Elder/Adult Dependent Care

Financial/Legal Concerns and Care Insurance

Financial and Legal Concerns
As Americans age, more people are going to need long-term care. In fact, the fear is that people are going to outlive their assets. Whether or not this fear is justified, it is always smart to do as much advance planning as possible, especially to secure a legal and financial foundation that is in place if and when a crisis does hit.

What catches most caregiving families unprepared is the fact that most of the ravages of old age are not covered by Medicare or other forms of health insurance. A new legal field has grown up recently to help families negotiate the complex labyrinth of legal and financial planning for elder care. These elder law services include setting up living trusts, wills and probate management, estate planning, advance directives, Medi-Cal planning, investigation into financial abuse, and conservatorship or guardianship.

Some of the documents you should consider are:

" Advance directives. " These are the most common legal documents that attorneys recommend to families. They include:

A durable power of attorney. This is a legal document that gives another person the right to act on your elder's behalf financially if he or she becomes temporarily or permanently incapacitated. Otherwise, a family member may have to go to court to obtain conservatorship or guardianship, which is time consuming and expensive, and strips the elder of rights.
A durable power of attorney for health care. This is a document that allows your elder to name another person to carry out preferences in treatment (or no treatment) should he or she become unable to communicate or make decisions, especially at the end of life. This document also explains how decisions are to be made.
A will or living trust. If there is a will, the estate will go through probate, a court procedure that determines how assets will be distributed. Trusts are agreements that determine how assets will be managed in life, and by whom, and how they will be distributed after death. Trusts do not go through probate.

Estate planning means creation and conservation of an estate, post-death estate administration, and disposition and distribution of the estate to beneficiaries. It can also mean deciding who will get property, avoiding probate and reducing taxes if the assets are substantial.

Different states have different laws. Consult an elder law attorney for details. For a local referral, contact the National Academy of Elder Law Attorneys, 1604 N. Country Club Road, Tucson, AZ 85716 (520-881-4005). Their web site is http://www.naela.org

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Legal and Financial Records
You should have the following information on your elders handy, or know where to locate it:

Full legal name
Social Security and Medicare numbers
Date and place of birth
Names and addresses of spouse and children (or location of death certificate if any are deceased)
Location of birth certificate and certificates of marriage, divorce, citizenship, pre-nuptial agreements
Names and addresses of close friends, relatives, doctors, lawyers
Requests, preferences, pre-arrangements for burial instructions, burial plot deed
Copy of military discharge papers, military record
Keys to the house, car, safe deposit box, etc.
Information about house maintenance, contracts, utilities, etc.
Sources of income and assets (pension funds, interest income, savings bonds, etc.)
Property deeds and tax amounts
Health and life insurance policies, names, and numbers (including supplemental health and long-term care insurance)
Household, boat, auto insurance and titles
Names and numbers of policies or accounts for stocks, bonds, Keogh, IRA plans, property (investment income)
Employer/retirement asset information such as profit-sharing, stock options, credit union, ESOP or TRASOP benefits, annuities, medical insurance for surviving spouse
Bank accounts (checking, savings, credit union, IRAs, 401Ks, stocks, bonds, money markets); names, phone numbers, amounts
Copy of most recent income tax return
Liabilities (what is owed to whom, when payments are due)
Mortgages and debts (how and when paid)
Credit card and charge account names and numbers
Names and telephone numbers of financial advisers, brokers, insurance agents, bank officers, and money management services
Estate documents: wills, trusts, powers of attorney, health care proxies

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Long-Term Care Insurance
When considering long-term care insurance, know that premiums are age-related: The longer you wait, the more costly they are. It's a good idea to determine whether the policy is affordable; you need to discuss age, health status, overall retirement objectives, and income. Know, also, that if your elder has Alzheimer's or Parkinson's, for example, or other existing health problems likely to result in the need for long-term care, he or she may not be able to buy a policy. (Consult a financial planner, your local Health Insurance Counseling and Advocacy Program, or local Area Agency on Aging. Call several insurance companies and agencies to compare policies and provisions.)

Some tips on shopping for long-term care insurance:

Is the premium affordable now and in the future?
Is there a clause that will allow benefits to increase along with inflation?
Does the policy cover nursing homes, care in the home, or both? Is there coverage for adult day care or other community services or facilities?
How long a benefit period will your policy cover? Catastrophic events last longer, and have longer benefit periods and higher costs.
What are the death benefits?
Is the policy renewable for life?
Are Alzheimer's disease, senility and other " organically based mental conditions " covered?
Is coverage limited to Medicare-certified nursing homes?
Must you have a hospital stay before entry into a nursing home to get benefits?
Do the premiums go up as you get older?
Is there a grace period for late payment?
What is the deductible? When are benefits payable?
What is the daily benefit rate? How does it compare to actual charges where your elder lives?
Are insurance premiums and benefits tax deductible?

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