Good news! For the first time since 2008, the Department of Veterans Affairs has announced an increase in maximum  Aid and Attendance benefits available to veterans of the armed forces. These new figures for 2012 reflect a 3.6% cost-of-living adjustment, effective December 1, 2011:

$20,447 per year (~$1,704 per month) for a qualified veteran;
$24,239 per year (~$2,020 per month ) if the veteran is married;
$13,138 per year (~$1,095 per month ) for a surviving spouse of a qualified veteran;
$31,578 per year (~$2,631 per month ) if both spouses are qualified veterans.

What is Veterans Aid & Attendance?

Veterans Aid & Attendance pension benefits are intended to be a form of financial assistance to meet the care needs of veterans and their surviving spouses. If you are younger than age 65, then you must be completely disabled in order to receive this benefit. Those over 65 do not have to be disabled. However, the veteran or spouse must be in need of regular aid and attendance due to: Inability of claimant to dress or undress himself (herself), or to keep himself (herself) ordinarily clean and presentable; frequent need of adjustment of any special prosthetic or orthopedic appliances which by reason of the particular disability cannot be done without aid (this will not include the adjustment of appliances which normal persons would be unable to adjust without aid, such as supports, belts, lacing at the back etc.); inability to feed himself (herself) through loss of coordination of upper extremities or through extreme weakness; inability to attend to the wants of nature; or incapacity, physical or mental, which requires care or assistance on a regular basis to protect the claimant from hazards or dangers incident to his or her daily environment.

It is helpful to note that not all of the disabling conditions in the list above are required to exist. It is only necessary that the evidence establish that the veteran or spouse needs “regular” (scheduled and ongoing) aid and attendance from someone else–not that there be a 24-hour need.

How do I know if I can qualify for Veterans Aid & Attendance Pension Benefits?

You or your spouse must have served on active duty for at least 90 days, at least one day of which occurred during a period designated as wartime (see below). There must have been an honorable discharge as well. Single surviving spouses of such veterans are also eligible.

Periods Designated As Wartime:
World War II — December 7, 1941 through December 31, 1946
Korean Conflict — June 27, 1950 through January 31, 1955
Vietnam Era — August 5, 1964 through May 7, 1975; for veterans who served “in country” before August 5, 1964, February 28, 1961 through May 7, 1975
Gulf War — August 2, 1990 through a date to be set by law or Presidential Proclamation

If you would like to learn more about the Veterans Aid & Attendance program and how the Farr Law Firm can help you obtain the benefits you deserve, contact us!

If you would like to sign up to receive Evan Farr’s Aid & Attendance 4-Part Mini Series via e-mail, please click here.

Filing a Veterans Aid & Attendance Claim

Siblings often have trouble agreeing on anything, so why should it be any different when it comes to Mom and Dad’s elder care?  Unfortunately those of us in elder law see quite often how families have a very difficult time when it comes to determining what is best for aging parents.

In some cases, one sibling may be expected to take on an unreasonable portion of the elder care with other siblings not recognizing (or possibly not caring) that it is a hardship. Perhaps it’s because of geographical closeness, or financial stability, or even perceived favoritism of a particular sibling. Other times, siblings simply can’t agree on the best course of medical intervention or the choice of an assisted living facility.

A certified elder law attorney like Evan Farr can actually help to avoid or work through some of these issues.

The best approach is to start early.  Most siblings can likely agree that having your parents make their wishes known in advance is a good thing. (And sticking to them, no matter what, when they become necessary.)  The attorney can help them draw up some very important documents before they are even needed. Such as:

• Medical Power of Attorney – This names the person responsible for making medical decisions when the parent is unable to do it for himself or herself.
• Financial Power of Attorney – This is used to determine who will have control of the parents’ finances in order to keep the household going, pay medical bills, etc. during an illness or crisis.
• Living Will – A living will helps to outline the parents’ wishes when it comes to medical interventions and end-of-life care.  Having this in place takes some of the burden off of the adult children who would otherwise be making these choices.

If possible, it’s best to have all of the siblings aware of and in agreement about these documents, as it can cut down on the amount of frustration later. Of course, children must also realize and respect that it is entirely up to the parents who they want to nominate as their primary Agents, and whether they may act independently or if they must act in cooperation with one or more siblings.

When things do become more intense and these documents come into play, it is still likely that siblings will have disagreements about what is best.  The one who has the largest responsibility for day-to-day elder care may become resentful, while another may also harbor resentments that someone else was chosen to take care of the parents’ finances.  Throw in the emotions that surface when facing your parents’ mortality, and there is potential for a major explosion and grief.

In order to diffuse the situation, an elder law attorney can direct you to other forms of outside help.  For example, some families choose to hire a “geriatric care manager.”  This person is able to manage many aspects of the parent’s care, and because he or she isn’t a family member, much of the associated drama is mitigated.  When a situation has become too out of hand, the siblings may need to agree to use a mediator.  This impartial listener can help to determine the best course of action for getting the parents the care they need while meeting the needs and wishes of the siblings as appropriately as possible.

In order to salvage an uncomfortable family situation, it may be advisable for members to seek family counseling.  This is most likely to work when all of the members are invested in a positive outcome.  The staff at the Farr Law Firm can help direct you to many resources for counselors and mediators here in the Northern Virginia area.

If you’re a parent that would like to start laying the proper groundwork for your children now, contact the Farr Law Firm to discuss drawing up the proper documents to make future life transitions as smooth as possible for your family.

Basic Estate Planning

Life Care Planning

Farr Law Firm Trusted Referrals

How important is social support as a person ages? This may seem like an easy question to answer. Most people would not choose isolation and loneliness versus spending time with companions. However, can lack of social support really hinder a person’s overall quality of life?

Lack of social support is related to negative impacts on health and well being, especially for older people. Having a variety of positive social supports can contribute to psychological and physical wellness of elderly individuals. Support from others can be important in reducing stress, increasing physical health and defeating psychological problems such as depression and anxiety.

When considering who provides social support for an elderly individual our first thoughts are of family members. While it is true that most support does come from family members, there are many circumstances in which family members cannot be supportive (stress due to responsibilities, illness, death, financial problems, job relocation). In the United States the fastest growing age group of individuals are those 85 years and older. Due to this fact, family supports will inevitable decrease for these older individuals. A need for community-based services is more important now then ever before.

Community-based services can be extremely useful for elderly individuals. Services for older persons can encompass many areas, but one of the most important areas as discussed previously is social support. Support for elderly persons can be found in many places including: senior centers, assisted living facilities, meal delivery, religious affiliations, adult day care centers, etc. These services can provide positive social supports that can help older persons defeat loneliness and isolation. However, social support must encompass more then physical presence or conversation. Studies have shown that social support services should contain quality activities. These activities should promote positive self-awareness.

Self-awareness is key to a person’s overall quality of life and satisfaction. Many leisure social activities can be used to help increase an individual’s self-awareness. Activities for elderly individuals may include reminiscence groups, journal writing, readings of favorite book passages, group exercise, singing groups, etc. Individuals may also feel more self-satisfied if they are part of the planning of social activities that take place.

Two of these community-based service centers that provide quality social support services for elderly individuals are discussed below.

Senior Citizen Centers

Today, there are estimated to be about 15,000 senior centers across the United States. Senior centers act as a focal point for older Americans to receive many aging services. The most common services offered at a senior center include health programs (including Zumba and Yoga), arts/humanities activities, intergenerational programs, employment assistance, community action opportunities, transportation services, volunteer opportunities, education opportunities, financial assistance, senior rights counseling/legal services, travel programs and meal programs. These programs and activities can help promote positive self-awareness.

Lori Beckle describes how participating in her local senior citizens center has given her the independence and life satisfaction she thought was lost when her husband died in 2009. “ I was devastated and so frightened for my future without Ed. He was my only friend and the one I turned to when I felt alone. My daughter invited me to attend our local senior center where a bereavement group was being held for those who had lost a loved one. I met Phyllis during the group and now I have a new friend I call when I become afraid. Phyllis has helped me develop the skills to get through the tough times and focus on my immediate happiness.”

Adult Day Care Centers

According to the National Adult Day Services Association (NADSA), there are currently more than 4,600 adult day care centers nationwide. Adult day care is a program in which activities are provided to promote social support and health services to an older adult during the daytime. Most centers operate Monday through Friday during daytime hours. Social support services at an adult day care can consist of musical entertainment and singing groups, group games such as cards, gentle exercise, discussion groups (books, films, current events), holiday/birthday celebrations and local outings. Not only are these social activities provided, but participants of the program can also develop lasting relationships with staff and other participants. Adult day care centers also provide meals and health services. Adult day care centers differ from other programs for elderly individuals, because they allow the participants to develop and increase self-awareness by encouraging independence.

Amanda describes her experience as a volunteer at her local adult day care center. She stated, “ I was involved in planning the activities for Thursday afternoons. I wasn’t sure what kind of activities my older friends would enjoy so I had them share their favorite activities they participated in when they were my age (23). I soon realized that I was hearing the most fascinating stories of hopping trains, college dances, swimming in the lake, etc We decided Thursday afternoons would be spotlights of each individuals’ lives as a twenty-something. One of the participants told me that Thursdays became a highlight for her week.”

Adult Day Care Centers and Senior Citizen Centers help to provide an elderly individual the opportunity to participate in social support activities. Social support activities found in these programs can be beneficial to a person’s quality of life and overall satisfaction. With a higher self-awareness and quality of life an individual can reduce the risks of mental and physical health problems as they age.

Many adults know they need a living trust – not a will – to allow loved ones to skip the dreaded probate process after they are gone.  But a lesser-known reality is that proper Medicaid planning may be necessary to ensure the standard of living does not dramatically change before death.  Proper planning can ensure access to basic dental health services, including dentures, for someone receiving long-term care benefits through Medicaid.

An unfortunate reality is that many Middle Class Americans do not realize how proper planning can save hundreds of thousands of dollars in nursing home and long-term care expenses.  Anyone can qualify for Medicaid, but for seniors in Virginia, only “medically necessary” dental procedures are covered.  With proper planning, however, one can qualify for Medicaid and receive items and services that are not covered.

One of the many problems facing seniors of today are the effects of a lifetime of wear-and-tear on teeth and gums. Receding gums, root decay, a lack of fluoride-treated water as a youth, and gum disease all contribute to an unhealthy and often painful mouth. Gums naturally recede over time, leaving the tooth root exposed, which can result in uncomfortable sensitivity to hot and cold foods. This also leave the tooth root open to decay-causing acids which over time may result in the loss of your teeth. Most municipalities didn’t have fluoride-treated water until the 1960′s (nor did we know as much about good oral health) which resulted in poorer dental health for those of generations before the 60′s. And as your dentist will tell you every time you’re in the chair, gum disease is a common but serious malady for people of all ages which can result in infection, painful tooth loss or an uneven jawbone. Over 40% of the adult population in the US suffer from some form of natural tooth loss, although the statistics are higher for those over age 65.

At a certain point, the simple joy of sharing a good meal with family and friends becomes a painful or embarrassing ordeal for many seniors. The classic solution is dentures. But dentures are expensive (ranging from a few hundred dollars to several thousand per pair), and seldom fully covered by insurance companies. If you or a loved one are already enrolled in Medicaid, you know that unfortunately it does not cover dentures–however, the money you’re saving on expensive nursing home care can be put towards bettering your comfort and standard of living, with items such as dentures.

Even if you’ve been diligent about oral health your entire life, as you age you might face some practical challenges in keeping it up. Arthritis makes gripping the slim handle of a toothbrush painful, but don’t let this to get in the way of continued good oral hygiene. Consider inserting the handle of the tooth brush into a tennis ball. Or perhaps invest in an electrical toothbrush that can get the job done with less manual movement. For flossing, there are many assistive picks and devices available in the supermarket that can make flossing easier for those with dexterity problems.

Finding a solution that works for you–whether it be dentures or continuing your dedication to good oral health–can help you retain the charming smile you remember. If you need guidance in figuring out how to afford the best long-term care possible for yourself or a loved one, we can help. Call us at 703-691-1888 to make an appointment for your complimentary consultation.

As I’m sure you’ve heard (and felt!) this week has already shown record-breaking temperatures across the country, and this heat wave is only expected to move further east through the end of this week. Temperatures are expected to break 100 today and tomorrow with a heat index of up to 110! While high heat is usually just an inconvenient downside to summer, when it crests as high as this we should consider taking some precautions. Caregivers, make sure to pay special attention to your elderly loved ones during this unbearable heat wave.

According to The Weather Channel, heat is the number one weather-related killer in the United States outpacing hurricanes, tornadoes and other natural disasters. Soaring temperatures pose the biggest threat to the elderly, the very young, and the ill, as well as those who cannot afford air conditioning or live in the heart of big cities. Check on your elderly neighbors and invite them into your air conditioned home if they don’t have it. (Who knows, you might even trade some interesting stories over a cold glass of iced tea!) If you are living in a big city, the threat is two fold. High temperatures often continue through the night as concrete and asphalt release the heat they’ve absorbed throughout the day, leaving you in a baking oven even in the dead of night. Less obvious but just as threatening is the increase of pollutants in the air (due to the stagnation caused by lack of air circulation) that can irritate those with sensitive respiratory systems. For seniors already suffering from emphysema or asthma, this can be particularly threatening.

Caregivers and family members, keep on the lookout for symptoms of the two most common heat-related illnesses in the elderly: heat exhaustion and heatstroke. Heat exhaustion is defined as a “mild form of shock marked by heavy sweating, weakness, cold, clammy skin, a weak pulse, fainting and vomiting.” If not quickly caught and treated, the condition can possibly lead to heatstroke–a life threatening illness that can result in brain damage or even death if not treated by emergency medical help immediately.

Seniors and those caring for them should take extra care to prevent any ill-effects from this suffocating heat. Ensure that those most at-risk are in an air-conditioned and cool room if possible. If not, you may want to consider temporarily helping them move to a location that does have air conditioning to keep them more comfortable. Of course, make sure to drink plenty of water as well. Even the strongest of us can fall prey to the heat if we aren’t aware and don’t take the proper precautions.

Stay cool!

Source: The Weather Channel

When it comes time for a child or parent to begin making plans for the beloved but aging senior in their life, the myriad of choices, paths, options and steps to take can seem endless and overwhelming–so much so that many dejectedly assume that nursing home care is the only option. But this isn’t always true! While some healthcare needs will eventually require the long-term care that a nursing home can provide, for others the goal is to stay in the comfort of their own home as long as possible. Fortunately, it IS possible to receive care at home and obtain Medicaid benefits. Medicaid application for a nursing home and for home-based care are somewhat different processes, but we regularly handle both at our Firm. In fact, home-based care is slowly becoming more popular with our clients as a means of staying in their comfort zone for as long as possible.

With this in mind, the Farr Law Firm is excited to announce a new relationship with American Care Partners @ Home Inc., a locally owned and operated at-home care agency based in Falls Church and serving the Northern Virginia area. This group offers a wide array of in-home care services, from a few hours of care a day to 24-hour round-the-clock supervision; from something as basic as simple companionship to assistance with household chores and errands. American Care Partners is unique in that their staff of physicians will conduct house calls to their patients right in their own homes, at no additional charge–“the 1940′s are back!” is what they say! And best of all, America Care Partners @Home Inc. are Medicaid approved and we look forward to working with them to attain the best possible care for our clients under Medicaid.

Another home-care company that we often recommend is HomeWell Senior Care, a nationwide organization with a very successful branch here in Virginia. HomeWell was founded by a caregiver in 1996 and focuses on “maintaining independence with quality home care for seniors.”

We at the Farr Law Firm enjoy working with these companies because they have a complete understanding of the Medicaid billing process, which makes things run smoothly. We strive to make the process of finding the best possible care for your loved one as stress-free and streamlined as possible for you and your family, and American Care Partners @ Home Inc., and HomeWell Senior Care are our integral partners in achieving that goal. If you have a parent or spouse in need of home-care, please contact the Farr Law Firm at www.farrlawfirm.com or by calling 1-703-691-1888 for your complimentary initial consultation. We can help you determine your financial options for long-term care and create the best possible care plan for your loved one.

For more information about American Care Partners @ Home Inc., visit them online at www.americancarepartnersathome.com or call at 703-261-4146.
For more information about HomeWell Senior Care, check out their website at www.homewellseniorcare.com or call 1-888-9-SENIOR.

While it may be true that the Supreme Court is often tasked with the daunting assignment of deciding the most controversial and divisive of issues, last Tuesday’s unanimous ruling was a little different.

Most who are familiar with the facts of Henderson v. Shinseki would probably agree that the decision “felt right;” especially to the elder law attorneys and senior-serving professionals who help U.S. Veterans on a daily basis.

The Court reversed a decision by the U.S. Court of Appeals that ruled Veterans Court judges could not extend the deadline to appeal, even when a Veteran’s mental illness procured the delay.

Justice Samuel Alito explained the Courts’ rationale in reversing the decision of the Court of Appeals;

The (Dep’t of Veterans Affairs) is charged with the responsibility of assisting veterans in developing evidence that supports their claims, and in evaluating that evidence, the VA must give the veteran the benefit of any doubt. … Rigid jurisdictional treatment of the 120-day period for filing a notice of appeal in the Veterans Court would clash sharply with this scheme.

For an interesting look at how the case developed in the headlines over the course of the past several months, read the first Washington Post article I referenced late last year, Court hears appeal from veteran who missed deadline, here.  Then, read Supreme Court eases benefit deadline for vets, the recent article from USA Today, available here.  The latter link also includes a photo of the late Mr. Henderson.

Last year I called attention to Henderson on my National Elder Law News Blog, in the article, Veteran Misses Filing Deadline Due to Mental Illness: Fair? a case about a Veteran with Schizophrenia, whose illness prevented him from meeting a deadline imposed by the government.

Mr. Henderson’s lawyer argued in front of the Court that his client’s disability – which developed as a result of years in the service – prevented him (Mr. Henderson) from meeting a deadline to appeal the government’s denial of his request for home care by the Veteran’s Administration.  The argument was that it would be an injustice to strictly enforce the deadline against Mr. Henderson.

Veterans’ disability compensation is paid to Veterans who are injured as a result of their service to the country.  If denied a request for benefits, there are 120 days to file a notice of intent to appeal.  Mr. Henderson was denied home care by the Veteran’s Administration, after which he filed his notice of appeal 15 days late.

The case really boiled down to inquiries of fairness and Congressional intent.  Henderson argued that Congress intended for Veterans to be treated fairly, and that the 120-day time limit was meant to be flexible; a permeable deadline, should the interests of justice require an extension.

The loser in this case (The Secretary of Veterans Affairs) argued that the time period was meant to be strictly applied and that any change to the deadline must come from Congress itself and not from the discretion of the bench (a judge).

Various veterans groups followed this case from its inception.  With the traumatic stress and psychological scars evident in many soldiers who have returned from the wars in Iraq and Afghanistan, groups like the National Organization of Veterans’ Advocates, the National Veterans Foundation, and Paralyzed Veterans of America are undoubtedly happy with how Henderson turned out.

For information on Aid & Attendance benefits, you can check out our Firm’s links to frequently asked questions below:

What Is the Amount of the Aid and Attendance Benefit?

Who Is Eligible for the Aid and Attendance Pension Benefit?

Is Aid and Attendance Only for Low Income Veterans?

How is the Aid and Attendance Benefit Calculated?

Filing a Claim

The Asset Test

Image Credits: Photograph uploaded by FreeDigitalPhotos.net Admin

Today’s  women are decision makers.  For some couples, the woman is THE decision maker, and there’s nothing wrong with that.  For example, in nearly 8 out of 10 cases where married couples purchase a vehicle, it is the woman who makes the final decision.  And because women outlive men by 5.4 years on average, women frequently make decisions that have long lasting effects upon their children, their spouse, and even their parents.

Today, I want to offer 3 tips to help open the lines of communication between parent and child when it comes to the difficult subject of long term care.

Tip 1: Explain that Elder Law Attorneys are Passionate About Their Clients – Elders!

Elder law attorneys have deliberately chosen a career in a specialized area of law to serve elders.  Moreover, Virginia Rules of Professional Conduct require lawyers to act in the best interests of their clients.  The client of an elder law attorney is the elder.  Not the child. 

Elder law attorneys are equipped to facilitate familial harmony; they place the client’s concerns at the forefront of any discussion, and they orchestrate a plan that can protect a nest egg from the catastrophic expenses of long term care and improve quality of life.  An inheritance is nice – and usually a much larger inheritance is a by-product of the plan devised by an excellent elder law attorney – but the first thing I explain to families I meet with is that the inheritance is not the focus.  My client’s quality and dignity of life is priority #1.

Tip 2: Gather Information with Parents in No-Pressure Environment

Parents love to do things with their kids, and adult children likewise value the time they have with their aging parents.  One easy way to spend time with your parents while gathering information is to attend a free seminar hosted by a local elder law attorney.  Don’t be afraid to research, communicate and explain important statistics to your parents.

Tip 3: Use Easy to Understand Statistics to Convey Your Message:

Did you know that if you are over age 65:

• you have a 7.2% chance of having an auto accident every year;
• a 6.15% chance of needing to file a homeowner’s insurance claim; and
• a 70% chance of needing long-term care?

Over half of those who need long-term care will require a nursing home.

Here is the statistic you must be concerned with:

• 13% of drivers are uninsured;
• 15% of homeowners are uninsured; but
• 90% of senior citizens are uninsured and unprotected against long term care needs.

This means;

1. 87% of people insure themselves against an event that has a 7.2% annual probability;
   

2. 85% of individuals protect themselves against an event with a 6.15% annual probability; but

3. Only 10% protect themselves from an event with a 90% probability!

Why is it important to plan for long term care?  Primarily because the expenses of long term care are catastrophic and can wipe out a nest-egg in less than a year.  50% of couples and 70% of singles are impoverished (broke) after one year of entering a nursing home.

Medicaid is a government program meant for those who plan for it.  I encourage you to attend a free seminar on the subject, as it is shocking that so many smart people do not realize that Medicaid – not Medicare – can be used to pay for long term care.

One common misconception is, “We don’t need to plan for our long term care yet, we’re only 65.”  Almost half of all long-term care claimants are under age 65 at the time of disability.  Every day that goes by without a plan, the family is risking possible delay or even forfeiture of government benefits that are meant to pay for catastrophic long term care costs.

Talking to your parents about their long term care options can be understandably difficult, and no other generation has had to simultaneously balance so many familial responsibilities at one time.  But there is a new breed of estate planning and elder law that takes a family-friendly, solution-based approach making it easier to discuss difficult subjects.

As Halloween approaches this year, I can’t help but draw an analogy between the nights I spent meandering my neighborhood as a kid looking for handouts, and our current economic times.  I recall my grade-school friends and I operating our minds at their collective capacities, as we planned the best streets to target and the best routes to take to get from house to house most efficiently. Some of the parents surpassed expectations and gave out the good stuff — like king size candy bars! Others doled out the less-desirable treats, such as candy corns, smarties, or the dreaded raisins.  Some neighbors, when they were gone for the evening, left out giant bowls of candy for us trick-or-treaters to help ourselves.  Other neighbors were always gone, and their houses completely dark.  But fortunately for us candy-loving kids, most or our neighbors participated in the fun of Halloween. In fact, many of our neighbors offered a variety of different candy to choose from each year.  We never knew how much candy we’d wind up with at the end of the night, or how much of the “good stuff” we’d have in our bag.

Similar to the unpredictability of household Halloween generosity encountered by children, the Federal Government is providing the public with what can appropriately be called a “mixed bag” of economic solutions. It might just depend on what house, or rather, what state you live in.

Social Security and Supplemental Security Income recipients will not receive an increase in 2011 because there has been no increase in the federal Consumer Price Index.  Read the Social Security News Release Here (released October 15, 2010).

Though the federal Social Security Administration is not able to provide an increase for its beneficiaries because of long-standing federal law that ties Social Security and Supplemental Security to the Consumer Price Index, other federal agencies, and some state agencies, are doing what they can to help alleviate the financial struggles of the elderly and disabled.

One prime example:  the federal Administration on Aging and the Centers for Medicare and Medicaid Services (both part of the U.S. Dept. of Health and Human Services) recently awarded more than $2 million in grant funding to the Virginia Department for the Aging and the Virginia Department of Medical Assistance Services, the latter being the Virginia agency that runs our state’s Medicaid system.   Read the Commonwealth of Virginia Press Release Here (released October 6, 2010).

This grant funding to Virginia’s Medicaid system comes with high hopes and great expectations. The over $2 million in funding will be used to bolster services for two key underprivileged groups – the elderly and the disabled – by alleviating burdens in the following areas:

•    Prescription drug coverage
•    Long-term care services
•    Transition support from nursing homes to community based services
•    In-home support services for sufferers of Alzheimer’s disease

In providing these much-needed funds to Virginia for the improvement of Virginia’s Medicaid program and the development of additional services for the elderly and the disabled, the Federal Government has demonstrated its continuing commitment to improving and strengthening the Medicaid system throughout the United States.  As Senator Rockefeller wrote in 2005, on the 40th anniversary of the Medicaid program,  ”taking care of our most vulnerable people is a moral obligation . . . our representative democracy has a responsibility to do for the future what we have repeatedly done in the past: protect, preserve, and strengthen Medicaid.”

Medicaid is what pays for the vast majority of nursing home care in the United States. With both the Federal Governemtn and the Virginia State Goverment now strenghtening the Medicaid program, smart long-term care planning (i.e., Medicaid Asset Protection Planning) has never been as important as it is now. According to the Virginia Department for the Aging, the population of elderly adults in Virginia will double in less than 20 years — to the point where one in five residents of Virginia is expected to be aged 65 or older.

A statistic I cited in a previous article demonstrates the importance of Medicaid Asset Protection Planning — about 70% of Americans who live to age 65 will wind up needing long-term care at some point in their lives.  For the more than 40% who will require long-term placement in a nursing home, the cost of such care will be financially devastating without a smart Medicaid Asset Protection Plan focused on structuring assets in a way that protects those assets while allowing earlier Medicaid eligibility.

For most seniors over age 65, Medicaid is the equivalent of government-subsidized long-term care insurance, just as Medicare is governement-subsidized health insurance.  But remember — the fact that Medicaid is “government-subsidized” does not mean that it’s a “handout.” On the contrary, it’s your tax dollars that fund the Medicaid program, just as it’s your tax dollars that fund Medicare.  It’s also important to note that the Federal Government and Virginia State Government both encourage Americans to engage in smart Medicaid Asset Protection Planning — for example:  there are laws that protect spouses of nursing home residents; there are laws that encourage Americans to engage in Medicaid Asset Protection by purchasing Long-Term Care Insurance “Partnership” policies; there are laws that allow the exemption of certain types of assets when applying for Medicaid; there are laws that permit individuals to qualify for Medicaid even after transferring assets to a spouse, or to a disabled family member, or to a caregiver child.  To smartly plan and protect assets while accelerating qualification for Medicaid is no different than planning ahead to maximize your income tax deductions in order to minimize your income taxes.   It is no different than taking advantage of tax-free municipal bonds.  It is no different than planning your estate to avoid estate taxes (which, incidentally, a lot more people are going to be doing again next year when the Federal Estate Tax returns with a vengeance – with an Exemption Equivalent Amount of only $1 million – but that’s for another article . . . ).

At a time when much federal spending leads to controversy, Medicaid is an example of the government legitimately promoting the best interests of society.  Similar to how my mom always made sure I ate a well-balanced dinner before embarking upon my annual October 31st sugar binge, our Federal Government and State Government are truly looking after the citizens of America (even in these gloomy economic times) by directing funds to programs that benefit and protect our most fragile citizens — the elderly and disabled.

The Farr Law Firm specializes in Family Protection Planning (i.e., Estate Planning, Incapacity Planning, and Medicaid Asset Protection Planning), and we are here to help you.  If you have not yet done your Family Protection Planning, I encourage you to call us to take advantage of a free consultation to determine the planning solution that’s best for you and your family.

I’ve written several times over the years on the topic of Reverse Mortgages.  My first article explained the concept and requirements of a Reverse Mortgage and how seniors can use a reverse mortgage.  My second article, entitled Using a Reverse Mortgage to Pay for Home Care, explained how the Reverse Mortgage can be used as a tool to help seniors stay in their homes and age in place.  My most recent article, entitled Huge Problem with Reverse Mortgage Industry, raised a nationwide alarm about how the reverse mortgage industry is “shooting itself in its collective foot” (and, I believe, discriminating against disabled and incapacitated adults) by routinely second-guessing the legitimacy of every power of attorney document and therefore imposing unnecessary obstacles for, and sometimes turning away, the very people who need a reverse mortgage the most — those frail elders who are unable to care for themselves but wish to remain at home and age in place rather than being forced to sell their homes and move into a long-term care facility.  Here’s the link for the ElderLawAnswers article which picked up on my concerns and confirmed the enormous scope of this problem.

Specifically, Pepe says that HUD’s ongoing Mortgage Insurance Premium will be increasing from 0.5% to 1.25% (a 150% increase!), and that the size of new HECM reverse mortgages will shrink anywhere from 1% to 5% depending on the applicant’s age.

However, Pepe also points out that homeowners will soon have a second HECM reverse mortgage option, called the “HECM Saver.”　According to Pepe, the HECM Saver is a smaller and less expensive reverse mortgage. Under the HECM Saver, a reverse mortgage applicant will gain access to significantly less money, but in return, says Pepe, “HUD will waive its pricey Initial Insurance Premium, saving the applicant up to $12,510 in initial costs.” 

Pepe did not mention whether HUD will be waiving or reducing the ongoing Mortgage Insurance Premium, so I’m guessing it won’t be.
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