term care insurance. Therefore, purchasing a policy with a longer Elimination Period (90 days to 180 days) probably makes good sense if it results in substantial premium savings. This is particularly true if you are buying the policy when you are in your 50s or 60s and will probably be paying the premium for many years. |
| COMMENT: The Primary Services that count toward your Elimination Period are shown on the Schedule Page of the Policy and are as follows: (1) Nursing Home services; (2) Assisted Living Facility services; and (3) Home Care and Community Careservices.
Other care described in the Policy does not count toward reducing your Elimination Period, nor are other services (such as, Respite Care, Hospice Care, Needs Assessment and Informal Caregiver Training) subject to the Elimination Period. |
Case Studies: A Crucial Factor in Long Term Care Insurance
Case Study 1: Tailoring the Elimination Period to Manage Costs
John, a 55-year-old individual, is considering purchasing a long term care insurance policy. He understands that the length of the elimination period affects the cost of the premium. After assessing his financial situation and weighing the potential risk, John decides to opt for a longer elimination period of 180 days.
By choosing a longer elimination period, he can significantly reduce his premium payments, making the policy more affordable for him. John recognizes that this decision aligns with the purpose of long term care insurance, which is to safeguard against prolonged and expensive care needs in the future.
Case Study 2: Utilizing Primary Services to Meet the Elimination Period
Mary, a long term care insurance policyholder, requires nursing home care due to a decline in her health. Her policy includes nursing home services as part of the primary services that count toward the elimination period. Mary stays in a nursing home for 90 days, which satisfies her elimination period requirement.
After the elimination period is fulfilled, Mary becomes eligible to receive long term care insurance benefits for the covered services she receives. The elimination period acts as a waiting period during which Mary is responsible for the costs, but once it is met, the insurance coverage kicks in, providing financial support for her ongoing care needs.
Case Study 3: Balancing Elimination Period and Care Needs
Sarah, a 62-year-old individual, is planning for her long term care needs. She carefully evaluates the options for the elimination period in her long term care insurance policy. Sarah considers her ability to pay for long term care expenses and the quality/cost of the facilities she would prefer.
Given her financial circumstances and the potential duration of care, Sarah decides on a 60-day elimination period, striking a balance between cost and coverage. With this choice, Sarah ensures that she can receive benefits relatively soon after requiring long term care services while still maintaining a manageable premium.
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