Chapter 6: Key Terms

Question 1

Activities of Daily Living (ADLs)

Answer 1

Physical functions that an independent person performs each day: bathing, dressing, eating, transferring, toileting, and maintaining continence

Question 2

Adult Day Care

Answer 2

Services provided during the day at a community-based center. Programs address the individual needs of functionally or cognitively impaired adults

Question 3

Assisted Living

Answer 3

Senior housing that provides individual apartments, which may or may not have a kitchenette. Facilities offer 24-hour on site staff, congregate dining, and activity programs. Limited nursing services may be provided for an additional fee.

Question 4

Bed Reservation

Answer 4

Some policies will pay to reserve a bed in the nursing home when the insured leaves to go into a hospital. This reservation can last a specified number of days or until the insured returns from the hospital

Question 5

Chronic Illness

Answer 5

Having a physical or cognitive impairment that prevents the insured individual from performing at least two of the six activities of daily living for at least a 90-day period, or requiring substantial supervision to prevent the insured from posing a danger to themselves or others.

Question 6

Custodial Care

Answer 6

Board, room and other personal assistance services (including assistance with activities of daily living, taking medicine and similar personal needs) that may not include a skilled nursing care component

Question 7

Expense Incurred Method

Answer 7

This method provides for reimbursement of expense once bills are submitted to the insurance company. The reimbursable amount cannot exceed the benefit amount.

Question 8

Guaranteed Purchase Option

Answer 8

Allows the insured to increase the benefits by a stated percentage periodically

Question 9

Guaranteed Renewable

Answer 9

The company must renew the policy each year as long as premiums are paid

Question 10

Home Health Care

Answer 10

Limited part-time or intermittent skilled nursing care and home health aide services, physical therapy, occupational therapy, speech-language pathology services, medical social services, durable medical equipment (such as wheelchairs, hospital beds, oxygen, and walkers), medical supplies, and other services provided in the patient’s home

Question 11

Hospice Care

Answer 11

Offers a special way of caring for people who are terminally ill, typically utilizing a team-oriented approach to address medical, physical, social, emotional, and spiritual needs

Question 12

Inflation Protection

Answer 12

Helps the insured to maintain the purchasing power of the original contract benefit

Question 13

Intermediate-Care Nursing Facility

Answer 13

A licensed facility with the primary purpose of providing health or rehabilitative services. Typically provides custodial care along with intermittent medical care (not daily).

Question 14

Long-Term Care Insurance

Answer 14

Coverage that pays for all or part of the cost of home health care services or care in a nursing home or assisted living facility

Question 15

Long-Term Care Services

Answer 15

Medical and non-medical care for people with chronic illnesses or disabilities that assists people with ADLs (bathing, dressing, eating, transferring, toileting, incontinence). Long-term care can be provided at home, in the community, or in a facility

Question 16

Maximum Lifetime Benefit

Answer 16

The total amount of money that could be paid under the LTC policy for charges incurred for covered services

Question 17

Medicaid

Answer 17

A state and federal assistance program that pays for medical care and most long-term care expenses for eligible persons with low incomes and limited assets

Question 18

Mental and Nervous Disorders

Answer 18

Long-term care insurance policies can exclude coverage of some mental and nervous disorders, but the policy must cover serious biologically-based mental illnesses and other diseases, such a schizophrenia, major depression, Alzheimer’s disease, and other age-related disorders.

Question 19

Non-Forfeiture Benefit

Answer 19

The insurer must guarantee that the insured will receive some of the benefits paid for even upon cancellation or lapsed coverage

Question 20

Pre-Existing Conditions

Answer 20

A pre-existing condition is an illness or a disability for which an insured has received previous medical advice or treatment usually within six months prior to the application for long-term care coverage

Question 21

Refund of Premium

Answer 21

The company will refund some or all of the insured’s premiums minus any claims paid under the policy if the policy is canceled. The insured’s beneficiary will received such refund is the insured dies

Question 22

Restoration of Benefits

Answer 22

Some policies restore benefits to the original maximum amounts if the insured no longer needs long-term care services, usually after 180 days

Question 23

Shared Benefits

Answer 23

Policies that have this benefit permit a person who has fully exhausted the benefits under their own policy to make use of the benefits available under their spouse’s policy

Question 24

Skilled Care Facility

Answer 24

24-hour nursing care for chronically-ill or short-term rehabilitative residents of all ages. It provides the highest level of service, and combines daily medical and custodial care

Question 25

Special Needs Trust

Answer 25

A specific type of trust that is used to provide benefits to persons or beneficiaries with special needs. They are designed to protect eligibility for government assistance programs

Question 26

Terminal Illness

Answer 26

Having a life expectancy of less than 24 months, which must be certified by a qualified health professional

Question 27

Total Plan Benefit

Answer 27

The total amount of money that could be paid under the long-term care policy for Charges incurred for covered service

Question 28

Traditional Medical Care

Answer 28

Attempts to treat or cure illness

Question 29

Waiver of Premium

Answer 29

Allows the insured to stop paying premiums during the period in which he or she is receiving policy benefits. However, if this provision may only apply to certain benefits, for example, nursing home or home healthcare