Is a retirement community
right for you?
A CCRC (short for “continuing care retirement community”) is a senior community where residents move between levels of care as they age.
This means residents start living independently in their own apartment while taking advantage of the various recreational, dining, social and educational opportunities the community has to offer.
As the aging process creates a need for more care, residents will transfer to assisted living and ultimately to skilled nursing or memory support.
Many seniors find it appealing to settle into a community that guarantees a lifelong place to live, even as their care requirements change. But before making the decision, it’s important to consider a few things.
First, though costs vary based on the amount of care provided, the size of the unit and geographic location, CCRCs can be very pricey, costing more than a lot of individuals with moderate income or assets can afford.
For example, entry fees can range from $30,000 to upwards of $1 million and monthly charges can run between $300 and $5,000.
Seniors often use proceeds from selling their home to pay for a CCRC, but there could be tax consequences, since the IRS doesn’t permit people to take gains from selling their home and roll them directly into a CCRC unit.
Medicaid eligibility is another consideration. Residents typically put their entry fees in an escrow account, which used to be excluded from their countable assets for Medicaid eligibility purposes.
But since 2006, these are considered countable resources if, among other things, the fee is refundable should the resident die or leave the community or if the entrance fee does not confer an ownership interest.
Because of fine print like this and complicated fee structures that differ between CCRCs, it’s a good idea to review your contract with an elder law attorney before signing.
One more thing to consider is whether the CCRC has policies that deny residents access to certain amenities or activities or segregates residents altogether when they move to a higher level of care.
For example, a woman in Alabama was banned from bingo games when she moved to her facility’s nursing unit while rehabbing from back surgery, even though she easily could have attended the games with a motorized scooter.
Meanwhile, a CCRC in Norfolk, Virginia, abruptly declared a popular waterfront dining room off-limits to those in assisted living and nursing units, resulting in longtime friends and even married couples not being able to eat together.
Media attention brought about reversals in both cases, and some believe that these policies violate the Americans with Disabilities Act. But even if they don’t, these are the types of things you should ask about and discuss with an elder planning lawyer when deciding whether to move into a particular community.
Is your loved one being unduly influenced?
“Undue influence” is a legal term that refers to a vulnerable person, such as an older or ill individual, being influenced by someone else into doing something that doesn’t reflect their actual wishes. For seniors, this often comes in the form of someone manipulating a senior into signing a will or coercing them into giving someone control over their financial affairs.
In order to prove undue influence, you need to show that the victim was susceptible because of a physical disability, physical dependency and/or mental or psychological condition. You also need to prove that the person exploiting them had an opportunity to assert their influence, that they actually did so and that they received some sort of benefit under suspicious circumstances.
Signs of undue influence include a senior becoming isolated from friends and family; signatures on documents looking different from past signatures; sudden and unexpected purchases or withdrawals of cash; and/or an unexpected or unrelated person suddenly speaking on the senior’s behalf.
If you have an older relative who exhibits any such signs, it would be a good idea to examine their finances, will and other estate planning documents and to get in touch with an elder law or estate planning attorney to help you determine the next steps you need to take. These can be challenging cases to prove, but the sooner undue influence is detected, the easier it is to address.
What you should know
This summer, President Joe Biden signed into law the Inflation Reduction Act (IRA). In addition to measures to address climate change, generate revenue and boost U.S. manufacturing, the law includes provisions that some have described as a “game changer” for millions of American seniors on Medicare who have been dealing with soaring drug costs.
First, the law caps how much seniors on Medicare can be forced to pay out of pocket each year on medication and vaccines. Starting in 2025, out-of-pocket spending on prescriptions will be limited to $2,000 per year.
Seniors should also feel some relief in 2024, a transition year where costs will be capped at Medicare’s catastrophic drug limit (currently $7,050).
Given that medication for conditions like rheumatoid arthritis, cancer and multiple sclerosis can generate out-of-pocket costs of more than $10,000 per year, the savings should be significant. Meanwhile, vaccines will be free beginning in 2023.
Additionally, beginning in 2024, an estimated half-million more Medicare beneficiaries will be eligible for low-income subsidies to help pay for prescription drugs because the IRA raises the income limit for eligibility from 135 percent of the federal poverty level to 150 percent.
Meanwhile, diabetes patients are keenly aware that the price of insulin has skyrocketed over the past decade. But starting in 2023, the IRA will cap Medicare recipients’ insulin co-pays at $35 a month, which should result in significant savings.
Finally, the IRA has targeted drug prices themselves by allowing Medicare to negotiate prices for certain medications. This, however, does not take effect until 2026, when Medicare will be able to negotiate the pricing for the 10 drugs it spent the most on the year before.
That list will expand to 20 drugs by 2029 and economists estimate that costs of such drugs will be cut between 40 and 70 percent as a result — savings that should be passed along to patients.
Nursing homes suing friends and families
to collect on bills
A recent trend has emerged where nursing homes are attempting to collect on their residents’ unpaid bills by pursuing friends and relatives, even those who have no financial ties to the residents or legal responsibility for them.
Monroe County, New York, home to the city of Rochester, provides a snapshot of this practice. According to reports, 24 nursing homes filed nearly 250 debt collection suits in court between 2018 and 2021, the vast majority of which targeted a friend or relative of the resident. Many of the suits involve aggressive tactics, including baseless accusations of people of hiding residents’ assets. Further, many of the targets had no financial or legal authority to act on the resident’s behalf or pay their bills.
How did this happen? It’s common for a relative or friend to sign admissions papers on behalf of an older relative or sick friend, and sometimes those documents include a clause designating whoever signs as a “responsible party” to help the facility collect payments. This practice is arguably illegal, since federal regulations prohibit homes from requiring a resident’s family or friends to guarantee the resident’s debts, but in some instances people agree to pay to avoid the stress and expense of going to court.
If a nursing home is coming after you for the debt of a friend or family member, you should speak with an attorney experienced with elder law issues. And if you’re thinking of signing anything on behalf of someone close to you, run it by an elder lawyer first.
Identity theft is the illegal use of someone else’s personal information — such as name, Social Security number, driver’s license number or bank or credit card information — to make purchases, borrow money, open a cellphone account or get a credit card.
While anyone can fall victim to identity theft, senior citizens can be particularly vulnerable. That’s because more people, such as home health care workers, nurses, family members and other service providers they tend to rely on for assistance, may have access to personal information that can be put to nefarious use.
A number of states, including, most recently, New York, have officially made identity theft a form of elder abuse and are dedicating resources to combat it. But it’s still important to take steps or help seniors close to you take steps to prevent it.
For example, it’s a bad idea to carry your Social Security card. It’s also risky to carry around your Medicare card if it’s an older one with your SSN listed on it. Instead seniors should make a photocopy to carry around, using a permanent marker to black out the first five digits. Similarly, don’t carry your checkbook around — just have the number of checks that you need.
Make sure all personal documents with sensitive information are kept in a safe, secure, locked place and put any such documents — particularly financial documents — through a shredder before throwing them away. Don’t respond to unsolicited emails requesting information, register with the Do Not Call list to deter telemarketers, and monitor and review your credit report on a regular basis.
If you or someone you know does fall victim to identity thieves, be sure to place a fraud alert on all credit reports, close any accounts that you suspect were compromised or fraudulently opened, and file a police report.
Medicare Advantage ‘risk adjustment’
may affect care
Unlike traditional Medicare, which runs on a fee-for-service arrangement, the Medicare Advantage program pays participating private health plans a flat fee every month to provide whatever care a patient needs based on their age, gender, geography and risk factors that impact their health.
To cover patients with expensive conditions like diabetes, heart disease and cancer, Medicare provides a higher monthly payment using a “risk adjustment” for each such condition. So the unhealthier the patient, the more the plan takes in.
Unfortunately, this has created an incentive for unscrupulous healthcare companies to game the system by adding codes to patients’ medical records for conditions that either have been resolved or do not currently impact the patients’ health.
For instance, in one of the examples that was part of a lawsuit the government brought against Sutter Health in California, the company added thyroid cancer to a patient’s record as a current condition even though the patient had been cancer-free for years. This way, Sutter got an inflated monthly payment from Medicare without providing treatment. In fact, some large health systems have engaged in sophisticated data-mining to scour health histories of thousands of Medicare Advantage patients in search of past conditions to add to current records, bringing in millions of dollars in inflated payments as a result.
So what does this mean for you? If you are a Medicare Advantage patient, it means your record may portray you as being sicker than you actually are. This could cause you to be stigmatized as being obese or mentally ill, or create a false picture that can influence how doctors decide to treat you. If you suspect that your health record or that of a loved one contains exaggerated or outdated diagnoses, you should discuss your options with an attorney.
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