Wealth Planning and Long-Term Care Planning for Aging Parents

If you have the responsibility of taking care of your aging loved ones, this is an extremely common situation that is facing more people in the sandwich generation. The sandwich generation often has children of their own, while they are also helping with the health care management or the costs associated with the loved one.
Many people don’t like to think about incapacity, money or death, but this is extremely important for any situation in which you are helping a loved one work through the issues of aging. There are several different steps that you can take in order to minimize the negative impacts of failing to plan. Failing to plan can make things more complicated for everyone, in the event that your loved one suffers from incapacity or suddenly passes away. Several different things should be discussed with your aging parents, including:

  • Putting together a living trust.
  • Planning for the possibility of long term care, including long-term care insurance.
  • Evaluating housing options.
  • Determining transportation needs.
  • Ensuring proper documents are in place.

Having a consultation with an experienced estate planning attorney can help you address many of the issues associated with the estate planning and the elder law planning process. Learn more about how estate planning Virginia can help you by setting up a consultation today.
 

Caring for a Child with Addiction or Mental Illness After You Pass Away

A woman in train alone and sad
Every parent has concerns about how they will pass on their assets to their loved ones in the future but there are many more complications when you have a child who is struggling with mental illness or with addiction issues.
Many parents who find themselves in this situation may feel overwhelmed by the process of caring for these children and therefore, avoid thinking about how these children will be taken care of when the parents are gone. Estate planning might differ in this situation when compared with another type of family. There are a couple of important steps that you need to take in order to plan appropriately for the future.
Whether the child is affected by addiction or mental illness, they may never fully recover from this condition and this is why it is important to think about using tools such as a trust in order to strategically allow access to them for support.
Not distributing the assets directly to your children means that they will most likely be invested with an experienced financial advisor with the ideal purpose of the money growing. In the event that the mental illness or addiction problem gets worse, this allows for more resources to fight the addiction. If the addiction problem is abated, however, the trustee may be able to help the child with new endeavors such as education or job opportunities. Careful planning should always go into any situation in which there is mental illness or serious concerns about addiction or spendthrift behavior. A trust may be the most appropriate way to plan for this- ask your Virginia estate planning attorney for more information.

Caregivers Should Take Care To Get Care Themselves

Home care

Home care

People who are willing to become a caregiver to a loved one, regardless of the circumstances, are taking on an awesome responsibility.
Consider this set of guidelines offered at Preserve dignity

  • Involve your loved one
  • Promote independence
  • Ask for help
  • Be an advocate
  • Take care of yourself

That last guideline might sound simple, but it’s perhaps one of most overlooked on the list, according to the website.
“Many caregivers are so accustomed to providing help and seeing to another person’s needs that they don’t know how to ask for aid themselves,” the article notes. “Take advantage of the help that’s available. Your family is your first resource. Spouses, brothers and sisters, children and other relatives can do a lot to ease your caregiving burden. Let them know what they can and should do.
Look to your church for aid and counsel. Make your minister or religious leader aware of your situation. Turn to caregiving support groups, or support groups for specific illnesses like Alzheimer’s or heart disease.“Encourage your loved one’s friends and neighbors to provide what comfort they can.”

For Caregivers, Ensuring Legal Matters Essential

Doctor laying hand on senior man's shoulder

Doctor laying hand on senior man’s shoulder

Caregivers of people with serious illnesses, particularly cognitive issues of the elderly, have a lot on their plate, but they also have an obligation to make future legal preparations for their loved ones.
“As a caregiver, you should begin making legal preparations soon after your loved one has been diagnosed with a serious illness,” states an article on the webmd website. “People with Alzheimer’s disease and other long-term illnesses may have the capacity to manage their own legal and financial affairs right now. But as these diseases advance, they will need to rely on others to act in their best interests. This transition is never easy. However, advance planning allows people with a long-term disease and their families to make decisions together for what may come.
“Clearly written legal documents that outline your loved one’s wishes and decisions are essential for caregivers. These documents can authorize another person to make healthcare and financial decisions, including plans for long-term care. If the person being cared for has the legal capacity, the level of mental functioning necessary to sign official documents, he or she should actively participate in legal planning. To give your loved one the best care possible, obtain legal advice and services from an attorney experienced with these issues. If the person you’re caring for is age 65 or older, consider hiring an attorney who practices elder law, a specialized area of law focusing on issues that typically affect the elderly.”
Webmd.com advises caregivers to be certain that important documents are in place, including:

  • Power of attorney
  • Durable power of attorney for health care, also known as health care proxy
  • Living will
  • Living trust
  • Will

 

Elder Mediation Can Help Keep Siblings Friends

The stresses and strains of caring for an aging parent, and especially determine what form that care should take, can push apart even the closest of siblings.

A recent story in The New York Times describes how two sisters nearly had a falling out after the death of their father in 2011 when it came to what was best for their 84-year-old mother.
“We were all confused and upset about the situation,” Rosie McMahan, 51, of Amherst, Mass., an educator and a counselor for teenagers, told the newspaper. “We had so many questions. How much respite should my sisters offer me? Should Mom’s name stay on the deed of the house? Where will either of them go if I can’t keep taking care of them?”
“It was hard to figure it out,” said her 50-year-old sister Therese, a midwife in Somerville, Mass. “How do we make decisions? What do we all feel comfortable with? What are the guidelines we’re going to adhere to? Every conversation ended with someone crying or hanging up, or both.”
“To help them navigate those difficult waters, they went to mediation to learn how to ‘stay in each other’s life and not have it be destructive,” as Rosie put it.”
“We wanted to stay connected as siblings, but if you don’t get someone else to help you out, you kind of fall prey to your childhood antics,” she said. “A mediator makes a hard job a little easier.”
“Elder mediation, an emerging area within family mediation, has gained so much traction that in 2009 the Association for Conflict Resolution, a professional organization, started an elder decision section,” the article states.
The story cites a 2001 report in the journal Conflict Resolution Quarterly that showed nearly 40 percent of adult children who cared for a parent said they experienced major conflict with a sibling. That conflict could be “over the amount of care, or money, or who should be making decisions, or just deep-rooted sibling rivalry over who does Mom or Dad love best,” said the report’s author, Deborah B. Gentry, a professor emeritus at Illinois State University.
“Most of the time siblings want what’s best for the parents,” Susanne Terry, a mediator in Danville, Vt., told the author. “They just look at it in a different way.
“Our goal is to help them figure out what their common interests are, so they can work together to find solutions.”

Article Predicts Technology May Change How People Age

Technology can’t halt the aging process, but a Huffington Post piece points out that it may change the way people grow older.

“Technology is changing everything, including how we will age and the quality of our senior years,” begins the story by Ann Brenoff ” Mobile devices, wearable gadgets and Internet-based technologies will help older adults age in place while monitoring their health and safety.”

  • The piece went on to site these specific coming advancements as having an impact on older Americans:
  • Talking street signs
  • Cars that drive themselves
  • Video-call doctor visits
  • Remote patient monitoring.
  • Online medical records.
  • Robots as caregivers.
  • A proliferation of LED lights in unexpected places
  • Safety monitors that “go way beyond nanny-cams
  • Homes that age along with the occupants
  • More apps to help people better understand their bodies

Ethical Guidelines For Helping Older Clients Offered By ABA

For attorneys who focus all or part of their practice on the needs of older clients, the American Bar Association advises adhering to the “Four C’s of Elder Law Ethics.”
They are:

  • Client identification
  • Conflicts of interest
  • Confidentiality
  • Competence

“First, all lawyers have an ethical obligation to make it very clear who their client is,” the ABA advises on the first point. “The client is the person whose interests are most at stake in the legal planning or legal problem. The client is the one, the only one, to whom the lawyer has professional duties of competence, diligence, loyalty and confidentiality.”

ElderlyWomanInGlasses (Photo credit: Wikipedia)

ElderlyWomanInGlasses (Photo credit: Wikipedia)

Avoiding a conflict of interest relates directly to client identification, in that “in most situations, a lawyer may only represent one individual.”
“For example, when legal planning involves property, such as a family home, in which several people have an interest, these interests are actually or potentially conflicting,” the newsletter states. Sometimes joint representation is possible, even with potential conflicts of interest, but it is more likely that we will be representing only the older person whose interests are at stake.”
Confidentiality, which is at the very heart of all attorney-client matters, simply means the lawyer may not share any information with other family members unless given permission to do so.
“Some clients want all information shared and family members involved in discussions,” the ABA points out. “Some merely want family members to be given general updates. Some want complete confidentiality. It differs from person to person.”
The final “C” is a special ethical responsibility when handling the legal affairs of older clients, according to the newsletter.
“Lawyers must treat the impaired person with the same attention and respect to which every client is entitled. This means meeting privately with the client and giving him or her enough time to explain what he or she wants.
“Assessing a client’s capacity to make decisions is part of our getting to know the client. While most clients can explain a problem and what it is they want, there will be some clients who cannot. Speaking privately allows us to find this out. When family members answer all the questions, it makes it difficult for us to determine our client’s level of understanding.”

Long-Term Care Cancellations Require Better Notification

It should never happen again.
And whether it’s by passage of a new law or a rule change at the Virginia Bureau of Insurance, maybe it never will.
A recent story in the Richmond Times-Dispatch brought to light the plight of people left without long-term care for the elderly. The story focused on the Pirron family. For more than a decade, David and Anne  Pirron paid almost $400 in premiums a month long-term-care policy offered by John Hancock Life Insurance Co.
“Their son, Michael Pirron, had helped them research a policy, and later he was added as a third-party designee so that he also would get notices about changes to the plan,” according to the story by Tammie Smith.
“About a year-and-a-half ago, my mother had a major health issue,” Michael Pirron, the CEO at Image Makers, a Richmond-based technology consulting company, told the newspaper. “Realizing my father was not managing my mother’s health well, I called the long-term-care (policy).”
“To his surprise and dismay, Pirron said he was told the plan had been canceled seven months before because of nonpayment,” Smith wrote. “Apparently his father, who had begun to show some of the cognitive impairments of Alzheimer’s, had inadvertently canceled the automatic payments while intending to cancel another automatic bank draft. Pirron said the company that wrote the policy sent letters to his father, who just stuffed them into a drawer. As the third-party designee, Pirron was supposed to get notices as well. The insurance company said a separate letter was sent to him, but Pirron is adamant that he never got anything. If he had, Pirron said, he would have corrected the matter.
“The company refused to reinstate the policy. Pirron appealed but was denied.”
Although nothing can now be done for his parents, Michael Pirron has been working to get a bill passed in the state’s General Assembly that would force long-term policy insurers to notify third-party designees by certified mail when a policy is canceled.
“The bill this year, House Bill 719 sponsored by Del. Jennifer L. McClellan, D-Richmond, was considered by a House subcommittee in January but did not make it out after state insurance officials said they would work on an administrative fix,” according to the Times Dispatch. “The state Bureau of Insurance … filed a notice of a proposed rule change that addresses Pirron’s concern about third-party designees getting notices. The proposed change also requires companies to keep receipts showing cancellation notices were sent.
“McClellan said that because the rulemaking process was in the works, her bill did not go forward.”

Less Costly Options Exist To Afford In-Home Care

While in-home care for elderly parents or other relatives may be a kinder approach than placing them in a nursing facility, it can also be a very pricy proposition.

English: My parents.

(Photo credit: Wikipedia)

A recent Caring.com article offers some creative approaches to affording this option.
“In general, pay rates in urban areas are higher than in rural communities, and still higher on the east and west coasts than in the central United States,” according to the article. “Costs also depend on whether you’re looking for homemaker services, defined as ‘hands-off’ care, such as cooking, cleaning, running errands, and general companionship, or home health aide services, which include personal care, such as bathing and dressing. A comprehensive 50-state survey of care costs by MetLife found that as of 2011, average hourly rates for home health aides ranged from $16 to $29 across the country, while rates for homemaker aides without medical training ranged from $13 to $24. These rates do not seem to be changing much over time. According to Genworth’s 2012 data analysis, the median rate for in-home care of $18 to $19 an hour nationwide is rising by only 1.15 percent every five years.”
Among the advice on making this sort of care more affordable are reversible mortgages, pensions for veterans that may have previously gone untapped and making alterations to life insurance policies no longer needed to care for others.
“The way this works is that your loved one sells the policy back to the issuing agency for 50 to 75 percent of its face value, an amount determined based on the amount of the policy, the monthly premiums, and the policy holder’s age and health,” the article stated. “There may be restrictions; some policies can only be cashed in if the policyholder is terminally ill. But many are quite flexible. And if yours isn’t, there are settlement companies that will buy the policy, also at 50 to 75 percent of face value, then pay the premiums until the policyholder’s death, when the company will collect the benefits.
“If the company that issued the policy won’t cash it in, don’t worry. Your loved one may be able to sell the policy for a ‘life settlement’ or ‘senior settlement.’ In this case the settlement company pays the premiums until the policyholder dies, then receives the benefits that would originally have gone to the policy’s original beneficiaries.”

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Court sides with nursing home against woman’s grandchildren

An elderly New York State woman thought she was doing the right thing for her grandchildren.
A court ruled otherwise, in a case of estate planning gone horribly wrong.
The woman, Lillian Hellman, sought to have four annuities, which she obtained in her name with her in control of the accounts, transferred to each of her grandchildren, making her insolvent and eligible for Medicaid once she had entered a nursing home.
Not so fast, nursing home officials said, and a court agreed with them, according to an article on the website elderlawanswers.com.
“In 2000, Lillian Heather purchased four annuities for each of her grandchildren as part of her estate plan,” the website stated. “The annuities named the grandchildren as annuitants and beneficiaries, but Ms. Heather retained control of the accounts. Ms. Heather also appointed her grandchildren as her attorneys-in-fact under a power of attorney. In 2006, Ms. Heather entered a nursing home. One granddaughter, Kristin Goldman, signed the admission agreement as her designated representative. After entering the nursing home, Ms. Heather annuitized the annuities and the full value was transferred to the grandchildren. She applied for Medicaid benefits, but the state denied benefits because she had transferred assets for less than fair market value.
“The nursing home sued the grandchildren for fraudulent conveyance, arguing that they had transferred Ms. Heather’s assets for no consideration, rendering her insolvent. The nursing home also sued Ms. Goldman for breach of contract, arguing that Ms. Goldman had access to Ms. Heather’s assets and should have used them to pay for her grandmother’s care.”
The New York Supreme Court in Queens County sided with the Chapin Home for the Aging to the tune of $287,893.95.
“According to the court, it was undisputed that the transfers were made without consideration,” elderlawanswers related. “Moreover, the grandchildren did not present any evidence that the transfers did not make Ms. Heather insolvent. Nevertheless, the court rules that Ms. Goldman is not personally liable for breach of contract because the admission’s agreement did not make the designated representative personally liable.”