Preparing a Plan
THE FAMILY CONVERSATION #1
PLANNING ACROSS THE GENERATIONS
Providing good care not only requires advanced planning, but thoughtful, ongoing conversations between adult children and their loved ones.
These are not easy conversations. They cover complex subjects, ranging from financial and health issues to estate planning issues—topics that parents may be reluctant to discuss. And they’re emotional issues, forcing us to acknowledge that while we’d all like to see our parents as robust and independent persons, the odds are they will need our care at some point.
Too often, families avoid such conversations until a crisis arises—a fall, an accident or serious health diagnosis. Making big decisions in the midst of emotionally trying circumstances, however, is never a good strategy. No matter the challenges or reluctance, it’s better to talk when your parents are healthy, sharing information and weighing options and preferences before a crisis happens.
So how do you start?
Setting the Scene
Everyone’s situation is different. You could decide to bring up these topics informally or in a formal, planned meeting, whichever seems appropriate.
Despite the challenges, families that work together usually find that it relieves anxiety and enhances their relationships. It’s hard to create a good caregiving plan for your parents without building a team, especially with the people closest to them. If family members take the time to explore things early, they’ll likely avoid facing serious conflicts later. It can’t be too soon, but it can be too late if a health crisis occurs. The longer you wait, the fewer options you have, and you may find yourselves forced to make decisions without any idea what your loved ones may have wanted.
Having the Conversation
How you conduct potential caregiving conversations will depend on your family dynamics, of course, but here is a list of suggested tips from geriatric care experts:
Once your parents have had a chance to express their thoughts, you and your siblings can share your views. Be honest about your own concerns. Are you worried that your parents aren’t safe? That they don’t have enough access to friends and social activities? If one of your parents is already caring for the other, are the caregiving duties too much? And if your family assumes that the adult children will be the “default plan” when it comes to parental support, what impact will that responsibility have on the caregivers’ jobs, children and other responsibilities?
Be methodical in your approach, but don’t worry about not trying to cover everything at once. Again, stay respectful. Never give the impression that you want to “take over.”
The Sibling Syndrome
If you’re lucky, all your siblings will agree on the planning process. But that’s often not the case. When siblings fight, it can end up a war, and in some cases, sadly, they end up never speaking to each other again once mom and dad are gone.
To help families avoid such situations, siblings and parents need to talk openly about family history and dynamics, and how they might affect caregiving plans. Old roles and patterns from childhood may re-surface, creating contentious meetings and awkward choices. Don’t expect a sibling to see your parents as you do. You’re affected by how each of you related to them growing up, yet those past roles should not continue to define you today—especially in the context of your parents’ caregiving needs. To help navigate emotional disagreements, therapists often recommend that siblings try a simple semantic technique: Use “I feel” sentences, speaking from your own experience and perspective, rather than “you” sentences that may make your brothers or sisters defensive or angry.
While a care plan should be a shared responsibility among siblings, realistically, one sibling frequently ends up as the primary caregiver. This role should not default to the person who lives closest, but delegated to the one who is most skilled, willing and emotionally prepared. Siblings should evaluate what each of them could reasonably and honestly do. And if the burdens are disproportionate, talk about how each can contribute—perhaps with respite care, assistance in navigating entitlement benefits, or managing financial assets and estate planning.
The primary caregiver, in turn, must:
These conversations may not always be pleasant, but if you take the time to address issues early, you’ll likely avoid more serious conflicts later—and hopefully keep your family intact.
Making a Plan
While there is no one “right” caregiving plan, there are common issues.
Even if the conversation does not go smoothly, you will have accomplished something: The seed has been planted. Your parents may not respond much initially, insisting, “We’re fine, thanks, we don’t need help.” But you’ve probably gotten them thinking and they may even restart the conversation themselves as they face new experiences. Consider this the first of many conversations. The whole point of talking early in the game is to create a plan, so you don’t have to face an emergency without the information you need.
ASSEMBLING VITAL DOCUMENTS
One of the most important tasks for families is to make sure that important information relating to their elderly loved ones is accessible. Gathering and organizing may take more than a day, but working together will make it easier, and your entire family will feel more secure when the papers are in order. Try breaking the task into a few steps:
1. Identify where your parents keep their important papers. It may be at home, in a file cabinet or safe, or in a safety deposit box, or with their attorney—or all those places. It doesn’t do any good to have your parents records in order if no one knows where to find them.
2. Sit down as a family to review all relevant documents and accounts. Identify missing links—information gaps you need to fill in to help your loved ones plan for retirement, as well data or contacts you might need in a medical emergency. Make sure designees and beneficiaries are up to date for all policies and accounts.
3. Come up with a checklist of all the documents. Note which ones you need to keep together in a safe place, such as a secure file cabinet, so you can locate them quickly when needed. Keep original documents, such as passports and birth certificates, in a fire-proof safe.
4. Make sure you know who is authorized to speak to company or government agency representatives, in case your loved ones can’t speak for themselves. Make copies of key documents for the person(s) designated as Power of Attorney and Health Care Proxy.
5. Consider electronically scanning files onto a memory stick that can be stored at another location. Remind your parents to update their documents every three years.
6. Don’t forget to keep a record of your parents’ “virtual estate.”
These records may include digital photos, social media, online records, financial and other accounts, including user names and passwords.
7. Make a “contacts” file with the names of all key people in your parents’ lives. Make it easy for your family members to locate these important people—close relatives and friends, primary physician, minister/priest/rabbi, attorney, accountant, tax preparer, and banker.
ADDRESSING ELDER LAW NEEDS
Consulting an Elder Law Attorney
Assuring the future care of an aging family member usually involves making important decisions about legal, financial, health care and estate planning options. Not everyone may need an elder care lawyer, but these professionals can help multiple generations of families plan how their health care and financial wishes will be carried out, including the execution of key legal documents such as health care proxies, living wills and powers of attorney. An attorney also can assist in planning for possible long-term care needs, including Medicaid options, as well as review wills, create trusts and design estate plans to preserve assets.
Family caregivers should be aware that if their parents hire an elder law attorney, the attorney represents the interests of senior clients —not their adult children. The attorney’s goal is to make sure that good care is provided and see that the senior’s assets are preserved as much as possible, and not necessarily for the sake of the children’s inheritance.
So how do you find a local elder law attorney? As with the hiring of other professionals, like accountants, start with referrals from people you trust, such as close friends, business associates, financial advisers and health care professionals. Also consider these sources:
Once you’ve assembled a short list of attorneys, check each candidate’s background (most likely individual credentials will be listed on the firm’s website) and request a brief interview. Confirm their background, experience and credentials:
Then, ask a series of additional questions:
- What percentage of the attorney’s practice is involved with elder law?
- Does the attorney speak or write frequently on the topic of elder law?
- What is the fee for the first consultation, and what information or documentation should you bring to that meeting?
- How are the attorney’s fees assessed for additional consultations, as well as the execution of wills, trusts and other legal documents?
- Can the attorney refer you to a handful of his or her clients?
An experienced elder law attorney can be a valuable asset for seniors and their caregivers, helping to explain complex regulations, identify unforeseen alternatives and potential family conflicts—before they become crises.
In addition to assessing your loved ones’ home for livability, caregivers should review the household for overall safety—especially if a parent lives alone. Take at least one day each year to perform a thorough safety check.
PUTTING KEY LEGAL DOCUMENTS IN PLACE
THE CORE FOUR
There are four important legal documents for caregivers and their elderly loved ones: two relating to medical decisions (the health care proxy and living will), known as advance directives, and two relating to financial issues (power of attorney and will).
Your parents should have a conversation with you and your siblings about these documents so that it’s clear what their wishes are, who in the family has been designated to assume various roles—and that they’re willing to serve in these capacities. Make sure you know where these documents are stored and that your loved ones provide copies to their doctor, elder law attorney, and other family members, as needed.
Most experts recommend that your parents consult an elder law attorney when completing these powerful documents—and you should, too, when doing them for yourself. Review these directives every few years, since changes in state law, as well as changes in personal situations—such as divorce, relocation, or death in the family—can affect how the provisions of legal documents are carried out.
A. Health Care Proxy
This document allows your loved ones to appoint an “agent,” typically a trusted family member or close friend, to make important health care decisions for them if they become incapacitated and unable to make such decisions for themselves. In New York, a health care proxy does not have to be notarized, but the form must be signed in the presence of two adult witnesses, not including the agent.
Actually, everyone over age 18—including adult caregivers and their grown children—should appoint an agent who can make health care decisions on their behalf, in case something unexpected happens. A health care agent can be your voice, someone who makes your health care decisions according to your own wishes, or your best interests.
In a health care proxy, the agent may be given limited or broad authority, including instructions about the types of medical treatments a person wants to receive if they are either temporarily or permanently unable to make their own health care decisions. Hospitals, doctors and other health care providers must follow an agent’s decisions as if they were the care recipient’s own. If someone does not have a health care agent, all appropriate medical treatments will be provided to that person.
To obtain a sample health care proxy form:
Go to the New York State Department of Health website (www.health.state.ny.us) and search for Health Care Proxy. Or write and enclose a stamped, self-addressed envelope to:
New York State Department of Health—Health Care Proxy
P.O. Box 2000
Albany, NY 12220
B. Living Will
A living will is a document that specifies what types of medical treatments your loved ones desire should they become incapable of expresses those desires. It must be signed in the presence of two competent witnesses over age 18.
People may wish to receive or refuse specific treatments under certain circumstances, most commonly a progressive or terminal illness or permanent disability. A living will should be clear and follow verbal instructions that have been given to family and friends. It can include instructions concerning the termination of life support.
If a person does not have a health care agent, a living will is better than having no advanced directive at all. Still, there is no statute in New York that governs living wills. The highest state court has ruled that a living will is valid as long as it constitutes “clear and convincing evidence” of your wishes. But there is no standard living will form, so even a well drafted document is ultimately subject to interpretation, and it’s hard to provide specific instructions to cover all possible future events. It’s especially important, then, for you and your parents to consult with an attorney to make sure that their wishes are stated in the most effective manner possible.
A sample living will form is available on the New York State Bar Association website (www.nysba.org/downloadforms Click Elder Law.)
In addition, if your loved one has serious health conditions, caregivers should consider another critical document, known as a MOLST (Medical Orders for Life Sustaining Treatment). These medical orders, including instructions regarding “Do Not Resuscitate Orders” or “Do Not Intubate Orders,” are intended to honor a person’s wishes and preferences in providing quality and-of-life-care. (See more information in Part IV, “Long-Term Care & Supportive Housing.”) The MOLST form (which should be printed out on bright pink heavy stock paper) is available on the New York State Department of Health website (www.health.ny.gov; search for “MOLST”).
C. Power of Attorney
This document gives an “agent” broad powers to take care of certain business or financial matters on behalf of another person, known as the “principal.” The principal, most likely an older parent, does not need to become incapacitated for the power to be triggered. Agents must act according to the instructions of the principals, or where there are no instructions, in their best interest of the principals.
In New York State the principal must sign a power of attorney in the presence of a notary and does not become effective until it is signed by the agent. That authority ceases, however, upon death of the principal or revocation of the power.
There are three types of Powers of Attorney:
A nondurable power of attorney takes effect immediately and remains in effect until the principal revokes it, becomes mentally incompetent, or dies. It is often used for a specific business transaction, such as the sale of a property, or the handling of financial affairs while the principal is traveling and unavailable to take care of them.
A “durable” power of attorney may be used immediately and remains in effect until the principal revokes it or dies. It enables the agent to act if the principal becomes mentally incompetent or is physically unable to make decisions.
A “springing” power of attorney becomes effective at some future time and remains in effect until the principal’s death, or until it is revoked by a court. This POA is often triggered by a specific event identified by the principal, such as an illness or incapacity, and initiated when the principal’s physician declares the principal not competent to manage their own affairs.
There are many online resources like the New York Bar Association that offer free templates to consider when drafting a power of attorney (www.nysba.org, click News & Publications, then Downloadable Forms, then Power of Attorney Forms). Nevertheless, a POA should be executed under supervision of an attorney to ensure that areas of authority are clearly defined and understood by both parents and caregivers—including recent changes in the law regarding major gift provisions.
A last will and testament is a legal document that helps individuals ensure that their assets and estate will be distributed according to their wishes when they die. In New York a will must be signed in the presence of two competent witnesses over age 18. This document enables someone to choose an executor to manage and distribute their property. Without a valid will, a person’s property will pass to those relatives specified by law through the court system.
While not related to the immediate financial aspects of caregiving, serving as the executor of a parent’s will is often an important part of a family caregiver’s long-range responsibilities.
ASSESSING FINANCIAL RESOURCES
If you’re like most families, your parents have probably put together some kind of financial plan for their later years, whether or not they decide to “retire.” Still, it’s important to be familiar with their plan, because ultimately, you may end up being in charge of their finances as part of your caregiving responsibilities.
Caregivers can help their loved ones conduct a “financial checkup,” especially when it comes to assessing two major areas of financial concern: housing and health care costs.
First, find out if your loved ones have a financial adviser—one who is a “fiduciary,” a trusted investment adviser who is required to act in the best interest of the client at all times, not just offer products that are “suitable” for them. (As of October 1, 2019, all advisers with the designation of Certified Financial Planner will be bound by new standards set by the industry’s Certified Financial Planner Board of Standards.) This adviser can act like a quarterback, working with your parents’ accountant, banker, estate attorney and other professionals to help them plan their future. The Financial Planning Association (www.plannersearch.org) has a registry service that can be used to search for names of Certified Financial Planners in your area. And you can learn more about the financial planning guidelines and resources at www.letsmakeaplan.org.
Visualizing these later years is not unlike planning a vacation: Your parents (and ultimately you, too) need to pick a destination—how do they want to spend their time and where—then meet with the financial adviser and map out how to get there. Granted, there are many unknowns, but caregivers can encourage their loved ones to create a written plan, so the family can assess their resources for caregiving.
Consider the basic steps—which could apply to multiple generations—listed below:
REVIEWING SOCIAL SECURITY BENEFITS
When your family sits down to discuss future caregiving needs, it’s likely that your elderly loved ones will already be collecting Social Security benefits. But it’s still important to know about your parents’ benefits, since Social Security makes up a substantial share of retirement income for many families—and may have a significant impact on their resources for caregiving.
Even after understanding the basics of Social Security, your loved ones might have additional questions over the years. Some examples:
- Spousal Benefits. The spouse of a person who is eligible or receiving Social Security benefits may be entitled to benefits, even if they’ve never worked. Application can be made at age 62, but the monthly payments will be reduced.
- Widow Benefits. A disabled widow or widower may apply for benefits at age 50. A widow/widower who remarries after age 60 is entitled to the same benefit as if the remarriage did not take place.
- Divorcee Benefits. If a person divorced but their marriage lasted at least 10 years, they are eligible to receive spousal benefits based on their ex’s work record. You must be at least 62 and not remarried.
- Supplemental Security Income (SSI). This program provides financial aid to persons 65 or over and to the blind or disabled of any age who need financial assistance. Income and resource eligibility levels must be met when a claim is filed.
If your parents are still in the process of deciding how to file for Social Security benefits, it might be worthwhile paying a small fee for assistance from a certified financial adviser. Ultimately, the payback for a good strategy could result in tens of thousands of additional dollars in benefits, depending on a person’s longevity.
CREATING A ‘WHAT IF’ PLAN
In the event that your loved ones become unable to adequately manage their financial affairs, they should have designated a Power of Attorney (see prior section), as well as a clear plan to continue handling the family finances. Here is a short list of steps for you and your parents to plan together:
- Store financial documents in a safe, accessible place.
- Create a list of account information, from utility bills to tax returns. Put copies of statements in a file, or directions where to find them.
- Organize and update digital documents, including passwords to online accounts.
- When practical, arrange direct deposits and online bill-paying.
Family caregivers also should be on the alert to protect loved ones against fraud and predatory marketing. Be on the lookout for mailers with disguised sales pitches, frequent phone mail-order purchases, or large bank withdrawals. AARP’s Fraud Watch Network gives tips to avoid scams and fraud, avoid identity theft and give resources to consumers against potential cons. (Visit www.aarp.org/money/scams-fraud/fraud-watch-network.)
ESTATE PLANNING AND FINANCIAL MANAGEMENT
The aim of estate planning is often to protect your loved ones’ financial resources, minimizing taxes and probate court costs while enabling people to influence how their estate will pass to heirs. But asset protection (revocable and irrevocable) trusts also may become a key component of financial planning for caregiving purposes, providing long-term care when your parents need assistance beyond family caregivers.
Unless your family has sufficient private income to pay the cost of your parents’ care when they need substantial daily assistance, you may eventually have to consider a Medicaid program to assist with or cover the cost of long-term care. The rules to qualify for Medicaid benefits are complex, and elder law attorneys can be instrumental in helping families assess legal tools to plan for long-term care, such as irrevocable trusts or pooled income trusts. Family caregivers often end up being the trustees or legal representatives appointed to oversee these trusts. See more information in under “Long Term Care Planning” section.
SUPPORT FOR VETERANS
If your loved one is a military veteran or veteran’s spouse, they may be entitled to a range of benefits through the U.S. Department of Veterans Affairs (www.va.gov).
Your parent may already be receiving some benefits, but if not, start by locating their discharge papers (DD Form 214), one of the key documents used to determine eligibility requirements for most VA benefits. (The application and approval processes can be lengthy.) Benefits cover a range of services and programs, including medical care, pensions, disability compensation, community-based residential care, treatment programs, burial benefits, and other services to eligible vets and qualifying family members.
The VA also has Caregiver Support Program that offers educational resources, multiple tools and services designed to help family caregivers:
- Caregiver Support Line (Toll-free 1-855-260-3274)—Provides immediate assistance or emotional support, help access services, or connect you with a local Caregiver Support Coordinator—a licensed professional who can match your family with services providing home health aides, skilled home care, respite care, and hospice.
- Caregiver Peer Support Mentoring program—Pairs caregivers with volunteer mentors who agree to share experiences and provide support by phone, email or mail for six months or longer.
- Aid & Attendance—A tax-free pension benefit that can help a veteran or veteran’s spouse meet the costs of an assisted living facility or the costs of care at home.
For more information about the Caregiver Support Program, including assistance for home care or long-term supportive services, visit www.caregiver.va.gov.
Dealing with Medicare can be a daunting task—and often, it’s the caregiver who is called upon to coordinate care and complex paperwork. Despite such challenges, several significant improvements are set to go into effect in 2019, and both caregivers and recipients should be sure to stay on top of ongoing changes.
In short, Medicare is a federal health insurance program administered by the Social Security Administration that provides health care for people age 65 and older, people younger than 65 with certain disabilities and people with end-stage renal disease (permanent kidney failure equiring dialysis or transplant).
There are four parts to Medicare:
- Medicare Part A (hospital insurance)
- Medicare Part B (medical insurance)
- Medicare Part C (Medicare Advantage)
- Medicare Part D (prescription drug coverage).
Parts A and B are called Original Medicare, also known as fee-for-service or traditional Medicare. As an alternative to Parts A and B, Medicare beneficiaries can choose a Medicare Advantage Plan, which offers Medicare-approved managed care health plans run by private companies. Some people get additional health insurance coverage, like Medicare Supplement Insurance (Medigap) to help pay for items not covered by traditional Medicare.
Medicare is steadily broadening the availability of “telehealth” programs that enable patients to confer with a doctor or nurse via telephone or the internet. In 2019 it will begin covering telehealth services for people in end-stage renal disease.
Enrollment: If seniors are 65 and collecting Social Security benefits or Railroad Retirement benefits, they will be automatically enrolled in both Medicare Part A and Part B. But those who are 65 and not receiving either of these benefits will need to actively enroll in Medicare. (They can apply online at www.medicare.gov or through their local Social Security office or Railroad Retirement Board field office.)
For many seniors, the initial enrollment period for Medicare Part A, Part B and Part D is the seven-month window that begins three months before the month they turn 65 and ends three months after the month they turn 65. If people miss that initial window, they may still enroll between January 1 and March 31 of each year, although their coverage won’t begin until July 1.
There are financial consequences for missing the sign-up windows for Medicare—seniors could wind up paying higher premiums. But under certain special conditions, people may be able to sign up outside of regular enrollment periods. For example, for those who continue working past 65 and are covered under a group health plan based on their current employment, there is a Special Enrollment Period to sign up for Part A or Part B—an 8-month span that starts the month after the employment or the group health plan insurance ends.
Here is a more detailed summary of the four programs:
Medicare Part A—Hospital Insurance
Part A helps pay for:
- inpatient hospital care
- medically necessary inpatient care in a skilled nursing facility after a hospital stay
- medically necessary home health care
- hospice care
Medicare DOES NOT pay for nursing home, long-term or custodial care.
Part A is free, although there are deductibles and co-insurance. Most people pay no monthly premiums, if they are entitled to Social Security or Railroad Retirement benefits.
Recipients must meet certain conditions to qualify for coverage, including a doctor’s certification or prescription. Usually, a certified home health care agency coordinates any home care services ordered by a patient’s doctor. Patients and caregivers should consult with their doctor to make sure Medicare covers a prescribed service or supply. In addition, they can log onto Medicare.gov and click What Medicare Covers.
Medicare Part B—Medical Insurance
Part B is optional to people who qualify for Part A. It can help pay for:
- services (lab tests, surgeries, and doctor visits) considered medically necessary to treat a disease or condition.
- outpatient medical care, such as doctor visits and physical therapy
- ambulance services
- durable medical equipment (such as walkers and hospital beds) and a number of other health services and supplies not covered by Part A
- limited number of prescription drugs
Part B also covers a roster of preventive and screening services, including tests for serious illnesses and chronic conditions such as diabetes, heart disease and cancer. It also covers two types of routine preventive doctor visits: one when you’re new to Medicare and one each year after that. (Visit www.medicare.gov, Click What Medicare Covers, then Preventive and Screening Services.)
Most doctors accept Medicare patients, but some don’t, so be aware that if a physician has opted out of Medicare, the patient is responsible for the bill. Also, it’s important to find out whether a doctor accepts Medicare “assignment”—that is, that he or she has agreed to the Medicare-approved amount as payment in full—or whether the doctor can charge the patient up to 15 percent above this amount.
Part B recipients pay an annual premium each month, which deducted from their Social Security check. Most people will pay the standard premium amount, although higher-income individuals may pay an extra charge. There is also a Part B yearly deductible before Medicare picks up its share, which is typically 80 % of the Medicare-approved amount of the service.
In most cases, people who don’t sign up for Part B when they’re first eligible have to pay a late enrollment penalty. The monthly premium for Part B may go up 10% for each full 12-month period that they could have had Part B but didn’t sign up for it.
Medicare Part C—Medicare Advantage
Medicare Advantage (MA) Plans are Medicare-approved health plans administered by private insurance companies that generally cover all health care provided in Part A and Part B coverage. They often offer additional benefits, such as vision and dental coverage, and many provide prescription drug coverage. MA plans include Health Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs), which usually require enrollees to get care from providers in the plan’s network or pay more for those outside the network.
Enrollment: Seniors can apply for Medicare Advantage plans during in the same seven-month period as their initial Part A and Part B eligibility, beginning three months before they turn 65 and ending three months after the month they turn 65. There is also an Annual Enrollment Period from October 15 to December 7 every fall, when Medicare beneficiaries may join, switch or drop a Medicare Advantage plan. (Coverage for enrollment changes takes effect on January 1.) In addition, between January 1 and February 14, enrollees in a Medicare Advantage plan can leave the plan and switch to Original Medicare.
A listing that compares basic costs for dozens of Medicare Advantage plans in the New York metro area is available in the “Medicare & You” handbook. On the www.medicare.gov website users also can search for Medicaid Advantage plans by ZIP code. (Click “Find Health & Drug Plans.”)
Medicare Part D—Prescription drug insurance
If seniors choose a traditional Medicare plan, they also can arrange for separate prescription drug coverage, administered by a roster of private companies approved by Medicare. These plans help cover the cost of prescription drugs and vary widely in terms of monthly premiums, copayments and deductibles. Seniors enrolled in a Medicare Advantage plan that includes drug coverage don’t need Part D.
Part D is optional, but if your loved ones decide not to enroll in a plan when they are first eligible—the seven-month initial enrollment period for Medicare—they may pay a penalty if they join one later. (As with Parts A and B, if seniors are currently covered by an employer or union plan they can enroll later without penalty.)
When shopping for a Medicare D plan that meets their needs, families can use the Plan Finder, the online tool on www.medicare.gov (Click “Find Health & Drug Plans”). Plug in the senior’s Medicare number and drugs (each drug’s name and dosage); the tool then displays a list of available plans, their estimated cost, premium, and deductibles; and which drugs are covered.
Medicare Supplemental Insurance (Medigap)
Medigap plans are offered by private insurance companies to help supplement deductible and co-payments for services provided by traditional Medicare. They do not pay for services unless these services are partially covered under Medicare Part A or B. Federal and state regulations have established minimum standards for companies offering Medigap policies, identified in most states by letters A through D, F through G, and K through N. Plans can vary widely, so families should compare options carefully.
To find companies that offer Medigap policies on Long Island and compare plans, visit www.medicare.gov, then click Supplements & Other Insurance. You can also click on the Publications tab to download the booklet, Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.
LONG-TERM CARE PLANNING
It’s emotionally difficult for many parents—as well as their adult children—to acknowledge that we all should plan for long-term care in our elder years. Most of us want to remain independent as long as possible, but eventually about two-thirds of those turning age 65 can expect to use some form of long-term care, through either family or outside services—or both—according to the U.S. Department of Health and Human Services.
Long-term care comprises a range of personal-care services and support that your loved ones may need as they age and become more frail. Such care is generally not medical care, but rather custodial care—that is, assistance with basic tasks of everyday life, usually referred to as the six Activities of Daily Living, or ADLs: eating, bathing, dressing, transferring (getting in and out of a bed or chair), toileting, and continence. Other common long-term care services aid with everyday tasks known as Instrumental Activities of Daily Living, or IADLs, including: managing personal finances, taking care of household tasks, shopping for groceries, using the telephone or other communication devices, and caring for pets.
A large majority of long-term care services are currently provided in the home and in community adult day care programs, with a smaller percentage provided in nursing homes. The cost for adult care can be dauntingly high. According to the Genworth 2018 Cost of Care Survey (www.genworth.com/about-us/industry-expertise/cost-of-care.html), the average annual cost of a home health aide in the New York metropolitan area is about $57,000 a year, while the average yearly cost for an assisted living facility is $71,000 a year, while the average annual cost for a nursing home semi-private room is about $145,000.
And Medicare does not pay the largest part of these costs. Nursing home mostly through Medicaid. Medicare will help pay for a short stay in a skilled nursing facility, for hospice care, or for home health care under certain limited, medically-related conditions. But it will not pay for most personal or custodial care, so it is important for seniors and caregivers to include discussions about how to pay for long term care planning as part of their family conversations.
To avoid draining your loved ones’ retirement savings, families—in consultation with their financial advisers—could consider several strategies to help pay for eventual long-term care:
- Long term care insurance—These policies, generally purchased when a person is younger, are specifically designed to help pay for the cost of services not covered by Medicare, Medicaid or other health insurance. Some life insurance plans have riders that will pay for long-term care. (See following section, “Long Term Care Insurance.”)
- Government programs—Medicaid or VA benefits may cover nursing home costs, provided that recipients meet a set of stringent financial and medical requirements. For instance, when reviewing a Medicaid application, the local social services department will examine whether an applicant has transferred or given away any assets for less than fair market value during a certain time prior to the application, known as the “look-back” period. (Currently, the look-back period is five years.) If the Medicaid agency determines assets have been gifted during the look-back period, it will impose a “penalty period,” based on the amount of the gift, during which the applicant will be ineligible for Medicaid services and will be required to pay privately. In addition, “Community Medicaid” options may be available for qualified individuals to receive money for in-home care without meeting the requirements of a look-back period. When considering such options, families should consult with financial advisers who understand Medicaid and VA benefits—and be aware that planning too far down the road also could be tricky, since government funding and regulations are continually under scrutiny by lawmakers in Washington and Albany.
- Private health insurance—Private insurance plans typically do not pay for ongoing long-term care but can provide temporary nursing home coverage.
- Reverse mortgages—Although not for everyone, a reverse mortgage can provide monthly income that may be used for long-term care. (See section on “Reverse Mortgage Options.”)
LONG TERM CARE INSURANCE
Long-term care (LTC) insurance is designed to help pay for services not covered by Medicare, Medicaid or other health insurance. Offered by a number of private companies in New York State, this insurance can provide a tax-free stream of funds to cover out-of-pocket expenses for services that enable the policy holder to perform basic Activities of Daily Living in a variety of settings, typically home care, assisted living and nursing homes. Coverage also may include care needed for individuals with cognitive impairment, such as Alzheimer’s disease.
But LTC insurance policies can be complex and premiums vary widely. While all policy holders must meet certain health qualifications, there are many variables to consider in each plan, such as age, type of care covered, length of benefit period, daily benefits, and “elimination period”—the length of time a person must wait before pays the care of cost. Besides traditional LTC policies, there are now “hybrid” plans that can be built into life insurance policies, offering riders that allow policy-holders to tap funds from their life insurance policy to pay for long-term care.
New York State has been a strong advocate in protecting consumers as well as offering tax incentives for purchasing LTC insurance in New York State—a 20 percent tax credit for premiums, and if you itemize deductions, there’s also an available federal tax deduction. The New York State Department of Health also offers a Partnership for Long Term Care program that combines private long-term care insurance with Medicaid Extended coverage (www.nyspltc.org). Several private insurers participate in this program, which allows policyholders to protect some or all of their assets by extending their benefits under Medicaid, should they need to receive additional services beyond their original private coverage.
Before purchasing a policy it’s important for family members to consult with health care professionals, counselors and LTC experts to understand the nuances of various plans and determine which is best and most affordable for them.
Family members also should make sure that the insurance company knows who should be notified, should their parent fail to pay their premium, as well as who is authorized to speak to company representatives, in case their loved ones can’t speak for themselves.
Consumers can purchase LTC insurance in New York up until age 79, but premiums get much more expensive as you get older, so people should consider signing up for a policy as young as possible to secure best options for a lifetime. That goes for both parents and their adult children, who will likely need long-term care too, as they age.
REVERSE MORTGAGE OPTIONS
For older homeowners who want to remain in their house as they age, but find themselves squeezed for cash, a reverse mortgage can be a useful financial tool to help pay for monthly expenses—including long-term care.
Reverse mortgages are for homeowners 62 and older who have a significant amount of equity built up in their house. They can borrow against that equity, taking the cash in a lump sum, as a monthly income stream or a line of credit they can tap when needed. The money doesn’t have to be repaid until the owner moves, sells the house or dies.
Most reverse mortgages today are known as Home Equity Conversion Mortgages, or HCEMs, offered from a program run by the U.S. Department of Housing and Urban Development. Unlike a traditional mortgage, there are no income or credit requirements for reverse mortgages. But HUD has tightened lending criteria, requiring that lenders determine whether would-be borrowers have enough income to keep up with property taxes and homeowners’ insurance, so they don’t default on the loan and, possibly, lose their home.
Caregivers and their loved ones should think carefully about taking out a reverse mortgage, because these loans can be complicated, with substantial fees and interest charges. Before completing the loan process, a borrower must meet with an independent, HUD-approved counselor whose job is to review the transaction, answer questions and suggest alternative options.
While tens of thousands of Long Islanders are caring for loved ones locally, many others are trying to care for elderly loved ones far away. For long-distance caregivers, what may have started out as a regular phone call to share family news often grows into a list of challenging responsibilities as parents become frailer—activities such as obtaining medical information, managing finances, taking care of household chores, arranging monthly “check-up” trips, overseeing legal affairs, and eventually moving your loved ones to adult care facilities.
This resource guide was designed to help caregivers find the support and services they need through government offices, social service agencies and nonprofit organizations in New York State and on Long Island. But it also can serve as a strategic tool to help families understand how to provide effective care at different stages of aging—no matter where their loved ones live.
Many of the tips, suggestions, and checklists may be helpful to long-distance caregivers as well as local ones.
The list of National Caregiving Resources (following this section) also offers several organizations that identify resources by geographic area, so caregivers can customize their search for help to where their loved ones live.
In addition, the National Institute on Aging, a division of the National Institutes of Health, offers helpful, broad-based information about long-distance caregiving on its website (www.nia.nih.gov; click Health Information then Caregiving). You can download a free copy of the institute’s booklet, Long-Distance Caregiving: Twenty Questions and Answers, from its publications page (Click Health Information, then Get Print Publications).
Here are some additional long-distance caregiving tips:
Choose a Main Caregiver
Figure out who will take the lead caregiving role among the adult children. A sibling who lives closest to an aging parent often becomes the primary caregiver, but they should discuss with other siblings how each family member can contribute or help out; an open dialogue is essential, as difficult as that can sometimes be. Long-distance caregivers can provide emotional support and occasional respite to the primary caregiver, as well as play a part in arranging for professional caregivers, hiring home health and nursing aides, or locating an adult care living facility.
Collect Critical Information
Learn as much as you can about your loved ones’ health and financial situations. To the extent possible, put all vital information in one place—a notebook, perhaps, in addition to a secure online document. This information should be organized and easy to reach in the event of a crisis. Include medical records, health insurance, financial and legal information, company names and phone numbers for utilities and other monthly service providers. Make hard copies and digital documents for various family members. Caregivers also may find they can help manage their loved ones’ finances online—for example, paying monthly bills; purchasing researching health problems or medicines; paying bills; or keeping family and friends updated. Some long-distance caregivers help a parent pay for care, while others step in to manage finances.
Create a ‘Circle of Care’ Contact List
Assemble addresses, emails and phone numbers of friends, neighbors, doctors, faith leaders and others—a “circle of care” around your parents who can be reached in the event of an emergency. These people also may be able to help out with shopping, transportation or visits. Consider including at least one person close by who can easily check in on your loved ones and give this person a key to the home if your loved ones approve. In some communities, mail carriers or utility workers are trained to spot signs of trouble through the Carrier Alert Program of U.S. Postal Service. They report concerns, such as accumulated mail or trash, to an agency that will check on the older adult. To find out if there’s a program in your loved ones’ area, contact the local post office.
Stay in Touch
Some long-distance caregivers might think the situation would be easier to manage if their loved ones lived closer. But many older people don’t want to move at all, facing the loss of old friends and familiar communities. Staying in contact with your parents by phone or email might not sound like much help, but often it is. If your loved ones are already living in a residential care community, several family members can participate in one phone call with them. Families also can schedule conference calls with doctors and facility staff to get up-to-date information about a relative’s health and status.
Identify Community Resources
Long-distance caregivers often have trouble finding local resources and services for their parents. Knowing where to ask can make a huge difference. Searching online is often a good way to start, exploring websites such as the federal government’s Eldercare Locator (www.eldercare.gov) which helps identify resources by topic, city or ZIP code. This service also offers information specialists who can help (1-800-677-1116) between 9 a.m. and 11 p.m. Caregivers can also get help locating resources through the area agency on aging in their loved ones’ community. These agencies (on Long Island, they’re the Nassau County and Suffolk County Offices for the Aging) can be found on the Eldercare Locator site; just go to Find Help in your Community and type in your loved ones’ city or ZIP code.
You also can go online to learn about public assistance programs available where your loved ones live. The National Council on Aging’s www.benefitscheckup.org is a free online service designed to help people over 55 search through more than 2,000 federal, state and private benefits programs to help pay for prescription drugs, health care, food and other basic needs.
Another option is to hire a private geriatric care manager. For a list of licensed professionals, searchable by ZIP code or city Aging Life Care Association website (www.caremanager.org). Even if you believe your parent of loved one needs some in-home care, be sensitive and respectful of their view of the situation. They may be reluctant to allow strangers in their home or they may have trouble facing such changes. Explain how various services work and that they are designed to help your parent remain independent.
Plan Your Visits
When visiting your loved ones, make use of the occasion to assess their current and future needs. Before the visit, decide what needs to be taken care of while you’re there, including purchasing household items, scheduling necessary appointments, going through financial and legal documents, and reviewing the home for comfort and potential safety hazards.
During the visit think about your parent’s daily needs and whether they need more help on a regular basis. Take note of anything out of the ordinary. Are they eating well? Socializing with friends and getting out? Keeping up with chores or housekeeping? Maintaining their personal appearance and hygiene? Paying bills and responding to correspondence? If not, consider additional resources.
At the same time, make sure your visit is an enjoyable event. Set clear-cut, realistic goals. Remember, a visit that’s too much business won't be good for anyone.
Don’t Forget Your Own Needs
Recognize the stress that caregiving—whether local or long-distance—imposes on caregivers. Accept that it's impossible for you to provide all the help your loved ones may need. Give yourself credit for whatever efforts you and other family members can provide. Ask for help when you need it. For more tips and resources to manage the stress of caregiving, see Part V of this resource guide (Caring for the Caregiver—You).