A nursing home agreement is a binding contract that typically involves a large amount of money. Just as with a real estate contract, it’s wise to have an attorney review the agreement before you sign it, so you can understand exactly what your rights and responsibilities will be. [Read more…]
If you have a family member who is suffering from some form of dementia, you know how financially difficult providing quality care can be. According to a study published this month in the New England Journal of Medicine, the financial burden on the nation as a whole is staggering, with the costs now exceeding those of both heart disease and cancer. [Read more…]
When you are preparing for retirement and beyond, considering how you will pay for long-term care should be an important part of your overall plan. Yet, too often people neglect to provide for long-term care and find themselves having to either self-insure or spend down their assets to qualify for Medicaid. This piece from NPR highlights some of the pitfalls. [Read more…]
Have you given any thought as to what would happen to your internet presence after you pass away? With a vast majority of adults now using online services such as email and social networking sites on a regular basis, digital estate planning is becoming increasingly important. Without a plan in place, your family may not be aware of the extent of your digital assets and may not be able to access your online accounts after you’re gone.
What is a Digital Asset?
Usually when we discuss assets, we think of things that exist in solid form and have tangible value. However, in this digital age, that definition isn’t broad enough. Our digital assets can include things like digital music and books we’ve purchased, as well as artwork we might have created online. Also, any account you create on a content-sharing site like Facebook or Picasa can be considered an asset, itself.
Unfortunately, the law in this area has yet to catch up with the modern digital age. Currently, only five states have laws regulating access to a deceased person’s online accounts. Though Massachusetts is working on legislation, it has yet to enact a law.
Because of privacy concerns, online companies like Facebook and Twitter refuse to grant surviving family members access to their members’ accounts. However, some companies are trying to address this growing issue. For example, Google created the “Inactive Account Manager,” which allows users to choose what will happen to their Gmail messages or other data if their accounts become inactive.
With the state of the law uncertain, it is important to revise your estate plan to ensure that your digital assets are disposed of according to your wishes. The government now recommends that people create a social media will.
Here are some steps you can take to get your digital affairs in order.
- Inventory your digital assets: determine what digital content exists and where it is located
- Decide what should happen to each digital asset or account after you’re gone
- Designate a digital personal representative to dispose of your online assets and accounts according to your wishes
- Create a separate document containing information on how to access online accounts, including usernames and passwords (since a will is a public document, it is best not to write this information in your will)
There are also a number of websites that have sprung up recently that can help you keep track of your online data and release it to those you designate after you pass away. Some include Legacylocker.com, Assetlock.net, and Deathswitch.com.
If you have not yet made provisions for what will happen to your online presence after you’re gone, contact Attorney Kristina Vickstrom at 508-757-3800. We will review your digital assets and help you incorporate them into a comprehensive estate plan.
Here’s some good news for people who live in – or are thinking of entering – a “continuing care retirement community.” These are communities for older people that provide an entire continuum of care, from independent living to nursing home, so that residents can “age in place” and not have to move elsewhere if their faculties start to diminish. These communities are an appealing option, but they can be very expensive. The good news is that there is a tax deduction available that could help defray the costs.
The tax break stems from the fact that if your medical expenses are more than 7.5 percent of your adjusted gross income (or 10 percent if you’re under age 65), you may be able to make a tax deduction for some health care costs.
Because continuing-care communities provide a full range of health services, when you enter a long-term contract with one, the IRS considers that part of your fee is a prepayment of future health care expenses. Therefore, it’s possible that you can make a tax deduction of at least part of your entrance fee and your monthly fees.
The key is that it doesn’t matter how much health care you actually receive in a given year. The percentage of your fees that is considered a prepayment of health care expenses depends on the overall, aggregate percentage of the community’s expenses that goes toward health care. This percentage varies from community to community, but is often in the 30 to 40 percent range. (Your community should be able to provide you with its exact figure.)
The deduction generally works with regard to the entrance fee only if the fee is non-refundable. However, if the entrance fee is only partially non-refundable, you might be able to take a deduction based on the non-refundable portion.
You should also know that if children or other family members help a resident to pay the entrance fee or monthly expenses, they might also be eligible for the tax break.
When you’re ready to discuss your next step in elder residence, contact Attorney Kristina Vickstrom at 508-757-3800.
A growing number of websites now allow people to plug in information about themselves and create a “do it yourself will”. But doing so can be very dangerous and can lead to big problems, according to an independent review by Consumer Reports.
The magazine analyzed three such sites – LegalZoom, Rocket Lawyer, and Quicken WillMaker Plus – and ran the results by a law professor who specializes in tax and estate law. All three “do it yourself will” websites had a variety of problems, according to the study.
The problems included:
Two sites applied federal tax rules that were already months out-of-date.
The law of wills varies from state to state, but the programs didn’t take into account variations in state law, including state lax law.
No tax advice.
None of the programs offered tailored advice on how to reduce taxes – a critical flaw.
The websites often lacked provisions on how to handle business interests, electronic assets, trusts for children with special needs, trusts for pet care, domestic partnerships, multiple trustees, how executors are to be compensated, etc.
The websites frequently made arbitrary choices and didn’t allow bequests to be handled differently. And some added additional provisions to trusts without any warning.
The professor described one will produced by Rocket Lawyer as “primitive,” and another as “a mess.”
The magazine noted that LegalZoom allows you to pay extra money to receive attorney “support,” but when it contacted the company, it was told to type questions about arbitrary or missing provisions into a box and that these would be handled later in a hard copy of the will. According to Consumer Reports, even though it paid the extra fee, this never happened.
Using a “do-it-yourself will” website to create your will can be “like removing your own appendix,” according to the Consumer Reports article.
There’s simply no substitute for a lawyer who can understand your wishes and goals, and provide legal and tax advice that’s suited to your specific needs. Although it’s best to contact us first, if you have already paid for one of these services call us today to review your will and make sure it accomplishes your goals and is appropriate for your unique situation.
Photo Credit: lukemontague
Some residents of assisted living facilities who are covered by Medicaid are at risk of being evicted if they leave the facility for a period of time – even if they leave merely for a temporary hospitalization.
This is a significant problem that seniors should be aware of when they are planning for long-term care.
In general, Medicaid will pay nursing homes to hold a room for a Medicaid recipient who is temporarily absent due to a hospitalization. This entitles the resident to return to the first-available room.
However, most states don’t make similar “room-hold” payments to assisted living facilities. And there is no law requiring assisted living facilities to give priority to returning residents.
As a result, even if an assisted living resident leaves for only a short hospital stay, the facility could refuse to accept the resident once he or she is ready to return. The resident might end up having to find a nursing home instead.
Although the federal government has authorized state Medicaid programs to make “room-hold” payments to assisted living facilities, only a handful of states (including Georgia, Illinois, Montana, and Washington) have adopted such programs so far.
Should you have any questions about your Medicaid planning to avoid eviction, contact Attorney Kristina Vickstrom at 508-757-3800.
[photo credit: MyFutureDotCom]
Applying for Social Security can seem easy, but there are actually a great many options and choices which one works best for you requires a lot of strategizing.
For instance, the longer you wait to apply for Social Security, the higher the monthly benefit you’ll receive.
Depending on what year you were born, Social Security calculates what it considers your “full” retirement age. If you claim benefits be- fore that age, Social Security penalizes you by reducing your benefit. If you claim benefits after that age, Social Security rewards you with “delayed retirement credits” and a significantly larger benefit.
So you’ll need to decide if it makes sense to apply sooner, and receive a smaller monthly check for the rest of your life, or wait and apply later, when you’ll be eligible for a larger amount.
If you’re married, things get much more complicated. That’s be- cause spouses can choose to receive benefits based on their own work history or based on their spouse’s work history, or both at different times. Plus, spouses usually are of slightly different ages, so they reach “full” retirement age at different points.
Here are two popular strategies that spouses sometimes use to maximize their payments:
1. Social Security Option: Free spousal benefits.
If you’ve been married for at least 10 years, you’ve reached full retirement age, and your spouse has applied for benefits, you’re entitled to collect a “free spousal” benefit equal to 50% of the amount your spouse receives. You can collect this amount without applying for your own benefit, which means that you can build up “delayed retirement credits.” At some point, you can switch from the free spousal benefit to your own benefit, at which time your monthly amount will be considerably larger than it would have been if you’d applied for your own benefit earlier.
Example: Bob and Mary have both reached their full retirement age of 66. Bob files for his monthly benefit of $2,000. Mary could file for her own monthly benefit of $900. Instead, she claims “free spousal” benefits of $1,000/month (half of Bob’s benefit). She builds up delayed retirement credits, and when she finally applies for her own ben- efit at age 70, she could receive hundreds of dollars extra per month for the rest of her life.
2. Social Security Option: File and suspend
You’re eligible for free spousal benefits only if your spouse has applied for his or her own benefits. But what if your spouse doesn’t want to apply for benefits now – because he or she wants to keep working and building up his or her own delayed retirement credits?
The solution is called “file and suspend.” Your spouse files for benefits now, but “suspends” them until some point in the future. The result is that your spouse continues to build up delayed retirement credits, but he or she has “filed,” which means that you can now receive free spousal benefits.
Example: Bill and Sue have both reached their full retirement age of 66. If they applied for benefits now, Sue would get $2,200/month, and Bill would get $800. Sue wants to keep working. So Sue applies for benefits now and immediately suspends them. Bill can then receive free spousal benefits of $1,100/month, and both spouses can build up delayed retirement credits until they eventually apply for their own benefits.
While it may sound complicated to file for one spouse’s benefits, apply for free spousal benefits for the other spouse, and then suspend the first spouse’s benefits, it can be done in one visit to your Social Security office.
Here’s a wrinkle, though: If you apply for free spousal benefits before you reach your own full retirement age, Social Security will give you those benefits or benefits based on your own work record, whichever is more. And if you receive benefits based on your own work record, you can’t continue to build up delayed retirement credits.
So this strategy works best if (1) you wait until full retirement age, or (2) your free spousal benefits are larger than those based on your own work history.
As you can see, choosing the best way to apply for Social Security can be very complicated. That’s why it’s smart to talk to an attorney who can advise you on the best possible strategy for your situation. Contact Attorney Kristina Vickstrom at 508-757-3800 to set up a consultation.
Many people incorrectly believe that once seniors enter a nursing home, their freedom is over. In fact, nursing home residents have many rights, and it is important to know those rights and to be able to enforce them.
Nursing home residents’ rights are protected under federal law. In broad terms, nursing homes are required to ensure that every resident be given whatever services are necessary to function at the highest level possible. Here are some of the specific protections that residents have:
- Residents have a right to privacy in all aspects of their care. This means that phone calls and mail should be private, and residents should be able to close doors and windows.
- Residents may bring belongings from home, and nursing home staff members are required to assist residents in protecting those belongings.
- Residents have the right to go to bed and get up when they choose, eat a variety of snacks outside meal times, decide what to wear, choose activities, and decide how to spend their time. The nursing home must offer a choice at main meals, because individual tastes and needs vary.
- Residents have the right to leave the nursing home and belong to any church or social group they choose.
- Residents must be allowed to participate in planning their care.
- Residents have a right to manage their own financial affairs.
- Residents may not be moved to a different room, a different nursing home, a hospital, back home, or anywhere else without advance notice and an opportunity for appeal.
If a disagreement with the nursing home does arise, there are a number of steps you can take to enforce the resident’s rights. The first step is to talk to the nursing home staff directly. This may be all it takes to solve the problem. If that doesn’t work, then you may need to talk to a supervisor or administrator.
If you’re still unable to resolve the issue, the next step is to contact the ombudsperson assigned to the nursing home. He or she may be able to intervene and get an appropriate result. You can find contact information for the Ombudsman Program in your state at: www.ltcombudsman.org/ombudsman.
Additional steps include reporting the nursing home to its licensing agency and hiring a geriatric care manager to intervene. If the direct approach isn’t working, you may need to hire a lawyer to resolve the issue. The last resort is to move the resident to a different facility.
If you feel that your or a family member in a nursing home’s rights have been infringed upon, contact Attorney Kristina Vickstrom today at 508-757-3800.
[photo credit: NursingHomesAbuseBlog.com]
Often, the best way to handle the problem of long-term health care costs is to buy long-term care insurance. If you can afford the premiums and you’re insurable, this can save you a lot of money in the long run.
However, long-term care insurance can be expensive. If you’re thinking about purchasing a policy, here are some things to consider:
How much long-term care insurance coverage do you really need?
A good way to get started, and to avoid overpaying, is to calculate how much of a benefit you actually require.
For instance, the national average cost of a private room in a nursing home is about $250 a day, and the average monthly base rate in an assisted living facility is $3,550, according to MetLife’s 2012 survey of long-term care costs. These numbers can vary widely from location to location.
One easy way to calculate a daily benefit is to take the average cost of care where you live (or are likely to live when you’ll need care), and subtract from that your daily income. For instance, if nursing homes cost $300 a day in your area, and your income is $3,000 a month, or $100 a day, then your daily benefit should be about $200.
Check what period the policy covers.
In general, the shortest period of coverage available is two years, but policies can be purchased for much longer periods or even for your lifetime. Of course, the longer the policy’s coverage period, the higher the premiums will be.
Most people don’t actually need lifetime coverage. Often, a good length of time is five years, because statistically it’s unusual for someone to need care for more than five years. In addition, Medicaid looks back five years for any asset transfers. If you purchase five years of long-term care coverage, you could transfer most or all of your assets to your children or to a trust, pay for your care with insurance over five years, and then qualify for Medicaid coverage.
Consider a smaller benefit.
A policy that pays $200 a day for five years might still be expensive, especially if it includes an inflation rider. If you can’t afford such coverage, you could think of long-term care insurance as “avoid nursing home” insurance. Under this approach, you could purchase just enough insurance to pay for home care or assisted living care, which are usually not fully covered by Medicaid.
For example, if you purchased insurance with a daily benefit of $100, you would have about $6,000 a month to cover your living expenses plus home care or assisted living costs. The premium for such a policy would likely be much more affordable than one for a policy with a daily benefit of $200.
Buy long-term care insurance when you’re younger.
Long-term care insurance premiums rise as you age, so the younger you buy, the cheaper your premiums. Be careful, however, because insurance premiums can, and often do, increase considerably from your initial purchase price. Even if you have a policy that is “guaranteed renewable,” your premiums could still increase.
Limit coverage to one spouse.
Often, a married couple will be able to afford coverage for only one spouse. This can be a reasonable option, particularly because the Medicaid rules provide some protection for the spouse of a nursing home resident.
If you have no specific reason to think that one spouse is more likely to require long-term care than the other, then looking at statistics alone, the wife should probably purchase the policy. In our society, women tend to live longer than men, and are much more likely to end up in a nursing home for a long period of time.
Of course, this amounts to playing the odds and is not a sure thing. On the other hand, some companies offer incentives for both spouses to purchase coverage, such as a premium discount for the second spouse.
Consider a ‘shared care’ policy.
If both you and your spouse are purchasing long-term care insurance, a “shared care” policy might give you more coverage for less money.
With this kind of policy, you buy a pool of benefits that you can split between you and your spouse. For example, if you buy a five-year policy, you will have a total of 10 years between you and your spouse. If your spouse uses two years of the policy, you will still have eight years.
A shared care policy may cost more than separate policies with the same benefit period, but it will allow you to buy a shorter policy knowing that you will have a shared pool of benefits to work with.
Choose a longer waiting period.
Most policies have a waiting period before coverage begins, typically 30 to 90 days. The longer you make this waiting period (which policies typically refer to as an “elimination period”), the cheaper your premiums. Keep in mind, however, that you will have to pay for your care out-of-pocket until the waiting period is over and the insurance begins its coverage.
Be careful with inflation protection.
Inflation protection increases the value of your benefit to keep up with inflation, and is generally recommended. But you should give some thought to whether you want compound-interest increases or simple-interest increases. If you’re purchasing a long-term policy and you’re age 62 or younger, then you’ll most likely want compound inflation protection. But if you’re 63 or older, some experts believe that simple inflation increases may be enough, and you’ll save considerably on premium costs.
To learn more about your long-term care insurance options, contact Attorney Kristina Vickstrom at 508-757-3800 or schedule a consultation online.