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Questions and Answers

Topics

Assisted Living — Finding the money to pay for it
Caregiving — Finding the money to pay for care
Long-term care — Paying for facility-based care
Long-term care insurance — Should I buy it?
Medicaid — How to qualify
Medicare — How to enroll

Assisted Living — Finding the money to pay for it

Q. Although assisted living sounds like the answer for my 87 year old Mother having a very difficult time living alone, she only has social security as her ONLY source of income. She, of course, has Medicare and Medicaid, which I understand is quite useless in this situation. She has always made me promise that she would not be put in a nursing home environment; but the assisted living sounds like the answer for her situation other than very little income. Is there any solution?

A. Your mother's situation is a tough one, but she might have some viable alternatives to a Medicaid nursing home, at least for the short term.

Many seniors own non-income-producing assets that can be converted into a stream of income. Usually, their largest asset in this category is their home. If she does own her home, your mother could take advantage of that asset in 2 ways.

First, she could take out a reverse mortgage. Instead of paying a monthly mortgage payment to a lender, the lender would pay your mother a monthly payment for as long as she continues to live in her home. This additional income could allow your mother to hire a home health aide to provide the assistance she needs to stay in her own home. You can find more information about reverse mortgages at AARP's Webplace | Reverse Mortgages: A Guide for Consumers.

Second, your mother could sell her home. To produce an income, she could (1) gradually spend the money she receives, (2) buy a CD with the proceeds and take the interest out as additional income each month, or (3) purchase an immediate annuity to provide additional income each month. This additional income might then be used in 2 different ways:

She could move in with you and use the additional income (plus the savings from her household expenses that she doesn't have any more since she sold her home) to hire home health aides when you are not able to provide the assistance she needs.

She might be able to move into an assisted living facility for awhile, thereby delaying her move into a Medicaid nursing home.

For more information, I suggest that you go to our page, "Can You Afford Long-Term Care?"

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Caregiving — Finding the money for care

Q. I have always donated to the Alzheimers Foundation, and now that my husband, who is 91, has the beginnings of Alzheimers, I was wondering if there is a grant or some financial aid for me to help pay for the nurses aides I need, as I can't do it all by myself — I get exhausted and depressed.

A. The best place to start is Benefits CheckUp, a Web site created by The National Council on the Aging, a non-profit organization.

Millions of older adults are eligible for federal and state benefits, but are not receiving them, including assistance to pay Part B premiums for Medicare benefits. This is unfortunate because these programs can help with housing, meals, transportation, health care, prescription drug costs, legal services and utility bills, just to name a few.

Benefits CheckUp helps older adults quickly and easily find out which benefits they qualify for, and how to get them (many are available regardless of income). This is a free service and is completely confidential. It does not require your name, address, phone number, Social Security number, or any other information that could be used to identify you.

Simply complete the online questionnaire. In a few minutes, you'll have a list of programs for which you or your loved one most likely qualifies, including phone numbers and addresses. It also includes step-by-step instructions on how to apply for the benefits.

To visit Benefits CheckUp, click here.

Another valuable resource is the Eldercare Locator, a free nationwide directory assistance service. It helps older people and their caregivers find local support services that enable aging Americans to remain independent in their own homes. As of now, this information is available only through their toll-free telephone number 1-800-677-1116, between 8AM and 9PM weekdays, Eastern Time.

You could also call your local chapter of AARP. Explain your situation to their volunteers; while they probably won't be able to help financially, they may be able to assist you in other ways. You might also want to investigate the volunteer organizations we list in our Web site. Simply click on Volunteer Organizations.

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Long-term care — Paying for facility-based care

Q. If a parent has some CDs in their name and their children's name, will an Assisted Living or Nursing Home take all their earnings? Is this the case even though the monies are in three names including our mother's? Can they apply for Medicare or Medicaid for these Assisted Living and Nursing facilities?

A. The answer to your first 2 questions is NO, unless you or your parent has assigned the CDs' earnings to the assisted living facility or nursing home.

Unfortunately, Medicare and Medicaid pay nothing for assisted living. Medicare does pay some nursing home expenses, but only if the patient is recovering and requires skilled care following a hospitalization. Medicaid can pay for nursing home care if your mother is impoverished, but that may not be the case if she owns CDs. And, Medicaid doesn't care if just her name is on a CD or if her children's names are on it also. In fact, if your mother's financial affairs are not set up properly, Medicaid may try to recover the cost of her nursing home stay from her estate, or even from you, after she passes away.

You can find more information about who pays for long-term care on our page, "Can You Afford Long-Term Care?"

I also recommend that you discuss your mother's situation with an attorney who specializes in elder law. There's a link to the National Academy of Elder Law Attorneys in the Legal Issues page in our Web site. Once at their home page, there's a link in the upper left corner that will help you locate an elder law attorney.

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Long-term care insurance — Should I buy it?

Q. I'm trying to decide on whether to buy long term insurance or not. Assuming no assets when I get ill, will I get the same level of care (facility and nursing) whether I have insurance or if I am on Medicaid?

A. Medicaid reduces your options to just one — living in poverty in a Medicaid nursing home with at least one roommate (no privacy). Medicaid rarely pays for care in your home, in a community setting, or in an assisted living facility. If local nursing homes are full, you have to go wherever a bed is available, even if it is hours away from your family and friends. While no one really knows how this affects people with advanced Alzheimer's or senility, it can be devastating for an elderly person who is very frail but still mentally alert. So, if you're thinking about spending down your assets to qualify for Medicaid, our advice is very simple — don't do it.

On the other hand, a good long-term care insurance policy can give you numerous options. Depending on the level of your needs (and your financial situation at the time), these options can include care in your own home, living in an assisted living facility, or moving into a better nursing home near your friends and family. When you purchase a long-term care insurance policy, we strongly recommend that you add an inflation rider to automatically increase benefits 5% per year, compounded annually (that just about equals the inflation rate of long-term care over the past 10 years). This will help assure that your policy can pay for these options when you eventually need them.

For more information, we recommend that you review our page, "Can You Afford Long-Term Care?" It will lead you to a worksheet that can help you determine how much long-term care insurance to purchase.

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Medicaid — How to qualify

Q. Please give me some information on how to get my parents on Title 19 [Medicaid]. My father really needs help. He had a stroke in Dec. 99. My Mom and I take care of him and both of us are really unable to lift and take care of him.

A. Eligibility for Medicaid varies by state. You'll need to contact your State Health Insurance Assistance Program (SHIP) or your state's Medicaid office for more information. The telephone number(s) should be in the blue pages of your phone book.

Depending on your parent's financial situation, it may not be necessary for your mother to go on Medicaid even if your father does. But, I'm not an attorney. I recommend that you discuss their situation with an attorney who specializes in elder law. There's a link to the National Academy of Elder Law Attorneys in the Legal Issues page in our Web site. Once at their home page, there's a link in the upper left corner that will help you locate an elder law attorney.

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Medicare — How to enroll

Q. I will be turning 65 in Nov. and would like to know who to contact, and what I have to do to enroll in Medicare. Thank you.

A. Like most government activities, nothing is as straightforward as we would like it to be. That includes enrolling in Medicare. For example, you must first determine which of 4 categories you fall into. But, enrolling is not that hard. The best place to start is Medicare itself. Simply click on Medicare - How do I enroll.

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