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Five Main Areas of Concern for Elderly Persons and Their Families
Jan L. Warner

Five Main Areas of Concern for Elderly Persons and Their Families

1. Long-term health care expenses -- especially for middle-income people. Wealthy people can afford long-term care in a nursing facility; the very poor will receive Medicaid assistance. Middle-income families, however, continue to be financially stretched to cover the costs of long-term care, particularly since people are living longer and governmental benefits are shrinking. And according to “Family Responsibility” provisions promoted by Congress in 1995 MediGrant legislation (which was defeated), children could be held responsible for their indigent parents’ nursing home expenses – before the parents could qualify for Medicaid.

2. Escalation of long-term care and medical expenses and reduction of benefits – compared to inflation of 3% to 4% annually, medical-related expenses have been increasing at approximately 12%. In addition, spouses are responsible for each other’s expenses and, in 29 states, children can be held responsible for their parents’ care. Now in cost-cutting modes, Congress and State governments are looking for ways in which to reduce contributions to the care of the elderly. Most recently, in The Health Insurance Portability And Accountability Act of 1996 which was singed into law on August 21st 1996, Congress included provisions that criminalize transfers of assets which result in Medicaid disqualification under certain circumstances.

3. Risky investment and management strategies. Because of increasing medical costs and static retirement incomes, some elderly people are making risky investments to try to increase their cash flow to pay for medical care. This, in turn, often puts principal at risk and places the elderly family in illiquid positions.

4. Joining Medicare HMO’s instead of relying on Medicare. Each week, thousands of Americans over age 65 choose to join Medicare HMO’s without appropriate investigation. In some instances, this can cause less coverage and greater financial exposure.

5. Not understanding what Medicare and Medicaid Cover. Medicare does not pay for long-term nursing home care except for a very short time and then on a limited basis. For the one in four Americans who enter nursing homes without a plan, this can be quite a shock.

and Three Tips

1. Plan in advance of catastrophic circumstances. Before a long-term or chronic illness takes away your options, seek out a qualified elder law attorney in your state to learn about your state’s laws and requirements. Make an appointment today.

2. Create contingency plans through documents. Because disability often causes the same problems that face incapacitated elderly persons, everyone needs a durable power of attorney for financial purposes and advance health care directives such as a living will.

3. Discuss plans with your family. Call a family meeting about all of these issues because they are family decisions. Adult children in their 40’s and 50’s have a big stake in these “elder” decisions since this “sandwich generation” is trying to raise and educate their children, plan for their retirement, and care for elderly parents and relatives. In many states, children can be held financially responsible for their parents’ medical bills.

© 2002, Jan L. Warner

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Today, more than 36 million Americans are age 65 or over. There are more than 22 million family-member caregivers. Then there are the Baby Boomers. All are grappling with the major decisions that accompany the latter stages of life. This book is for them. Written by two experts with decades of experience between them, it is a comprehensive guide that instructs readers about how to create a plan to deal with all aspects of aging, helps maximize options and ensure wishes are carried out.

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