Moving to a Care Community? Check the Fine Print
Group Of Senior Couples Enjoying Meal Together In an Assisted Living Facility

Moving to a Care Community? Check the Fine Print

Reading the fine print when purchasing a home in a retirement community or a care community is intimidating. The typeface is tiny, you’ve got boxes to pack and movers to schedule and, well, you know the rest. What most people do, is hope for the best and sign. However, that can lead to trouble, advises Delco Times in the article “Planning Ahead: Moving to a care community? Read the agreement.”

If you don’t want to read the fine print or can’t make head or tails of what you are reading, one option is to ask your estate planning attorney to do so. Without someone reading through and understanding the contract, you and your family may be in for some unpleasant surprises. Here are some things to consider.

What kind of a community are you moving into? If you are moving to a Continuing Care or Assisted Living Community, your documents will probably have provisions regarding health insurance, entry fees, deposits, a schedule of costs, if you need additional services, fees for moving to a higher level of care and provisions for refunds and estate planning.

When you enter an long-term care facility, nursing home, or Assisted Living facility, you may find yourself signing documents regarding everything from laundry policies, pharmacy choices, financial disclosures and statements of your rights as a resident. Not every document you sign will be critical, but you should understand everything you sign.

If moving into a nursing home that accepts Medicaid, you and your family need to know that nursing homes that accept Medicaid are not permitted to demand payment on admission from either an adult child or a power of attorney from their own funds. However, Pennsylvania does have support provisions regarding children, that are called “filial responsibility.” This should not be a problem, as long as you speak with an elder law attorney who can make sure you have completed the Medicaid application correctly and are in full compliance with all of the requirements.

If your adult children ask you to sign documents and “don’t worry” about what documents are, you may want to sit down with an experienced elder law attorney to review the documents. When someone is not trained to review these documents, they won’t know what red flags to look for.

If someone signs the document who is not the applicant/future resident, that person may become responsible for the costs, depending upon what role you have when you sign: are you a guarantor or indemnitor? That person typically agrees to pay after the applicant/resident’s funds are exhausted. The payments may have to come from their own funds. Sometimes the “responsible party” is simply the person who handles business matters on the applicant’s behalf. You’ll want to be sure that the person signing the papers understands what they are agreeing to.

Almost all agreements will say that the applicant, or the person receiving services, is responsible for payment from their own assets. However, if someone signing the documents is power of attorney, they need to be mindful of what they are signing up for.

If possible, the person who will receive services should be the one who signs any paperwork, but only after a thorough review from an experienced attorney.

Reference: Delco Times (Feb. 5, 20-19) “Planning Ahead: Moving to a care community? Read the agreement”

How Do I Prepare my Parents for Alzheimer’s?
Concerned aged mother and adult daughter discuss updating their estate planning documents and explore their options with regards to Alzheimer's

How Do I Prepare my Parents for Alzheimer’s?

Can your mom just sell her house, despite her diagnosis of Alzheimer’s?

The (Bryan TX) Eagle reports in the recent article “MENTAL CLARITY: Shining a light on the capacity to sign Texas documents” that the concept of “mental capacity” is complicated. There’s considerable confusion about incapacity. The article explains that different legal documents have a different degree of required capacity. The bar for signing a Power of Attorney, a Warranty Deed, a Contract, a Divorce Decree, or a Settlement Agreement is a little lower than for signing a Will. The individual signing legal documents must be capable of understanding and appreciating what he or she is signing, as well as the effect of the document.

The answer the question of whether the mom can sign the deed to her house over to the buyer.  is likely “yes.” She must understand that she’s selling her house, and that, once the document is signed, the house will belong to someone else. A terminal diagnosis or a neurodegenerative disease doesn’t automatically mean that an individual can’t sign legal documents. A case-by-case assessment is required to see if the document will be valid.

The fact that a person is unable to write his or her name doesn’t mean they lack capacity. If a senior can’t sign her name (possibly due to tremors or neurodegeneration), she can sign with an “X”. She could place her hand on top of someone else’s and allow the other person to sign her name. If this is completed before witnesses and the notary, that would be legal.

A hard part of Alzheimer’s is that a person’s mental clarity can come and go. Capacity can be fluid in the progress of a neurodegenerative or other terminal disease. Because of this, the best time to sign critical documents is sooner rather than later. No one can say the “window of capacity” will remain open for a certain amount of time.

Some signs should prompt you to move more quickly. These include things like the following:

  • Short-term memory loss;
  • Personality changes (e.g., unusual anger);
  • Confusing up or forgetting common-usage words and names; and
  • Disorientation and changes in depth perception.

Any of the signs above could be caused by Alzheimer’s, dementia, or many other problems. Talk to your, or your parent’s, physician and an elder law attorney. He or she can discuss the options, document your parent’s legal capacity, and get the right documents drafted quickly. Your elder law attorney can also give you information about planning for long term care options to consider and can help you understand the costs associated with long term care. 

Who Will Pay for Your Nursing Home Care?

It’s hard for everyone in the family, when a beloved parent or grandparent must enter a nursing home, because they can no longer live on their own. Often the result of a physical or mental decline, the difficultly is compounded by worries about how to pay for the care, reports The Ledger in the article “The Law: Are you eligible for Medicaid nursing home coverage?”

Once health insurance coverage ends, the cost of care becomes enormous, with the monthly cost for a private-pay resident at nursing homes often exceeding $10,000 a month. What usually happens? Residents can’t afford the care and only have two options: qualify for Medicaid Nursing Home coverage, or sell every asset they can, impoverish the spouse, and ask adult children or other family members for help. Most people contact an elder law attorney and explore becoming eligible for Medicaid Nursing Home coverage.

Let’s use the state of Florida for an example of how to qualify for this coverage. A person must pass a three-part test that examines their assets, income and health, at the time the application is filed.

Income. As of Jan. 1, 2019, you could have a maximum of $2,313 per month in income (before deductions) to be eligible for Medicaid Nursing Home coverage. If your income was above that number, then legal planning is necessary to create a qualified income trust. Timing is extremely important, because if the trust is not set up correctly or in a timely fashion, you will not qualify for Medicaid.

There is a common mistake made about a spouse’s income being too high. It’s happily not true: a spouse’s income can be unlimited, and it does not impact a Medicaid applicant’s eligibility for benefits.

Assets. As of Jan. 1, 2019, you may have a maximum of $2,000 of countable assets and be eligible for Medicaid Nursing Home coverage. If the assets are above that threshold, there are a number of acceptable legal options to help the individual become eligible. There are two types of asset classes to consider when applying for Medicaid Nursing Home coverage: countable and non-countable.

Some non-countable assets are as follows: In Florida, homestead property up to $585,000 in value, one automobile, a prepaid burial contract and term life insurance without a cash value. Countable assets include bank accounts, investment accounts, life insurance with cash value, CDs and annuities.

As of Jan. 1, 2019, a spouse may have a maximum of $126,420 of countable assets, without having an impact on their spouses’ Medicaid eligibility.

An elder law attorney should be consulted to help the family understand the income and asset tests and create a strategy to help the individual qualify, if they anticipate needing Medicaid Nursing Home coverage. It’s best to do this well in advance, if possible.

ReferenceThe Ledger (Jan. 9, 2019) “The Law: Are you eligible for Medicaid nursing home coverage?”