Projection applies unit costs, frequencies, and durations to each item of future care or loss, then adjusts for inflation and reduces to present value. Sources include provider quotes, published fee schedules, and regional cost databases.
Methodology varies among life care planners and economists.
Alternative Names:
Cost Projection, Future Cost Methodology
Why it Matters?
Cost sourcing is where projections diverge most, since a plan using retail charges produces figures far above one using contracted or regional rates for the same services. Asking which source was used for each line item, and whether the claimant's own insurance would pay a different amount, identifies the inflation. Replacement cycles for equipment are separately worth checking, since aggressive cycles compound across a life expectancy.
Frequently Confused with
Related terms
Frequently asked questions
Where do projections diverge most?
What else warrants checking?
