Long-term care insurance (LTCI) company executives, and representatives from their advisors and vendors, will be converging on Chicago Sunday for the latest Intercompany Long Term Care Insurance Conference, to find out what’s really going on in the LTCI market.
David Rinehart has a completely different, up-close perspective on how the LTCI business works: His company, Family Solutions for Care, is helping hundreds of families collect LTCI benefits.
The Lee’s Summit, Missouri-based company serves as an advocate for policyholders collecting benefits from stand-alone LTCI policies, and from features sold with life insurance policies or annuities that can help the purchasers pay for long-term care services.
Wendy Rinehart — David Rinehart’s wife — began selling LTCI coverage in 1997. When her clients began using the benefits, she discovered that they had trouble with paperwork. In 2011, Wendy Rinehart and a sister-in-law started a firm, ClaimJockey, to help with the paperwork.
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The firm changed its name to Family Solutions for Care in late 2018.
Wendy Rinehart is the chief executive officer.
David Rinehart is a principal.
The Rineharts estimate that they and their employees have helped clients collect about $100 million in LTCI and LTC hybrid benefits.
Here’s a look at nine things they have discovered, drawn from a recent interview with David Rinehart.
1. They like the LTCI issuers.
Wendy Rinehart stopped selling LTCI soon after getting into the patient advocacy business, and David Rinehart said he and his wife now try to keep an arm’s length relationship with LTCI issuers, to ensure their independence.
But David Rinehart said his experience is that issuers are sincere about wanting to pay complete, clean, well-substantiated claims promptly.
“There’s no doubt about it,” he said. “Insurers will pay legitimate claims.”
Rinehart said his experience is that the insurers that have gotten out of the LTCI business are about as good at paying claims as the active issuers.
When state guaranty associations take over failed issuers, they pay the claims they have guaranteed about as well as solvent insurers do, Rinehart said.
2. The real clients are not the usually the coverage purchasers.
Rinehart said his firm usually works with the adult children of the insureds.
The adult children may know little or nothing about any LTC benefits that might be available, and they often live far away from their parents, he said.
The agents who sold the LTCI coverage are rarely able to provide much help, because, by the time the clients file the LTCI claims, the agents have often retired from the business, Rinehart said.
3. The adult children need help finding Family Solutions for Care.
Rinehart said the firm depends heavily on referrals from agents, or retired agents, and from LTC services providers, such as home care agencies, nursing homes or assisted living facilities.
4. The LTC providers are not good at helping families file claims for LTCI or LTC hybrid benefits.
Rinehart said that one problem is that LTC service providers often try to avoid burdening clients by billing the clients for less care than they actually provide.