Reverse Your Mortgage

65+ Up Looking for Work - Unemployment rate for 45+ is 6.3%

We new that the baby boomers wre going to work longer. There are more than 1/3 more  workers  over 65+ in the job market than in 2001. There are more than one half a million workers 65 and older who want to work and are looking. Click Here to Read More.

$625,500 FHA LENDING LIMIT EXTENDED THROUGH DEC. 2010 -FINALLY, SOME GOOD NEWS OUT OF WASHINGTON!

House Approves Loan Limit Extension; House, Senate Leaders Reach Agreement on Home Buyer Tax Credit
The House and Senate approved a continuing resolution that includes a provision that would extend current loan limits for FHA and the government-sponsored enterprises through next year.
Additionally, Senate leaders announced they have agreed to an extension of the $8,000 first-time home buyer tax credit through April 30. The popular credit, which has strong support from the Mortgage Bankers Association (MBA), is set to expire Nov. 30.
The CR, which keeps the federal government running through Dec. 18, passed the House on a 247-178. The Senate vote was 72-28.
MBA commended both chambers on their actions. "Given the lack of a private secondary mortgage market, FHA, Fannie Mae and Freddie Mac are pretty much the only game in town," said MBA Chairman Robert Story Jr., CMB. "Extending the current loan limits through 2010 will allow more loans to qualify for these important programs and will help keep mortgage credit more accessible and affordable for qualified borrowers."
The CR provision would keep in place current conforming loan limits of $625,000 ($729,750 in designated high-cost areas). Without approval from the Senate, those limits will expire on Dec. 31.
MBA and other industry trade groups sent a letter this week to leadership of the House and Senate urging Congress to pass legislation “as soon as possible” to extend current higher loan limits. The letter called the higher limits a “key component of the economic recovery efforts because they help make affordable loans available for a broader spectrum of consumers who want to purchase a home or refinance an existing mortgage.”
"As we try to maintain the momentum of the housing recovery, providing affordable financing for qualified borrowers is critical," Story said. "Extending the loan limits, along with other initiatives such as extending and expanding the homebuyer tax credit, will help restore stability to the housing and mortgage markets."  

Meanwhile, members of the Senate said they substantially reached an agreement on extending the first-time home buyer tax credit, adding it to a bill that would extend expiring unemployment benefits.
The amendment would extend the existing $8,000 tax credit for first-time home buyers and offer a new $6,500 credit for existing homeowners who have lived in their current residence for a consecutive five-year period within the past eight years. Under the amendment, home buyers would be required to be under contract by April 30 and close before July 1.
MBA has supported extension and expansion of the tax credit, noting that the Internal Revenue Service recently reported that more than 1.4 million taxpayers have benefited from the tax credit, enacted by Congress as part of the Housing and Economic Recovery Act of 2008.
“MBA believes the first-time home buyer tax credit has had a stimulating impact on our economy, and MBA supports extending and expanding it so it can help more buyers and sellers,” MBA said in a recent Call to Action from its grassroots advocacy arm, the Mortgage Action Alliance. “Our fragile economy is just beginning to show signs of stabilizing. We should not jeopardize our recovery by letting this tax credit expire. The home buyer tax credit is helping hundreds of thousands of Americans realize the American dream, and it is creating thousands of jobs that rely on homeownership .

As a side note, the original bill did not include the provision to includes reverse mortgages in the extension of the 625,500 FHA lending limit extension. Lobbyists, including AARP and the National Reverse Mortgage Lenders Association were key in adding reverse mortgages to the extension.

Community Aging Services and Senior Centers

Community Aging Services and Long Term Care
There are many private, religious and government organizations across the country that provide supportive services for older people. Many of these services center around helping people stay in their homes and avoid having to go to live in an institution or perhaps move in with family. Because of the emphasis on helping people remain independent, many community aging programs could be viewed as long-term care programs. In fact it's probably just a matter of semantics; long-term care and community aging services are just two sides of the same coin. Other community services may provide socialization or training opportunities. Community aging programs might include:

• Meals served in community centers or delivered to the home
• Community Senior Center activities and training
• Transportation and shopping services for people who can't drive or leave their homes
• Home repairs, snow shoveling, telephone support, caregiver support, care management, legal services, energy and weatherization services, housing subsidies, home health care, counseling and much more
• Adult day care
• Protection from abuse
• Help with health insurance and government entitlement programs

Private support groups might be the Red Cross, women's auxiliaries or foundations. Many religious communities support activities for their elderly members as well as nonmembers. Both private and religious groups often provide services for free to people with little income and few assets. They may, however, charge people for services who have adequate income or assets. Many of these groups may also operate nursing homes and assisted-living facilities.

Senior centers are often the focal point for all aging services in a community. Experts or contact people are housed in senior centers and can provide many services in the center itself or refer out to other organizations that can help. The community served meals or congregate meals in senior centers are a means for attracting older people into the centers. Seniors can then be exposed to the many services that are available.

Government support for aging services comes from the Older Americans Act, passed in 1965. This act, over the years, has produced a large network of care providers and local government managers called Area Agencies on Aging. This network also includes federal agencies, state agencies as well as local area agencies and is called the "national aging network".

The National Aging Network
The Older Americans Act establishes an effective interrelationship between the federal government, State aging units and local service coordinators called Area Agencies on Aging. All three centers of service, the Federal, the state and the local engage in detailed future planning in order to accomplish their jobs. Input at the local level is received from diversified advisory boards representing stakeholders in the elder community. Community meetings and feedback from patrons of senior centers are also used in the planning process. Over the past 44 years, a great deal of thought and energy and research has gone into devising a delivery system that is both efficient and cost effective. In fact, the 29,000 service providers nationwide providing care under the act are the largest single network of long-term care providers in the country.

Local agencies on aging represent geographic areas in a state that can be serviced effectively by that local unit. Area agencies on aging normally contract with local for profit or nonprofit or public providers to deliver benefits. An agency may be allowed to provide directly, supportive services, nutrition services, or in-home services if it can prove a case for providing these services more effectively. An agency may also provide directly, case management services and information and assistance services depending on the methods used for such services in that state. Agencies may also use employees from cooperating or sponsoring counties or cities to staff and administer programs such as senior centers. Much of the work performed comes from dedicated volunteers who are both individuals and employer sponsored teams. This entire aging network system seems to work very well in accomplishing the goals of the Older Americans Act.

Why Is the Older Americans Act Important?
The decade from 1960 to 1970 was a period of social unrest and change. We lived through an unpopular war which resulted in student protests and mass demonstrations. Hippies, it seems, were everywhere and we were experiencing the so-called sexual revolution. It was a exciting time when civil rights were being extended to all Americans.

During this same period a number of organizations were lobbying Congress for the rights of older Americans. An outcome of this effort was not only the 1965 creation of Medicare and Medicaid but also the passage of the Older Americans Act. The act was designed to protect elderly Americans, including Indians, from unfair discrimination in the workforce as well as providing protection and services to help older people stay independent and remain in their homes.

Although the initial emphasis was directed more towards civil rights and recognition of the dignity of the elderly, over the years, new provisions of the Older Americans Act have become more focused on providing long-term care services for older Americans. These benefits are designed to help frail, memory-impaired, disabled, poor and socially needy elderly remain in their homes and avoid the cost of elder care institutions. And more recently, funds were provided under the act to support caregivers of the elderly and elderly grandparents babysitting or raising minor children at home.

The OAA provides benefits to all Americans over the age of 60. And employment benefits are available for all Americans over the age of 55. The act itself stipulates reauthorization or amendment on an ongoing basis and since 1965 the OAA has been changed and updated 14 times. The year 2005 is designated as a reauthorization year and Congress is busily working on additions to the act. Because of the constant additions, the Older Americans Act has become a giant mishmash of thousands of words, redundant sentences and hundreds of rules and procedures. It's our guess that the complexity of the act probably requires states to hire attorneys to run their aging departments. Notwithstanding, members of the care community who provide administration and services with the Older Americans Act work around the complexity of its rules in serving the aging community.

Funding for the services required under the OAA is provided by Congress yearly. These funds are then distributed to states, territories, the District of Columbia , Indian tribes and native Hawaiians on a formula basis which provides minimum funding levels to small population groups and sparsely populated states and proportional funding levels based on state elderly populations of the majority of the other states. Because of its large elderly population, as an example, California receives almost 10% of the money. And because of its high proportion of older people, Florida is next. Ten states receive 52% of the money.

Funds are provided in the form of grants for various programs authorized under the act and states have some limited latitude in administering these monies in local areas. Certain of the mandated programs require matching funds from state and local governments. Other program funds do not require matching dollars. Many states chip in additional funds to maintain their programs and these funds often exceed matching requirements. States, counties and cities recognize the value of these services and are often generous in providing additional funds, buildings, office space and other in-kind economic benefits. For every dollar provided by Congress local governments provide about two dollars in direct money, in-kind services from volunteers, community voluntary contributions and cost sharing funds.

The federal appropriation for 2005 was $1,369,028,000 and the breakdown for specific spending categories is listed below. Notice that over half of the dollars goes towards nutrition services which are typically weekday meals provided in community settings or delivered at home as well as incentive programs to help the elderly maintain proper nutrition.

• Congregate Nutrition Services, Home-Delivered Nutrition Services, and Nutrition Services Incentive Program (money from the Department of Agriculture), 52.1%
• Home & Community-Based Services, 25.9%
• National Family Caregiver Support Program, 11.7%
• Grants for Native Americans, 1.9%
• Program Innovations Grants, 1.7%
• Preventive Health Services, 1.6%
• Protection of Vulnerable Older Americans, 1.3%
• Program Administration, 1.3%
• iAging Network Support Activities Grants, 1%
• Alzheimer's Disease Demonstration Grants, 0.8%
• White House Conference on Aging, 0.3%
• Senior Medicare Patrols (HCFAC), 0.2%

Find your state Area Agencies on Aging or State Aging Services

Senior Citizen Centers
The first Senior Center in the country opened in 1943 in the Bronx, New York and was called the William Hodson Community Center . By 1961 about 218 senior centers had opened all across the country. The first Senior centers were operated by cities or nonprofit or religious organizations. Funding came from government, community donations and fees from people using the facilities. In the early days some federal funding came from Title XX of the Social Security act but funding for Title XX has been decreasing and much of that money today is being used for other programs. In 1972, the Older Americans Act was amended to provide funding for senior centers as this was considered to be an important piece of the aging network. Today, there are estimated to be about 15,000 senior centers across the country serving about 10 million older Americans annually. About 6,000 of these centers receive part or all of their funding through the Older Americans Act.

Senior centers act as a focal point for older Americans to receive many aging services. They are a vital part of the aging network. For Area Agencies on Aging, the senior center has become a place where many AAA services can be provided, where outreach and targeting can occur and where feedback can be received from the elderly. The most common services offered at a senior center are:

• Health and wellness programs
• Arts and humanities activities
• Intergenerational programs
• Employment assistance
• Community action opportunities and social networking opportunities
• Transportation services
• Volunteer opportunities
• Educational opportunities Information and referral
• Financial assistance
• Senior rights counseling and legal services
• Meal and nutrition programs
• Leisure travel programs

Larger senior centers in major cities may offer additional specific services because they serve a large and diverse group of patrons. Here are some examples:

• Education classes, perhaps through a local college
• Foot care
• Health clinics
• Haircuts
• Daily exercise
• Telephone friends
• Support groups for Alzheimer's caregivers
• Support for Parkinson's disease
• Low vision and diabetes services
• Weekly health speakers
• Grocery shopping
• Many and varied classes for personal growth and learning
• Special events and fundraisers such as auctions, raffles, sales, bazaars, rummage sales, bingo, special meals and parties, fashion shows and facility rentals

Most elderly people are aware of senior centers in their neighborhoods but for those who are not familiar with the program, senior centers are listed under that title in the Yellow Pages.

For more information about community resources go to the National and State Care Planning Councils websites http://www.longtermcarelink.net/a15state_councils.htm

Medication Problems and the Elderly

At 83 years old, Martha still lived in her own home, and enjoyed working in her garden and canning peaches. It was becoming harder to motivate herself, to get up in the mornings and accomplish the day's tasks. She confided to her daughter that she felt anxious and tired. Her daughter, who was taking medication for her anxiety, took Martha to her own doctor, not Martha's and got her a prescription for Valium. In doing so, the daughter's doctor, who had never seen Martha and who did not have her medical history, was only aware of a few medications they told him she was taking.

 

Martha, in fact, was taking 9 different medications as well as herbal supplements.

 

The addition of Valium to her existing list of prescribed drugs sent her to the emergency room with respiratory distress. If she had gone to her own doctor, he would have found that a dosage adjustment of her current medications would have solved her anxiety.

 

Medication errors are common in the elderly. Many seniors take on average 6- 8 different prescriptions as well as over the counter drugs. Many times the elderly will not go back to their doctor to have their dosage evaluated and changed if necessary. Family members should be aware, that elderly parents may tend to take the family's advice over going to their own doctor. Even though children want to help increase the health and stamina of their parents, they may in fact be causing damage by misdirecting their loved ones.

 

Where a younger person can benefit from herbal supplements like Ginkgo Biloba, Saw Palmetto and others, in older people, these herbals may cause adverse reactions with their prescription medications.

 

In 2003, a panel of experts put together a list of potential medications that would not be appropriate to give to seniors. This is called the “ Beers List ” after one of the research professionals.

 

Dr. Donna M Fick, R.N. one of the panel members for updating the “Beers List,” states in her article on Seniorjournal.com:  

"Just as our bodies physically slow down as we age, changes occur in the way that older bodies handle pharmaceuticals, and this has motivated experts to develop a list of drugs that may be harmful to elderly patients.

"With age, drugs tend to build up in the body, and the distribution and elimination of drugs from the body changes as well," says Dr. Donna M. Fick, R.N., associate professor of nursing at Penn State. "Many drugs, like diazepam (Valium) and other anti-anxiety drugs build up fast." 

An on-line article on HealthSquare.com , Titled "Drugs and the Elderly," talks about physical symptoms and medications.  

“ Among the first signs that a drug may not be working properly in an older person is a change in mood, energy, attitude, or memory. Too often, these alterations are overlooked, ignored, or chalked off to "old age" or senility. Older people may themselves feel that their blue mood is caused by something external such as the death of a friend or simply by boredom. Nothing could be farther from the truth. Virtually every heart medication, blood pressure drug, sleeping pill, and tranquilizer has been known to trigger depressive symptoms.

When a psychological symptom appears in an older person, examine his or her medication or drug use first. Consider, too, factors like alcohol intake, poor nutrition, and hormone imbalance. And never dismiss the possibility that a real psychological problem has developed and may itself require medication.”

There are many things family members can do to help monitor medications for their elderly parents.

• Make a list of medicines prescribed and all supplements being taken.
• Give this list to the doctor and pharmacist and have one on hand for emergencies.
• Use the same Pharmacy to fill all prescriptions. Pharmacies keep a record of your prescribed drugs and will verify your doctor's instructions. They will also tell you if foods or over the counter supplements will interact with a prescription.
• Dispense pills in a daily pill organizer box.
• Have a family member be responsible to call or physically monitor the taking of medication

Family members who live long distances from their elders have available to them

new technology in medication monitoring.  

• Alarms for pill boxes, watch alarms, medical alarm bands and necklaces that ring a reminder.
• Computerized pill box dispensers that ring a designated number if the pills have not been taken.
• Home Telehealth -

“Technology has developed computer and computer cameras to help the elderly in their homes stay safe and healthy. Home telehealth-set up by medical professionals in the home--enables providers to monitor such things as medications and blood pressure and actually see the patient. Patient questions are answered and advice is given, while the monitoring nurse views through the video phone how his or her patient looks physically.” The 4 Steps of Long Term Care Planning, Pg 92  

• Home Care Agencies – Home care companies offer a variety of service options in helping families care for and properly dispense medication to their elder parents.

Find a home care agency in your area http://www.longtermcarelink.net/a7homecare.htm

Overmedication or taking medication incorrectly may lead to early mental confusion and decline in health in seniors. “If medication problems were ranked as a disease in cause of death it would be the 5 th leading cause in the United States”. (from article on LongTermLiving)

PreNeed (Pre-Paid) Funeral and Burial Plans

Advantages and Disadvantages of Prepaid Plans
One way to plan in advance for the end of one's life is to sign a formal contract called a "preneed funeral plan." With this plan, money to pay for a funeral and/or burial is held in a trust, in an escrow account or paid through an insurance policy on the life of the person desiring the plan. Parts of or all of the funeral service and burial are designed in advance and pre-funded in advance and the family has little to do but show up.

This type of planning has become very popular in recent years. A survey conducted by the AARP in 1999, found that two out of five people over age 50 had been approached to pre-purchase funerals and burial goods and services. An AARP survey in 1998 indicates that 32% of all Americans over age 50, roughly 21 million people, have prepaid some or all of their funeral and or burial expenses (but not necessarily through a formal preneed plan). Breaking that down; about 25% of the over age 50 population have prepaid for their burials (cemetery plot, mausoleum or niche), 18% have prepaid for headstones, urns, caskets , grave liners or vaults, opening and closing of graves and so on and 13% have prepaid for goods or services from a funeral home or funeral director. The same survey indicates that over $25 billion is being held in preneed trust funds. Roughly another $25 billion is waiting to be paid out in life insurance benefits. Prepaid or preneed funerals and burials are big business.

Funerals and burials funded privately by the family, or paid from an individual life insurance policy and arranged informally through a funeral home or funeral director are generally not subject to state regulation. Any formal arrangement through a second party or involving a contract is subject to regulation in all states. Each state has adopted different rules as to who can sell these plans, what the plans can provide, what contract provisions must be, how the plan is to be funded and what recourse purchasers might have in the event of fraud or default. All states call these regulated plans "preneed" funeral and burial arrangements.

Here are some advantages as to why one would want to buy a preneed plan for funeral and burial services and goods.

• It provides peace of mind knowing these arrangements have been made in advance.
• It avoids the burden on family members to make decisions when they are most vulnerable to manipulation.
• It allows one to virtually control from the grave by determining in advance the funeral products, funeral services, burial products and burial services that one would prefer having for final arrangements.
• It helps the family to avoid taking loans, arranging finance plans, raiding savings or selling assets to pay for a funeral and burial.
• It guarantees (for many contracts) that if products and services currently purchased are not available in the future, equivalent substitutes will be provided at no additional cost.
• It locks in guaranteed prices (available with some contracts) forever.
• It allows for inflation in future costs (for those contracts that do not guarantee prices) by investing money in an interest-bearing account or buying life insurance that increases in value over time.
• Depending on the contract, it may allow for transfer to another funeral home or for partial or full refund.

Unfortunately, there are also problems with prepaid, preplanned final arrangements.

• With some trust fund and insurance funding options there may be no refund if someone wants to cancel the plan in the future.
• If a purchaser moves to another state there may be no transfer options or there may be different rules governing the funding option.
• In some contracts, interest earnings on investments resulting in excess money not needed for the plan may be retained by the funeral home or funeral director.
• On installment plans interest may be charged but not credited to the account.
• In certain insurance funded contracts, the ownership or death benefit may be irrevocably assigned to the contract holder (funeral home), preventing the purchaser from enjoying ownership rights in the policy.
• In certain insurance funded contracts, a growth in the death benefit over time that exceeds the cost of the preneed plan services and goods may be pocketed by the contract holder (funeral home) instead of being refunded.
• If the contract provider goes out of business or fails to secure 100% of the funds for future payment, there may be no recourse to get all of the money back that was put in.
• If certain services or goods that were purchased initially are not available in the future, but more expensive versions might be, the family may be forced to pay extra for those items.
• In certain insurance funded plans, if the insured dies too soon, there may have been a waiting period in which few or no benefits are paid at death, thus forcing the family to pay out of pocket for the funeral.
• Certain unscrupulous providers may have failed to provide an itemized list of services and goods or failed to identify properly, specific services and goods, thus allowing the provider in the future to substitute less expensive items or to leave out services and goods that were originally anticipated in the agreement.

What Services and Goods Can Be Prepaid?
All states allow for prepaid plans for funeral services and merchandise. This would include such things as picking up the body, embalming and restoration, rooms or chapel for viewing and funeral services, casket, vault or grave liner, transportation, permits, death certificates, obituaries and so forth. Almost all states allow for prepaid burial services and merchandise as well. Only about six states do not allow it. Burial services and merchandise might include opening and closing the grave, grave markers, vaults or grave liners, mausoleums or niches. Cemetery plots are excluded from prepaid plans in all states.

The AARP has excellent information for consumers on planning for funerals. Quoting from the AARP:

"Most states have a licensing board that regulates the funeral industry. You may contact the board in your state for information or help. If you want additional information about making funeral arrangements and the options available, you may want to contact interested business, professional and consumer groups."

To find a planner in your area you may also contact the National Care Planning Council at inquiry@longtermcarelink.net or call 800-989-8137

Planning for Elder Years

Planning for Your Elder Years: IF we were to ask an older person what his or her most important concerns for aging are, we would get http://ping.fm/ceZL7

E Street interview by AARP’s Sheilah Kast, on Retirement Living TV is an frank & excellent discussion on reverse mortgages.

REVERSE MORTGAGE PROCEEDS MAY BE GOING DOWN – WHY REVERSE MORTGAGES ARE AN EXPENSIVE LOAN

-         Here’s  a FHA history & current events lesson as to why

Although the reverse mortgage program has been around since the 1980’s it is still a very immature program and an expensive loan. The largest cost in attaining a HECM reverse mortgage is the FHA mortgage insurance. FHA is a government  agency providing insurance designed to urge lenders to lend and make it easier for borrowers to borrow. Here is how FHA started.

Just after the great depression:

• Two million construction workers were out of work.
• Banks demanded a 50% down payment and mortgages to be paid off within 3 to 5 years.
• 9 out of 10 American families could not afford to own their own home.

FHA was created to promote housing ownership. The agency started to insure loans and urge lenders to offer lower down payments and affordable interest rates to Americans who would have been turned down for a mortgage. 

For a similar reason, FHA started to endorse and insure reverse mortgages in the 1980’s. Many seniors needed a resource of retirement cash and most people’s largest asset is their home. Because reverse mortgages differed from traditional mortgages in that they were based upon the asset value & actuarial tables, it was an “out of the box” financial tool. It made sense for FHA to urge lenders to lend seniors money on the largest asset that people have, their home and get the industry started.

The purpose of the insurance is twofold. If the loan balance exceeds the home value at the time the loan becomes due, the lender can put in a claim to FHA & be reimbursed for the difference. Along the same lines, the borrower can be assured that if the lender goes out of business, FHA takes over the loan and the borrower’s funds and loan continues as contracted. An added assurance is the estate of the borrower are not responsible if the home’s sales proceeds are not enough to pay off the reverse mortgage to the lender. The estate is only responsible for an excess loan balance if they choose to keep the home in comparison to selling it.

For years, FHA has been criticized by the lending industry for what was viewed as an excessive premium to insure these loans. Lenders have endured shocked responses from financial professionals and consumers regarding the costs involved in attaining a reverse mortgage. The largest fee in attaining a reverse mortgage is the upfront 2% MIP & ½% per year (mortgage insurance premium).

With the plummet of home values, all that has changed. In June 2009, for the first time in the history of the program, FHA asked the administration for a $798 million subsidy or to decrease reverse mortgage proceeds to seniors and avoid the subsidy.  

I have personally seen reverse mortgages that balances exceed the value of the home and the borrower still had access to $40k in a credit line. This will be an automatic claim by the lender  to FHA when the loan becomes due. I think we will see more of these.

It’s an unfortunate additional result of today’s economic state. In order to avoid further burden on the government and to keep the program alive, reverse mortgage proceeds will have to be reduced. Late last week, The House of Representatives passed HR 3288.

The House Appropriations Committee approved the appropriations bill on July 17,2009  instructs HUD to reduce the principal amount a senior can receive on a HECM.

Peter Bell, president of the National Reverse Mortgage Lenders Association, told National Mortgage News that the committee’s action "reduces what seniors will get, which is problematic at a time when there is great need."

As a lender & advocate for seniors, I am saddened by the challenges that the program faces. The program has changed many lives for the better and will continue to do so. It is my belief that the reverse mortgage program will prevail with changes and will eventually become so popular that FHA reverse mortgages will be a small portion of the market as the competition rises by private lenders. Retirees need funds to retire on. It only makes sense they will use these safe loans to tap into their equity for retirement.

If you have a question of this issue or on reverse mortgages in general, CALL Angella Conrard, Reverse Mortgage Advisor 866-949-7030 or log onto www.reverse-your-mortgage.com

History of Reverse Mortgages

FHA asks for subsidy

Reverse Mortgage Subsidy or Decrease in Proceeds

Family Reunion--a Good Time for Family Planning

Summertime brings a lot of family time. With family reunions, picnics, weddings and other events, long distant family members travel to gather together. It is also the perfect time to do some planning for the future. With parents aging and their health and lifestyles changing, children need to discuss some changes and decisions that will be needed in the near future. Parents should take the time to tell their children where important documents are kept and what their wishes are in the event of needing health care directives or experiencing long term care needs.

 

For those children who live away, the change they see in their parent's health and mental capacity may be alarming -- whereas siblings that have daily contact are working with these issues constantly. Here is the chance to compare notes and work together as a complete family in the long term care planning process.

 

For you parents who are well and active, this is a good time to hold a family meeting and share with your children your plan for long term care. Tell them where financial and legal documents are located. Review health care directives, living wills and long term care alternatives.

 

Experience has shown that even families that are close can quickly grow angry, jealous and hostile towards each other when an aging parent begins to need long term care. If a

sibling moves into the parent's home, others can easily be suspicious of ulterior motives and fear losing their inheritance. On the other hand, the child providing the elder care becomes bitter and feels there is no support or help from siblings. Pre-need meetings for the purpose of making a plan, before eldercare becomes imminent, avoids these types of conflicts.

 

In its book, “The 4 Steps of Long Term Care Planning,” the National Care Planning Council provides guidelines and checklists for family planning meetings. Here's an excerpt from the book:

“The first step to holding a meeting, and perhaps the most difficult

one, is to get all interested persons together in one place at one time.

If it's a family gathering, perhaps a birthday, an anniversary or

another special event could be used as a way to get all to meet. Or

maybe even a special dinner might be an incentive.

 

The person conducting the meeting can be a parent or one person of

a couple who are doing their planning, years before the need for care

arises. A meeting on behalf of someone already receiving care or

needing care in the immediate future could be conducted by that

person or by a member of the family, by an adviser or a friend.

 

The agenda could be formal or informal. If you want a formal

agenda, we suggest using our care planning checklist as the agenda.

Copies of the care plan should be prepared prior to the meeting and

presented to those attending. Discussion is encouraged and we

recommend that the person in charge not dictate but encourage input

from everyone.

 

After a thorough discussion of the issues and the presentation of the

solutions to the problems that will be encountered, there should be a

consensus of all attending to support the plan. If the plan needs to

be altered to meet everyone's expectations then by all means do so if

that can be done. But it is not always possible to please everyone so

there must sometimes be compromise.

 

The end of the meeting should consist of asking everyone present to

make his or her commitment to support the plan.

 

GET IT IN WRITING! All good intentions seem to be forgotten

with time. It may be years after this meeting before the long term

care plan begins. If there are vocal commitments to help with

transportation to doctors, give respite to the caregiver or other

commitments, write them down on the care agreement. You can

even have each person put a signature to his or her commitment if

you think that is important.”

“The 4 Steps of Long Term Care Planning ,” by The National Care Planning Council

 

The U.S Department of Health and Human Services states:

“No one wants to think about a time when they might need long-term care. So planning ahead for this possibility often gets put off. Most people first learn about long-term care when they or a loved one need care. Then their options are often limited by lack of information, the immediate need for services, and insufficient resources to pay for preferred services. Planning ahead allows you to have more control over your future”.

http://www.longtermcare.gov

 

"Whether you plan a formal meeting with an agenda or informally gather for a discussion, when the family is together make it a point to start the long term care planning process.

There is a lot to learn and many decisions to make concerning finances, health issues and legal work. It may take research and a lot of time to put a plan together, but if everyone is involved it will work, and be worth it." National Care Planning Council, www.longtermcarelink.net

Putting Home Care in Perspective

 

The Evolution of Home Care
In the first century of our country's history there was no such thing as nursing homes or assisted living. Society was mostly rural and people lived in their own homes. Families cared for their loved ones at home till death took them. In the latter part of the 1800's because of an increasingly urban society, many urban families were often unable to care for loved ones because of lack of space or because all family members including children were employed six days a week for 12 hours a day. During this period many unfortunate people needing care were housed in County poor houses or in facilities for the mentally ill. Conditions were deplorable. In the early 1900's home visiting nurses started reversing this trend of institutionalizing and allowed many care recipients to remain in their homes. Nursing homes or so-called rest homes were also being built with public donations or government funds. With the advent of Social Security in 1936, a nursing home per diem stipend was included in the Social Security retirement income and this government subsidy spurred the construction of nursing homes all across the country.

By the end of the 1950s it was apparent that Social Security beneficiaries were living longer and that the nursing home subsidy could eventually bankrupt Social Security. But in order to protect the thousands and thousands of existing nursing homes Congress had to find a way to provide a subsidy but remove it as an entitlement under Social Security. In 1965 Medicare and Medicaid were created through an amendment to the Social Security Act. Under Medicare, nursing homes were only reimbursed on behalf of Social Security beneficiaries for short-term rehabilitation. Under Medicaid, nursing homes were reimbursed for impoverished disabled Americans and impoverished aged Americans over the age of 65. It has never been the intent of Congress to pay for nursing home care for all Americans. The nursing home entitlement for all aged Americans was now gone.

Over the last 40 years, there has been a gradual change away from the use of nursing homes for long-term care towards the use of home care and community living arrangements that also provide in-house care.

With Proper Planning People Could Remain in Their Homes for the Rest of Their Lives
We are seeing a trend towards working conditions like those in urban America in the early 1900's where both husband and wife are working and putting in longer hours. We are also seeing a return of the trend in the early part of the 20th century where outside visitor caregivers are becoming available to replace working caregiver's and allow the elderly to receive long-term care in their homes. In addition there is a significant trend in the past few years for Medicaid and Medicare to pay for long-term care in the home instead of in nursing homes.

Given enough money for paid providers or government funding for the same, a person would never have to leave his home to receive long-term care. All services could be received in the home. Adequate long-term care planning or having substantial income can allow this to happen.

We only need to look at wealthy celebrities to recognize this fact. Christopher Reeve, the movie star, was totally disabled but he had enough money to buy care services and remain in his home. President Ronald Reagan suffered from Alzheimer's for many years but received care at his California ranch. He was also wealthy enough to pay for care when needed. Or what about Annette Funicello or Richard Pryor? Income from their movie careers allowed them to receive care with their multiple sclerosis at home. We will be willing to bet that Mohammed Ali, who is severely disabled with Parkinson's disease, will probably never see the inside of a care facility, unless he chooses to go there to die. With the proper planning and the money it provides, most of us could remain in our homes to receive long-term care and we would never have to go to an institution or a hospital.

The Popularity of Home Care
Most of those receiving long-term care and most caregivers prefer a home environment. Out of an estimated 8 million older Americans receiving care, about 5.4 million or 67% are in their own home or the home of a family member or friend. Most older people prefer their home over the unfamiliar proposition of living in a care facility. Family or friends attempt to accommodate the wishes of loved ones even though caregiving needs might warrant a different environment. Those needing care feel comfortable and secure in familiar surroundings and a home is usually the best setting for that support.

Often the decision to stay in the home is dictated by funds available. It is much cheaper for a wife to care for her husband at home than to pay out $2,000 to $4,000 a month for care in a facility. Likewise, it's much less costly and more loving for a daughter to have her widowed mother move in to the daughter's home than to liquidate mom's assets and put her in a nursing home. Besides, taking care of our parents or spouses is an obligation most of us feel very strongly about.

For many long-term care recipients the home is an ideal environment. These people may be confined to the home but continue to lead active lives engaging in church service, entertaining grandchildren, writing histories, corresponding, pursuing hobbies or doing handwork activities. Their care needs might not be that demanding and might include occasional help with house cleaning and shopping as well as help with getting out of bed, dressing and bathing. Most of the time these people don't need the supervision of a 24/7 caregiver. There are, however, some care situations that make it difficult to provide long-term care in the home.

Please note from the first graph below that a great amount of home care revolves around providing help with activities of daily living. Note from the second graph below that the average care recipient has need for help with multiple activities of daily living. Finally, it should be noted from the second graph that well over half of home care recipients are cognitively impaired. This typically means they need supervision to make sure they are not a danger to themselves or to others. In many cases, this supervision may be required on a 24-hour basis. (Graphs were derived from the 1999 national caregivers survey, courtesy www.longtermcarelink.net.)

 

 

It is precisely the ongoing and escalating need for help with activities of daily living or the need for extended supervision that often makes it impossible for a caregiver to provide help in the home. Either the physical demands for help with activities of daily living or the time demand for supervision can overwhelm an informal caregiver. This untenable situation usually leads to finding another care setting for the loved one. On the other hand if there are funds to hire paid providers to come into the home, there would be no need for finding another care setting.

Problems That May Prevent Home Care from Being an Option
Caregivers face many challenges providing care at home. A wife caring for her husband may risk injury trying to move him or help him bathe or use the toilet. Another situation may be the challenge of keeping constant surveillance on a spouse with advanced dementia. Or a son may live 500 miles from his disabled parents and find himself constantly traveling to and from his home, trying to manage a job and his own family as well taking care of the parents. Some caregivers simply don't have the time to watch over loved ones and those needing care are sometimes neglected.

The problems with maintaining home care are mainly due to the inadequacies or lack of resources with informal caregivers, but they may also be caused by incompetent formal caregivers. These problems center on five issues:

1. Inadequate care provided to a loved one
2. Lack of training for caregivers
3. Lack of social stimulation for care recipients
4. Informal caregivers unable to handle the challenge
5. Depression and physical ailments from caregiver burnout

In order to make sure home care is a feasible option and can be sustained for a period of time, caregivers must recognize these problems, deal with them and correct them. The responsibility for recognizing these problems and solving them is another function of the long-term care planning process and the team of specialists and advisers involved.

Adequate Funding Solves Most Problems Associated with Providing Home Care
None of the problems discussed in this article would be an obstacle if there were enough money to pay for professional services in the home. These services would be used to overcome the problems discussed in the previous section. If someone desires to remain in the home the rest of his or her life, adequate preplanning could provide the solution.

This planning must occur prior to retirement. The most obvious way to provide sufficient funds for home care is to buy a long-term care insurance policy when someone is younger, healthy and able to afford the lower premiums. If insurance is not an option, then money must be put aside early in life to pay for care in the future. The only other option is to be rich.

Unfortunately, very few people address the issue of needing long-term care when they are older. This leads to a lack of planning and in turn leads to few options for elder care when the time comes. Lack of planning means most people do not have the luxury of remaining in their homes and must rely on Medicaid support in a nursing home to finish out the rest of their lives.