Claims from Assisted Living Facilities Are on the Rise: What’s the Cause?
Last month, the American Association for Long-Term Care Insurance released its most recent set of data on long-term care insurance (LTCi) claims and from where they originate. According to the data, nearly one in five LTCi claims originated from assisted living facilities in 2017. This figure – 19.7 percent – is a significant increase. In 2014, which was the last time that the AALTCI analyzed claim data, only 14 percent of claims originated from assisted living facilities.
While assisted living facilities did not generate the highest number of claims, they were the only segment of the long-term care industry to see an increase in claims from 2014 to 2017. Skilled nursing homes saw a decrease from 32 percent to 28.2 percent of claims, and claims from the home (the most frequent source of claims) decreased from 54 percent to 52.1 percent.
In addition, CNA’s Aging Services 2016 Claim Report revealed that while skilled nursing operators experience a higher number of claims, assisted living facilities on average paid more per claim from 2011 to 2015. While skilled nursing facilities paid a total average of $212,766, assisted living facilities paid an average total of $221,496.
What Causes These Claims?
The National Center for Assisted Living (NCAL) estimates that there are about 30,200 assisted living communities in the United States, with a total of one million licensed beds (and an average of 33 licensed beds per facility).
Within these facilities, there are a several prominent risk factors:
- Resident falls make up a significant portion of claims. In 2016, resident falls accounted for 42.7 percent of the claims surveyed, with an average payout of $186,589. Assisted living facilities, however, reported $196,571 in closed claims.
- Pressure ulcers and related maladies made up 18.6 percent of allegations. While skilled nursing operations saw a far greater frequency than assisted living facilities (a 15:1 ratio), assisted living facilities had a higher average value of closed claims ($236,562 to $231,732).
- Elopement saw the highest average total ($325,561), and 54.3 percent of elopement claims caime from assisted living facilities.
- Errors in administering medication, failure to follow physician order, improper care, failure to monitor, unsafe environment, resident abuse, and violation of resident rights were also prominent sources of claims.
Bruce Dmytrow, CNA’s vice president of aging services and national programs, stated, “The trend we’re seeing is the complexity of residents’ health is far greater today than before. With all the baby boomers coming up the pipeline, everything I’ve seen says they want to age at home, in place. Acuity is only going to continue to rise. [..] The key point is if you’re going to take in residents with a higher acuity level and more complex medical and behavior types of needs, you have to have the staffing that specializes in ways to take care of them.”
Understanding the source of claims and problems can help assisted living facilities to reduce their liabilities and prevent claims before they occur. In addition to having the right insurance for assisted living facilities, these facilities should implement programs and procedures to reduce the risk of these accidents, making the facility a safer place for all involved.
About Caitlin Morgan
Caitlin Morgan specializes in insuring assisted living facilities and nursing homes and can assist you in providing insurance and risk management services for this niche market. Give us a call to learn more about our programs at 317.575.4440.