A Long Term Care (LTC) claim comes at a challenging time for the insured and his or her loved ones. Often the person covered by the policy cannot make decisions alone, especially when cognitively impaired. If the claimant is impaired, a valid Power of Attorney (POA) is required so that the claims analyst knows who has the authority to make decisions on the claim and what exactly that person can decide. Without knowing the “who, , when, what” of a POA, the claims analyst cannot make a timely decision, in turn, adding to the stress of an LTC claim.
Taking a little extra time to thoroughly review the specifics of a POA matters in LTC claims management for a few key reasons:
- To understand who has the authority to make decisions
- To be clear when the POA takes effect and when it was signed
- To ensure the necessary protection of the insured’s privacy and adherence to all HIPAA regulations
To handle the claim appropriately, the claims analyst should answer these questions:
- Is a single person designated as POA, or is more than one individual listed?
- If multiple people are listed, can they act alone while the others listed are secondary, or must they act together when making decisions on a claim?
In cases where POAs have to make decisions together, both will need to be in agreement on decisions about the claim, and they should receive duplicate correspondence. In certain cases, dual POAs can agree to one of them being appointed as the primary contact. This decision must be in writing, signed by the person stepping aside, and documented in the claim.
Are there exceptions to the above?
One exception to the above rule is when a primary POA is found to be deceased. In this case, a copy of the obituary or death certificate is required as part of the claim documentation to allow the secondary POA to step up.
Sometimes the primary POA does not wish to take on this role. For example, the POA may be an elderly spouse who would rather have the secondary POA, most often an adult child, handle decisions regarding the claim. In these cases, a written notice as part of the claim documentation is required.
What is covered by the POA?
- Is the submitted POA a healthcare POA or a financial one?
Often family members will submit a healthcare POA, assuming it allows them to make decisions since the claim is health-related. While healthcare POAs sometimes allow the claims specialist to request medical records to assist with the claim process, they often only allow the POA to make healthcare and end-of-life decisions. They do not cover the financial aspects of a claim.
A financial POA allows a designated person to handle transactions with banks, make decisions regarding insurance policies, and access records under HIPAA regulations. Family members are required to make determinations including the claimed date of loss, the recipient [.3] of the benefit check, the hiring of home health care agencies, and facility placements.When does the POA take effect?
- Does the POA take effect the day it was signed, or must other requirements be in place for it to be enacted?
Some POAs require a doctor’s statement verifying the insured is incapable of making decisions independently. Sometimes the completed Attending Physician Statement can serve as notice that the insured’s provider agrees he or she cannot make decisions.
Other POAs require more than one doctor to provide documentation or other validation that the insured is incompetent. When the POA requires such documentation, you should consult your legal team for assistance in determining whether the information received allows the POA to be enacted.When was the POA signed?
- Was the POA signed before the claimed date of loss or after?
The date of signature is important to note, especially when a claim is filed for cognitive impairment. For example, if the family feels the insured requires supervision for his or her health and safety, but the POA was signed after the claimed date of loss, could the insured understand what he or she is signing?
Often family members are unaware a POA is needed to move forward with a claim if the insured cannot make decisions independently. Requiring a POA, however, can be a delicate topic to address since the policy belongs to the insured, who is the first person to make decisions on the claim. If the insured is cognitively impaired and consequently cannot make competent decisions or clearly discuss the claim, someone must step in to handle the claim. In this situation a legal review is warranted to make sure the insured can cognitively understand what was signed and that the POA is valid.
Once the review of the POA is completed and addresses the questions above, documenting the review within a claim file is a best practice. Noting in one documentation within the claim file who is designated as POA, when it takes effect, what is covered, and if it’s valid allows others to know who can be spoken to and what can be spoken about. Additionally, it allows those handling the claim to be aware a valid POA exists. This knowledge aids in the appropriate handling of a claim within privacy standards and HIPAA regulations.
When a LTC claim is filed, worry and stress are part of the family’s lives. And their loved one is at a point at which he or she cannot live independently. Understanding what to look for in a POA and confirming the validity of the appropriate person to speak to regarding the claim is vital to ensuring the timely handling of a claim. Decisions can be made at the right time that will help relieve some of the stress these families are experiencing.