Reverse Mortgages–Part 4

Resources

· AARP - has an excellent section dedicated to reverse mortgages, including a reverse mortgage calculator then can give you an idea before you apply of how much money you might be able to take out of your home.

http://www.aarp.org/money/credit-loans-debt/reverse_mortgages/

· The National Center for Home Equity Conversions - has greater detail, and many supplemental materials.

http://www.reverse.org./

· The names of FHA insured lenders can be requested from the Federal National Mortgage Associations (800) 7-FANNIE (Fannie Mae)

· The attorneys at Cohen and Oalican would be pleased to assist you in evaluating all of your financial options, including Reverse Mortgages.

http://www.cohenoalican.com

Reverse Mortgages–Part 3

Reverse Mortgage Pro's

• Fast access to your equity.
• The mortgage is typically not paid until you die.
• Proceeds can be used for in-home care if you do not qualify for, or cannot get adequate in-home care, keeping you out of a nursing home for as long as possible.
• If you have great need for the cash flow from a reverse mortgage, and preserving your estate for your heirs is not the primary objective of your financial plan, this can be an effective way of supplementing your cash flow.

Reverse Mortgage Con's

High Closing costs.

· Closing costs for Reverse Mortgages can be as much as double what is charged for a conventional mortgage.

Potential impact on eligibility for government benefits.

· Reverse mortgage payments are not typically counted as income, if the proceeds are spent in the month they are received. If the proceeds from the reverse mortgage however are not spent and accumulate in a bank account, they could push you over the allowable limits for Medicaid of SSI. Certain states may also consider the proceeds to be income, even though it is your own equity, as you receive a monthly check.

Spending your children's inheritance.

· If you are trying to preserve your estate for your heirs, the mortgage will be paid off through your estate. Your inheritors can receive the difference, however, between what you owe on the reverse mortgage and what the home actually sells for if there is an excess.

Moving Out.

· Under certain circumstances, if you end up moving to a nursing home, it could be construed as having “permanently moved out”, as there may be a presumption that an elderly person leaving their home for a nursing home would not be returning. If this were the case, it could force the sale of the home.

to be continued…

Reverse Mortgages–Part 1

Introduction to Reverse Mortgages from an eldercare perspective.

Elders often struggle to find the resources to stay out of nursing homes, and stay in their home, but still need in-home care. A reverse mortgage can be used to help make that happen.

Medicaid can be used to pay for nursing home care, but stay at home care can be difficult under Medicaid.

A reverse mortgage is not a panacea and should be evaluated with the help of an elder care attorney or elder care financial advisor.

What is a reverse mortgage?

A reverse mortgage is a loan designed specifically for elders (62 years of age or older) to take money out of their home either in payments, in a lump sum, as a credit line, or as any combination of the three.

Repayment of a Reverse Mortgage

A Reverse mortgage is a LOAN, and that loan has to be repaid.

The loans do not have to be repaid until any of the following 3 events occur.

1. the last surviving borrower dies.

2. the home is sold.

3. the borrower moves out permanently.

What is the purpose of the Reverse Mortgage?

One must never forget that the first purpose of any financial instrument, is to make money for the lender.

The intention or motivation for a reverse mortgage was to give seniors that were real estate rich, but cash flow disadvantaged, fast and easy access to the equity in their home for any purpose, including home based elder care.

 

to be continued….

Elder Abuse, a growing crisis without leadership–Part 3 of 3

 

So who is responsible?  The Administration on Aging & Health and Human Services are supposed to be providing the leadership services to put this problem in the spotlight where it can get the resources it needs to support our seniors.  The Elder Justice Act of 2009 makes grants available to states for Adult Protective Services Programs.  The Act also puts forward the means of creating, and implementing national priorities.  The Act, however, does not speak to national Elder Abuse Studies.

The report recommends that no less than The Secretary of Health and Human Services should determine the importance of providing Adult Protective Services with dedicated resources, and work with the Attorney General to create and deploy a national Adult Protective Services database so that the true measure of this problem is understood.

It is our firm’s hope that once properly understood, and the real depth of elder abuse comes to light, and thereby appropriate resources will be finally granted to the states to stop this horrible crime.

The report does seem to point to a need for better information, better cooperation, and better standards.  However what the elder community needs is real support.

With big government’s seeming paralysis to act on almost 50 years of “good intent” the need for legal representation, specializing in Elder Law is very obviously paramount.  While the firm of Cohen & Oalican deplores the need for protection for the elderly, the rising tide of abuse, in share numbers and sophistication makes it obvious that qualified legal counsel needs to be retained to help protect our more vulnerable population. 

Please, if you are a victim of abuse, don’t hide it, seek out help from law enforcement, and with an attorney.   If you haven’t been a victim of elder abuse, engage the services of an elder law firm to help you in decisions where you might be vulnerable.

 

Abuse and neglect should be important to all of us. Contact the elder law offices of Cohen & Oalican to talk to us. A loved one in your life may be the victim of nursing home abuse and neglect. An attorney can help you understand the law and what to do next

Top 10 Most Important Cuts to MassHealth for Seniors, the Disabled, and their Families

 

Introduction

We at Cohen & Oalican feel it is incumbent on us to keep our Elder, and disadvantaged client base abreast of the changes to our state’s Medicaid program, MassHealth in these economically challenging times.

As a result of the recession, politics, changing demographics, and many other factors, there have been some significant cuts to MassHealth, and other Health Reform programs.

Our job is not to comment on politics or right and wrong, but to help our clients who require services to get those services, without compromising their economic status. A large part of this is navigating MassHealth. Appropriate elder law attorney representation is a tremendous safeguard, our advice is to always PREPARE while you or your loved ones are healthy, not REACT. When you are in need of either, please feel free to contact us.

Briefly, Fiscal Year 2011 has seen an increase of less than 3% in funding, at a time when more demands are being placed on the Medicaid system, with healthcare cost inflation (depending on who is doing the estimates) is running anywhere between 5% and 8%. This means that funding, while it has increased, is not keeping up with healthcare inflation, at a time when overall demand on the fund is increasing due to the pure economics of more and more baby boomers retiring, and more and more younger people entering the Medicaid/MassHealth system due to unemployment from the recession.

to continue…

Alzheimer’s and Dementia Part 2

 

According to the law firm of Cohen and Oalican, elder law attorneys in Boston, MA, there are 5 specific conversations adult children should have with their parents as soon as the opportunity presents itself. They comprise the following:

1. Long-term care preferences

Would your parents prefer nursing home, long term care, or in-home care if there had to be a choice?  If they prefer a long term care or nursing home facility, what amenities and activities are important to them? Asking these questions early can smooth the moving to an assisted living facility or a home-health care program far simpler should the need ever present..

2. Legal Documentation

What good is a living will if no-one knows where to find it?  It is critical that you know what legal documentation your parents have before incapacity occurs. This includes making sure their parents have a power of attorney, health care directive and HIPAA forms so someone can easily step in to make financial or medical decisions on their behalf.  In absence of this documentation, the family can be forced into petitioning a court for control over their parents.  This can be expensive, time consuming, and may not result in what your aging parent wanted with their lives.

3. Medical Preferences and Wishes

Please discover what type of, and how much care your aging parents want as soon as possible after their initial diagnosis of Alzheimer’s or Dementia. Understand their desires about life support and  other end-of life medical treatments. Who do they want to make these decisions for them if and when they can’t?  This will help your parents' security in knowing that their desires in this area will be carried out, despite the family trauma that enfolds itself around Alzheimer’s and Dementia.

to be continued….

Alternatives to Nursing Homes as Nursing Home Populations Swell With Younger Patients - Part 2

 

One of the main reasons cited for this movement of younger people into nursing homes are the budget cuts most states face in Medicare and Medicaid.  In the long term, it is more cost efficient to care for a younger person in their home with part time caretakers.  However, in the short term, this is a more expensive way of treating patients, as the caregivers need to be hired and trained.  In the budget crunch most states are experiencing, short term funding takes priority over long term spending.   Younger people are being moved into nursing homes earlier, as in the short term, this is a more economically viable way of treating them.

According to a study by the AARP Public Policy Institute, the cost of at home care is about a third the cost of providing care in a nursing home or institution.  Many states, however, simply do not have the funding for at home care in their Medicaid programs.

One of the most telling quotes about the movement of younger people to nursing homes is:

“Over the past 20 years, federal laws and policies have established a civil right to get long-term care at home. But NPR's investigation found that is only sporadically enforced.

More than 60 percent of what states spend on long-term care for the elderly and disabled goes to pay for people — like Michelle Fridley — to live in a nursing home. The amount spent on home-based care has grown steadily, but not nearly enough to meet the need. Nationwide, there are some 400,000 people on state waiting lists for home-based care, double the number 10 years ago.”

Frequently attorney’s like our firm, that specialize in caring for the elderly, and those that have long term care needs, must be engaged to support a patient’s right to at home care.  In 1999, the right to at home care was clearly established in the Supreme Court, in the “Olmstead Case”.   In that decision, the Supreme Court stated that the unnecessary institutionalization of people with disabilities is  a form of discrimination.

 

To be continued…

Alternatives to Nursing Homes as Nursing Home Populations Swell With Younger Patients - Part 1

We heard the other day on National Public Radio, that one of the fastest growing populations in Nursing Homes is not the elderly, but rather adults   aged 31 TO 64.

These patients that are victims of disease, accident, health failure, or mental health problems.  Many of these new patients could be cared for at home, or assisted living facilities, but are instead finding themselves in the Nursing Home System.  Young people aged 31 to 64 are the single fastest growing population of nursing homes.  This population has grown roughly 40% since 2000.

This report underscores the fundamental need for legal advocacy when considering nursing home care, or alternatives to nursing home care.

You can see the full report here.

http://www.npr.org/2010/12/09/131912529/a-new-nursing-home-population-the-young

 

All too often, people think of nursing homes as a repository for the elderly, and disability attorneys like Cohen and Oalican as being entirely elder law.  There is a huge sense of accomplishment for us, however, when  we can use our skills and help young people, and their families, to live a fulfilling life, perhaps outside of institutional care, and despite their disadvantages.  We have long been involved in special needs trusts to help protect family’s finances when there is a young (or younger) family member with special needs.

 

To be continued….

Preview of the Proposed New Tax Relief Act of 2010 - Part 3

 

 

Once again.. this is a preview of what is currently under discussion.  It is NOT law, and should not be looked at as political, legal, or financial advice.  This is only  a brief look at some of the currently debated act, as it impacts our senior clientele.

 

Estate Tax
Top on the list for most of our elder law clients, is preserving their estate.  Below are the changes, verbatim, on what we may expect to see in tax relief in Estate Taxes.

Temporary Estate Tax Relief
Temporary estate, gift and generation skipping transfer tax relief. The EGTRRA phased-out the estate and generation-skipping transfer taxes so that they were fully repealed in 2010, and lowered the gift tax rate to 35 percent and increased the gift tax exemption to $1 million for 2010. The proposal sets the exemption at $5 million per person and $10 million per couple and a top tax rate of 35 percent for the estate, gift, and generation skipping transfer taxes for two years, through 2012. The exemption amount is indexed beginning in 2012. The proposal is effective January 1, 2010, but allows an election to choose no estate tax and modified carryover basis for estates arising on or after January 1, 2010 and before January 1, 2011. The proposal sets a $5 million generation-skipping transfer tax exemption and zero percent rate for the 2010 year. 5 of 12

Conservation Gifts & Capital Gains
For those clients considering the philanthropic disposition of property for purposes  of conservation, the following is being contemplated.

Extension of provision encouraging contributions of capital gain real property for conservation purposes. The bill extends for two years (through 2011) the increased contribution limits and carry forward period for contributions of appreciated real property (including partial interests in real property) for conservation purposes.

 

To be continued…

 

Your friends at…

Cohen & Oalican, LLP

Boston Elder Law Attorneys
Raynham Elder Law Attorneys
Andover Elder Law Attorneys

Preview of the Proposed New Tax Relief Act of 2010 - Part 1

 

 

There’s a lot of talk about the New Tax Relief Act of 2010. 

At the time of this writing, it isn’t law, and with our current political logjam, there is likely to be a fair bit of change between now and then. 

We thought, however, that our clients would like to hear some of the elements that are of most direct interest to their welfare, and to the health of their estate.

Once again.. this is a preview of what is currently under discussion.  It is NOT law, and should not be looked at as political, legal, or financial advice.  This is only  a brief look at some of the currently debated act, as it impacts our senior clientele.

Reductions in Individual Income Tax Rates

Under contemplation is to temporarily extend the 10% bracket. The 10% individual income tax bracket expires at the end of 2010, and this impacts a great deal of our elder law clients. If nothing happens, the lowest tax rate will be 15%. This proposal extends the 10% individual income tax bracket for an additional two years, through 2012.

 

Part 2 will look at the proposed changes to Capital Gains and Dividends as well as The Dependant Care Credit.

 

Your friends at…

Cohen & Oalican, LLP

Boston ElderLaw Attorneys
Raynham ElderLaw Attorneys
Andover ElderLaw Attorneys

Scams and our elderly clients

• Unlicensed contractors offering home repairs: "Hey, we just finished a job for the smiths two streets over, and there's leftover tile, would you like a great deal on....."  If it sounds too good to be true, it probably is.  Beware of home repair scams.   Look out for transient work crews, strangers claiming to have extra material, free inspections in your home.. All of these should be red flags.  You should look to licensed bonded and insured professionals.  It may feel more expensive at the outset than these street contractors that show up.. but nothing is more expensive than a botched job, or worse, paying and never seeing your money or the work again.  Shop around for a certified contractor insist on a detailed contract on the work to be done, estimated cost and timetable.

• The state of Massachusetts Executive Office of Elder Affairs should be notified of any scam, or scam attempt by calling 1-800-243-4636.

If you have been victimized, keeping quiet will not help the next victim in line.  Just last month (October 20/2010) in Ipswitch an elderly citizen was approached by someone saying that they were the recipient of funds from the federal government, and asked to provide personal information in order to claim his windfall.  The man intelligently informed local police, and the scammer was investigated and arrested.  We applaud this anonymous individual.  Our elders cannot be a doormat waiting for the next scam artist to come knocking. 

If you are subjected to a scam, contact local authorities, and your elder law attorney.

 

At Cohen & Olican we take pride in protecting our clients.

Scams and our elderly clients.

Our elder law firm, Cohen & Olican LLP, works hard to protect the rights and assets of our elderly and handicapped clients.  When we champion your rights, it is totally upsetting to us to see our clients preyed on by unscrupulous con artists. 

So, in this article, we are going to do our best to alert you to some of the more common scams, and how to protect yourself.  Of course, should you fall victim to one of these scam artist, turning to professional law enforcement, and your elder law attorney is far more important than protecting yourself from embarrassment.  Acting against these scam artists is the only way to protect the next victim.

You've hear the adage "If it sounds to good to be true......"   Well, frankly, more often than not, it is too good to be true.   Yet still the vulnerable are constantly preyed on by con men and women, leaving financial devastation in their wake.

 

Tomorrow we will present some of the most common scams you should be on the look out for.

How to Protect Your Home if You Are Admitted to a Nursing Home - Part 3

Medicaid Lien

There is also the distinct possibility of Medicaid putting a lien on your home to compensate for the expenditure on your treatment. If you sell your home while still living, the lien would have to be satisfied by reimbursing the state for the amount spent on your medical care. The only cases where you can claim exemption from this rule is when a spouse, or a minor, disabled or blind child, or a sibling with equity share in the property, is living in your home.

Recovery of Estate

As stated earlier, only if a spouse, a minor, blind, or disabled child, or a sibling with a share in the property inhabit the house, can you be exempted from the state claiming it as recompense for your Medicaid expenses of your nursing home treatment. If the spouse of dependent family member move out or dies, the state can again try to claim the property.

There are some situations however, when the value of a home or property can be protected against recovery by Medicaid. These are:

• If you or your spouse owned the home as tenants by the entirety.
• If the house is in the name of your spouse and you have given up your interest in it.
• If the house is in the name of an irrevocable trust.
• If any family member is eligible as a ‘care-taker child’.’ This is applicable when a daughter/son looked after you prior to your admittance to a nursing home and has no other place to live in. The person can then avoid a Medicaid claim on the house after your demise.

It is advisable to have a detailed discussion with an attorney regarding this ‘care-taker child exception’ and whether it can be applicable for any family member in your case. Considering the many legalities and other policy matters involved, the attorney can guide and help you to protect and retain your home and property, against all claims by the state and Medicaid.

For further information visit Cohen & Oalican,LLP Boston Elder Law and Estate Planning Attorneys, Also serving Andover and Raynham Massachusetts