The cost of paying privately for care in a nursing home rose 4.4% in 2011, nationwide, according to a survey done by MetLife.  The current cost of one year in a nursing home is, on average, $87,000.

The cost of care in a Maine nursing home is at least this much, if not more:  generally in the range of $7000 to $8000 per month.

 What might this mean for you and members of your family?  Consider the following:  

• Do you have adequate income and savings to cover years in a nursing home? 
• If you were in a nursing home and your spouse were at home, how much would your spouse need in order to remain comfortable?
• Is it important to you to pass on something to the next generation?   How would you feel if your savings were completely used up on the cost of your care, before you die?
• What if you had to sell your home or other property in order to pay for your nursing home care?
• Are you aware that Medicare covers only short stays in a nursing home –only for skilled care and rehabilitation? 
• Do you know what the Medicaid program (called “MaineCare” in Maine) covers in your state?
• What is the quality of care at nursing home and assisted living facilities in your area?
• Have you checked out long term care insurance, to see what it covers and what it would cost?
• Have you met with a elder law attorney (also referred to as an “elder lawyer” or “elder care attorney”) to find out what coverage might be available to cover some of the cost of your care, and what you can do to get that coverage? 

Be aware that each state is different with respect to nursing homes, Medicaid and other programs. While there may be books on this subject at your local book store, those books won’t tell you the specific things you should know about Maine nursing homes and Maine elder care.  Also, beware of advice given by neighbors and friends.  Each person’s situation is different, and what may have helped someone else won’t necessarily help you.   

In my blogs, I will be addressing some of these issues in the coming weeks.

A concern that older people often bring to estate planning and elder law attorneys is how they can make sure that, at their deaths, the right people receive treasured heirlooms and other items.  These items include jewelry, antiques, firearms, tools, musical instruments, art work, knick-knacks, and the like.  Lawyers refer to this “stuff” as “tangible personal property.”  

It is not necessary to list things in the last will and testament prepared by your estate planning lawyer.  Instead, you can list these things in a separate writing, which your will refers to.  This separate writing can be in your own handwriting or typed.  What’s important is that it be signed by you and dated.

This list can be dated before or after the will prepared by your lawyer – it doesn’t matter.  You can change it time and time again, without going back to your estate planning lawyer to get your will changed.   The best place to keep this list is together with your will.   

Some people, instead of preparing this list, go around their homes and put post-it notes on things, naming the person to receive each item.  This will work out fine as long as your family agrees about who gets what.  However, if they don’t agree, there is no way to make sure that these things will go to the right people.  This can cause problems within your family and could even require a judge of the Maine probate court to resolve the issue.   Therefore, it is best to put your wishes in writing.

As an attorney focusing on elder law, I am carefully watching the Maine Governor Paul LePage’s proposed cuts to MaineCare programs serving the elderly.   My last blog post was about the proposed elimination of coverage for residential care (also known as “assisted living” or “boarding home” care).  

The Governor’s budget proposal also includes cuts to prescription drug assistance to Maine’s elderly.   According the Spectrum Generations, the proposed MaineCare cuts are as follows:

• Prescription Drug and Health Care Assistance for People over 65 and People with Disabilities: Approximately72,000 Maine elderly and people with disabilities would lose some or all assistance they currently receive to pay for Medicare and/or prescription drug costs. Of the 72,000, over 20,000 (with incomes between 135-185% FPL) will lose all assistance they currently receive through the Medicare Savings Program (MSP) to help pay for Medicare premiums, co-payments and deductibles, prescription drug costs, and coverage through the so-called “donut hole”. The remainder, approximately 52,000 people, will lose some assistance with Medicare and/or prescription drug costs.

• Prescription Drug Assistance for Certain People over 62 and People with Disabilities: Approximately 5,000-6,000 low-income older adults (over age 62) and people with disabilities who do not have Medicare will lose all assistance they currently receive to afford their prescription medications through the Drugs for the Elderly program (DEL). These are individuals with serious health conditions such as diabetes, heart disease and Lou Gehrig’s Disease.

These MaineCare cuts, of course, must have legislative approval in order to go into effect.  Hearings are being held at the State House right now.  More details will be coming.

This week Maine’s governor released his proposal for cuts to the MaineCare (Medicaid) program.   A number of the proposed cuts will affect Maine’s elderly. 

An area of particular concern is the elimination of MaineCare coverage of expenses faced by elderly and disabled people who live in residential care and assisted living facilities.   As an elder law attorney, I have many clients in these facilities who cannot afford to pay the monthly cost of $4000 to $7000, who are on MaineCare or will need to apply for it soon.  I also have many clients who are stressed out caregivers who cared for an elderly relative for as long as possible, before reaching the point of exhaustion.  

Assisted living and residential care facilities are for elderly people, many of them with Alzheimer’s and other forms of dementia, who need supervision around the clock. In these settings, they are provided with security, reminded when to eat, dress and bathe, are helped with medication, and provided assistance with some activities of daily living.

 Where will these people go if they can’t get MaineCare and can’t afford to pay privately?  Most will not meet the criteria for nursing home level of care.  So they will have to return to live with exhausted spouses and other relatives, many of them also elderly and with health problems).   For those without families or homes to go to, or whose families simply cannot take them back, the outcome is not clear. 

 The governor’s proposal is at this point just that — a proposal, which will need legislative approval before it becomes a reality.  Regardless of whether you agree with the governor, it is important to be aware that this change may be coming.

When a marriage occurs later in life, each partner has his or her own lifelong experience.  Each has a substantial personal, family and economic history.  In addition, each party has separate assets and liabilities, developed separately from the new marital partner. And quite importantly, each partner has a family constellation (children, grandchildren and others) separate from the new marital partner.

When thinking of marrying, the partners inevitably consider the impact the new marriage will have on their separately developed economic and personal lives.  The questions which arise are:

• If my new marriage ends in divorce, how can I protect my separately developed assets?
• If my new marriage ends in divorce, will I be entitled to support, or will I have to pay support?
• If I remarry, how can I ensure that upon my death, my separate assets will go to my own, original family?
• If I make an agreement with my new partner about these subjects, will that agreement “hold up in court”? 

Maine law, in the Uniform Premarital Agreement Act, provides answers to these questions.  The Act permits parties to have an agreement which is made in contemplation of the marriage.  Under the act, the agreement must be made before the marriage and then takes effect when the couple is married.  The agreement must be in writing and signed by the parties.  The agreement can be modified or terminated during the marriage if both parties agree.

If my new marriage ends in divorce, how can I protect my separate assets?  The Act permits a prenuptial agreement to contain the following kinds of provisions, giving a party the opportunity to protect that party’s separate assets:

• The agreement can state that the separate real estate, accounts or retirement assets of a party are to remain the separate property of its owner, and that additions to and increases in value to any such property remain the separate property of its owner.
• The agreement can give a party the exclusive right to manage, re-invest and otherwise completely control that party’s separate assets.
• The agreement can allow a party to keep that party’s separate assets in the event of divorce.

 If my new marriage ends in divorce, will I be entitled to support, or will I have to pay support?  A prenuptial agreement can state that upon divorce neither party will pay support to the other.  The agreement can also set forth a specific amount of spousal support. The agreement can state that spousal support will be terminated later, for example upon remarriage of the spousal support payee.

If I remarry, how can I ensure that upon my death, my separate assets will go to my own, original family? The prenuptial agreement can give a party the opportunity to pass his or her separate assets to that spouse’s original family or other loved ones upon death. A premarital agreement can prevent a surviving spouse from demanding a one-third “elective share” amount from the deceased spouse’s estate and from exercising other rights otherwise available under the law. The agreement can state that the surviving spouse is to receive a certain limited amount, and can require one or both spouses to have wills providing for this specific amount.

If I make an agreement with my new partner about these subject matters, will that agreement “hold up in court”?  The Act upholds these agreements, if they are made in the correct fashion (made in contemplation of marriage, executed before the marriage, written and signed).  However, the court will not enforce the agreement if it was not executed voluntarily by the parties.  The court will not enforce the agreement if it was an “unconscionable” agreement and the victimized party was kept in the dark about the assets of the other party.  The following suggestions help keep premarital agreements enforceable:

• Full financial disclosure:  Before signing the agreement, the parties should make an accurate and complete disclosure to each other of their separate assets, liabilities and income. 
• Separate lawyers for each spouse: Before signing the agreement, each party should have access to separate and independent legal advice.  

Does every person who is thinking of marrying later in life need a premarital agreement?  Does every person have to keep his or her assets separate from a new spouse? 

          Of course not.  The law doesn’t require premarital agreements, but only permits them.  Every person and every marriage is unique. Some couples, for very good reason, want to blend their assets during their new marriage and to permit flexibility as to what happens in the event of divorce or death.  I have clients who, after reviewing the relevant facts, have written premarital agreements, and I have had other clients who have chosen not to write them.  The important point is that people marrying later in life ought to give careful attention to the above considerations, so that they can choose the legal option which best fits their situation. 

The information provided here is for educational purposes only, and should not be construed as legal advice or an answer to a specific legal problem.

 Michael J. Levey practices family law with the firm of Levey and Wagley, P.A. in Winthrop, Maine. Go to www.leveyandwagley.com.     

Have you ever tried to transact business on behalf of an elderly or disabled relative using that person’s financial power of attorney (POA)?  Have you been told by the financial institution that it will not accept the form because it was a) signed too long ago, or b) is not on the institution’s preferred form?  This scenario can be extremely frustrating if you are trying to look after someone, paying bills and monitoring investments.  Your elderly or disabled relative may now be too incapacitated to sign a new POA on a form acceptable to the financial institution, requiring you to spend time and money getting a court order appointing you conservator. 

Hopefully, this will change as of July 1, 2010, when a new Maine law, the Uniform Power of Attorney Act, takes effect.  The purpose of the law is to make it easier to use validly executed POA’s.  Under this law, financial institutions are subject to penalties if they fail to honor powers of attorney which have been properly acknowledged (witnessed by a notary public or attorney at law):

• Institutions may not require an additional or different POA form if the form you have grants you the authority to perform the act requested.
• Institutions have a maximum of seven days to honor a POA. 
• If an institution has a question of concerning the validity of the document or your authority as “agent”, the institution must, within that seven-day period, ask you to sign a “certification” of your authority, or must seek an “opinion of counsel” (letter from an attorney regarding the legality of the document).
• Once the institution has obtained the certification or opinion of counsel, it has only five additional days to honor the document.  
• If the institution violates these rules, and if you have to obtain a court order confirming the validity of the POA, the financial institution will be required to pay attorney’s fees and costs incurred by you to obtain that court order. 
• (There are, however, exceptions to these rules.  An institution will not be required to honor the document or pay attorney’s fees and costs if: the institution had actual knowledge that the POA was terminated; if the institution had a good faith belief that you lack authority to perform the act requested; if the institution had a good faith belief that physical or financial abuse, neglect, exploitation or abandonment has occurred; or if it would be inconsistent with federal law to honor the document.)

The important

• Family caregivers provided the overwhelming majority of long term care in the U.S.:  about 80%.
• Over three-quarters of adults in the community in need of long term care relied exclusively on family and friends for care; only 8% use paid help only.
• 17% of family caregivers provided 40 hours of care a week or more.
• The estimated value of “free” services provided by these caregivers was $306 billion a year ($1.8 billion in Maine) — almost twice the amount spent on paid home care and nursing home care combined.
• 1.4 million children under age 18 provided care to an adult relative.
• 30% of caregivers are over age 65, many with their own health problems.
• More than half of family caregivers work worked outside the home while caring for a family member.
• The typical working family caregiver lost $109 per day in wages and health benefits as the result of care giving responsibilities.

(Source:   National Family Caregivers Association, www.nfcacares.org.)

Typical family caregivers. Some typical family caregivers I have seen in my practice:

• Alice, a single teacher in her 50’s, whose father has dementia, takes early retirement with a reduced pension to live with and care for him full time.
• Bertha and Gladys, maiden ladies in their 70’s, live together in the family home. Bertha cares for Gladys, who has Parkinson’s and receives MaineCare.  Bertha worries she will lose the home when Gladys dies.
• John, a single father, leaves work frequently to drive his mother to doctor’s appointments, and worries about losing his job.  He’d like to hire a neighbor to help out, but can’t make sense of the payroll requirements.
• Frances, married to Albert for 40 years, cares for him at home with the help of her two children.  Albert will soon need nursing home care, and Frances worries that the cost will take all their savings.

Answers and solutions for family caregivers. Caregivers face additional stress when encountering legal and financial issues.  There are some answers and some solutions for them, such as:

• In the case of a married couple, when one is in a nursing home or assisted living, the spouse at home need not spend down all savings to pay for care, nor must she give up the home.
• With proper advice, a married couple with one enrolled in MaineCare have opportunities to protect their estate for their heirs.
• Hiring paid caregivers can be made easier with the help of an accountant or payroll service to handle tax withholding and other requirements.
• Investment in income-producing property can be a wise move for some people, helping with MaineCare eligibility and helping to minimize the impact on their finances.
• Under certain circumstances, an older person who wants to give his home to a live-in caregiver child or to a disabled child may, with proper legal advice, do so without risking MaineCare eligibility.
• Older siblings who own and live in a home together can ensure that the survivor is able to keep the home upon the death of the first of them.
• Maine’s “Long Term Care Partnership Program,” now in the development stage, provides incentives to people who purchase long term care insurance by enabling them to preserve assets for their heirs if they later receive Maine Care.
• With a personal care contract properly drafted by an attorney, an older person may pay a relative or friend to provide care, without risking MaineCare eligibility.
• A caregiver who takes time off of work to help an ill relative may be protected under the state and federal Family Leave Act.
• A caregiver and older person who want to collaborate financially to build an in-law apartment should obtain advice to minimize tax consequences and ensure MaineCare eligibility later on.
• Middle income elderly and disabled people seeking care at home may meet MaineCare income guidelines and should not hesitate to apply for help to supplement the help of a family member.

Caregivers in these situations should obtain professional advice.   “Self-help” is usually not a good idea.

Helpful links for family caregivers:

Spectrum Generations’ Family Caregiver Support program.  Download their publication, “Connections: A Guide for Family Caregivers in Maine”:  http://www.seniorspectrum.com/Services/Family_Caregiving.asp

Services available through Maine’s five area agencies on aging under the National Family Caregiver Support Program:  http://www.maine.gov/dhhs/oes/fcsp.htm

Information on respite/alternative care and caregivers’ support groups:  http://www.maine.gov/dhhs/oes/caregivers.htm