According to the Department of Veterans Affairs website, VA Aid and Attendance is “a benefit paid to wartime veterans [or their spouses] who have limited or no income, and who are age 65 or older, or, if under 65, who are permanently and totally disabled.” Unfortunately, too many veterans and their spouses are unaware that they qualify for this benefit, or even worse, have never been informed that the program exists.

An informative article in the Washington Post quotes the VA’s deputy undersecretary for disability assistance as saying that he believes they are only reaching “about one in four eligible veterans.” Part of the reason for this is that “there are a lot of veterans where it’s been 40 years or more since they’ve been on active duty. It just doesn’t occur to them there may be a benefit from the VA.”

If you are a war veteran over the age of 65 it is very likely that you and/or your spouse qualify for Aid and Attendance Benefits. Eligibility requirements include:

• You served at least 90 days of active military service 1 day of which was during a war time period. (If you entered active duty after September 7, 1980, generally you must have served at least 24 months, or the full period for which called or ordered to active duty.)
• You were discharged from service under conditions other than dishonorable.
• Your countable family income — after subtracting care and medical expenses — is below a yearly limit set by law (The yearly limit on income is set by Congress.)
• You must need help with at least one activity of daily living: dressing, eating, walking, bathing, adjusting prosthetic devices or using the toilet. Those who are blind, living in nursing homes or require in-home care may also be eligible.

For many veterans and their families the financial assistance they receive from their VA Aid and Attendance benefits can be an incredible help. Unfortunately, the application process required to receive the benefits can be daunting. “It’s not a simple process. A&A applicants must mail the forms, copies of service records, marriage certificates, proof of insurance and medical records to the regional VA office. If a third party is making the application, an additional form, 21-22-a or 21-0845, must be completed.”

This is why many veterans ask a knowledgeable Elder Law or Estate Planning attorney to help with the application process. The right attorney can help you find and fill out the correct forms, gather the necessary records and materials, and keep track of progress throughout the entire process. If you think you may be eligible for VA Aid & Attendance Benefits, check out the information on VA Pension Benefits by clicking this link:  VA Pension Benefits.

According to the article, “A huge wave of baby boomers may need long-term care in their golden years — and yet fewer than half have taken steps to prepare for it… two-thirds of Americans believe it’s important to plan for long-term care, but only 44% have taken steps to protect themselves.”  Part of the reason for this lack of preparedness is that Baby Boomers underestimate the likelihood that they’ll need long-term care, or they overestimate the likelihood that their children or families will be able (or willing) to provide that care.

But there’s another reason why Baby Boomers are statistically unprepared for the crisis of old age; to put it simply, there aren’t any clear avenues to solid and reliable financial preparedness.  “While it’s clear that not enough people are thinking about preparing for their long-term-care needs, it’s not at all clear what, if any, the best solutions are.”

Some think that extra savings in the bank will cover the cost of long-term care; others believe that government programs such as Medi-Cal or Medicare will take care of them.  Unfortunately, both of these beliefs are mistaken. “The average cost of a nursing home ranges from $85,000 to $120,000 a year, while hiring an aide to spend six hours a day on average in the home starts around $40,000 a year… Medicare, meanwhile, only covers up to 100 days of long-term care and often involves co-payments. Medicaid [Medi-Cal in California]will cover long-term nursing-home care but only after the person has drained his or her savings account.”

Another solution is long-term care insurance; but even with long-term care insurance, nothing is clear cut, and too many people have found themselves paying into a policy and ending up with no return on their investment. You also need to be healthy enough to qualify for the policy.  Long-term care insurance is still one of the best options out there, but “There have been horror stories of people paying premiums on long-term-care insurance policies for years, only to find the benefits won’t cover their needs 20 or 30 years down the road when health care and long-term-care costs are significantly higher.”

Another option may be Medi-Cal for those who need nursing level care.  Our firm has been a leader in assisting clients with qualification,  and with helping them plan their estates to enable qualification when need later arises.  There are many myths associated with Medi-Cal. For more information, we invite you to download a free copy of our “Consumer’s Guide To Medi-Cal Planning“.

The best advice we can give is to do your research and ask for the help of an advisor with experience in elder law, elder care, and senior financial planning.  Be prepared.



Although it may seem like an easy fix to looming financial debt, don’t give in to the temptation to use your own savings.  Before you give in to fear and drain your retirement, get some professional financial advice.  This special edition recently released in the New York Times shows that it is possible to prepare for what’s coming—both for your parents and yourself.

Our first recommendation is to discuss your situation with a trusted financial advisor.  After that, one of the primary suggestions offered in the Times is to talk to your parents about their situation.  It may not be easy; be prepared for your initial advances to be met with resistance.  Aging parents often worry that they will lose control of their own finances, or that giving decision-making capacity to one child will lead to anger or hurt feelings among their other children.  Instead of gearing up for a fight, the article mentions a few ways to gently lead into the conversation (including talking about family philanthropic projects.)

Another discussion you won’t want to skip is one about Long-Term Care Insurance.  This article by Ron Leiber discusses different kinds of insurance, whether or not you’ll need it (you will), and how to pay for it.

The world of “old age” is changing.  People are living longer than their predecessers and are experiencing more long-term health issues.  In some situations, elders may be able to rely upon Medi-Cal to subsidize the cost of residence in a nursing facility, provided that appropriate planning is in place.  However, care outside of the nursing home environment usually requires reliance upon savings and/or long term care insurance if available.  For veterans, a tax-free Veterans Pension may be available, even if the disability is not related to military service.  Serious discussion and serious planning are essential to surviving the challenges of the “new” old age. 

The idea of long-term care insurance is no longer a new and strange one, but it’s still not a concept most people feel completely comfortable with. What kind of long-term care insurance should you be looking at?  Can you get coverage for your entire life? (Probably not.) What types of care and services will be covered? (Each policy will vary.) Can you get a policy that goes into effect right away, or is there a waiting period? (There is often a waiting period.)

Not all long-term care policies are created equal.  The U.S. News and World Report recently published an article advising 7 things to look at when choosing a long-term care policy. Some of the things you’ll want to pay attention to include the benefit amount, the benefit period, which services are covered, and inflation protection, just to name a few.

Choosing a long-term care policy is an important step, and not one to be taken blindly.  If you are confused about long-term care policies, or unsure of which one may be right for you, don’t hesitate to ask the advice of a professional. Insurance agents, financial advisors and estate planners may all be able to help answer your questions or point you in the right direction.

Elder law attorneys have known about Caregiver Agreements for a long time, but a recent article in the Wall Street Journal will hopefully raise caregiver awareness of this useful contract; especially, as the article mentions, given the “still-fragile” state of the economy. A Caregiver (or Employment) Agreement “should document a caregiver’s responsibilities and hours and set a rate of pay that’s in line with local practices. Both the caregiver and care recipient should sign the contract and disclose it to the rest of the family.”

An agreement of this sort can be useful not only for the care-giver and the cared-for; it also comes in handy if you think you may need to rely on Medi-Cal (known as Medicaid in other states) to cover nursing home costs sometime in the near future.

According to the article, “Before Medicaid will pick up the tab for nursing-home costs, it requires applicants to recoup certain payments made to relatives over the previous five years — and use the money to pay the nursing home… But if payments to relatives are made under the terms of a written employment agreement, often called a personal-care contract, the law allows it.” While the recoupmement term is different in California, the point is well-taken.

But remember, “to pass muster with Medicaid, it’s important to have such a contract in place before the services are rendered.”

This is why it is extremely important to talk to an attorney who is well-versed in elder law and Caregiver Agreements before any contracts are signed or money changes hands.

Paula Span in her article on the NY Times New Old Age Blog suggests that “what variety of facility an older person lives in may matter less than we’ve assumed. And that the characteristics adult children look for when they begin the search aren’t necessarily what makes a difference to the people who move in.”

Span’s suggestion is based on (among other things) a recent study published in The Journal of Applied Gerontology, which found that among 150 Connecticut residents living in various long-term care situations (assisted living, nursing homes, residential care homes), the type of living situation itself made little difference in the resident’s emotional well-being. Rather, happiness and contentment was more a matter of “the characteristics of the specific environment they’re in, combined with their own personal characteristics — how healthy they feel they are, their age and marital status.”

Logically enough, a resident of a long-term care facility of any kind is more likely to report satisfaction and comfort if they had a hand in choosing their living situation, if they were part of the decision making process. In fact, it is the process itself—researching options, visiting facilities, considering current and future social and physical needs and how they will be met—that is the beginning of acclimatization.

Whatever your choice, you’ll want to know that you have options for paying for your long-term care living situation. Medicare.gov has published a chart summarizing and comparing the various options for long-term care financing. We find that the chart falls short, however, in the way it outlines the features of  “Medicaid”, called Medi-Cal in California, as it does not address planning options that are currently available to qualify for the subsidy and protect your home and other assets.  For more on this topic, see our “Consumer’s Guide to Medi-Cal Planning”.

Here are some of the distressing details you’ll find in the USA Today article:

• The American Academy of Family Physicians says 13% of respondents didn’t participate in Medicare last year, up from 8% in 2008 and 6% in 2004.
• The American Osteopathic Association says 15% of its members don’t participate in Medicare and 19% don’t accept new Medicare patients. If the cut is not reversed, it says, the numbers will double.
• The American Medical Association says 17% of more than 9,000 doctors surveyed restrict the number of Medicare patients in their practice. Among primary care physicians, the rate is 31%.

What this means for seniors is that although you may be able to qualify for Medicare you may not necessarily be able to count on it. But you can take action to ensure that a crisis for Medicare doesn’t mean a crisis for you. Your financial advisor or estate planner can help you determine what options you have regarding long-term care, asset protection, and even using alternate strategies in conjunction with Medicare. For example: it may be possible to re-design your trust and estate plan to facilitate access to a nursing home subsidy from the government in the event of future need.  See our articles, “Spousal Protection Planning: Creating A Plan for Each Other”, and “Developing a Plan for An Incapacitated Spouse“

The days of being able to count on the government to take care of you in your old age may be coming to an end. It’s time to make your own luck and plan for your own future. Our firm may be able to help.

Large banks are not immune to this trend—and the potential to increase their client base by offering financial elder-care services. The question is, how effective can a bank be at helping you care for your elderly relatives?

According to this article in the Wall Street Journal banks can be helpful with certain financial issues such as helping to “sort out medical bills, hire in-home care or even manage the sale of a home.” Some of the larger banks are even beginning to offer more in-depth services such as “estate planning and setting up powers of attorney… crisis management (triggered, say, by a broken hip or a car accident); health and home assessments; Medicare-coverage selection and claims management; and evaluating retirement communities and long-term-care facilities.”

All of this sounds great, but before you get too excited our firm would like to caution you to be as careful about hiring a bank to do your estate or elder care planning as you would be with engaging any other attorney or professional advisor. After all, as the WSJ article says, “banks and trust companies aren’t doing this solely out of the goodness of their hearts. Providing extra services targeted at the elderly and their family caregivers can bump up the asset-management fees that clients pay each year. . . [or] persuade a few clients to move assets to an institution to meet its minimum deposit requirements.”

So we urge you, before you jump into anything—whether it be with a bank, an attorney, a CPA or other important advisor—do the research and ask all the questions you need to ask in order to find out whether this advisor truly knows their stuff; knows the ins and outs of the law and the care-giving industry; and most important of all, make sure the person or institution you hire will be working for you, will be your advocate and your ally during difficult and confusing times. Further, to the extent your loved one needs legal services to plan for incapacity, to implement asset preservation strategies, to design an estate plan or to plan for Medi-Cal or other public benefits, our strong recommendation is to first seek the advice and guidance of an Elder Law attorney knowledgeable in the field. In our opinion, acquiring these skills takes years of study, practice and experience.

This is great news! This means that long-term care insurance could cost you less than $100 per month! The trick is that you have to think about it early. “Age at the time of application plays an important role in determining the cost for long-term care insurance the Association study reports. While 41.5 percent of buyers under age 61 pay between $500 and $1,499-per-year, only 20.8 percent of buyers who are ages 61-to-75 pay within this range.”

This is not to imply that if you’re over the age of 75 you’re out of luck. You’re not likely to get the same great rates as someone in their 50’s, but you still may not have to pay an arm and a leg for long-term care insurance. According to the report, of applicants aged 76 and older only 28.2% end up paying an annual premium of $4,000 a year or higher. Actually, almost half of applicants in this age range still end up paying less than $2,500 a year. This may not be the attractive $500/year you could have gotten in your 50’s, but it also isn’t the thousands of dollars a month most people seem to be afraid long-term care insurance is going to cost them. In fact, it’s only a little over $200/month.

If you’ve been thinking about long-term care insurance, don’t wait any longer. This is one situation where time is not on your side; the quicker you act the better it will be.

(1) enrollment is open to those who are employed and choose to make voluntary monthly contributions to the program, and there is no underwriting exclusion based on pre-existing conditions; enrollment will open January 1, 2011; (2) eligibility kicks in only after the individual has been enrolled in the voluntary payroll deduction program for 5 years, but the payout will not begin until 2017; (3) benefits will be a minimum of $50/day but be scaled up as high as $75/day, depending upon the degree of impairment, and there is no lifetime “cap” on payout; (4) benefits will coordinate with government assistance from the Medi-Cal program, such that CLASS benefits will have no effect on eligibility for Medi-Cal, Medicare, Social Security Retirement or Disability benefits, nor SSI. In fact, persons in nursing homes who qualify for CLASS benefits will be able to retain 5% of their daily or weekly cash benefit without seeing a reduction in their Medi-Cal subsidy.

Unfortunately, because of the 5 year vesting requirement and the companion requirement that the individual be employed for at least 3 out of those 5 years, most currently retired seniors will not see any direct benefit from the program.  However, seniors can, and should in our view, encourage their children and family members who are still employed to sign up.  That encouragement can be a part of the parents’  legacy to their own children, just as Senator Kennedy left his legacy to the nation.

For more on topic, see the following fact sheet prepared by the Kaiser Family Foundation.

It is for this very reason that a new trend in long-term care insurance seems to be emerging. According to this article by Stacy Schultz, there is an upswing in the purchase of long-term care insurance by the Boomer Generation—except the insurance isn’t for the Boomers themselves, it’s for their parents. “Many of them have just had a relative go through being in a nursing home, and they see the devastation and the stress it causes,” quotes the article. “They’re concerned about mom and dad, and if their parents don’t have a lot of means they want to buy insurance for them.”

If you are considering buying long-term care insurance, either for yourself or your parents, you have a number of options, especially compared to even just a few years ago. Forbes.com recently published an article outlining the improvements in long-term insurance, and what your options are if you’re buying it today.

Take an hour or two this month to talk to your parents (or your kids) and advisors about what the coming years have in store. You may not need long-term care insurance, but you will certainly need a plan, and it’s never a bad idea to know your options, especially when it comes to protecting your future. In the lives of many Boomers, protecting their own future also means protecting their parents’ futures.

A recent segment on NBC’s The Today Show takes a close look at long-term care and the price individuals and couples are required to pay as age related illnesses make it more and more difficult for senior citizens to live at home without care.

The show tells the story of “Roberta” and her husband, a couple married for 44 years, who felt there was no choice but to divorce after Roberta’s husband was diagnosed with dementia and the subsequent nursing home bills quickly depleted their assets. After paying no less than $75,000 in care costs, Roberta was advised by her attorney that one of the only ways to conserve her remaining assets for her own support would be to divorce her husband, allowing him to qualify for Medicaid coverage. As an Elder Law firm, we frankly wonder whether that was the only option for Roberta.  In California, at least, there may have been other options that might avoided  the tragedy of divorce.

With growing numbers of senior citizens being diagnosed with debilitating elderly illnesses, and the cost of nursing care on the rise, more and more couples are finding that without some kind of long term care insurance, or a Long Term Care Estate Plan,  they simply can’t afford the cost of aging. Medicaid (called “Medi-Cal” in California) can help, but planning is the key to avoiding the tragedy of Roberta and her husband.

Plan ahead for your own old age by talking to your advisors about Medi-Cal,  your options for long-term care insurance, and whether your existing estate plan should be re-designed.  Most have been designed with death in mind, rather than with extended long term care needs in mind.  Our firm has specially designed a Long Term Care Estate Plan for couples in just the situation above, and we have been able to help couples avoid the dreaded option of divorce. See the following links, one for healthy couples and one for a couple with an incapacitated spouse.