The Cost of Living adjustment for Veterans’ Compensation is a 3.6% increase in benefits, effective December 1, 2011 for benefits to be payable in January of 2012. This adjustment applies to the rates of compensation for veterans with service-connected disabilities and the rates of dependency and indemnity compensation for the survivors of certain disabled veterans. No increase in pension benefits was announced.
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A recent analysis reveals that the largest for-profit facilities maintain staffing levels nearly one-third lower than non-profit and government-owned nursing homes, resulting in a significantly lower quality of care.
The study, led by the University of California San Francisco (UCSF), looked at the relationship between staffing and quality of care at the ten largest for-profit nursing home chains.
“Poor quality of care is endemic in many nursing homes, but we found that the most serious problems occur in the largest for-profit chains”, said lead author Charlene Harrington, RN, PhD, professor emeritus of sociology and nursing at the UCSF School of Nursing. “The Top ten chains have a strategy of keeping labor costs low to increase profits. They are not making quality a priority”.
Although the top chains had the sickest residents, their total nursing hours were 30 percent lower than non-profit and government nursing homes, the UCSF study found. Moreover, the major chains were well below the national average for registered nurse and total nurse staffing, and below the minimum nurse staffing recommended by experts.
According to the study, the ten largest for-profit chains were cited for 36 percent more deficiencies and 41 percent more serious deficiencies than the best facilities. Deficiencies include failure to prevent pressure sores, resident weight loss, falls, infections, resident mistreatment, poor sanitary conditions and other problems that could seriously harm residents.
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In her recent Wall Street Journal article titled IRS Clarifies Estate Rules, Laura Saunders refers to new rules which make clearer the procedure involved for a surviving spouse seeking to take advantage of the $5 million per individual and $10 million per married couple exemption from estate taxes.
Ms. Saunders cites the example of a Wife who died in 2011 with assets totaling $1.5 million. $3.5 million of her exemption went unused.
Under the new rules, Wife’s executor can file an estate tax return which includes the value of Wife’s assets as of her date of death. This preserves her remaining $3.5 exemption which Husband can use at his death. It is crucial that Wife’s estate tax return is filed and within nine months after Wife’s death.
Portability of the deceased spouse’s unused exemption expires at the end of 2012. Some estate planning experts believe portability will be renewed by Congress.
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Once the Will is located, it should be given to the Estate’s attorney. Instead of reading the Will out loud (as seen on television), the Estate’s attorney will send copies of the Will to individuals who may have an interest in it.
The Estate’s attorney will send a copy of the Will to the Executor, the person who is responsible for filing for Probate, managing the decedent’s property and making sure the provisions of the Will are carried out.
The Estate’s attorney will also send a copy of the Will to anyone who is named as a beneficiary. If any minor children or incapacitated individuals are named as beneficiaries, their guardians will receive a copy of the Will. Copies will also be sent to the deceased person’s heirs at law — in most cases this is the spouse and children.
If the Will funds a revocable trust, the successor trustee of the trust is entitled to a copy of the Will. Once a Will is probated, it is available to the public and anyone can read it. For this reason and others, many individuals choose to have a revocable trust so that they can keep their financial and personal business private.
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Thinking about a time when you will need help taking care of yourself is not fun. That is why most people put off discussing long-term care until it can’t be ignored. But it is better to start long-term care planning early. Here are some reasons to start planning now:
• People are living longer and are more likely to need long-term care. Life expectancies keep increasing, which means you are more likely to need help at some point. At least 70 percent of people over age 65 will require some long-term care services at some point in their lives, according to the U.S. Department of Health and Human Services.
• Care expenses are high. Whether you receive care in a nursing home or at home, expenses are rising. According to the 2010 MetLife Market Survey of Long-Term Care Costs, in 2010 the average cost of a room in a nursing home was $83,585 a year and home care aides averaged $21 per hour. Those figures aren’t going to start going down.
• Family caregivers may not be available. In more and more households, both partners work. In addition, children often move far away from their parents. This means that your adult children may not be able to easily take of you when the time comes.
• The earlier you plan, the better. By planning ahead, you may be able to preserve your assets instead of using them all up paying for long-term care. In addition, if you plan early, you may have more options for care.
Planning steps may include executing advance directives and a power of attorney, putting assets in a trust, purchasing long-term care insurance, getting a reverse mortgage, creating a caregiver contract with an adult child, or transferring a house to children.
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In a recent Chicago Tribune article, Daily Money Management Services Keep Seniors Independent, the availability of a personal service to handle paying bills, balancing the checkbook, filing insurance claims and other money management matters is reported on.
Amie Hyman, owner of Heartfelt Solutions for Seniors, Inc. in Willow Springs, addresses the issue and explains how times have changed from when senior citizens were able to rely on relatives who lived close by and senior citizens had uncomplicated money management issues. “This service is very much in demand, as the younger generation does not always live in the same area as their parents”, states Ms. Hyman. “It becomes overwhelming when the junk mail, doctor bills and Medicare statements start to pile up. They can forget to pay a bill or they are late and incur fees”.
Some of the services provided to seniors include setting up automatic withdrawals from bank accounts to pay bills, writing checks, managing bank deposits, transferring funds among accounts, negotiating with creditors and dealing with medical insurance providers
Andrea Donovan of Senior Living Advisors in Riverside, Illinois was recently quoted in a Chicago Tribune article about retirement communities in the Chicago area. In the article, Ms. Donovan points out that there are four kinds of contracts available at Continuing Care Retirement Communities, that is, a community which has independent living, assisted living and skilled nursing all in one area. This is an attractive feature because individuals not need to move to a different community in the event of a change in health status.
The first kind of community is a Full Life Care community. The resident is charged an entrance fee and a monthly fee. Residents receive unlimited access to all levels of care with only a small change in monthly fees to adjust for inflation and increased costs.
The second is Modified Life Care. The contract limits the number of days in assisted living or skilled nursing for the resident. Once those days have been used, the resident is often offered a discounted rate for continued care. This option is attractive for residents who believe their assets will be sufficient to pay for future health care needs.
The third is Fee for Services Care. The entrance fee and monthly fees are substantially lower than the Full Life Care and the Modified Life Care options. The monthly fee covers living expenses. Residents have access to all levels of health care and pay the entire cost.
The fourth is Rental. This option requires a monthly rental payment, similar to renting an apartment.
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Asset protection planning is about protecting your assets from creditors – and it is not just for the super-wealthy.
Anyone can get sued. Lawsuits can stem from car accidents, credit card debt, bank foreclosures or unhappy customers. If someone wins a monetary judgment against you, your family could become bankrupt trying to pay it off. To keep your assets away from creditors, you need to move them somewhere creditors cannot reach them. Asset protection techniques include maximizing contributions to IRAs, moving funds to an irrevocable trust, retitling various assets or using limited liability companies or family limited partnerships.
It is important to note that asset protection planning only works if you act before you are sued. Under the law, you may not defraud current creditors. If you are already being sued or if you know you are going to be sued and you transfer assets so that creditors cannot reach them, the court will reverse the transfer. That is why it is a good idea to put a plan into place now.
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A federal judge has ruled that retirees cannot dis-enroll from Medicare Part A without also losing their Social Security benefits and refunding all of the money paid to them.
Anyone who has reached age 65 and who is entitled to Social Security benefits is also automatically entitled to Medicare Part A without charge. However, the three plaintiffs in a recent case brought by three federal employees, wanted to drop their Medicare coverage because they claimed it threatened their coverage under the Federal Employee Health Benefit program, which they said was superior. They argued that Medicare law allows them to drop out of the program without losing their Social Security benefits.
The judge acknowledged that the three retirees had a legitimate point that the law does not specifically say that avoiding Medicare Part A means losing Social Security benefits. But the judge found that requiring a mechanism for Plaintiffs and other similarly situated individuals to dis-enroll would be contrary to congressional intent, which was to provide mandatory benefits under Medicare part A for those receiving Social Security Retirement benefits.
The judge also pointed out that the plaintiffs would not gain much by renouncing their Medicare coverage.
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The maximum contribution to a Roth IRA in 2010 and 2011 is $5000, and if you are 50 years or older by the end of the year it is $6000. The top modified Adjusted Gross Income (AGI) for a full contribution for Single individuals in 2010 is $105,000 and in 2011 is $107,000. The AGI for Married individuals filing jointly is $167,000 in 2010 and $169,000 in 2011.
Typically, individuals choose to convert to a Roth IRA because they believe their taxes will be higher in retirement or they are decades away from needing the cash. However, a Roth is an excellent way to pass on wealth. There is no distribution requirement with a Roth as there is with a traditional IRA. Once funds are in a Roth, you will never have to pay income taxes again and neither will your children, grandchildren or anyone else who inherits the Roth account.
Keep in mind that a conversion from a traditional IRA to a Roth is worthwhile only if you can pay the taxes for the conversion from outside savings.
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Illinois Estate Planning and Elder Law Blog