Prudential Long-Term Care Underwriting

1
Prudential Long-Term Care Underwriting

• Pat Flynn, RN, Clinical Manager, LTC Benefit
  Access and Underwriting

2
Underwriting Support

• Hotline [phone] (pre-qualifications only)
• Customer Service 1-800-732-0416 (status)
• E-Mail account LTCUnderwriting_at_Prudential.com
• Newsletter FrontRunner
• Personal point of contact assigned underwriter
• Medical conditions guidelines revised September
  2006
• BrainSharkweb based training

3
Underwriting Guidelines

• Eligible Population 18 - 79
• Use current age at time of application signature
• Do not backdate application
• Age automatically saved within 30 days of
  birthdate
• Do not request to save age if applicant has
  turned 80 by date of application

4
Primary Requirements
AGE lt65 Medical Record No Interview(FTF) No
65 to 71 Yes No
72 Yes Yes
5
Underwriter Considerations

• Cognitive status
• Functional capacity-ability to perform ADLs,
  IADLs
• Medical conditions may result in need for care
  (falls, fractures, c/o pain/weakness)
• Multiple medical conditions - in combo are more
  significant (DM with Heart Disease, CHF with
  angina)
• Multiple changes in medication
• Lab results

6
Underwriter Considerations (Contd)

• Treatment plans - PT/OT
• Cardiac rehab, steroid injections, planned or
  recommended procedures
• Chronological age vs. physiological age
• App may seem younger or older than actual age
• Frailty - more susceptible to illness/disease
• Independence factors
• Working, married with spouse in good health,
  active, driving and travel independently

7
Determining Successful Applicant Questions

• Unsteadiness or limping?
• Tremors (hands or face)?
• Shortness of breath while speaking or walking?
• Use of assistive devices? What type?
• Do spouses share in conversation or does one
  speak for the other?
• Can he handle his IADLs independently?
• Shopping, laundry, cooking, check book,
  transportation, etc.

8
Determining Successful Applicant-AgentSurgery
Waiting Period

• Hip/Knee 3 mos
• CABG-6 mos 12-DM
• Angioplasty 3 mos, 12-DM
• Pacemaker 3mos, 12-DM
• Defibrillator 12 mos
• Heart valve 6 mos, 12-DM

• Endarterectomy3 mos, 12-DM
• Back/Spine 6 mos
• Fractures 3 mos
• Pelvic fracture 12 mos
• Surgery anticipated-Postpone

Assumes completely recovered, no limitations to
functionality or underlying disease
9
Underwriting Risk-Low

• Stable medical conditions
• Predictable clinical course
• No ADL/cognitive deficits
• Met stability interval-time from end of treatment
  until signing of application
• Generally speaking low probability of having
  significant ADL loss next 4-5 years

10
Underwriting Risk-High

• Unpredictable medical conditions
• Condition threatening to functional independence
• Current ADL deficits
• Current Cognitive deficits
• Likely to require human assistance with ADLs
  within next 4-5 years

11
UW Classes-Preferred

• 15 discount
• Reward for good habits and lifestyles
• Must answer no to smoking past 36 months
• May not use multiple medications
• Must fall within Preferred height to weight
  Guidelines (pg 83)
• Leeway 5 - 8 lbs with no other medical history
• Must answer no to any history of specific
  medical conditions (pg 81-82)

12
Underwriting Classes Standard I

• Generally ALL medical conditions that meet
  stability indicators
• Specifically, minimum length of time required
  from completion of any / all treatment for
  condition to the time an application is submitted
• Diabetes controlled by diet and exercise ONLY
• Height to weight within guidelines
• Smoking less than one pack per day have no
  associated cardiac, respiratory or vascular/
  circulatory conditions

13
Underwriting Classes Standard II

• Congestive heart failure
• Hodgkins Disease
• Leukemia
• Lymphoma
• Diabetes/ daily medication

• Chronic Obstructive Pulmonary Disease/ daily meds
• Emphysema/ daily meds
• Smoking one pack or more a day

These are the ONLY conditions that should be
rated STANDARD II
14
Disclosure / Appeals Process

• Will consider appeal within 60 days of decline
  decision
• To request an appeal
• Send name, policy , SS, DOB and reason for
  appeal request and/or access to records to LTC
  Underwriting Appeal
• Fax [phone]
• Mail 2101 Welsh Road Dresher, PA 19025
• Request for disclosure of specific reason for
  decline is sent ONLY to applicant or physician
• Appeal of decision may require supportive medical
  information from physician
• After 90 days of original decline date requires
  new application if decision reversed

15
Decision Terminology

• Approved as applied for
• Approved with modifications significance of risk
• Reduced daily max, reduced lifetime max, increase
  benefit waiting period, eliminate cash rider,
  change rating
• No additional Benefit increases allowed for 2
  years
• Declined risk is too great
• Declined with Reconsideration
• Generally has not met stability period an offer
  to review another app at a specified later date
• Applicants 76 - 79 will seldom be offered
  reconsideration (greater possibility of decline
  in health)

16
Decision Terminology (continued)

• No reconsiderations are communicated to agent
  only
• Approved as applied for
• NO increases permitted
• Maximum benefits acceptable for risk
• No requests submitted for 2 years (full
  underwriting, attained age)

17
Correspondence For Decline

• Letter to applicant will be specific and focused
  based on medical condition/ impairment, results
  of testing, etc.
• Copy of decline letter to producer as provided on
  application
• Phone outreach

18
Long Term Care Claim and Benefit Access
Presentation
19
The Definition of Long Term Care

• Broad range of help one needs if unable to care
  for oneself due to PROLONGED illness or
  disability
• Involves receiving assistance of another person
  to perform essential activities of daily living
  when those tasks can no longer be performed
  independently

20
Six Activities of Daily Living

• Bathing
• Washing oneself by sponge bath or in tub/
  shower, including task of getting in or out of
  tub/ shower
• Dressing
• Putting on and taking off ALL items of clothing
  and any necessary braces, fasteners or artificial
  limbs
• Transferring
• Moving in/out of bed, chair or wheelchair

• Toileting
• Getting to from toilet, getting on off
  toilet, performing associated personal hygiene
• Continence
• Ability to maintain control of bowel bladder
  function or unable to maintain control of bowel
  or bladder function, ability to perform
  associated personal hygiene (caring for catheter
  or ostomy bag)
• Eating
• FEEDING oneself by getting food into body from a
  receptacle (plate, cup, feeding tube or
  intravenously)

21
Defining Chronic Illness

• Physical limitation preventing policyholder from
  performing without substantial assistance at
  least 2 ADLs for at least 90 days/ Or
• Severe cognitive impairment requiring substantial
  supervision to protect policyholders health or
  safety

22
Certifying Chronic Illness

• Loss of functional capacity (physical or
  cognitive) suggests appropriate care and
  developing a plan of care
• NOT a chronic medical condition, or medical
  diagnosis

23
Types of Medical Conditions

• Acute
• Generally resolves within 90 days, short hospital
  stay, rehab potential good
• Chronic
• Long-term, rehabilitation potential poor
• Cognitive
• May need redirection for safety and physical
  hands-on assist for ADLs, rehab potential poor

24
Federal Law

• Created and defined Tax Qualified Long-Term Care
  Policy
• Policies must define chronically ill individual
  as someone certified by a Licensed Health Care
  Practitioner
• May use Prudential LTC vendor for face-to-face
  assessment or own physician (Pru will provide
  physician with certification forms)
• The chronically ill or disabled individual must
  need SUBSTANTIAL ASSISTANCE with 2 ADLs, and
  must be expected to last at least 90 consecutive
  days, OR individual must have a severe cognitive
  impairment requiring SUBSTANTIAL SUPERVISION
• Under tax qualified policy, insurers must pay
  claims (for qualified long term care services)
  pursuant to a Plan of Care
• Plan of Care is a document prescribed by a
  licensed health care practitioner

25
How Do We Certify Chronic Illness?

• Gather objective documentation/substantiation
  from multiple sources
• Observation of physical functioning
• How well performs ADLs, how managed before and
  why now cannot
• Use standard measurements of skills
• Tools and resources
• Face to face assessments, medical records from
  hospitals, rehab facilities, nursing home
  assessments, care plans, service levels,
  chronicity guides, medical disability advisors,
  hospice assessments, etc.

26
Creating the Plan of Care

• Maximize wellness, reduce dependency, conserve
  claimants pool of money
• Type intensity of services consistent with type
  level of actual need for substantial assistance
• Optimizes claimants ability to regain partial or
  full functional independence
• Includes what care services are recommended, by
  whom, frequency, duration
• Supportive community resources
• Restorative services
• Assistive devices that foster independence
• Caregiver support

27
Summary

• Determine what ADL or cognitive deficits exist
  and extent of deficits
• Whether insured needs substantial assistance of
  another person
• Need for substantial assistance last 90
  consecutive days
• Identify opportunities to restore/improve
  independence through plan of care
• Reduce dependency gtreduced intensity of services
  gtreduces claim
• Protects claimants pool of money