PATTI'S BLOG

The Internal Revenue Service (IRS) is increasing the amount taxpayers can deduct from their 2013 taxes as a result of buying long-term care insurance.

Premiums for “qualified” long-term care insurance policies (see explanation below) are tax deductible to the extent that they, along with other unreimbursed medical expenses (including Medicare premiums), exceed 7.5 percent of the insured’s adjusted gross income. This threshold is rising to 10 percent on January 1, 2013, although it will remain at 7.5 percent for taxpayers 65 and older through 2016.

Just like with most things in life, salt is best in moderation. Salt has been around for thousands of years and has served multiple purposes from being a means to preserve meats to adding flavor to a dish. But did you know that too much salt can create health problems including high blood pressure and heart disease? It is not just the french fries or the potato chips that we have to watch out for, but items that are packadged and heavy card-based.  On National Eating Healthy Day, the American Heart Association developed a list of six items that we should be mindful of consuming because of their above average levels of sodium. Please click the link to find out what are the 'Salty Six'.

Each year, I make a list of goals that I want to accomplish for the year.  Some years, the goals have a theme – unfortunately, the theme is almost always the same:  lose weight, exercise more…

This year, I’m challenging you to make one of your New Year’s goals to get your estate planning affairs in order.  This is one goal that is easy to accomplish – I promise!

Here are 5 easy steps you can take to accomplish this goal.

1. Get educated about estate planning.  Attend an estate planning workshop or two.

On Friday night, we gathered with neighbors old and new to celebrate a cherished tradition – our annual progressive dinner.  Traditionally, we begin the year.  We find out about the new babies, weddings and graduations to come.  We learn what colleges the children will attend, and where soon-to-be college graduates will start their careers.  We also check in on aging neighbors to find out about their health scares, their difficulties, the loss of their loved ones.  After moving from house to house for salads, and main courses, we end up with more wine and sweet treats to reminisce about dinners past.  How many have we had?  No one can remember.  But by the end of the evening, we’re looking forward to next year’s dinner, and assigning tasks to make it happen.

Continuing this tradition is important to my family and my neighborhood because it allows us to connect with our neighbors, to get to know them when times are good so that we can help each other when times are not so good.  Without our traditional yearly gathering, we might not realize when our neighbors need our help.

In my practice, I see many people who see their aging or ill family members and friends at the holidays and realize that all is not well.  Sometimes, all has not been well for so long that those family members are now in crisis.

If you are visiting family members who are aging or ill, take the time to talk with them to find out about their health.  Are they seeing a doctor?  What medications are they taking?  How do they keep track of their medications on a daily basis?  Ask them if they have a healthcare proxy or advance directive for healthcare?  Who will make healthcare decisions for them if they are not able?

Although it can be difficult to have a conversation with parents about their finances, ask them if they have appointed someone to make financial decisions for them if they are not able.  Look around the house and see if there are stacks of unopened bills.  Find out if they have long-term care insurance.  Ask where their important financial and legal documents can be found.  If they haven’t appointed anyone to make decisions for them, urge them to do that while they still can.

If your aging family members are still driving, ride with them to see if they are still able to drive safely.  Are they stopping at the stop signs?  Do they forget to look before making a turn?  Do they still remember how to get to places they have been to many times before or do they forget where they are going?  If they are having trouble driving, would a driving school help?  Or, can you help them find transportation so they won’t need to drive anymore?

With married couples, try to talk with each one alone.  Sometimes couples get so good at covering for each other, you don’t realize that one of them might be suffering from dementia.  If one of the couple is ailing, find out how the well spouse is coping.  Is he or she eating and sleeping right?  Is he or she getting help in the home so he or she can get out to see friends, or just get some time to rest and recharge?

Look in the refrigerator, freezer and cupboard.  Is the food in the refrigerator or cupboards moldy or out of date?  Are they going to the grocery store on a regular basis?  If you suspect that they are not eating right, is there a meals-on-wheels program that they might qualify for?

I hope that you will enjoy holiday traditions with family, friends, and neighbors this year.  Will you take time to talk with your family and friends to see whether they might need help in the coming year?

Happy Holidays!

Patti Elrod-Hill

Medicare changed things up a bit this year by scheduling open enrollment early.  Because Medicare is in the news, I’ve been getting a lot of calls from clients to ask me about Medicare. While most people understand that they can become eligible for Medicare when they turn 65, they wonder about the types of Medicare plans available, and what plan they should choose.  Today, we’ll talk a little bit about the basics of Medicare, and about how to choose a Medicare Part D prescription drug plan.

Here is the basic Medicare alphabet:

Medicare Part A covers hospital insurance that can help pay for inpatient care at hospitals, skilled nursing facilities, hospice, and home health care.

Combating Autism Reauthorization Act of 2011

You can’t turn on the television or radio without hearing about the negotiations – or lack of negotiations- in Congress regarding the looming budget crisis.  We are all concerned about whether our elected representatives in Washington can come to a compromise that will help the country out of the current debt crisis.  Of great concern to those of us who work with families who have family members with special needs is whether, and how, the few programs left to support these families will be affected.

Assuming Congress gets through these negotiations and gets back to work on other important issues, Congress has the opportunity to address a significant issue that the United States faces today.  That issue is that the number of persons diagnosed as being on the Autism spectrum is increasing at an alarming rate.

 If the last few years have taught us anything, it is that life is not predictable.   The economic crash seemed to come out of nowhere.  The weather appears to be totally weird and unpredictable, with tornadoes and floods occurring with fierce and dangerous intensity.

So, too, our health and physical wellbeing are not entirely predictable.  Despite our best efforts to eat healthy food and exercise regularly, we can have a car accident or suffer a bad reaction to medication and become ill or disabled.

For some of us, our financial resources and health insurance may not be enough to cover our care needs.  When that happens, we sometimes have to seek governmental assistance to provide for our healthcare.

Many of my clients had no idea they would end up depending on Supplemental Security Insurance (SSI) or Medicaid for assistance, but those progams can be a lifeline for those with disabilities and longterm care needs.

How can we plan for our loved ones and family members who are on governmental assistance programs?  How can we provide for their needs without jeopardizing their public benefits programs?

One way is to establish a special needs trust for the benefit of the person with a disability.  A special – or supplemental needs trust, as I’ll call it- is an entity established to hold assets so that those assets are available for  the needs of the person with a disability that are not provided by the governmental benefit.  The person with the disability is not the trustee, does not own the assets, and cannot control the assets, so the assets aren’t counted for purposes of qualifying for benefits.

SSI and Medicaid generally restrict the recipient of those programs from having more than about $2,000 in assets, but the assets in the trust aren’t calculated in that $2,000.  Most of the time, the trust is established by a parent or grandparent, but If the assets did not belong to the person with a disability to begin with, anyone can establish the supplemental needs trust and anyone can contribute assets to that trust.  The trust can be the recipient of gifts or inheritance.

We’ve discussed how to choose a trustee in previous blogposts,

http://bit.ly/rfPKWc  but for a supplemental needs trust I usually recommend appointing a professional trustee to manage the assets in the trust.  The intricacies of public benefits programs can be daunting for most people, so even though they charge for the management,  professionals with experience with supplemental needs trusts can save money in the long run.

So, even though life seems unpredictable, you can at least plan for some of the supplemental needs of your loved one with a disability.

 When Bridget came to visit, she wanted to take my blue and white teacups home with her.  They were shiny and pretty, and fit in her hand just perfectly.  Dick promised they would go to the mall and buy some teacups just like them.

Bridget was in the mid to late stages of Alzheimer’s disease when she and Dick first visited my office.  Dick, a wonderful, patient husband and caregiver to Bridget, was determined to be prepared for whatever legal and financial zingers might hit the couple.  Years before, after Bridget was first diagnosed with Cognitive Memory Impairment, Dick and Bridget had prepared living trusts, powers of attorneys, and healthcare directives.  They came to me to make a few changes to Dick’s living trust and financial power of attorney.   I always recommend that clients update advance directives and powers of attorney to avoid having someone decide that the documents are “stale” and, therefore, not valid.  We prepared new advance directives for Bridget and Dick.  On the day Bridget came to sign, she could not remember that the children whom she had nominated as agents were adults.  In fact, I’m really not sure she could remember who her children were.

With sadness, I told Dick that Bridget could not sign any documents that day.  We agreed to try another day, since those with dementia often have times when they are very alert, and other times when they are not.  Bridget never was able to sign her new advance directive, and soon went to stay in a wonderful memory care facility.   The health care and financial proxies she had already signed worked fine for her, and Dick was able to make her healthcare and financial decisions without any challenges.

Susan, on the other hand, had never executed advance directives for healthcare, financial powers of attorney, or any wills or trusts.  She didn’t think she needed to, since her husband made most of the financial decisions for the couple.  Her family did not push her to do any planning, since they thought it would upset her.  When I visited Susan at the nursing home after her husband died, she told me the nurses were stealing her underwear, she no longer recognized her family members, and she wondered why I was visiting her at work.   Susan swore like a sailor, and insisted that she would not sign “any g. . d. . . papers”, believing that I was trying to steal from her, too.

As a result, her family had to spend months and thousands of dollars to seek guardianship and conservatorship of Susan, a court proceeding which is expensive financially and emotionally for all involved. 

Many folks with Alzheimer’s and other dementias become paranoid and distrustful.  When they hit that stage, it is extremely difficult to get them to agree to do advance directives, financial powers of attorney, or wills.  Why would they agree to sign something that they believe allows folks to steal from them?

As an attorney, I preach that every adult needs to have an advance directive for healthcare, a financial power of attorney, and at least a basic will.   In Susan’s case, her fear of planning led to heartache and hardship for her family.   Could all of this expense and difficulty have been avoided by visiting an attorney’s office while Susan was able to plan for her and her family’s future?

As a footnote, I want to tell you all about Dick, Richard J. Farrell, whom I mentioned above.  Dick has written a book Alzheimer’s Caregiving about his life with Bridget, joys and trials of caregiving, and about his grief when Bridget died after living with Alzheimer’s for nearly 20 years.  Check out his website at www.alzheimerscaregivingbook.com to see how you can order a copy.

Sometimes bad things happen right under our noses, and we don’t want to – or can’t – see.  Elder abuse is like that – we can’t – or don’t want to admit that we see it.

June 15^th was Elder Abuse Day, a day intended to draw our attention to a problem that is often ignored. The term “elder abuse” is often in the news, but what exactly is elder abuse?

The World Health Organization defines elder abuse as “a single, or repeated act, or lack of appropriate action, occurring within any relationship where there is an expectation of trust which causes harm or distress to an older person.”

Elder abuse is not confined to the poor.

Once I convinced my client, Mary, that a trust is a safe, and not so scary, way to protect herself and her stuff during any incapacity, she wanted to know who could possibly serve as a backup trustee?   According to Mary, her daughter was a kind and loving person who would do everything she could to support her mother, but her daughter’s financial skills were somewhat suspect.  Mary’s son is a busy family man with a great job, but he seems too busy to help Mary now.

Who could she choose? 

First, what does a trustee do exactly?  A trustee is a fiduciary, which means that he or she has a legal or ethical duty regarding the management of property for another.  Although a trustee may have either the duty to manage the trust assets or the duty to distribute those assets, many trustees both manage and distribute.  A trustee is usually responsible for investing the assets in the trust, distributing those assets to the beneficiaries according to the trust terms, and making sure any required accountings are prepared and that taxes are paid when necessary.