Although you may feel alone in your care-taking efforts, be assured that you are not. Many people are in your same situation and we at the Paton Law Firm, LLC have been helping clients through this difficult period for decades. Feel free to contact us and let us know how we can help you.
Ten Tips When Caring for a Parent or Other Loved One
It is always difficult when your parent, spouse, aunt, uncle, sibling, or other loved one becomes ill or aged. Below are ten helpful tips to help you prepare for, and even avoid, a bad situation.
(1) UPDATED AND VALID ESTATE PLANNING DOCUMENTS
It is imperative that you review and confirm that your loved one has a valid Will, Living Will, and Power of Attorney. These are especially important in light of recent privacy laws, health insurance policies, and multiple marriages.
(a) Will: A will ensures that a person’s assets are distributed pursuant to his/her wishes. Titling of assets can affect the Will’s distribution (see #2 below).
(b) Living Will: A Living Will ensures that a person’s wishes regarding life sustaining treatment are known and effected.
(c) Power of Attorney: A Power of Attorney (“POA”) appoints an Agent to handle financial affairs, medical decisions, tax planning, Medicaid planning, etc. It must allow for unlimited gifting for Tax and Medicaid Planning. Under the privacy laws, doctors are not allowed to speak to anybody but the patient unless there is a valid POA.
It is important to review your loved one’s assets. Often a loved one may change the title of assets for convenience. Mom may change a bank account to “Mom and daughter.” Technically, Mom has “gifted” this bank account to her daughter regardless of what the Will says. This does not protect Mom from Estate Taxes or in the event of a Medicaid application.
Further, knowing all assets will help solve potential cash flow problems. Frequently, people live only on income. This may not be enough, so assets must be liquidated or mortgaged. There are many opportunities to create cash flow, but there are certain consequences to be considered, including tax implications.
(3) MEDICAID PLANNING
Many people gift their assets in order to qualify for Medicaid. There is a 5 year “look-back” for assets gifted. Under the right facts, there are exceptions and there is no look-back period. A prepaid funeral will help spend down your loved one’s assets.
Sometimes gifting is not recommended. A thorough review of assets, facts, and gifting opportunities can confirm the best plan, the tax consequences, and whether the look-back period can be avoided all together.
(4) LONG TERM CARE INSURANCE
This policy will pay the expenses of a home health aide, nursing home, or assisted living facility. However, you must purchase the policy before your loved one becomes “uninsurable.” You can keep the expense down by changing the elimination period, coverage period, and daily benefit amount. Further, the premiums can be tax deductible and you may qualify for additional discounts.
(5) LIFE INSURANCE
Proper planning with life insurance can provide funds to dependent family members, save taxes, allow for Medicaid eligibility, and be a source of additional cash for your loved ones.
As people get older, they easily forget to make payments, critical when the payment is for insurance (health, long term care, homeowner’s, car, life insurance, etc.). All insurance policies should provide that you will be notified thirty (30) days before coverage lapses, so you can make payment.
It is important to gather as much information as possible about your loved one (name of attorney and other advisors, location of insurance policies, tax returns, and any other important information). Then keep this information handy—in a drawer, file cabinet, or safe deposit box. If your loved one gets sick, you will need to act quickly; you will not have time to search for this information.
(8) FUNERAL PLANS
This is difficult to discuss, but very important. Today, there are many options when making funeral arrangements. As such, you and your sibling(s) may have different ideas of what funeral arrangements your loved one wanted, causing unnecessary family strife. Your loved one should write his/her wishes to avoid conflict. Alternatively, your loved one may prefer to have a pre-paid funeral plan.
(9) MEDICARE PRESCRIPTION CARD
Currently, there is a Medicare Prescription Card that provides discounts on prescription drugs. There are a variety of these plans, and they differ based upon your loved one’s medication. Most chain pharmacies (CVS, Rite Aid) have their own plan. The cards cost up to $30.00. You can call 1-800-MEDICARE to help analyze the plans.
(10) NEW TECHNOLOGY
Technology may help alleviate your concerns about a loved one living alone. You can place cameras throughout your loved one’s home and check in on him/her from your personal computer. With proper planning, this won’t be too intrusive and will provide comfort to all parties.
There are sneakers with GPS for a loved one who wanders. More information is available at www.gpsshoe.com.
Lifelinesys.com has a system to detect a fall and initiate a call to 911.
There are also systems for medication management. See https://www.lifelinesys.com/content/medication-dispensing-service for more information.