Category Archives: Financial Senior Tips

Veteran’s Benefits

Understanding the VA Aide and Attendance Pension

Veterans who have served on active duty during wartime are often unaware that they may be eligible for a VA Aide & Attendance Pension to help with the cost of assisted living, adult daycare, skilled nursing, and home care. A veteran’s surviving spouse may also be eligible for this assistance. The amount of this pension may be up to $1881 to $2230 per month, depending on the veteran’s family size, and the funds are given directly to the veteran or surviving spouse to help pay for his or her care.

The general qualifications include:

  • A veteran must have served on active duty for at least 90 days, with at least one day during wartime.
  • The veteran must have been honorably discharged.
  • The veteran must be at least 65, or officially disabled if younger.
  • A veteran must require help with activities of daily living.
  • A veteran must meet the income and asset guidelines.

There are three levels of VA Pensions: Basic Pension, Aid & Attendance, and Housebound. A veteran must be eligible for the Basic Pension in order to qualify for the Aid & Attendance and Housebound benefits and must have limited income and assets to be eligible. However, the income and asset guidelines are considered quite generous, given that the VA allows veterans to deduct their projected ongoing medical expenses from their income to reduce the amount of their countable income.

For example, if Bill has an income of $32,000 per year, but has assisted-living expenses of $36,000 per year, he would show a deficit and may be eligible for the full pension amount of $1881 per month, for a single person. With these additional funds, he could easily afford to pay for his assisted-living care. While the guidelines are far more complex than outlined in this brief example, it is helpful to see how a veteran could potentially be eligible. There is also an asset limit of $123,600, not including a primary home and vehicle, as well as a look-back period of three years for gifts and items sold.

Assistance is available for veterans interested in learning more about the VA Aide & Attendance Pension or for those interested in applying. Remember, you do not need to have a service-connected disability to be eligible for this pension. The Veteran’s Service Officers are able to assist with this process at 208-235-7890 or more information can be found online at https://www.benefits.va.gov/pension/aid attendance_housebound.asp. You are also welcome to call our office to obtain more information.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

March 2019

Medicaid – Estate Recovery

What to expect when Medicaid pays for your long-term care.

Medicare, which pays for hospital, doctor and medication expenses, does not pay for long-term care. Medicare is an entitlement program that you do not have to pay back. Medicaid funds long-term care services for individuals who meet the qualifying criteria. However, when an individual, 55 years or older, has received Medicaid funds to pay for his or her healthcare, the Department of Health and Welfare, IDHW, is required by federal law to recover the cost of their care through Estate Recovery.

If a married individual, who received Medicaid funds, passes away, IDHW will not make a claim against that person’s estate until the surviving spouse has also passed away. During the surviving spouse’s lifetime, there are no restrictions on how the assets in the estate are used, as long as they are used for the surviving spouse’s benefit, and not given away. In addition, the surviving spouse can continue to live in the house or sell it and make other living arrangements. Whatever is left in the estate when the surviving spouse passes away, is subject to Estate Recovery.

When both spouses have passed away, the Personal Representative of their estate is required to provide written notice of the probate to the Estate Recovery division of IDHW. Estate Recovery is made against real and personal property in the estate. It is also made against property held in a revocable trust or property held in joint tenancy. However, IDHW does not make a claim against the death benefit of a life insurance policy.

There are some exemptions from Estate Recovery. One is, the decedent’s surviving spouse or adult children are allowed to keep any tangible, personal property such as household items, furnishings, automobiles, family heirlooms and personal effects, up to $10,000. Also, if an adult child pays fair market value for any item of property in the estate, they can keep it in the family.

Sometimes, I use this analogy to explain Estate Recovery. When I was in law school, I didn’t have enough money to cover all the expenses, so I took out a student loan. When I graduated, I received a letter from the bank with my loan repayment schedule. Similarly, when a person who received Medicaid “graduates,” or passes away, their estate will receive a claim from Estate Recovery to pay back the money they borrowed to pay for their care.

These are complex laws and regulations. Make sure to speak with someone who has experience in this area before making any decisions.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

January 2019

A Gift for You!

This Booklet helps you know how to be more prepared for the future.

Dear valued client,

We are sending you the attached Booklet entitled “A Senior’s Guide to a Well-Planned Future.” This booklet is designed to help you plan today for a better tomorrow, by putting legal documents in place and communicating your desires to your family. We hope that you find it interesting and informative. You may also view the Booklet or download it from our website listed below.

We believe that life is good, and that we can choose to make it even better.   Having the opportunity to ‘connect’ with you each month through our Senior Tips is enjoyable for us and we hope it has been helpful to you. Often, we receive comments back from you which makes our day! We hope you have a very Merry Christmas, and we look forward to a happy New Year!

Sincerely, Tom Packer, Sandy Packer and Becca Freeburne 

Click here to view & download the booklet

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

December 2018

Social Security Benefits – When a Family Member Dies

How to handle that final check.

We frequently hear from clients after their spouse has passed away, wondering if they have to return the final Social Security benefit paid to their spouse. It can be a confusing process to figure out Social Security rules, but in this case, the guideline is quite simple, although it can feel unfair.

Here are two things to remember:

  • Social Security benefits are paid a month behind. For example, the check you receive in December is November’s benefit.
  • A person must live the entire month to receive the benefits for that month, per Social Security regulations.

For example, if your husband passed away on December 20th, his estate is entitled to keep the Social Security payment that arrived in December. The payment arriving in December is for November’s benefit, since benefits are paid a month behind.

However, his estate is not entitled to keep the December benefits that would be paid in January, since he did not live the full month of December. In fact, if he dies anytime within the month of December, even if he passes away on December 31st, his estate is not entitled to December benefits. Putting it simply, the estate will receive a check from Social Security for the last full month that he lived.

What happens if you receive an extra monthly benefit?

In many cases, the funeral home will report the person’s death to Social Security, but if Social Security was not notified prior to the payment being processed, you may receive an extra payment. If the funds are directly deposited into your bank account, you can contact the bank and request that the funds be returned to Social Security. If you receive a paper check, you should return the check to Social Security and do not cash it. To report a death or to apply for benefits, you can call 1-800-772-1213.

As the surviving spouse or as a minor child, you may be eligible for a one-time death benefit of $255. Some spouses are also entitled to widow or widower benefits, although additional regulations apply. However, knowing at least the basic regulations can help you make some sense in a confusing system! We are here to help if you have additional questions.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

November 2018

Medicaid Myths

Don’t believe everything you hear about Medicaid.

I have had several calls and questions about Medicaid that make it clear that there is a lot of misinformation about Medicaid. Here are some of the questions I fielded this past month:

  1. “Is it true that if I am applying for Medicaid and sell my home, I have to use the proceeds of the sale to pay for my long-term care?” First, youdo nothave to sell your home. Your home does not count toward Medicaid eligibility. If you are a couple, after one spouse qualifies for Medicaid the home can be transferred to the non-Medicaid spouse, who can continue living in the home. If you are single, Medicaid allows you to sign a form that you intend to return home, if possible. This allows you to retain ownership and control of your home. However, Estate Recovery will make a claim against your estate for the costs of your care after you have passed away.

If you decide to sell you your home, Medicaid requires you to spend down your cash assets to $2,000 for a single person or $3,000 for a couple if both are on Medicaid. But the proceeds of the sale can be spent to benefit you personally. For example, you can pay off debts, buy a new car, pay for eye care, prepay funeral expenses, pay for travel, pay for dental and medical expenses not covered by Medicare or Medicaid, or for any other expenditures that benefit you. The proceeds of the sale of your house do not have to be used to pay for your care. One final point, you cannot give your money away. There is a 5-year lookback for any money that is given as a gift.

  1. “Is it true that if I set up a Miller Trust, that I can use the money in the trust to pay medical bills or upgrade my room to a private room?” Youcannotuse the money in a Miller Trust to pay medical bills or upgrade a room. A Miller Trust helps you qualify for Medicaid when your monthly income exceeds the maximum limit allowed by Medicaid, which is $2270 per month in 2018. If your income exceeds that amount, you can use a Miller Trust, to qualify for Medicaid, but the money that goes into the Miller Trust is used to pay for your share of costs at the facility. Any money left in the trust at your death goes back to Medicaid.

Another trust, known as a Special Needs Trust, is a trust set up to supplement the needs of a person who is disabled and receiving Medicaid. If a person has a Special Needs Trust, it can be used to pay medical bills or upgrade a room. Apparently, the person who asked the question was confusing a Miller Trust and Special Needs Trust. These are different trusts that are used in different situations.

  1. One last myth to dispel—If you are married, and only one spouse is going on Medicaid, the well spouse can keep half of the cash assets up to $123,600, and the other spouse can still qualify for Medicaid.

These Medicaid Myths that are passed around can cause you to spend down more cash than you need to. It is important to have accurate information when making decisions about Medicaid. The costs of long-term care represent a significant financial risk. Understanding how Medicaid works will allow you to access government benefits in the least, financially-disruptive manner possible.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

March 2018

Check Investment and Insurance Beneficiaries

Sometimes Probate is required even though you tried to avoid it. 

Draw a circle; consider the circle to represent everything you own—your house, car, recreational vehicles, bank accounts, investments, insurance policies, IRAs, retirement accounts, etc. The property within the circle is known as your estate.

There are many ways property in your estate may be transferred to those you designate. For example, you can sign a Pay-on-Death request with your financial institution making your account payable to one or more payees at your death. You can hold property with someone else as joint property or community property with a right of survivorship, so that upon the death of one party, the property automatically belongs to the surviving party. Additionally, your estate can be probated to transfer your property to the persons designated in your Will.

Sometimes people go to great lengths in their planning to avoid probate. Then, after they have passed away, the family discovers that their loved one designated their Estate as the beneficiary or failed to designate a beneficiary, therefore, the death benefit is paid to the Estate.Insurance companies will not give money to the Estate without an order from the Court. Therefore, the family is frustrated when they find out that after all their loved one’s efforts, a petition for probate will need to be filed and a personal representative appointed to receive the death benefit from the insurance company.

Working with insurance companies can be confusing, frustrating and time consuming; however, when you are doing your estate planning it is wise to review your beneficiary designations on insurance policies and investments to avoid this problem.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

February 2018

Maintaining Financial Boundaries

By setting boundaries, harmony in the family can be preserved.

In my Elder Law practice, I counsel regularly with older adults and their children. Some of their stories and challenges are unique, but some I hear over and over again. When this happens, it seems worth writing a tip about it.

As adults age and start to require assistance in paying bills and making financial decisions, often a well-meaning adult child will come alongside of his or her parents to help them in financial matters. For example, an adult son may start by writing checks and have dad sign them. As mom needs help with the groceries, an adult daughter may pick up a few things for her and pay for mom’s groceries along with her own. Somewhere along the way, boundaries are blurred, and the well-meaning adult child begins to have a sense of ownership and entitlement to dad or mom’s property.

Other times, an adult child, who never really figured things out for himself or herself, starts to rely on mom—her fixed income and limited assets—for his or her support. Moms are especially easy prey in these situations. Their love for their children knows no boundaries, and they sometimes willingly sign over the farm and anything else that may be asked for. Mom’s happiness and even her daily needs are now inextricably tied to her children’s choices concerning her.

The problems that both scenarios create are endless. If the adult son or daughter has paid for things out of their own pocket, they may feel they should be compensated for past purchases or even services provided.

When other siblings learn of financial exploitation of a parent, family relationships are fractured, which is the last thing mom and dad want. Also, Medicaid eligibility, which funds assisted-living care, can be jeopardized if parents have given away their property. Wills can become meaningless, if in the parents’ lifetime they give their property to a child. I could go on, but I think you get the picture.

So, what is the solution? Maintaining good boundaries is essential when helping an aging parent. With regard to finances, maintaining boundaries starts by approaching the task with the attitude that a parent’s property is their sole property and should be used solely for their benefit. That’s not to say that a parent cannot use discretion to purchase gifts for children and grandchildren. But, if the gifts become excessive or lopsided between family members, that can be a red flag, and it can become a breeding ground for trouble and discontent among siblings.

The next step is putting in place an accountability system for the person who is assisting the parent. It can be a simple system of saving receipts for the groceries and writing a check to be reimbursed for the amount of the purchase. A little accounting can go a long way to prevent suspicion or misunderstandings.

The third step in maintaining good boundaries is transparency with other family members. As a family, talk with parents about how they would like to be helped, put a plan in place that is understood by the family, and as the plan is carried out, routinely update family members with information. This way, harmony can be preserved, and parents can have the dignity and respect that they deserve.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

Thomas W. Packer

November 2017

Avoiding Scams and Fraudulent Requests

If someone calls or requests money – Beware!

At times, I have clients come to my office and tell me they have been scammed by mail, phone, or on-line—someone had asked them for money, but it turned out to be fake. These scams often target older adults, and they are becoming increasingly more common.

I know a man who received a call and was told he had won a Cadillac. All he had to do was send $5,000 and the car would be his. He sent the money, but he never saw the car. Later, he received another call from a law firm that said they were representing several individuals who had also been scammed by the person who scammed him. He was told that the law firm would help him recover his money if he would send a retainer to the law firm, which he did. He later found out that the alleged law firm was the same person who had scammed him on the Cadillac.

Recently, in our area, someone claiming to be the IRS called and requested individuals to pay back taxes immediately to avoid a costly court settlement. The IRS has said that they will NEVER contact you by phone about your taxes. Unfortunately, many people fell for this before the scam was exposed.

Remember, anyone asking for money or personal information must be completely vetted to know why they are requesting it. If you are contacted by phone, you simply need to reply that you don’t give that information out over the phone unless you have initiated the call. If you receive a request for your personal information by mail or email, don’t respond to it.

Regrettably, these con-artists get very good at convincing you to act. Remember, they get plenty of practice calling dozens of people a day; finding ways to convince people that they are legit and to send money to them immediately. Always check with a family member, trusted friend or an attorney before sending money or your personal information, to be sure that it is safe.

Please don’t let your hard-earned money get into the hands of someone who is deceiving you! It is better to be safe than sorry; it’s impossible to get money back. Included below is an article about Consumer Information from the Federal Trade Commission that will help you avoid the myriad of schemes that are out there.

https://www.consumer.ftc.gov/articles/0060-10-things-you-can-do-avoid-fraud.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

Children caring for their parents

Parents and children should clearly define expectations and eliminate misunderstandings.

I’m touched regularly by the goodness of the families I work with in my Elder Law practice. With a large percentage of the population aging, we see more and more adult children who are coming alongside their older parents as primary caregivers.

In years past, a large portion of a family’s wealth was lost to the high cost of assisted-living facility care. We often encounter clients who are thinking outside the box and retiring early from different professions to go to work caring for mom and dad.

Many older adults are electing to stay in their homes where they want to be and receive personal care from a family member. Under Medicaid rules, if a child cares for his or her parents in their home for two years, the parents can transfer their home to the child and still be eligible to receive Medicaid benefits with no period of ineligibility.

When a child provides care to a parent, there are several advantages to having a Personal Care Service Agreement in place:

  • Clearly defining the caregiver role and tasks can help set expectations and eliminate misunderstandings down the road.
  • Contractually agreeing to a wage may also prevent other family members from becoming concerned about the transfer of mom and dad’s assets to the person providing care.
  • If at some point Medicaid benefits are accessed to help pay for facility care, a Personal Care Service Agreement is an essential part of Medicaid and Estate Planning.

Federal and State government programs support and incentivize the idea of families providing care to older adults. Accordingly, there are mechanisms in the law that essentially provide for a transfer of wealth to family members, rather than assisted living facilities, in exchange for providing care. And more importantly, it seems to result in better outcomes for the whole family in terms of health and happiness.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

Older Adults Needing Financial Help

Tip: Consider the risks of putting a son or daughter on your bank account as a joint tenant.

Putting an adult son or daughter on a bank account is a common practice of older adults who need help paying bills and managing their finances. However, having a child as a joint tenant on an account may cause the following problems:

  1. The child sometimes withdraws money from the account for their personal use.
  2. If a parent asks the bank to remove the child’s name from the account, the bank requires the child’s signature to have his or her name removed. This often leads to a confrontation between the parent and child, which many parents will avoid.
  3. If there is a joint tenant on an account, and the parent passes away, the Personal Representative of the parent’s estate cannot withdraw money from or close the bank account.
  4. Most often, when the owner of a bank account passes away, the intent of the owner is to have the remaining balance go directly to his or her estate to be divided between all the children. However, Idaho Probate Code § 15-6-104 states that when a joint tenant is added to a bank account and the owner of the account passes away, the money in the account can go to the joint tenant if he or she can prove it was a gift. This leads to all kinds of proof problems concerning the owner’s intent, and the other children are at risk of the joint tenant taking it all.
  5. If a son or daughter is involved in a divorce or takes out bankruptcy, having their name on their parents’ account raises an issue of their ownership interest, and the money could be taken in the divorce or bankruptcy proceeding.

The easiest solution for older adults needing help with finances is for the parents to give a son or a daughter a Financial Power of Attorney (POA). With a POA, the child can assist the parents in paying bills and managing their financial affairs. The child has no ownership interest in the account and has a fiduciary duty to the parents to use the money for their benefit. The parents can revoke the Power of Attorney at any timec if a problem develops.

The parents can also set up a Pay-On-Death Agreement with the bank to pay the remaining balance in the account at their death to whomever they designate.

Remember, there are safer ways of getting help with your finances than putting your son or daughter on your bank account.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.