Building Legacies that Last Estate Planning and Elder Law

Social Security Can Be Fixed

MP900390083 (1) People who are opposed to the Social Security system claim that it is about to go broke and disappear soon. That is not true.

Social Security opponents and opponents of government spending in general, like to make the claim that Social Security is going to go broke or bankrupt. They then normally use this piece of information to get people to support cuts to Social Security benefits or increases to the age of retirement.

They are using  recent government reporst as ammunition to suggest that if something is not done, then Social Security will go broke in 2022. The problem is the claim is not true, as Forbes discusses in "Fake News: Why Social Security Isn't Going Broke."

Social Security currently takes in more money every year than it pays out in benefits. That has created a surplus in the Social Security Trust Fund. What will happen in 2022 is that, due to demographic changes, Social Security will start paying out more than it takes in. However, since there is a surplus, current benefits will not have to change. The surplus can be spent down. It will not run out until 2034. When that happens, Social Security will not disappear. Instead benefits will be cut slightly, as the program will only be able to pay out as much money as it takes in.

This means is that politicians have a lot of time to fix Social Security, if they are willing to do so. They do not need to raise the retirement age or cut benefits. They can also fix things by increasing funding for the program.

Reference: Forbes (June 18, 2018) "Fake News: Why Social Security Isn't Going Broke."

 

Estate Sale Gone Awry

MP900202201Estate sales are increasingly popular ways to get rid of unwanted items of personal property from an estate. One Colorado woman recently learned just how eager people can be to get a good deal.

Mary Andrews, a resident of Longmont CO, recently had an extremely bad day. She had a garage sale but did not manage to sell everything she had on offer.  However, that is not unusual.

Before Andrews cleaned up all the leftover items from her lawn, she left her house without locking her door. When she came home later, she found a lot of people inside her home taking everything that was not nailed down.

Why? An estate sale was supposed to be held two doors down from Andrews. People mistakenly believed that hers was the house for the estate sale. Furthermore, these people mistakenly believed that everything left over, which included the items in her house, were all left over and free for anyone who wanted them.

The police filed a report on the incident.  However, they have closed the case due to the lack of suspects. Fox News reported on this incident in "Colorado house ransacked after estate sale mix-up."

The good news here is that people who are having estate sales can expect very enthusiastic buyers, even if they are not giving the items away for free. Estate sales have proven to be a great way for heirs to dispose of property they do not want. Buyers are so enthusiastic that many elderly people are having estate sales, while they are still alive as a way to downsize before moving to a smaller, more manageable home.

Reference: Fox News (March 28, 2018) "Colorado house ransacked after estate sale mix-up."

 

Planning After You Retire

Happy-old-coupleAfter you retire, you should continue to make plans so that you will be ready in case anything happens.

Everyone knows that it takes a lot of planning to retire properly. You must make sure that all of your finances are in order. You also should make sure that you have completed everything you need to receive Social Security benefits, when you want to start them and to enroll for Medicare.

It might be tempting to stop planning after retirement.  However, there is still some planning left to do, as the Wills, Trusts & Estates Prof Blog explained in "Post-Retirement Planning: A Checklist for Seniors."

Retirees need to plan for emergencies and the possibility of no longer being able to handle their own affairs. They need a general durable power of attorney, a health care power of attorney and a living will.

Fortunately, those documents are easy to get from elder law attorneys. However, just getting those documents is not quite enough.

If something happens to a retired person, the people designated to help immediately need to be able to step into their roles. That means all the information necessary for them needs to be gathered into one place.  This information includes a list of financial, investment and digital accounts. It also means that the legal documents need to be stored in the same place. Finally, a trusted friend or family member should be told where to find everything, if needed.

Talk to an elder law attorney, if you have questions about what you need to do to plan after you retire.

Reference: Wills, Trusts & Estates Prof Blog (March 20, 2018) "Post-Retirement Planning: A Checklist for Seniors."

 

Elder Fraud Charges Brought

MP900202201[1]Federal law enforcement officials have announced actions against hundreds of scammers accused of defrauding the elderly.

One of the worst aspects of elder fraud is that it often seems like there is very little that can be done about the fraud. After a scammer has taken advantage of an elderly person, it is difficult for the elderly person to recover any lost money. Local law enforcement and elder law attorneys are sympathetic, but they are often unable to help very much.

This might lead some people to think there is little reason to even bother reporting minor incidents of elder fraud. Nothing could be further from the truth, as the recent FBI announcement explains. It is titled "Law Enforcement Action Aimed at Those Who Victimize Senior Citizens."

Federal law enforcement officials working with other agencies have announced massive actions taken against the perpetrators of elderly fraud. In fact, 250 people have been charged.

It is believed that those charged were responsible for victimizing 1 million elderly persons at a cost of approximately $600 million. This action comes on top of 200 cases filed against individuals for elder fraud issues last year.

It is important to report fraud against the elderly. Each report helps federal authorities develop these big cases that will eventually put the scammers out of business.

Reference: FBI (Feb. 22, 2018) "Law Enforcement Action Aimed at Those Who Victimize Senior Citizens."

 

Hospital Discharge Planning

Bigstock-Doctor-with-female-patient-21258332[1]Before a Medicare patient can be discharged from the hospital, there must be a plan in place for any needed continual care. Patients and their families should double check some information in that plan.

When Medicare patients are ready to leave a hospital after an extended stay, they often are not ready to go home and resume their normal lives. They might need to be transferred to another facility, such as a nursing home or a rehabilitation center. It depends on the needs of the specific patient being discharged.

Medicare requires that a plan for care be developed with a social worker who can help the patient understand the plan. Just taking the word of the social worker about what options are available, is not always advisable as the Pittsburgh Post-Gazette points out in "Doublecheck when they say the rehab center doesn't have room."

Patients are sometimes told that their preferred facilities for care after being discharged from the hospital do not have room for them. Sometimes that is true, but it is not always true.

Hospitals that have financial interests in other facilities, all too often try to steer patients into those facilities and away from others. For that reason, it is a good idea for patients and families to call facilities for themselves to ask about availability.

If you think a hospital is not doing what Medicare requires it to do, then it is a good idea to contact an elder law attorney.

Reference: Pittsburgh Post-Gazette (Feb. 26, 2018) "Doublecheck when they say the rehab center doesn't have room."

 

Common Elder Scams

MP900387640Some scams against the elderly are well-known.  Nevertheless, they continue to work.

People who seek to scam the elderly out of money are not always very subtle about it. Not every scammer is patient enough to slowly get to know an elderly person and then con them out of their money. Some scams used against the elderly are demanding.

A common one is for an unknown person to call a grandparent and tell him or her that a grandchild is in trouble and needs cash wired immediately. The trouble normally consists of a problem with the police, where bail money is needed.

Another common scam the Minneapolis Star Tribune points out in "As senior population grows, so do scams targeting their money," is for a voice message to be left on an elderly person's phone claiming to be from the IRS. The elderly person is instructed to call a number right away for their last chance to settle a problem with the IRS by sending money.

Those schemes might seem like obvious scams to most people, but they continue to work on many of the elderly. The scammers seek to take advantage of the elderly person's diminished capacity and by demanding the money right away, the victim does not have the time to think through the request or ask anyone else about.

These and other scams against the elderly are unfortunately increasing. Elderly people should be aware of them and never agree to send money over the phone to someone, until they discuss the matter with someone else.

Reference: Minneapolis Star Tribune (Feb. 16, 2018) "As senior population grows, so do scams targeting their money."

 

Dealing with Scams

Bigstock-Elder-Couple-With-Bills-3557267[1]Scams conducted against the elderly are far too frequent and difficult to prevent. However, there are some steps you can take if you or an elderly loved one has been scammed.

Along with the growth of America's elderly population, has come a less welcome population growth.

The number of scammers.

This unwelcome “population” has increased, as unscrupulous people seek to make easy money by duping the elderly.

There are many types of scams that target the elderly, ranging from large ones meant to make millions to very small scams meant to cheat an elderly person out of a few hundred dollars.

The smaller ones can be very difficult to prevent because they often consist of someone calling the elderly and pretending to be someone else, such as a charity or a debt collector.

These callers lie and sweet talk their way into getting the elderly victim's bank or credit card information.

If you know someone who has been a victim of such a scam recently, there are some things that you can do as My San Antonio discusses in "How to handle a scam against elderly parent."

The first thing that needs to be done is to contact the financial institution and make sure it is aware of the scam.

The institution can even block the transaction, if it is not too late.

The local police should be called as well to make sure the crime is reported.

It is also a good idea to contact an elder law attorney to ask for legal advice, if needed to get any money back.

When the elderly are scammed, it is not always possible to get their money back.  However, by making a few phones calls, you can make it more likely.

Reference: My San Antonio (Jan. 12, 2018) "How to handle a scam against elderly parent."

 

Will Inheritances Become a Thing of the Past?

MP900439346[1]In wealthy countries aging populations and the increasing costs of caring for the elderly are putting in jeopardy the entire idea of inheritances for large percentages of the population.

One of the key ways that people in the U.S. have been able to stay in the middle class and slowly build up some wealth between generations is through inheritances. Receiving even a small inheritance from parents, especially if it includes real estate, allows families to build up some wealth. That wealth can, in turn, be left as inheritances for their children.

Even if people are not consciously aware of this, they seem to know it intuitively judging by their actions and their estate planning. In wealthy countries, that idea is in jeopardy of becoming a distant memory for middle class families as the Financial Times explains in "Opinion Today: The end of inheritance."

The article is about the situation in the U.K., but the issues in the U.S. are the same.

The overall population is aging. The elderly are living much longer than in previous years. This increases the cost of providing care for the elderly population. There are not enough younger people paying taxes to make up for the increasing costs.

When political leaders have proposed addressing the issue, they have been punished by voters, who do not want changes to the elder benefits they have been promised.

At some point, the issue does need to be addressed.

If governments cannot afford to meet elder care expenses, then the costs will fall on individual families.  It is likely that there is nothing left over for many middle-class parents to bequeath to their children.

Reference: Financial Times (Dec. 23, 2017) "Opinion Today: The end of inheritance."

 

Americans Have Dim View of Life in a Nursing Home

Many in survey would choose death over moving to a nursing home. Pexels-photo-209224 (1)

A new survey reveals that 61% of Americans would rather pass away than go to a nursing home, according to Financial Advisor in "Older Americans Would Rather Die Than Live In a Nursing Home."

This creates a lot of potential challenges for stakeholders.

It is an issue for elderly people who might have no choice but to go to a nursing home.

It also creates challenges for family members who act as caregivers for the elderly, since they will want to be even more careful than usual when it is time to suggest that a loved one needs nursing home care.

It also creates a problem for nursing homes, since they need to look for ways to improve their reputation.

That could mean that they need to offer more care which costs money, which would be a challenge to nursing homes and the government.

Reference: Financial Advisor (Dec. 20, 2017) "Older Americans Would Rather Die Than Live In a Nursing Home."

 

Being Under Observation in the Hospital

Bigstock-Doctor-with-female-patient-21258332[1]Many elderly people face gigantic medical bills for hospital stays because of how they are classified by the hospital. This makes a big difference in how much Medicare will pay.

When an elderly person has an extended stay in the hospital, they are almost always under the impression that Medicare will cover most of the costs. However, many stay in the hospital for weeks and only later discover that they are responsible for most of the costs of their stay.

This is because Medicare is very particular about when it will pay for hospital costs.

For Medicare to pick up the bill, the patient must be classified as an inpatient. This means that the patient has been formally admitted to the hospital.

If the patient is an outpatient, Medicare will not pay and those patients who are in the hospital "under observation" are still considered to be outpatients, no matter how long they are actually in the hospital.

The story is picked up by The New York Times in "Under 'Observation' Some Hospital Patients Face Big Bills."

Elder law advocates have long pointed out that the rule is absurd.

The patient does not always get to choose what the hospital writes down in the file. The patient also does not always know the importance of being formally admitted, instead of just being under observation.

There has never been a way for the patients to challenge their designations later, until now.

A judge in Connecticut has recently opened the door for legal challenges.

Reference: New York Times (Sep. 1, 2017) "Under 'Observation' Some Hospital Patients Face Big Bills."