financial abuse of the elderly

What Does Financial Abuse of the Elderly Look Like?

When you think of financial abuse of the elderly, you may have certain images that come to mind. Perhaps it’s the greedy nephew. Or a money-hungry elderly care provider. While not all instances look the same, one thing is certainly true: financial abuse of the elderly is becoming more common.

Baby Boomers, those born between 1946 and 1964, make up a huge portion of our population. In fact, the number of Americans who are 65 or older is projected to double from 52 million in 2018 to 95 million in 2060. With so many older Americans, the way we care for them continues to change and evolve.

And with that, more and more episodes of financial abuse of the elderly are coming to light.

The Higher Incidence of Financial Abuse

All of us, regardless of our age, are subjected to an onslaught of fraudulent offers daily. Whether these incentives arrive via email, direct mail, over the phone, or on social media, they can sometimes catch us off guard. We’ve all become more wary of these scams, and we have come to realize that if something looks too good to be true, it probably is.

Unfortunately, it’s not the scams that are responsible for much of the financial abuse of the elderly. No, that honor usually goes to someone an older person has a relationship with: a caregiver, friend, romantic interest, or even family member.

When the culprit is someone the elderly person trusts, it can be especially tricky for family members to address. After all, Grandma may be attached to or feel dependent upon the person you’re trying to bring attention to. And if the person is a family member, there may be concern about stirring up family drama.

Financial Abuse of the Elderly Is Growing

There is a legal definition for the financial abuse of the elderly. It is an intentional act, or failure to act, by a caregiver or another person in a relationship involving an expectation of trust that causes or creates a risk of harm to an older adult. Specifically, financial abuse or exploitation is the illegal, unauthorized, or improper use of an older individual’s resources by a caregiver or other person in a trusting relationship for the benefit of someone other than the older individual. This includes depriving an older person of rightful access to, information about, or use of personal benefits, resources, belongings, or assets.

In financial abuse cases that have gone to court, the term “undue influence” becomes very important. The definition of undue influence is: “When people use their role and power to exploit the trust, dependency, and fear of others. They use this power to deceptively gain control over the decision making of the second person.”

What Courts Look for in Financial Abuse of the Elderly

The court looks at the following things when considering if undue influence has been used:

  • The victim’s vulnerability
  • The factors that created authority or power for the influencer (for example, becoming a primary caregiver)
  • The actions or tactics used by the influencers (did the influencer control who the victim was allowed to see, did they threaten to withhold life necessities, etc.)
  • The “equity of the result” (what were the economic consequences for the victim, how did it diverge from the victim’s prior intent, etc.)

Examples of Financial Abuse

Some examples of financial abuse include:

  • Using ATM or credit cards without permission
  • Forging checks
  • Misusing power of attorney to gain access to funds for one’s own needs rather than for the benefit of the victim
  • Pressuring the victim into paying abusers expenses in exchange for caregiving
  • Theft of money or possessions
  • Using coercion or deception to induce victim to surrender finances or property

Signs of Financial Abuse of the Elderly

According to the National Adult Protective Services Association, signs of potential financial abuse include:

  • Termination of vital utilities such as telephone, water, electricity/gas, or garbage
  • Unpaid bills and liabilities, despite adequate income
  • Oversight of finances surrendered to others without explanation or consent
  • Transferring assets to new “friends” who are assisting with finances
  • Checks written to “cash”
  • Does not understand his/her current finances, offers improbable explanations
  • Unexplained disappearance of cash, valuable objects, financial statements
  • Unexplained or unauthorized changes to wills or other estate documents
  • Giving away money or spending promiscuously
  • Appearance of property liens or foreclosure notices

If You Suspect Financial Abuse

It can be difficult to determine if financial abuse of the elderly is occurring with your loved one or friend. If you are afraid there is a change that an older friend or family member is being taken advantage of:

  • Talk to the victim and determine what is happening
  • Gather as much evidence as you can
  • Call financial institutions. While they cannot share information, under the new Senior Safe Act, they can stop disbursements if there is suspicion of financial abuse.
  • Report any and all forms of elder abuse to Adult Protective Services (APS). APS offices are designed to help investigate allegations of abuse.
  • Contact law enforcement. APS should be able to tell you who to contact in the law enforcement in your community.

Having an experienced attorney on your case is equally important. Trust Poulos Law Firm to provide you with knowledgeable counsel to protect your loved ones from financial abuse of the elderly. Contact us to learn more.

Information About Continuing Care Communities

Life plan communities, often referred to as continuing care retirement communities (CCRCs), are an increasingly popular choice of aging Americans. These communities offer the array of care options necessary as seniors move through the stages of aging that include independent or assisted living, memory care, and skilled nursing. Beyond health care CCRCs offer a wide range of services “such as housekeeping, dining options, transportation, fitness and wellness programs, recreational activities as well as social activities and outings for residents.” It is essentially “aging in place” except in a community environment. There are approximately 2,000 CCRCs in the country as compared to about 30,000 assisted living facilities primarily because the price of a CCRC is about $3,000 to $5,000 a month. If you can and are considering joining a CCRC, there are some parameters to consider very carefully.

The first consideration is financing. Can you afford the buy-in and associated monthly fees? If necessary, a senior is allowed to convert home equity and other assets into their initial expenditure to join a CCRC however, the vast majority of seniors who choose to reside in a CCRC have the personal financial resources to fund the stay out-of-pocket. All facilities and contracts are different. Each state has an agency that regulates CCRCs, and the government entities offer listings and a consumer guide about the CCRCs available in your state. There is also an independent nonprofit organization called CARF International, which provides accreditations for CCRCs and their services.

Overall, you will not be able to use Medicare to cover the cost of a CCRC because Medicare Services do not cover long-term care. The exception for Medicare coverage is if you use skilled nursing services while in your CCRC facility; Medicare will cover up to 100 days of that service. Because these CCRC contracts are similar to a “long-term insurance plan” it is tax-deductible because the IRS considers it a prepaid medical expense. The financial picture is different for every individual and every facility so get with your financial planner and elder law attorney to carefully review the contract and its terms before committing to anything.

While every CCRC is different, there is some standardization in the three types of contracts that are typically offered. The first is an all-inclusive, fixed price contract. While it is the most expensive contract, it provides unlimited access to all of the assisted living, medical care or skilled nursing care at no additional charge. This contract is best for someone entering the facility while still healthy and independently able. The second option is a modified contract that provides services for a set length of time which is a gamble. In the event you outlive the contractual timeline the additional services required are likely to expose you to a higher monthly fee. The third type of contract is a fee for service which means you only pay for the services you use. Fee for service contracts typically lowers your entry cost into the community, but you will pay market rate for assisted living or skilled nursing care if you need those services.

The best time to make a move into a CCRC is when you are healthy and able to take advantage of all the facilities have to offer. Being in a community that provides health and wellness strategies above and beyond medical care can allow you to age more successfully and with fewer health incidents. Moving into a CCRC is not a decision to be made in desperation because of an urgent health care need. The complexity and range of the CCRC contracts and pricing options need your careful thought and review with professional guidance to optimize your aging experience. Seniors with a spouse find a CCRC living choice particularly gratifying because partners will need different medical help at different rates. Even if the couple is not living in the same unit due to medical conditions they are at least on the same campus.

The social and activity amenities offered in CCRCs are very interactive and keep residents engaged. However, if the location of the campus is remote from urban environments, you might feel isolated and disconnected from the world at large. Some CCRCs are popping up in downtown locations and even on college campuses around the country. So be certain when considering a move to a CCRC you ask yourself if the site appeals to you for the long term. Also, find out how far removed it might be from family members you want to visit with often.

There are many questions to ask when contemplating a move into a continuing care retirement community. Visit the property and bring a family member or legal counsel to ensure the proper inquiries are made and that answers are complete. Ask to spend a week at the facility to experience it first hand and avoid buyer’s remorse. You are deciding whether to reside at a property for the rest of your life and must be sure that the facility is a fit for you. Because there have been bankruptcies in the CCRC business sector, you must review the facility’s financial sustainability. You do not want an unsuccessful CCRC to force you into a relocation process late in life that can be financially, physically, and emotionally draining.

Leaving Well: A Step-by-Step Process

Contemplating our own death is one of the hardest challenges we will ever have to face. Yet, if we want our dying to be meaningful and merciful, it is imperative that we think about it while we still can. Most of us want to die at home, in a familiar and peaceful setting surrounded by loved ones. We would much rather not spend our last moments in an emergency room or ICU, with strangers futilely pounding on our chests and our families relegated to the waiting room.

With those two alternatives in mind, we need to do all we can to keep control, as much as possible, of decisions that need to be made long before our final moments. We need to think carefully, well in advance, about what makes life worth living, and where pain and limitation have so eroded that quality of life that we would prefer not to go there.

These are notoriously difficult questions, but it is vital to address them anyway. For example, Terri Schiavo spent nearly half her young life unconscious in a condition known as a “persistent vegetative state,” being kept alive by a feeding tube. Her husband and friends claimed that before her severe brain injury, she said that she would not want her life sustained by machines. Unfortunately, she never put that wish in writing. On the other side, her devout family and right-to-life supporters insisted that she be kept alive despite her dire condition. After protracted litigation, Ms. Schiavo’s husband prevailed, the feeding tube was withdrawn, and, fifteen years after she was injured and never having regained consciousness, she was finally allowed to die.

Since her passing, the law has evolved nationwide to encourage us all to document final wishes, to avoid the anguish and uncertainty of Ms. Schiavo’s situation. There are a number of documents available in your state for that purpose. The umbrella term for these is “advance health-care directives.”

It’s our job as lawyers to help you sort through the various directives needed to express your wishes. Here is a step-by-step guide to begin the conversation about final wishes, and to understand which document does what when.

1. If you are over the age of 18, appoint a health-care agent to speak for you when you can’t.

Decide who, among those who know you well, is best suited to take on this responsibility. That person must possess good communication skills, remain calm in difficult situations, and be able to deal flexibly with complexity that might arise in reconciling your wishes with available medical options. Depending on which state you live in, your agent can also be called a “health care proxy.”

Sit down with that person and discuss your wishes in various scenarios. This is not an easy conversation to have, but there are guides available to help you. Visit “The Conversation”
https://theconversationproject.org/
and download the starter kit.
http://theconversationproject.org/wp-content/uploads/2015/09/TCP_StarterKit_Final.pdf

2. Health Care Power of Attorney (HCPOA)

Once you have had that conversation, visit your lawyer to name your agent formally in an HCPOA document. HCPOA conveys legal authority on your agent or proxy to express your health-care decisions when you are unable to.

3. HIPAA authorization

Your agent or proxy will also need access to your otherwise-private medical information. This is best done by a standardized document that complies with the federal Health Insurance Portability and Accountability Act (HIPAA). Without this authorization, your agent will be unable to obtain the medical information necessary to exercise the authority you want him or her to have.

Now armed with your agent and the HCPOA and HIPAA documents, you will know that if you were to meet with an accident or lose consciousness, you have chosen and empowered an advocate to speak for you. You should review and update these documents every five years or so.

The next three documents are important at the end of life. All these documents should stipulate that you desire comfort care, to keep you clean and as pain-free as possible. Remember, though, that you must create these documents while you are still able to know and communicate your wishes, so it’s best to do the next two documents at the same time that you do your HCPOA and HIPAA.

3. Living Will (also known as Physician’s Directive)

This document is for use when you are not enjoying quality of life. Either death is imminent; you are in a persistent vegetative state; or you are permanently unconscious, permanently confused, or unable to care for yourself. If you have no awareness of others; can’t remember or understand or express yourself; or are unable to move, bathe, or dress yourself, it’s advisable to have expressed, in advance, the kind of treatment you want to receive or not receive.

A living will expresses your choice as to whether you do, or do not, want artificial measures that will merely prolong your life but not improve it. Those measures, among others, may include CPR if your heart stops, or breathing or feeding tubes, or repeated courses of antibiotics or chemotherapy.

You may also require physicians, and not your agent, to be the ones to decide whether to cease life-prolonging procedures as you would like. This decision will relieve your agent from the heavy responsibility of making that irreversible choice.

Living wills are legal in almost every state. Ask your lawyer. Don’t make this kind of document yourself. Otherwise you risk that the document may be misinterpreted, with drastic consequences.

4. Specialized Directives

Medical decision-making varies depending on specific health conditions, so specific directives may be tailor-made for those conditions. For example, people suffering from advanced dementia benefit from a directive, in addition to the HCPOA or living will, specifically requesting that hand-feeding be ceased when the person can no longer speak, recognize loved ones, or move purposefully. Otherwise, caregivers are obligated to cajole or demand that the patient be fed by hand, taking advantage of a primitive reflex to open the mouth. This risks that the person may inhale the mush instead of swallowing it, in some cases causing pneumonia.

For this kind of condition, ask your lawyer to prepare a specific directive tailored for advanced dementia, using the directives created by End of Life Washington

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or End of Life Choices New York.

End of Life Choices New York

If, however, you suffer from a neurological illness like Lou Gehrig’s disease (ALS) or advanced Parkinson’s, even though most of us would decline mechanical treatments, those same treatments may be important aids to preserve quality of life for people with those conditions.

Again, remember that you must create these documents while you still have the capacity to communicate your wishes. Living wills should be reviewed every six months, because wishes can change depending on the progress of the illness.

5. POLST or MOLST

This is a brightly colored, short-form document that is primarily intended for emergency responders when the patient is frail and is likely to die within a year. It is designed to be immediately recognizable by hospitals and EMS personnel, to express that when the patient is unresponsive, cardio-pulmonary resuscitation (CPR) and other aggressive treatments are desired or not desired (DNR).

This document should be filled out in consultation with the patient’s physician. The acronyms stand for “physicians’ orders for life-sustaining treatment” or “medical orders for life-sustaining treatment.” Many states provide for this kind of document.

6. MAKE YOUR DOCUMENTS KNOWN

When it comes time to use your documents, they must be readily available. Give a copy of them to your agent or proxy, make sure they are included in your medical records, and, if you are in need of the POLST or MOLST, post it beside your bed or on your fridge where EMT knows to look for it. If your documents can’t be found, or if your agent or family don’t understand them or ignore them, you will have spent your time, effort, and money in vain.

But if all goes according to your wishes, you will have done your best to create a good death, one that is as meaningful as possible for all concerned. If we can assist in helping you with any of the documents above, we would be honored to do so.

The Senior Safe Act

The Senior Safe Act, signed into law by President Trump earlier this year, is designed to protect our elders from financial abuse from either within a family or support system, or by scam artists preying upon them. Tens of billions of dollars each year are illegally taken from US seniors and these numbers only reflect the crimes being reported.

Issue (Percentage of cases reported)
Third-party abuse/exploitation (27%)
Account distributions (26%)
Family member, trustee or power of attorney taking advantage (23%)
Diminished capacity (12%)
Combined diminished capacity and third-party abuse (12%)
Fraud (6.30%)
Elder exploitation (5.70%)
Friend, housekeeper or caretaker taking advantage (<1%)
Excessive withdrawals (<1%)
SOURCE: North American Securities Administrators Association

Often a senior does not report financial abuse or identity theft because they are unaware, embarrassed, or worse, they think that someone will deem them mentally unfit and they might be “put away” as a consequence of having been exploited. While these are real issues and fears experienced by elderly people, the scale of financial exploitation is so great it has to be addressed. This is why the enacted Senior Safe Act, coupled with the Elder Abuse Prevention and Prosecution Act (signed into law October 2017), as well as two Financial Industry Regulatory Authority (FINRA) rule changes (which have already taken effect), will provide the legal protections and financial industry framework our senior population need and deserve. One of the most important aspects of the new FINRA rules is the ability for member firms to place a temporary hold on disbursement of funds or securities when there is a reasonable belief that a senior is experiencing financial exploitation, thus protecting assets before they are taken from the senior. This new rule, in conjunction with the Senior Safe Act, can help keep seniors’ assets from vanishing.
The Senior Safe Act, which was originally initiated by Rep. Bruce Poliquin of Maine, is based on the already existing program in that state with the same name. Similar to the Maine program, the federal legislation allows insurance and financial advisors to report incidence of suspected cases of financial fraud involving their senior clients to financial institutions, who in turn could pass the suspicions on to the proper authorities.

As long as the insurance and financial institutions elevate concerns in good faith and their employees have received the proper training, the law will protect the institution and its workers from liability in a civil or administrative proceeding where information had been presented to authorities in the hopes of protecting a senior client from financial abuses or identity theft. The training includes a collaborative effort between state and federal regulators, financial firms and legal organizations, credit unions, broker-dealers, insurance companies and agencies, and investment advisers to educate employees on how to spot and report suspected elder financial abuse.

Seniors who are most active in communicating with a trusted professional third party about their finances are the least likely to fall victim to financial fraud. Counterintuitively, most financial fraud happens to seniors who do not display signs of cognitive impairment. Senior participation with professional and properly trained employees of financial institutions is the back-story of this bill. All of the legal protections of the Senior Safe Act will achieve nothing if there is no participation by seniors.

It is advisable to find a trusted professional adviser to help protect seniors against financial abuse and identity theft. The Senior Safe Act should make it much easier for seniors to find a properly trained individual who will monitor their financial accounts and be able to report signs of potential trouble to authorities. That trusted individual will be able to identify the warning signs of common scams and educate seniors as to how best to protect themselves; such as how often to check credit ratings for signs of identity theft, reviewing financial statements, identifying common phone and online scams, and more. The laws are in place to help seniors stay protected. Get protected by becoming more involved in your own personal financial world. Contact our office today and schedule an appointment to discuss how we can help you with your planning and participation.

Recognizing and Reporting Elder Abuse

What is Elder Abuse?
Elder abuse is a problem that takes many forms. Unfortunately, many seniors are subjected to elder abuse and often times the abuse goes unreported and the abuser goes unpunished. Elder abuse may take the form of physical abuse, include hitting, striking, beating, kicking, and using excessive force. This may also include the overuse of restraints or drugs.

Emotional or psychological abuse is also a common form of elder abuse. This can be anything that causes emotional pain or distress and may include verbal assaults, intimidation, isolation, humiliation, and harassment.

Neglect is also a common form of abuse in senior citizens. Neglect is when a caregiver fails to provide the necessary care for the senior citizen under their care. In contrast, self-neglect is when a senior citizen who is mentally competent refuses to care for their own needs and causes harm to themselves.

Financial exploitation is yet another form of elder abuse. Financial exploitation is often committed by family members (most common), caregivers, or strangers.

Reporting Suspected Abuse
Adult Protective Services (APS) is often the first to receive reports of or to respond to reports of elder abuse. Their job is to provide for the safety, health, and well-being of elderly and vulnerable adults. The law requires those who work with senior citizens in various capacities to report to APS if they suspect elder abuse. When APS receives reports of abuse or neglect, they have several possible actions or interventions. They are responsible for receiving and investigating reports of elder abuse. They then must evaluate the victim’s risks and assess the victim’s ability to understand their risk and give informed consent. The APS worker can then develop a case plan for the abused elder. Once a case plan has been decided, the case worker can arrange for necessary care, medical attention, and legal consultation. Once this is done Adult Protective Services then monitors the services and evaluates the case.

More serious cases of abuse may be reported directly to police. If a senior is in immediate danger, this may be the best course of action.

Many websites provide information on warning signs of potential physical abuse, emotional/psychological abuse, sexual abuse, neglect, and financial abuse. If you have a loved one who is a senior citizen, it is important to know the warning signs for abuse. It is also key to stay involved with the caregivers and to make regular visits to check on the care of your senior loved one. The National Adult Protective Services Association, http://www.napsa-now.org/get-informed/ , has important information on different types of abuse, as well as ways to get help in any state

What is Long Term Care Insurance?

Long-term care insurance is very beneficial for the elderly or disabled person who need will services or support to meet their personal care or health needs. However, it is important to understand long-term care insurance before the time comes when the benefits are needed. Unfortunately, many people wait and then miss out on what long-term care insurance can offer.

Should I get long-term care insurance?
There are a few things to consider before you go out and purchase long-term care insurance. First, consider your age. Age is important because it is much cheaper to get long-term care insurance at a younger age. Older adults and those who already have existing health conditions may have more difficulty getting long-term care insurance and the premiums are guaranteed to be costly.

Second, consider your support system. In other words, do you have family who will be able to help provide for your care needs in the future? If so, then you may not need long-term care insurance. This is definitely a good time to sit down and talk about the future with your family.

Third, consider your savings and investments. This is where a financial adviser or elder law attorney can help you understand ways to pay for long-term care and whether or not long-term care insurance is right for you.

What is the cost of long-term care insurance?
The cost of long-term care insurance cannot be attached to specific numbers. The cost depends on age, gender, marital status, the insurance company, and the amount of coverage. The younger a person is when they get long-term care insurance, the lower the premiums will be. Generally speaking, long-term care insurance policies are less expensive for men than women. This is due to the fact that women generally live longer and therefore are more likely to make claims on the long-term care policies. Married people have lower premiums than single people. Just like with any type of insurance, rates for long-term care insurance will vary from one company to the next. It is important to shop around and compare the costs of long-term care insurance with a variety of carriers. The amount of coverage desired greatly affects the cost of the long-term care insurance. Better coverage with fewer restrictions will come at higher premiums. Be sure to do your homework, talk to your financial planner, and elder law attorney to help determine long-term care insurance needs.

What does long-term care insurance cover?
Once you have a long-term care policy, you are eligible for benefits if you have dementia or another cognitive impairment or you are unable to perform at least two of six activities of daily living. These activities include bathing, dressing, eating, toileting, caring for incontinence, and transferring. When a policyholder is eligible and in need of filing a claim on a long-term care insurance, a variety of services may be covered. Nursing homes and assisted living facilities may be covered services. Within those services, policies may only cover room and board or they may cover more extensive services. Long-term care insurance also covers adult day care services for those who need a program for health, social, and other support services during the day. Home care is also provided under some long-term care insurance. This service helps with activities of daily living in the policyholder’s home. When home adaptations are necessary, such as ramps or grab bars, long-term care insurance can cover these services. Care coordination and future service options are also available services with within long-term care insurance policies. You will need to understand your specific policy to determine the specifics of the services covered and to what extent they are covered.

Long-term care insurance can seem very complicated. Remember there are professionals who specialize in helping to determine long-term care insurance needs and coverages. A great place to start is with your financial advisor and elder law attorney.

If you have any questions about something you have read or would like additional information, please feel free to contact us.

New Law Encourages Reporting of Elder Financial Abuse

President Trump signed the Economic Growth, Regulatory Relief, and Consumer Protection Act into law on May 24, 2018. The Act contains a section that was once a stand-alone bill from Sen. Susan Collins (R-Maine) which is designed to encourage the reporting of elder (age 65 and older) financial abuse witnessed by financial institutions. The Act does not mandate that these institutions report financial abuse directed towards elders to avoid penalties, rather it gives them an incentive to do so. The Act provides immunity from any lawsuit alleging elder financial abuse if the financial institution reports it to state or federal law enforcement agents. To qualify for immunity, a financial institution has to create and administer a training program for employees to teach the employees how to spot elder financial abuse. This Act provides immunity to financial institutions because they are often the first to witness elderly clients making unusual transactions that may be linked to a scam.

The Act was inspired by the Senior$afe program in Maine. Senior$afe encourages state regulators, financial institutions, and legal organizations to work together on educating banking and credit union workers to spot and stop elder financial abuse. When elders have a trusted third party to talk to about their finances, they are less likely to fall victim to elder financial abuse, and this program has found success in reducing the amount of elders who fall victim to these scams.

However, this isn’t an entirely new idea. In 2016, the Consumer Financial Protection Bureau (CFPB) issued a report that found how reporting elder financial abuse has already become a respected norm in hundreds of counties around the country. The report found that these counties created voluntary community-based partnerships to prevent, detect, and respond to elder financial abuse situations. These partnerships often include entities such as financial institutions, adult protective services, and law enforcement. The CFPB found that these partnerships can be incredibly effective in protecting their elderly citizens. What’s more, in states without elder financial abuse protection laws, these community efforts have created a sense of responsibility within these counties to protect their most vulnerable from financial scams, without reward or threat of prosecution against financial institutions. Following this report, the CFPB released a resource guide and best practices to help and encourage other counties across the US to adopt their own protection partnerships. Among other recommendations, the CFPB encourages communities to directly include law enforcement and financial institutions in these partnerships. Financial institutions are often the first to spot these cases, and law enforcement has an obligation to investigate once a claim is made. Also, the CFPB recommends that partnerships which serve diverse areas engage with groups that are already entrenched in the community, such as service groups or faith-based organizations.

Protecting our most vulnerable is important to providing a safe and prosperous society for all citizens. These community-based partnerships and the Economic Growth, Regulatory Relief, and Consumer Protection Act are both steps in the right direction towards protecting those who aren’t able to protect themselves. If you have any questions about something you have read, please do not hesitate to contact our office.

Solo Aging and the Challenges it Brings

For some seniors in the baby boomer generation aging brings with it new challenges in the form of solo aging. Solo aging is a senior who has no children and no younger (or healthier) family members to assist them as they age. As in generations before, baby boomers are living longer and healthier lives but for some there is no escaping the eventualities of disease like heart disease, arthritis, diabetes or dementia. Others may require extensive care following a fall that results in a broken hip or other serious injury.
In prior generations when an aging senior needed assistance with activities of daily living they would typically enter a residential facility or be treated at home, often times with a younger family member to supplement their needs. In the case of the baby boomers however, healthy family members who can provide care are in shorter supply. Solo aging requires a modified approach to the requisite standard planning around the larger family system of previous generations.
The Pew Research Center found the rate of childlessness in baby boomers to be about 20% -double the number of previous generations. This childless statistic translates to one in five baby boomers having no adult children to help them when independent living becomes difficult or impossible. This solo aging segment of the baby boomer population is typically white, highly educated, reasonably affluent, and has a desire to remain living in the United States. Any of their immediate family that could provide care is often small in number and likely to live far away. These solo agers are fiercely independent and are accustomed to making their own decisions and will not let go of their self-determination easily.
Like most seniors, the solo ager prefers to remain in their private home. Living at home in the earlier years of retirement is often a suitable arrangement but over time the downward slope of mortal decline can lead to a number of dangerous difficulties. Incorrect management of medication, poor nutrition, isolation and loneliness, alcoholism and depression, dementia, and susceptibility to scam artists are just some of the problems that can become prevalent. Without the benefit of a younger family member who can “well check” them the solo ager is at an increased risk of becoming a victim of fraud, abuse, or more serious health decline. Moreover, when the time does come for care giving and/or relocation to a more suitable and safer living environment the solo ager will not be able to rely on an adult child to help them find qualified caregivers and appropriate living arrangements as well as orchestrate the physical downsizing and relocation to a new home.
What to do? Prepare and prepare early. Even if a solo ager is healthy it is impossible to predict the future. The unexpected fall or illness happens and more often than most people think. The solo ager needs to empower a third party, through proper legal documents, to act in a fiduciary capacity in the event the senior becomes incapable of making decisions. This includes a trusted friend, extended relative or even a professional fiduciary or private guardian.
There must also be legal protection in the form of a healthcare directive and estate plan or trust in place. Without the benefits that a traditional family support system brings the solo ager must pay strict attention to the details of their life planning and seek professional counsel to make proper arrangements. The reliance must shift from immediate family to legal professional counsel to ensure the solo ager is cared for in the manner they want should the need arise. While it may seem an uncomfortable discussion at first, the solo ager should be reminded they are maintaining life control by having legal documents created to reflect their own wishes. The solo ager can garner a sense of inner peace in their retirement years knowing their plans are properly in place and that the course of their life will reflect their desires.
If you or someone you know is a solo ager, we can help. Contact our office today and schedule an appointment to plan for your future!

Make Sure Your Wishes Are Carried Out

The importance of making end of life preparations cannot be stressed enough. Many put off making these plans thinking there is always time. The sad reality is that none of us are guaranteed time. Others may be bothered by the thought of death itself and allow this to paralyze them when it comes to making plans and getting their affairs in order for the end of life. However, most of these same people have wishes and thoughts about where and to whom their assets are distributed. Many of them also have ideas about what they do and do not wish to have happen when their life ends. Lack of preparation and planning means that these wishes likely will not be honored. In addition, it causes additional strain and stress on the people who are left to sort out the affairs. An example of this is the story of Debbie.

Debbie was a teacher who had been retired for several years. She was aging alone. She never married and had no family around. She did have a small circle of friends. After retirement, Debbie’s health progressively declined and she had more and more difficulty caring for herself. After a few years, Debbie passed away in her home.

Previously, she had conversations with a handful of her friends telling them her wishes for the possessions and assets she had. Because of these conversations, these friends each thought she had made the proper preparations to ensure these wishes would be followed. Unfortunately, Debbie had none of the necessary end of life documents that would allow her wishes to be followed. Her friends were left to try to piece together a puzzle that only many missing pieces. Her burial was prolonged and what she did have after paying expenses to settle the estate and bury her will not end up where Debbie wanted. This scenario can, however, be avoided.

If you or your elderly loved one have not made end of life preparations, make time to do so as quickly as possible. An elder law attorney can help guide you in what you should be doing, and can make sure the proper documents are in place to carry out your wishes regarding your health, care you want (or don’t want) to receive, and who should receive your money and possessions.

The first key document to be sure you have is a will or a living trust. A will allows you to specify where your money and possessions should go upon your passing. It also allows you to choose an executor of the estate. The executor will take care of managing the estate, paying debts, and distributing property as specified. A will only takes effect upon your death.

A living trust does everything a will can do, but also allows for you to choose someone to manage your assets if you become incapacitated because it is effective during your lifetime. A living trust also provides privacy, as it is not subject to court proceedings that become open to the public like a will is. There are numerous other advantages to a living trust that can be explored with the help of an attorney.

A living will and health care power of attorney are two additional documents that take effect while you are alive. A living will specifies your wishes for end-of-life medical care. For example, you can specify whether you want to be kept alive by artificial means if you are in a terminal state. A health care power of attorney provides for someone to make health care decisions for you, in case you aren’t able to make decisions yourself. Both of these documents outline your wishes about medical treatment and care when you can’t make them for yourself, so it’s important to seek legal guidance to make sure these documents are drafted properly.

A financial power of attorney should be in the plan as well. A financial power of attorney names an agent to handle your finances in the event you are no longer able to. An agent can open and close bank accounts, write checks, and sell property if you choose to allow them the authority to do so. Like the health care power of attorney, the financial power of attorney should be created with legal advice to make sure your wishes regarding your finances are properly documented.

Having an estate plan is necessary for you to have a say in what happens if you become sick and cannot make decisions for yourself, and to determine what happens with your money and your belongings after death. An estate plan also helps those who are left to deal with the estate to do so in a more simple and straightforward manner.

If you have any questions about something you have read or would like additional information, please feel free to contact us.

Power of Attorney Misconceptions

A durable power of attorney is one of the most important estate planning documents you can have.  It allows someone who you appoint (your agent) to make decisions on your behalf in the event you become incapacitated. If you have not appointed an agent then your friends and family may not have the authority to make decisions on your behalf.  In that case, a judge may have to appoint someone for this task, which can require a court process that is expensive and tedious.

While a durable power of attorney (POA) is one of the most common estate planning documents, it is also one of the most misunderstood. This article will break down some of the common misconceptions regarding POAs and help you understand what you need to create a valid POA.

Misconception: Technology is so great now, there is no need to speak with an attorney, I can just create my own POA online.

Truth: POAs are not one-size-fits-all. Each person’s situation is unique.  If you use a cookie cutter program it may not cover specific transactions.  In order to conduct many financial transactions specific language must be used to grant proper authority.  Elder law attorneys create these documents regularly which gives them valuable experience in unique situations and can make sure you have all your bases covered.

Misconception: POAs are one-and-done documents. Once I create it I will never have to touch it again.

Truth: POAs are documents that should be updated regularly. Laws change and if you have not regularly updated your documents you may find out too late that your POA is not valid. Further, some financial institutions may not accept a POA that was not updated in the last few years for fear of a lawsuit.

Misconception: I shouldn’t make my POA active until I become incompetent (a “springing” POA).

Truth: While the timing of granting agency through a POA is a matter of personal preference an immediately effective POA should be considered.  A springing POA usually requires a finding of incompetency by at least one doctor and sometimes two.  However, there may be an emergency where a doctor will not sign off that you are incompetent. Making your POA effective immediately removes the need for a doctor to declare you incompetent.

Misconception: I don’t need a POA, I’m young and healthy, plus I don’t have many assets.

Truth: Every single person over the age of 18 should have a POA. You never know when something catastrophic may happen.  You need to have a plan in place to take care of you in the event you become incapacitated unexpectedly.  If you do not have these documents in place then you have no control who will be making decisions on your behalf.  It can be expensive and time consuming for your loved ones to go through the court to have one of them appointed by a judge.

POAs are absolutely essential documents that everyone should have. It is important to consult an elder law attorney who can examine your unique situation to create your POA and to keep it updated. Please do not hesitate to contact our office if you would like to speak with an attorney about creating your own POA.

Helpful Ways to Pay for Assisted Living Costs

Assisted living rent can vary from $2,000 to $5,000 monthly. Depending on what type of care your loved one needs, assisted living can be the most affordable solution when compared to a nursing home ($5,000 to $10,000 or more per month) or long-term in-home care. If closely monitored medical supervision is not necessary for your aging senior, assisted living might be the best financial choice.

One payment strategy that has become popular is to use Medicaid. If your loved one does not have many financial assets and their income levels are low, this could be the right solution for them. Medicaid varies from state to state both in name and in eligibility requirements. Many states dictate that a senior is eligible if he or she has less than $2,000 in assets, or $3,000 if married.

If you are trying to help a senior with a creative financial strategy by gifting money and other assets to family members, known as “Medicaid spend-down”, the government has a five-year look-back rule regarding financial transactions. There are strict guidelines about Medicaid spend-down. If a senior is caught incorrectly spending down resources to qualify for Medicaid, the penalties are steep, including disqualification from receiving Medicaid for a lengthy period. Also, many states do not cover assisted living under Medicaid, but require the submission of an additional wavier. Be aware that Medicaid assisted living payments are only accepted by some communities and Medicaid beds are usually limited. There can be long waiting lists to enter into a Medicaid financed assisted living facility.

If your senior has a disability, he or she may qualify for Supplemental Security Income (SSI), which is a federally administered program. SSI is the government safety net for those destitute and wholly or partially disabled by illness or injury. SSI is a monthly payment which a senior can use to pay for assisted living. To qualify for SSI, contact the appropriate local Social Security office and provide financial documentation and a doctor certification to attest to your senior’s inability to work because of a medical disability.

If your loved one or their spouse is a Veteran, residential care could be paid for in a variety of situations with Veterans benefits. There is a set of benefits available to those with disabilities or service-related injuries, and there is also another set of benefits called Aid and Attendance, made available to any Veteran or surviving spouse who is both disabled and whose income is below a certain threshold. The Veterans Administration website outlines the complicated process to access benefits. It is extremely beneficial to work with an elder law attorney who knows the details of the programs and can assist with the application.

A life insurance policy can pay for your loved one’s assisted living. Often, seniors have a long-standing policy that was implemented to help family members upon their death, but a life insurance policy can provide financial support now. A process known as “accelerated” or “living” benefits is a “cash out” policy that can have your senior redeem 50 to 75 percent of the face value of the policy. Each amount is based on specific policy conditions as well as individual corporate rules. Some policies can only be cashed out if the policyholder is terminally ill while other companies are more flexible in cash outs. If your senior’s particular company does not allow the policy to be cashed, it can still be sold to a third-party company who usually affords the same 50 to 75 percent face value cash out. That company continues to pay the original premiums until their death, at which time the company redeems the full value of the policy. Finally, if your loved one’s policy is of lesser value, it may qualify for a life settlement option known as a “life assurance” benefit or conversion program, which allows the senior to convert between 15 and 50 percent of the policy value directly into long-term care payments.

Does your loved one have a long-term care insurance policy? It can pay for assisted living care. Policies vary, but once the determination and action is taken to collect on it, those monies can be paid directly to an assisted living facility or to the beneficiary who in turn pays the facility. It is wise to consult with an elder law attorney to help understand individual company requirements to optimize the process of collection.

An annuity can be used to pay for some or all of the senior’s assisted living. If your loved one invests a lump sum into an annuity, they will receive regular payments over a promised time period, usually the rest of their life. The annuity helps to stretch your senior’s budget and guarantee at least some money is coming in, even in the event they live longer than expected. Most annuities allow the beneficiary to continue to receive money regularly even if the purchase premium runs out. If your senior were to live a very long time, they would get more back than they put in and an added bonus is that annuities are oftentimes not fully counted as assets by Medicaid when applying for government assistance. The income is counted but not the value of the asset. It is imperative to seek the advice of an elder law attorney before opting into an annuity as they are complex financial products and a wrong decision could be disastrous.

Reverse mortgages are another strategy to pay for assisted living. If your loved one owns their home outright or has only a small mortgage on it, they can get cash value from their home equity in a lump sum or series of monthly payments. The bank will decide the valuation of the home based on multiple factors like the homes worth, interest rates and the applicant’s age. The borrower can stay in the house until death even if the loan balance exceeds the worth of the home. After death, the loan balance has to be repaid which usually means selling the home. Reverse mortgages were developed to help widows remain in their homes after the primary income earner passed away or if that spouse needed to move into assisted living, leaving the other spouse to reside in the long-time family home. Like annuities, a reverse mortgage is a complex financial product, and it is crucial to receive sound advice from a trusted professional and work with a reputable reverse mortgage company. If only one senior parent is living and they do not want a reverse mortgage, they might consider renting out their home and using a landlord to manage the property. The income from renting the house can be used to pay for assisted living expenses.

Lastly, it is possible to pay for assisted living with a bridge loan, which is a short-term loan of up to $50,000 explicitly designed to provide funds to move a loved one into an assisted living facility or continuing care retirement community. It is an unsecured (no collateral required) line of credit with the intent to finance the first few months of living expenses during the sale of the senior’s home, while the application for Veterans benefits is pending, or other actions that are taken that free up funds. Since the interest rates can range from 8.25 to 12.5 percent, this option is best as a short-term strategy. The other type of bridge loan is called the Capital Access Program. It is a lower interest lump sum loan secured by real estate or other assets that the company deems acceptable collateral. It is designed to help seniors come up with the large upfront entrance fee some senior assisted living facilities require. Both types of loans are based on the usual credit criteria: credit score, credit history, debt to income ratio, and more. The senior or an adult child can secure the loan, and up to six family members can cosign loan applications, allowing the risk to be shared among multiple family members.

If your loved one is healthy enough to successfully live in an assisted living facility, the monthly cost is likely a top factor when considering their options. These are some, but not all of the viable and creative ways to pay these costs. To fully explore the options available and what is best for your senior seek the advice of an experienced elder law attorney and make the best decision for your loved one. Contact our office today and schedule an appointment to discuss how we can help you with your planning and which strategy is best to help your senior pay for assisted living.

America is Facing a Family Home Caregiver Shortage

The aging population of the United States is widely reported as the bulk of the baby boomer generation is already retired or nearing retirement. However, what has not been widely reported is how the rest of the nation will provide care for this large, aging population. According to a 2017 Merrill Lynch study, nearly 95% of caregivers are family members. These family members are providing over $500 billion worth of free care annually. For perspective, that’s three times Medicaid’s professional long term care spending. The number of family caregivers is shrinking at a time when the population that needs them is expanding at a rapid rate. In 2020, there will be over 56 million people in the U.S. age 65 and older. In 2010, that number was just 40 million.

This is a unique problem for the baby boomer generation for several reasons. The main reason is the simple fact that there is just an unusually large number of people in this generation. Unfortunately, every elder who needs care will not have a family member willing to give care. This responsibility will then fall to professional home care workers. Government statisticians project that the nation will need an additional million home care workers by 2026, an increase of 50% from 2014. Fulfilling the need for this many additional workers will be difficult, however.

Home care workers face extremely low wages, inconsistent work schedules, and there is little, if any, room for advancement in the industry. For example, the median salary for a home care worker is a minuscule $10.66/hour according to the U.S. Bureau of Labor Statistics. For comparison, that’s about the same hourly wage as a fast-food cook and about 30% less per hour than a veterinary technician makes. Looking beyond just salary, benefits are dismal, also. Only a third of home care workers are full-time and qualify for benefits. Further, there is a better chance you get injured on the job as a home care worker than if you worked in the oil and gas extraction field.

Another reason why this is such a unique problem for baby boomers is that it was more common in the past for children to stay in the same geographic area as their parents and be able to provide free care to them when it was needed. With advancements in travel and technology, it has become exponentially easier for people to move away from their parents, whether it be for job seeking reasons or simply for a change of scenery. Also, with the increasing rate of debt Americans are taking on, some family members just do not have the means to take time away from work to care for ailing family members.

There are several small initiatives taking place to help combat this shortage. In Massachusetts, the Home Aide Care Council has started a two-week training program that introduces new home care workers to what the job entails before they start their formal training as a home care worker. Also, some states are starting programs that provide opportunities for advancement. New York has a program that trains home care workers to administer routine medication, which gives them experience that can help them move into other positions in the healthcare industry.

4 Steps to Choosing the Right Nursing Home

Choosing a nursing home for a loved one is an important decision and should be carefully considered. Below are some steps designed to assist families in choosing a nursing home.

1. Identify Nursing Homes in the Area
The first step in choosing the right nursing home is to identify all the possible nursing home options in the area. Asking friends, family, and other people you trust is an excellent way to begin the search for possible options, especially if have had personal contact with the nursing home. Doctors and hospitals can also help identify nursing home options that provide the type of care a loved one may require.

Another option is using the internet to locate nursing home facilities. The Medicare website has a locator for nursing homes and even provides some comparisons of nursing homes – an important benefit highlighted in the next step below.

2. Research the Quality of Care Provided by the Nursing Home
Using comparisons like those found on the Medicare and Medicaid websites can be a very helpful starting place for gathering information on nursing homes and the quality of care provided. This information along with information from other sources like the long-term care ombudsman. Many facilities may provide survey results that can give insight into the facility’s care.

Other sites that allow consumers to post reviews, like Yelp.com, can also be an important way to compare nursing homes. While best known for its restaurant reviews, Yelp also includes reviews of skilled nursing facilities and rehabilitation centers.

3. Visit the Nursing Homes in Person
After doing ample research, it is time to visit the nursing home. Nursing homes will schedule tours for prospective residents. While there, pay close attention to the cleanliness of the facility, and the appearance of the residents. Make note of what the residents are doing and how they look. Are they engaged in activities, is there evidence of neglect, is there enough staff to attend to the patients? Ask about patient to caregiver ratios so you can compare it with other nursing homes.

Other things to consider include how the facility provides for social, religious, recreational, or cultural needs, and the types of meals they prepare. You may have the opportunity to have a meal during your visit, which will allow you to sample a meal, but also observe how the residents are treated during meal times.

Before leaving, find out who you can call if you have additional questions. Then, make a second unplanned visit at a different time or on a different day. An unplanned visit will allow you to observe the nursing home and its residents on a “normal” day.

4. Choose a Nursing Home
Making notes during the first three steps can help families go back and carefully look at the information gathered to make a decision. If more than one facility fits the needs of the loved one, then it is important to consider cost and what is most important to the family.

Once a nursing home is chosen, an agreement will need to be signed. It is important to have an elder law attorney review this agreement to make sure there are no hidden provisions, like holding a child responsible for non-payment, or a minimum number of months before a resident can apply for Medicaid.

These steps will allow families to make the best nursing home choice possible. Although, many families find themselves in sudden need of a nursing home facility after hospitalization, most have time to make preparations. If time is not a factor, following these steps can help to avoid making a decision that is not best for the loved one in need of care. Any long-term care decision is made best when families are armed with as much information as possible.

The rise of bankruptcy in the lives of aging Americans

The golden years are turning into bankruptcy red for many retired and aging Americans. While medical advances are keeping seniors alive longer, the associated healthcare costs in the quest for longevity are being off-loaded onto the older individual at a time when reduced income is a hallmark of senior living. Older Americans are increasingly filing for consumer bankruptcy. According to the Consumer Bankruptcy Project, the population aged 65 or more are filing for bankruptcy at a two-fold increase, and there is nearly a five-fold increase in the percentage of seniors in the US bankruptcy system. The economic risk for seniors is running rampant, and the sad truth is currently 97 out of 100 people aged 65 and over are not able to write a check for $600 or more due to insufficient funds.
The sentiment among Americans is that their standard of living will increase at the age of retirement when it is quite the opposite. The typical retiree has set aside about $60,000 for their old age living, and more than 50% over the age of 55 have saved less them $50,000; as much as 40% of these workers have less than $25,000 set aside. The stark reality is none of these “nest eggs” are enough to see a senior through old age and the unforeseen disasters that can deplete what little has been saved.
One of the more common financial obstacles that create this bankruptcy scenario is a health issue. Medicare is not comprehensive. In the absence of a supplemental insurance plan picking up the non-Medicare funded 20 percent cost, a senior can be left with unforeseen operation and rehabilitation costs. Without full health care coverage, the cost of staying alive as a senior is practically prohibitive between prescriptions, treatments, surgeries, rehabilitation, and assisted care. The primary two options available to a senior to cover these costs of survival are credit card debt and loans. Suddenly, at a time when most seniors should have very low monthly living costs, they find themselves back in a debt slave scenario with little or no income to address their healthcare debt.
Many seniors have concluded that retirement is not a part of their future as they will need a viable stream of income to avoid financial disaster. While this seems reasonable, it is not a good plan to assume one will be healthy enough to work forever. As we age, there is an increased probability that working will become impossible due to unforeseen illness. When this happens, debts begin to mount, and bankruptcy becomes a likely result. Additionally, the era of stable pensions afforded to a long time employee has gone by the wayside. Fewer companies even offer them anymore and those that do often modify and reduce pension benefits to meet corporate expectations of financial profits.
The cost of living rarely if ever is reduced over time and while social security benefits seem like the answer to a senior’s retirement years; these benefits seldom cover basic living expenses no matter how long an individual may have worked or how much they paid into the system. The senior who is faced with government social security benefits and very little additional income usually turn to credit cards to address the gap between low income and living expenses. This scenario takes a senior right back to debt slave mode. As many as two out of three seniors who file for bankruptcy cite credit card debt as one of the primary reasons.
Scams that target the senior population are becoming more sophisticated and prolific with the advent of technology. What used to be a “one to one” scam can now be distributed via email to thousands of targeted seniors who are online in greater numbers than ever before. Often the unsuspecting senior will make passwords or personal bank information available to what they believe is a legitimate request for information from what appears to be a valid email. Seniors can also fall prey to predatory lenders as many seniors cannot read the fine print or understand the consequences of their actions. When scam artists victimize a senior, the senior often loses a large chunk of their assets which in turn can put them in a bankruptcy scenario.
While it is impossible to know the exact future, it is possible to make reasonable plans for it. Learn the ways that you can protect yourself from becoming part of these bankruptcy statistics in your senior years. Even a modest plan is better than no plan at all. Seek the advice of trusted legal and financial professionals to help you understand what you can do to protect your future. Please feel free to contact our office today to discuss how we can help you with your planning.
If you have any questions about creating a secure financial future for retirement years, call us today! Tel: 623-252-0292

Reasons to take your social security benefit early

Receiving your social security benefits at an earlier age will not reduce the overall amount of your benefit over time. Because you will be taking it at a younger age, your monthly payment will be smaller than if you had waited but the aggregate payout overtime will be the same amount. To see how the numbers work out use the Social Security table or Social Security detailed calculator to understand how your monthly benefit payout amount differentiates depending on when you claim your benefits.

While it is not always optimal, there are some reasons to take your social security benefit early. If the potential for program insolvency is causing you additional anxiety, then it may make sense to start taking benefits earlier than your full retirement age.. Lack of quality sleep and over anxiousness in waking hours thinking about when to take your benefit can lead to health problems.

Another reason to take your social security benefit early is if you believe your life expectancy has changed. While the longevity rate keeps increasing the more you age, it does not prevent the unfortunate diagnosis of a life-threatening disease. If your health has declined and you may not live out your statistical life expectancy, then it may be proper to claim your benefit early. Claiming your benefit earlier can give you comfort financially, physically, and mentally.

If you are a legally married woman, you can make a rational case to start taking social security benefits at the earliest possible time if your husband has been the significant wage income earner. Statistically, the wife will outlive the husband, and the spouses can share the wife’s early benefit as an income source. But if you take your benefit early, how long do you have to be married before receiving your deceased spouse’s increased benefit? The answer is, it depends. There are three types of benefits in this married spouse category: spousal, survivor, and divorced spouse. Each status has different qualification rules, and it can be complicated to decipher the best benefit available to you. It is crucial to check Social Security Administration benefits for spouses as well as a trusted legal advisor to outline your best course of action.

Deciding when to take your social security benefits involves numerous factors. A balance has to be struck between the cost of living adjustments (COLA), current expenditures and expected longevity. If we can be of assistance, please don’t hesitate to reach out.