Choosing a Long-Term Care Facility

How to Choose a Long-Term-Care Facility for a Loved One

This step-by-step guide can help you find the right place to meet your loved one's needs.

By Cameron Huddleston, Contributing Editor, Kiplinger.com

Making the decision to move a loved one to a long-term-care facility is never easy. Finding the right facility is even tougher. I know because I made the decision recently to place my mother, who has been diagnosed with Alzheimer's, in a memory-care residence that specializes in caring for people with the disease.

After spending months agonizing over whether it was the right time to move her to a facility where she could receive 24-hour care, I spent just as long trying to find a residence that would best suit her needs. I believe, though, that all the time it took me to research and visit facilities was worth it because I did find the right place for my mom.

If you have a loved one with Alzheimer's, dementia or other disability, that person might someday need to move into a long-term-care facility. Although the majority of Americans who need care receive it at home from family or friends, those with Alzheimer's are much more likely to receive care in a nursing home. According to a 2012 report by the Alzheimer's Association, 75% of people diagnosed with the disease will be admitted to a nursing home by age 80, compared with 4% of the general population. That's why it's important to know how to choose a long-term-care facility if the need arises for someone you love. The steps below will help.

Step 1: Determine your needs

Before you can select a long-term-care facility for a loved one, you must know what sort of care he or she needs. There are several levels of care that senior-care properties provide:

Assisted living for those who need help in one or two activities of daily living, such as dressing or bathing.

Skilled nursing for those who need the attention of a nurse every day, who are bedridden or have more complicated behavior issues.

Memory care for those with dementia or Alzheimer's disease.

Some properties provide varying levels of care under one roof. That can be a good option for people who want to move to a senior-care residence when they're just starting to require help, then stay in place (by simply moving to another wing or floor) as their needs progress, says Sean Kell, CEO of A Place for Mom, a senior-care adviser service.

Kell says that, in addition to considering the level of care, people need to think about where their loved ones would want to be. That is, would they prefer living downtown or in the suburbs? In the same city where they currently live or closer to family in another city? Do they need a place that allows pets or accommodates special dietary needs, such as a kosher diet? These questions need to be addressed before you start your search in earnest.

Step 2: Assess your ability to pay

Your options may be limited if your loved one does not have long-term-care insurance or other financial resources to pay for care. Assisted living costs $3,600 a month on average, Kell says, and memory care runs about $4,700 a month on average. Skilled-nursing facilities cost an average of more than $6,700 a month and can reach as high as $10,000, Kell says.

Health insurance and Medicare do not cover this sort of long-term care. If you're a veteran, you might be able to get help paying for long-term care from the Department of Veterans Affairs. Medicaid rules vary by state, but in general the government program does pay for long-term-care services (primarily nursing-home care). However, your loved one basically has to deplete his or her assets to become eligible. Medicaid does cover assisted living in more than half of the states if the cost is less expensive than a nursing home, says Byron Cordes, president of the National Association of Professional Geriatric Care Managers. But the waiting list to get Medicaid coverage for assisted living is long, he says.

Step 3: Start your search

Once you know what type of facility would be the best match for your loved one, you can start your search. Ask doctors, as well as friends and family, for recommendations. There also are several resources to help you develop a list of senior-care properties that might fit the bill.

Eldercare Locator is a service of the U.S. Administration on Aging. It provides links to Area Agencies on Aging, which can provide a list of facilities and information about long-term-care options in your area.

Read more HERE


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The Law Offices of Jeremy W. Howe, LTD. are ElderLaw attorneys in Rhode Island who specialize in wills and trusts, estate planning, guardianship, probate, and Veterans Aid and Attendance Benefits.

They also are Newport Rhode Island Divorce Lawyers, Attorneys, Mediators, and Arbitrators providing services for family law issues such as divorce, child custody and visitation, support, and military family law.

Call them today at 401-841-5700 or visit them on the web at http://www.CounselFirst.com.

A Matter of Trust: Giving Away a Home

Family Value

By Anne Tergesen

Depressed real estate values and changes in tax rules make this a good time for older homeowners to transfer property to their children using a specialized trust designed to save on gift and estate taxes.

Known as "qualified personal residence trusts," or QPRTs, these vehicles allow a homeowner to continue to live in a house for years before transferring ownership to heirs at a discount to the current market value.

Wealth advisers say QPRTs are getting more popular as clients seek to take advantage of beaten-down property values and a temporary increase in the gift-tax exemption to $5 million from $1 million for individuals and to $10 million from $2 million for couples.

"When the gift-tax exemption was only $1 million, it was more difficult for clients to pass along their homes without gift-tax consequences," says Mike Foltz, a principal at Balasa Dinverno Foltz LLC, an Itasca, Ill., estate-planning firm. Mr. Foltz says five of his clients currently are evaluating QPRTs, up from two at this time last year.

"They can move a big asset out of their estates at a fraction of the future value," he says.

To maximize the savings - and minimize the conflict - families who use these trusts need to plan carefully. Advisers say the strategy makes the most sense for someone with a net worth above the current estate-tax exemption, which also is $5 million per person.

Below that level, transferring a residence through a QPRT still could be a smart tax move for those who might get caught if their assets appreciate or the individual estate-tax exemption drops back to $3.5 million (as the Obama administration's 2012 budget proposes) or even to $1 million (as the current law mandates for 2013).

But there are risks. Most use QPRTs for homes they expect to remain in their families after they are gone. In part, that is because when a homeowner gives away a residence in a QPRT, his or her adjusted tax basis - the original purchase price plus improvements - carries over to the heirs. As a result, if the children were to turn around and sell the home, they could owe a substantial capital-gains tax. (Still, at 15%, the capital-gains-tax rate is far below the 35% estate-tax rate.)

What's more, selling a home held in a QPRT "can get messy," says Blanche Lark Christerson, managing director at Deutshce Bank Private Wealth Management in New York. Because of restrictions on the amount of cash QPRTs can hold, a home-owner must reinvest the proceeds of a sale in another property or take back the cash directly or in a series of payments. Since withdrawing cash from a QPRT reduces the amount that will go to heirs, it defeats the purpose fo the deal, Ms. Christerson says.

Another risk: You have to give up the home when the trust ends, even if you are still alive. To prepare for that day, many homeowners craft upfront agreements that give them the right to rent the peroperty for the rest of their lives. Rental payments are an effective way to transfer more to their lives. Rental payments are an effective way to transfer more to heirs. But to pass muster with the Internal Revenue Service, you must pay a fair-market rent. And your children will owe tax on the income.

Still, the QPRT can be a powerful estate-planning tool.William Mielke, 63 years old, and his wife, Barbara, 62, are considering putting their Marco Island, Fla., oceanfront vacation condominium into a QPRT for the benefit of their 30-year-old daughter. With a QPRT, Mr. Mielke, president and chief executive of an engineering firm in Waukesha, Wis., can transfer a valuable asset without giving up his access to the home or reducing the liquid investments he may need in retirement, says his adviser, Mark Ziety at Shakespeare Wealth Management Inc. in Pewaukee, Wis.

What's more, if the market for Florida real estate rebounds (and the Mielkes outlive their trust), any appreciation the property earns will pass to Mr. Mielke's daughter gift- and estate-tax free.

When you set up a QPRT, you remain the home's owner for as long as the trust is in effect - often 10 to 20 years. During that period, you continue to live in the house and pay all the expenses, including the property taxes and insurance. When the trust expires, the home passes to your children, free of gift tax. Typically, the necessary appraisals and legal documents run $5,000 to $10,000.

Here's how it works: Suppose you set up a QPRT at age 60 when your property is worth $2.5 million. Since the home won't actually pass to your children until the trust expires, the law allows you to discount the $2.5 million you are transferring by an interest rate the Internal Revenue Service sets monthly. This tells you the current value of the gift you will be making in the future.

At today's 3% rate, the current value of a $2.5 million gift to be made in 10 years is $1.59 million, Deutsche's Ms. Christerson says.

If you don't outlive the trust, the market value of your home will be included in your estate. (While your demise would cause your heirs to miss out on any estate-tax savings, it also would nullify the upfront gift-tax consequences of the deal.)

To prevent conflict some families hash out written plans for dividing the finances and chores. For Mr. Mielke, this is easy: "She's our only daughter, so we won't have to worry about family arguments over who wants to use the house and whether to sell."

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The Law Offices of Jeremy W. Howe, LTD. are ElderLaw attorneys in Rhode Island who specialize in Wills and Trusts, Estate Planning, Guardianship, Probate, and Veterans Aid and Attendance Benefits.

They also are Newport Rhode Island Divorce Lawyers, Attorneys, Mediators, and Arbitrators providing services for Family Law issues such as Divorce, Child Custody and Visitation, Support, and Military Family Law. 

Call them today at 401-841-5700 or visit them on the web at http://www.CounselFirst.com.

House Sale Proceeds and Minor Children

ELDER LAW:
An elderly father and his adult son came to our office just after the mother had died. All three had been joint owners of property that was being sold and father and son had questions regarding the proceeds from the sale. Specifically, they wondered if they would be able to put all the proceeds in the son’s name. By doing so, they hoped to provide for the son since he was unemployed and enable the father to qualify for state assistance should he need future nursing home care.

We cautioned the father and son that any transfer of the father’s share of the proceeds to the son would have adverse consequences should financial assistance from the state be required before five years had passed. We also advised them that “gifting” would have tax implications. Our concern was that although the father wanted to help his son, he could be jeopardizing his own financial future.
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The Law Offices of Jeremy W. Howe, LTD. are ElderLaw attorneys in Rhode Island who specialize in Wills and Trusts, Estate Planning, Guardianship, Probate, and Veterans Aid and Attendance Benefits.

They also are Newport Rhode Island Divorce Lawyers, Attorneys, Mediators, and Arbitrators providing services for Family Law issues such as Divorce, Child Custody and Visitation, Support, and Military Family Law. 

Call them today at 401-841-5700 or visit them on the web at http://www.CounselFirst.com.

United Way in RI and Newport Probate Attorney

August 2008 Newsletter

Here’s a new source of information: “United Way- 2-1-1.” Material about this free service was forwarded to me by a lawyer friend and fellow practitioner from Middletown- Cristina Offenberg. The material from the United Way of Rhode Island reads as follows:

2-1-1 is the fastest and easiest way to get information when you need it, 24 hours a day, 7 days a week. One call gives you access to resources across your community, whether you need to get help- for you, for a family member or for a friend- or want to help. No more wrong numbers, no more wasted time trying to find the right person to call.

Examples were listed: “daycare for your child, financial assistance for a utility bill, find a mental health counselor to help you in a crisis, or connect with any other community service.” Or, “If you are able to help others by donating your time as a mentor or volunteer or by donating food, clothing, toys, furniture, 2-1-1 is also for you.”

It sounds useful. Try it and let us know how helpful it is to you. “Cris” Offenberg stated in her email that other states were utilizing the same system so try it wherever you live.

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The Law Offices of Jeremy W. Howe, LTD. are ElderLaw attorneys in Rhode Island who specialize in Wills and Trusts, Estate Planning, Guardianship, Probate, and Veterans Aid and Attendance Benefits.

They also are Newport Rhode Island Divorce Lawyers, Attorneys, Mediators, and Arbitrators providing services for Family Law issues such as Divorce, Child Custody and Visitation, Support, and Military Family Law. 

Call them today at 401-841-5700 or visit them on the web at http://www.CounselFirst.com.