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The Difference between the Elimination Period and the Certification Period

Posted by Scott A. Olson on March 23, 19101 at 08:09:22:

In Reply to: No benefits until 90 days confinement? posted by Yinka on March 03, 19101 at 16:21:15:

Yinka,

You bring up one of the more complicated aspects of long term care insurance policies. I'll try to make it simple.

Every long term care policy has an elimination period. Elimination period is a nice way of saying "deductible." The elimination period is the number of days you would need care before the policy would begin to pay for your care. The elimination period is expressed in days. Most companies offer a choice of elimination periods, ranging from as short as 0 days, to 20 days, 60 days, 90 days, and some even offer a 180 day elimination period.

Tax Qualified policies have a 90 day certification period requirement. That means that before a TQ policy will pay any benefits, your doctor must certify that he expects you to need care for at least 90 days. With a TQ policy, if you had a 0-day elimination period, but your doctor said that you were only going to need care for 6 weeks, the TQ policy would not pay any benefits at all, even though you had a 0-day elimination period.

If you are concerned about short term needs like that, then you should purchase a non-tax qualified policy with a 0-day elimination period.

If you are not concerned about a short-term need like that, then you may be better off with a tax qualified policy.

One more point about elimination periods. Long term care policies will not duplicate payments. In other words, even if you had a 0-day elimination period and medicare or your major medical paid for your first 100 days in the nursing home, most long term care policies would not duplicate their payment along with your medical insurance payments.

Also, the better policies allow days of care that are paid for by your medical insurance to count towards your elimination period.

This is a very brief answer to a very complex subject. I hope that it has helped you some.

Scott A. Olson, CLTC

Follow Ups:

Re: The Difference between the Elimination Period and the Certification Period : Yinka, : You bring up one of the more complicated aspects of long term care insurance policies. I'll try to make it simple. : Every long term care policy has an elimination period. Elimination period is a nice way of saying "deductible." The elimination period is the number of days you would need care before the policy would begin to pay for your care. The elimination period is expressed in days. Most companies offer a choice of elimination periods, ranging from as short as 0 days, to 20 days, 60 days, 90 days, and some even offer a 180 day elimination period. : Tax Qualified policies have a 90 day certification period requirement. That means that before a TQ policy will pay any benefits, your doctor must certify that he expects you to need care for at least 90 days. With a TQ policy, if you had a 0-day elimination period, but your doctor said that you were only going to need care for 6 weeks, the TQ policy would not pay any benefits at all, even though you had a 0-day elimination period. : If you are concerned about short term needs like that, then you should purchase a non-tax qualified policy with a 0-day elimination period. : If you are not concerned about a short-term need like that, then you may be better off with a tax qualified policy. : One more point about elimination periods. Long term care policies will not duplicate payments. In other words, even if you had a 0-day elimination period and medicare or your major medical paid for your first 100 days in the nursing home, most long term care policies would not duplicate their payment along with your medical insurance payments. : Also, the better policies allow days of care that are paid for by your medical insurance to count towards your elimination period. : This is a very brief answer to a very complex subject. I hope that it has helped you some. : Scott A. Olson, CLTC

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