Accelerated Benefits - A clause in a life insurance policy that allows payment of benefits for long-term care services.

Accumulation Period - The amount of time an insured is given to accumulate the number of days of care needed to satisfy the elimination period of a long-term care insurance policy.

Activities of Daily Living (ADLs) - Physical functions that are performed on a daily basis such as bathing, dressing, eating, transferring, toileting, and continence. The ability or inability to perform these functions often determines whether an individual is capable of living independently. Long-term care insurance policies assess the ability and inability to perform ADLs as a criteria for determining eligibility for LTC insurance benefits.

Acute Care - Medical care received from licensed health professionals and/or hospitals with the aim of full restoration or rehabilitation of physical functions. Acute care usually refers to a treatment period of 100 days or less, which we define as short-term care.

Adult Day Center - A facility in which services and care are provided to individuals who are unable to remain at home alone during the day. These services might also include social and recreational events to alleviate the social isolation that a person living alone might experience. Caretakers who are regularly employed during the day frequently utilize these centers for those in need of care while working during the day. Senior centers and community centers often offer adult day programs.

Adverse Selection - The disproportionate number of people who are likely to submit claims in an "insurance pool," resulting in a higher rate of claims than expected. Results in the potential to have inadequate premium reserves to cover the costs of the claims unless premium rates are increased.

Alzheimer’s Disease - A progressive, irreversible form of dementia that causes severe intellectual deterioration that eventually results in complete dependency. It affects 5% of those over 65 and nearly half of those over 80. The cause of the disease is unknown at this time. Symptoms begin with loss of memory and rational thinking, with progressive deterioration over the course of several years.

Ambulatory - The ability to move about, generally without any type of assistance.

Ambulatory with Assistance - The ability to move about with the aid of a cane, crutch, brace, wheelchair, or walker.

Ancillary Services - Personal care services such as podiatry, dentistry, and hair care that are needed by a nursing home or assisted living resident, but not typically included in the basic costs charged by the facility.

Assisted Living Facility/Community - A residential facility for those who may need help with activities of daily living, or supervision due to cognitive impairment. These facilities usually include private units (apartments or rooms), two to three meals a day, laundry services, transportation, activities, and housekeeping. In most facilities, a 24-hour staff is available to meet residents' needs.

Bed Reservation Benefit - A covered expense in most long-term care insurance policies that allows a facility to receive payment for a bed being held for a resident who requires temporary hospitalization.

Benefit Amount - A set dollar amount of benefit per day, week, or month that a long-term care insurance policy will pay for long-term care costs.

Benefit Period Maximum - The maximum amount a long-term care insurance policy will pay for covered services in a lifetime. The benefit can be expressed in length of time, or a dollar amount. This benefit may be payable to the owner of the policy or to a third party, such as a facility or home care provider.

Benefit Triggers - The criteria used by insurance carriers to determine eligibility for long-term care insurance benefits. The best policies "trigger" benefits when a policyholder is unable to perform two or more ADLs without assistance, or when cognitive impairment is determined to be severe enough for the person to need supervision.

Board and Care Homes - "Homes" that provide limited supervision and care to their residents. Medical personnel are usually not on staff and the administration of medications is not usually available.

Bundled Products - Policies that combine life insurance or some other financial product "bundled" with long-term care insurance.

Care Coordination - Assistance with the development and implementation of the plan of care including helping to identify appropriate services and making arrangements to receive care.

Caregiver - A person giving assistance to another. Assistance is usually required due to medical reasons, inability to perform activities of daily living, or cognitive impairment.

Caregiver Training Benefit - A benefit in a long-term care insurance policy that pays for someone to learn the best methods to use in caring for the policyholder who is on claim.

Chronic Illness - An illness characterized by permanency and/or residual disability requiring a long period of care.

Cognitive Impairment - Deficiency in short- or long-term memory; orientation as to person, place, and time; abstract reasoning; or judgment as it relates to safety awareness.

Co-insurance - The process of paying for a portion of the cost of care out-of-pocket.

Community-Based Services - Services designed to help older people stay independent and in their own homes for as long as possible.

Comprehensive Planning Approach - A 7 step process for planning for long-term care within the context of your personal and financial objectives.

Comprehensive Long-Term Care Insurance Policy - A long-term care insurance policy that covers care in any environment, including facility care and home care.

Conditionally Renewable - A policy that may be canceled at any time for various reasons, including excessive claims history. No longer allowed in currently issued long-term care insurance policies, but older in-force policies may contain this clause.

Conservator - If a court determines that a person is unable to manage his/her property due to mental illness or deficiency, physical illness or disability, drug abuse, chronic intoxication, advanced age, confinement, disappearance, detention by a foreign power; and if that property will be wasted or dissipated without being properly managed or if funds are needed to care for the individual or those supported by him, a "conservator" may be appointed by the court.

Continuing Care Retirement Community (CCRC) - Also called "Life Care Communities," these communities offer the full spectrum of living and care arrangements, from independent living to nursing home care, without having to leave the community.

Custodial Care - Care to help an individual perform their activities of daily living, such as bathing, dressing, and eating.

Delayed Word Recall (DWR) - A memory exercise that is used to screen for short-term memory or primary memory loss.

Dementia - Deterioration of intellectual faculties.

Elimination Period - Also known as the "deductible," the time period during which a policyholder pays for covered services before a long-term care insurance policy will begin to pay for those services.

Estate Recovery - When a Medicaid recipient dies and leaves an estate, Medicaid may seek to recover from the estate the money it spent on care for the recipient by using the Estate Recovery process.

Estate Planning - Addresses tax-efficient ways to acquire, preserve, and transfer a person's financial wealth to other parties, both during and after life.

Facility-Care-Only Policy - A long-term care insurance policy that only covers care in a facility such as a nursing home or assisted living community. Care in the home is not covered with these policies.

Facility Certification - A certificate given to a facility that is in compliance with a set of federal standards regarding staffing, cleanliness, and maintenance of records. Nursing homes must be certified before they are reimbursed for care provided to Medicaid recipients.

Financial Planning - The overall process of setting financial goals, evaluating where you are with respect to those goals, laying out a plan to achieve them, implementing the plan, and modifying the plans and actions as your current situation and goals change.

Formal Care Provider - Caregivers who are trained specialists and provide long-term care services as a career.

Free-Look Period - Also called the "Right to Return" provision. A newly insured long-term care insurance policyholder has the right to return the policy to the company within 30 days of receiving it, for a full refund of any deposits or premium payments paid.

Grace Period - A length of time after the premium due date during which the coverage remains in force although the premium payment has not been paid. This period is normally 31 days.

Group Long-Term Care Insurance - Coverage offered by employers or other groups that is normally issued on a Guaranteed Issue or Modified Guarantee Issue basis. This means that the applicant could be accepted for coverage without full underwriting.

Guaranteed Issue - A policy issued without any underwriting requirements. Coverage may be obtained regardless of current or past health conditions.

Guaranteed Purchase Option - A provision giving the insured the right to purchase additional coverage at set intervals without having to reapply and health-qualify for coverage. The premium for the additional coverage will be based on the policyholder's age at the time of benefit increase.

Guaranteed Renewable - A policy that can only be canceled because of non-payment of premium. Adjustments in premium may be made, but only for a whole class of insureds and not just the individual.

Health Insurance Portability and Accountability Act (HIPAA) - Legislation effective in 1997 that resulted in the standardization of long-term care insurance policies and clarified the tax treatment of benefits and premiums for long-term care insurance.

Home Care - Personal care services provided by trained but non-skilled personnel. Does not require the supervision of a physician.

Home-Care-Only Policy - A policy that does not cover care in any type of facility. Typically, covers home health care, home care, and some homemaker services.

Home Health Agency - A private or public agency that specializes in providing skilled nurses, homemakers, home health aides and therapeutic services (e.g., physical therapy) in an individual's home.

Home Health Care - Care or services received from skilled personnel in your home. The treatment or plan of care is supervised by a physician or registered nurse.

Hospice Care - A special way of caring for the needs of a terminally ill patient and emotionally supporting his or her family. This care addresses physical, spiritual, emotional, psychological, social, financial, and legal needs, while enhancing the dying person's quality of life.

Incidental Activities of Daily Living (IADLs) - Activities such as cooking, cleaning, shopping, laundry, managing money, administering medications, and providing transportation.

Inflation Protection Rider - An option on a long-term care insurance policy that provides for automatic increases in benefit levels to hedge against inflationary increases in long-term care service costs.

Informal Caregivers - Caregivers who care for a patient out of love or a sense of duty rather than as a profession.

Institutionalization - To admit a person into a facility, such as a nursing home, where they will usually have an extended or indefinite stay.

Intermediate Care - Provided when recovery and rehabilitation are the primary goals and 24-hour-a-day physician supervision is not needed.

Lapse - Termination of a policy when a premium is not paid.

Life Care Arrangement or Life Care Contract - Typically, a financial arrangement utilized by Continuing Care Retirement Communities. The resident pays an initial lump sum of money when they move in, and then a predetermined monthly amount thereafter.

Lifetime Policy - A long-term care insurance policy in which there is no maximum limit to the cumulative benefits that can be collected.

Lifetime Maximum Benefit - The term used to describe the total dollar amount that can be collected from a long-term care insurance policy. Choices in the lifetime maximum range from as short as one year to unlimited coverage, which has no cumulative dollar or time limit.

Limited Pay - Long-term care insurance policies in which premiums are paid for a limited time period instead of over the life of the policy. Common periods include single payment, five-year pay, ten-year pay, and twenty-year pay.

Long-Term Care - Medical and social care given to individuals with a chronic illness, disability, or cognitive disorder. Defined by the author as needing assistance for longer than 100 days. This care may take place in a skilled nursing facility, assisted living community, adult day center, the home of the person receiving care, or someone else's home. Care can be administered by medical professionals or nonprofessional personnel.

Long-Term Care Plan - The result of the process of deliberately choosing the most appropriate resources to pay for long-term care in advance of the need for care. The plan should be in writing and a copy provided to family members and financial advisors.

Meals-On-Wheels - A program that delivers meals to people who are homebound.

Medicaid - A welfare program administered by the federal and individual state governments that helps pay for certain types of medical care given to needy and low-income people. A nursing home must be certified by Medicaid in order to be reimbursed for care provided to a Medicaid recipient.

Medi-Cal - The Medicaid program in California.

Medicare - A federal health insurance program that pays for health care for people over 65 and some people under 65 who are disabled. Part A is Hospital Insurance and Part B is Medical Insurance. Medicare pays for limited short-term care in a skilled nursing facility but only under certain conditions. Medicare DOES NOT pay for long-term care.

Medicare Supplement Insurance - Private insurance policies that cover health care costs not fully covered by Medicare. Medicare supplement insurance DOES NOT pay for long-term care.

Medigap Insurance - Another name for Medicare supplement insurance.

Modified Guaranteed Issue - People who are in poor health but can certify that they are currently not needing long-term care services, or do not have a condition that will result in the need for long-term care in the near future, may qualify for coverage under this type of issue.

National Association of Insurance Commissioners (NAIC) - A membership organization of state insurance commissioners. One of its goals is to promote uniformity of state regulation and legislation related to insurance.

Nonforfeiture Benefit - Usually available as an option, it allows the policyholder to receive some type of benefit if the policy lapses. The benefit is usually in the form of a paid-up maximum benefit equal to the cumulative premiums paid at the time of the lapse.

Non-Tax-Qualified Policies (NTQ) - Policies that do not conform to HIPAA's requirements and do not receive the same favorable tax treatment as Tax-Qualified policies.

Nursing Home - A licensed facility that provides general nursing care to those who are chronically ill or unable to take care of daily living needs.

Outline of Coverage - A description of the coverage and benefits of a long-term care insurance policy. Includes a statement of exclusions; limitations in the policy; a statement of the terms under which the policy may be returned and the premiums refunded; and a description of the policy benefits.

Partnership Policy - A type of policy that allows you to protect some of your assets if you apply for Medicaid after using your policy's benefits. Currently available in some states.

Plan of Care - An organized schedule of treatment or care for a patient, usually developed by care coordinators, physicians, nurses, or discharge planners at hospitals.

Planning Gap - A shortfall between the resources allocated to meet long-term care costs and the estimated cost of that care.

Power of Attorney - A written agreement that authorizes a relative, attorney, business associate, friend, or another person to sign documents and enter into transactions on behalf of the individual.

Respite Care - The in-home care given to a chronically ill beneficiary in order to give the regular caregiver(s) a break.

Restoration of Benefits Rider - If you elect this rider when you buy a policy with less than an "Unlimited Benefit Maximum," and you use a portion of your policy benefits, the entire pool of benefits in the policy will be restored if your health returns and you go without care for a specified period of time.

Sandwich Generation - A family that is raising children and caring for an aging parent(s) at the same time.

Senility - Mental deterioration that sometimes accompanies aging.

Senior Center - A community-based facility that provides seniors with activities such as recreation, education, cultural, and social events.

Short-Term Care - Care that is required for less than 100 days.

Single Sales Approach - Addressing one aspect of insurance or financial planning in a vacuum instead of considering all aspects within the context of the overall personal and financial situation and objectives of the individual, family or company.

Skilled Care - Care provided by a trained medical person and under the supervision of a doctor or other qualified medical person.

Skilled Nursing Facility (SNF) - A facility providing skilled care by licensed staff.

Sponsored Long-Term Care Insurance - Offered by an employer or other "group," but unlike true group insurance, sponsored programs use the same strict underwriting guidelines as individually issued policies.

Spousal Discount - If husband and wife or partners purchase coverage from the same insurance carrier, they may receive a premium discount on both policies.

Survivorship Benefit - Offered as a rider, this provision states that if one spouse dies after paying premiums for a certain period of time, the spouse still living is no longer required to pay premiums on their own policy. Requires both spouses to have coverage with the same insurer, and normally requires that both insureds go claimfree for a certain number of years.

Tax-Qualified Policies (TQ) - Long-term care insurance policies createdby HIPAA legislation in 1996. Resulted in the standardization of long-term care insurance policies and the clarification of the tax consequences of receiving benefits.

Third Party Notification of Lapse - Requires insurers to send a notice to an individual designated by the insured before a policy is canceled due to nonpayment of premium.

Underwriting - The process of examining, accepting, or rejecting insurance risks, and classifying those accepted to charge the appropriate premium for each.

Uninsurable - Individuals who are not eligible for insurance due to the presence of a health condition that requires them to already receive care, or who may have a higher probability of needing care in the future. Examples would be people who have already been diagnosed with Alzheimer's Disease or Parkinson's Disease.

Waiver of Premium - A provision in some LTC insurance policies that states the insured is not required to continue paying premiums while he or she is on claim.