New legislation created by Senator Amy Klobuchar (D-MN) calls for the review of complaints from long-term care insurance policy holders.
“More families are looking to buy long-term care insurance, but the insurance companies haven’t always played fair,” said Klobuchar in a page posted on the Senator's website. “I believe consumers have a right to know exactly what’s in their insurance policies and they deserve to have their claims paid promptly without having to go to court.”
"Frankly, we sense this is a solution in search of a problem," states Jesse Slome, executive director of the American Association for Long-Term Care Insurance, the industry trade organization. "Insurers are not in the business of denying claims and paid some $8.5 billion to 180,000 individuals last year." Recent studies by state and federal agencies have reported that consumer complaints were most commonly due to consumers submitting incomplete claim information or having not yet met their policy's deductible period.
According to Slome, long-term care insurers have worked closely with the National Association of Insurance Commissioner's Senior Issues Task Force over the past year on an independent third-party review provision. The NAIC comprises insurance commissioners for states. "That provision would provide consumers with reasonable recourse and was just adopted into the NAIC model regulations adequately covers the issue," Slome notes. "Insurance is regulated at the State level so I'm not sure why having something in a federal bill is necessary."
The Long-Term Care Integrity Act proposed by the Senator will "protect consumers who have purchased long-term care insurance and are seeking claims on their policies." The legislation calls for creation of an independent third-party review board to address one of the most common complaints about long-term care policies: the denial of appropriate and timely benefits by insurance companies.
Currently, those who are denied benefits must go to court, which is expensive and time-consuming when people are most vulnerable and in need, the Senator's website explains. "We applaud everyone concerned with helping Americans plan for the future risk of needing long-term care and certainly policyholders should have avenues to get paid when they qualify for benefits," Slome concludes. "Consumers should know that insurers pay long-term acre insurance claims promptly and that their State insurance commissioners are ensuring they have recourse to help rectify any issues."
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