Understanding Your Long-Term Care Options

"Mom had a fall." I'd come to dread the four words uttered on the other end of the phone, but there they were. Again. Mom had just recovered from her most recent fall last summer when she'd fractured a vertebrae, and I thought things were getting better.

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I found myself lurched back into the reality of the moment. My mother needed to explore options for assistance. It's a conversation that I'd tried to start a hundred times before but just couldn't figure out how to do it. I was suddenly faced with the need to make a life-changing decision. But first, I had to know: what were my Mom's options for assistance?

This concern is shared by millions of seniors, adult children, friends and neighbors, around the world. It isn't a simple problem. The answers involve complex financial, emotional, physical and spiritual considerations, but there are many ways to get an older adult the help they need. When you boil down the choices though, there are really three routes to take:

• Provide assistance within the senior's home, allowing them to remain in their own house.
• Create a place for them to stay in your home (or a relative's).
• Find an alternative residence or care facility, for example, a Residential Care Facility (RCF), or a Skilled Nursing Facility (SNF).

How Do I Make a Choice About Care?

I certainly wasn't the only person whose parent had experienced a bad fall. Every year, the need to make long-term care decisions is precipitated by a fall, an illness, Alzheimer's or Dementia, or the sudden death of an older adult's spouse. Suddenly, you're trying to make a complex decision in the midst of a very stressful event. It's really important to have the tools and questions in mind to think through this difficult and personal decision. Below is a list of questions that can help clarify your own values and beliefs:

1. Consider Staying at Home

Most seniors will tell you that their first choice is to stay at home. They're comfortable in their spaces. They have many memories and it feels safe, even if in reality it isn't what it used to be. To give up their home feels like they are giving up a large part of who they are. It can be a difficult conversation, but I've found that you need to act as a sounding board to help your parents think through their realistic needs and assess what's feasible.

• What level of care is required?
• Is non-medical assistance needed (such as shopping, cooking, paying bills and the like)?
• Do they need help ensuring that medications are not forgotten?
• Is help required with activities of daily living?
• How many hours a day is the care required?
• How much will it cost? Will paying these costs reduce or eliminate other choices later on?
• Is reliable help available?
• Are you able to check that the hired help is not abusing your parent?
• Is the home safe for an older adult? If not, can it be modified to be safe?
• Are railings available for the full length of all staircases?
• Are supports available in the shower or tub?
• Are there gas appliances that must be lit?
• Is there a way to summon help if the parent falls and is unable to move?
• How often will you personally be able to visit?
• What are the demands on your time due to work and other family obligations? (For example, would you be taking time away from other family members or your job to spend hours traveling each weekend to visit?)

2. Consider Moving Senior into Your Home

• Can your parent be left alone and for how long?
• What changes will need to be made to your home to make it safe for a senior?
• Who else lives in your home and how will they be impacted? (e.g. Are there children living at home? How old are they?)
• What will you do if the person becomes ill or simply needs to go to the doctor?
• Are you and your spouse in COMPLETE agreement?
• Are you also in agreement on sharing the responsibilities?
• Have you researched what the role of caregiver can mean in your life? There are lots of resources online that can help connect you with other caregivers and deal with the inevitable stress (and also share its benefits).
• How do you feel about having part-time help come into your home?
• Have you investigated the options for senior daycare?
• What are the options if you want to go away for a weekend?

3. Consider Moving Senior into a Care Facility

• Are the financial resources available for this option?
• How far away is the facility from you? Should you relocate the senior, geographically, so that you can more easily visit?
• Are you prepared for enormous initial resistance? This is a big change for a senior.
• Have you thoroughly researched what's available?
• Have you thought about the possible need to move among facilities with differing levels of care? (For example, eventually a parent might need to move from assisted living to a nursing home).
• If funds are available, but limited, have you learned how the facilities address Medicaid?
• Will the facility accept a client coming in on Medicaid or will they demand an initial paid period? Facilities are becoming increasingly inventive about ways to finance the cost of care. Care costs money. Include this fact in your planning. Ask, don't assume.
• Don't assume that government funded facilities will be horrible (or that private facilities will be wonderful). Visit them and decide for yourself.

There can be advantages and disadvantages to all three of the options, depending on the situations of both you and and your parent. Taking the time to prepare and educate yourself now can make it a lot easier to deal with that dreaded phone call, should it ever come. You'll be glad you did.


http://seniorcare.homeinstead.com/long-term-care-options/

Should You Pay a Relative to Take Care of Mom?

Should You Pay a Relative to Take Care of Mom?

Growing numbers of families are compensating relatives who serve as caregivers to elders. But to avoid exacerbating tensions, it is important to disclose such arrangements to the entire family.

According to a report by the National Alliance for Caregiving and AARP, 43.5 million Americans looked after a friend or relative age 50 or older in 2009, 28% more than in 2004. In a survey conducted for Home Instead Senior Care, a home-care franchiser, nearly 7% of respondents said they receive compensation for providing care to a relative.

Jeffrey Bloom, an elder-law attorney in Boston, says the number of such cases in his practice has quadrupled since before the recession. "I have several clients with adult children who are out of work," he says. "Rather than pay someone else for care, many hire the child."

Feeding the trend: the high unemployment rate, the rising cost of nursing-home care, an aging population and a 2006 change in Medicaid law that makes it harder for people who wish to qualify to give away assets. (Individuals are subject to strict limits, which vary by state, on the value of their assets in order to qualify for Medicaid benefits.)

When caregivers make financial sacrifices, elder-law attorneys say, it is often appropriate to compensate them. Some 37% of caregivers surveyed by the NAC in 2007 said they had quit a job or reduced their hours to accommodate their responsibilities.

There are several ways to compensate a family caregiver. Attorneys say many families pay an hourly wage. As an estate-planning tactic, others opt for annual gifts or a lump-sum payment designed to cover services over an extended period. Some arrange for the caregiver to receive a larger inheritance.

Which option makes the most sense will depend on factors such as the caregiver's desire for income now versus later and the care recipient's estate-planning goals. Families also must consider tax consequences. And if a parent may need to rely on Medicaid to cover future nursing-home costs, it is important to pay the caregiver in a way that is permitted under Medicaid law.

Regardless of the method selected, elder-law attorneys urge clients to disclose these arrangements to the whole family. When revealed after the fact, compensation agreements can create suspicions that result in family conflicts or even estate litigation, says Howard Krooks, an elder-law attorney who practices in Boca Raton, Fla., and Rye Brook, N.Y. (To find an elder-law attorney familiar with your state's rules, go towww.elderlawanswers.com or www.naela.org.)

Under federal law, when annual compensation exceeds $1,700, an employer and employee each owe federal payroll taxes of 6.2% for Social Security and 1.45% for Medicare. The employer must generally also pay 6.2% on the first $7,000 in wages in federal and state unemployment tax, says Melissa Labant, a CPA with the American Institute of Certified Public Accountants. (For more information, see IRS Publication 926, "Household Employer's Tax Guide.")

In many cases, people employing someone 40 hours or more a week also are required to contribute to state workers' compensation insurance pools.

Some families prefer to give caregivers tax-free gifts in lieu of compensation. Current law allows people to give up to $13,000 a year to anyone, which also may reduce the amount of a taxable estate. While each person also is permitted to give away an additional $1 million over his lifetime, such gifts reduce the amount a donor can ultimately shelter from the estate tax.

Particularly in situations where a care recipient may eventually need to rely on Medicaid, attorneys say it is important to draft a written agreement—often called a "personal care contract"—that documents the caregiver's responsibilities and hours and sets a rate of pay in line with that of local service providers.

Under such a contract, Anne Stone, 51, received $420 a week for providing 21 hours of care to her wheelchair-bound father, William Stone, 81, from October 2008 until last February, when he entered a nursing home. Ms. Stone says the payments made up for some of the income she lost when caregiving responsibilities forced her to take time away from the doggie-day-care business she operates in Sudbury, Mass.

"I was taking so much time off from work that we had to turn business away," she says.

The payments had an unanticipated benefit: They also helped Mr. Stone deplete his savings so he could qualify for Medicaid. Without the employment contract, Medicaid would have considered all of the payments to Ms. Stone a gift made to hide assets, subjecting Mr. Stone to delays in coverage, says Mr. Bloom, the Stones' attorney. To pass muster with Medicaid, he says, it is important to have such a contract in place before the services are rendered.

Rather than issue regular paychecks, some families opt to pay caregivers an upfront lump sum, typically calculated by multiplying the caregiver's hourly wage by the number of hours he or she is expected to work over a parent's life expectancy. With such a move, a family can transfer assets to a child that Medicaid might otherwise deem available to pay a nursing home.

Still, in some states, says Mr. Krooks, lump-sum payments can trigger delays in Medicaid coverage.

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