| Page outline |
|
Legal Planning
Financial Planning
|
Legal and financial planning should begin soon after the diagnosis of Alzheimer's has been made. People with Alzheimer's may be able to manage their own affairs at the beginning. As the disease advances, they will increasingly need to rely on others to act in their best interest. A good way for Caregivers to get an introduction to Legal and Financial Planning is to attend a free Legal and Financial Seminar at the New York City Chapter of the Alzheimer's Association. It is recommended to attend an Understanding Dementia meeting before attending the Legal and Financial Seminar.
Two questions that need to be answered at the beginning of the planning process are:
- Who will manage the person with dementia's financial affairs?
- Who will make medical decisions on their behalf?
The two legal instruments commonly used in New York State to address these concerns are Power of Attorney and Health Care Proxy. In New York State, a Health Care Proxy must be a separate document from a general Power of Attorney. For documents used in other states, families are advised to consult an elder law attorney.
back to top
|
Power of Attorney
This is a legal document that enables an individual with dementia to authorize a trusted person to make legal decisions on his or her behalf. While there are different types of Powers of Attorney, most people sign a Durable Power of Attorney because it remains in effect even after the person with dementia can no longer make financial decisions. A Durable Power of Attorney may help avoid a time-consuming and expensive guardianship proceeding in the future. It is strongly recommended that an elder law attorney draft the durable power of attorney. Forms found in stationary stores may not be sufficient for planning purposes. See the section on Legal and Financial Planning Instruments below for more detail.
Health Care Proxy
A Health Care Proxy is someone appointed to make medical decisions on another person's behalf. A person with dementia is encouraged to complete New York's Health Care Proxy form soon after diagnosis. This form enables them to designate one or more trusted individuals to make all decisions regarding health care. Such decisions may include: choices regarding health care providers, medical treatment, and, in the later stages of the disease, end-of-life decisions. For more information on medical decision making and advance directives,
see Delegating Medical Treatment Decisions.
back to top
|
It is important for all individuals with dementia, regardless of means, to obtain legal guidance. Families who are unable to afford an attorney may obtain free legal services from our chapter listing. To learn about free legal services,
please click here.
For those who are financially able, it is advisable to consult an attorney who practices in the area of elder law . Elder law is a specialized area of law focusing on Medicaid planning, trusts, wills, advance directives guardianship, disability planning and other related legal areas that typically affect older adults. To locate an elder law attorney on the site of the National Academy of Elder Law Attorneys Inc., please click here.
The New York City Chapter maintains a listing of Elder Law Attorneys that may be obtained by contacting our 24-hour helpline by telephone at 1-800-272-3900 or online by clicking here. Please note: A referral does not constitute a recommendation. The New York Chapter cannot guarantee, endorse, or recommend any of the providers listed. Furthermore, we do not receive any financial compensation from the providers.
When consulting with an attorney, it is advisable to bring someone with you. The fees and responsibilities of the attorney you are engaging should be clearly outlined. During the consultation, do not be afraid to ask for clarification of any points you do not understand. Prior to meeting with the attorney, compile important documents pertaining to the person with Alzheimer's disease. Click here for a list of Important Documents.
To read PDF files a copy of the (free) Acrobat Reader is required. If not installed on your computer click on the logo below to go to Adobe's website to download the reader.
back to top
|
- Always name a successor, or "back up" agent in the event that the primary agent becomes unable or unwilling to act.
- Consider a neutral third person as an agent under the power of attorney if immediate family members don't get along.
- If there is no family member available who has the time or expertise to manage the estate of the person with Alzheimer's disease, consider having a bank manage the estate.
- Be sure that all designated individuals have a copy of the power of attorney and have access to the original document.
- Be sure physicians and other health care providers have a copy of the health care proxy.
- Inquire whether or not the health care agent has authority to consent to a brain autopsy.
back to top
|
In order to develop a plan that addresses care and treatment issues for a person with Alzheimer's disease and for his or her caregiver, professional assistance should be sought. The professionals who specialize in planning for the person's physical long term care needs include doctors, nurses, social workers, geriatric care managers , therapists, and counselors. The Helpline of the New York City Chapter of the Alzheimer's Association can also help you.
back to top
|
The first step in planning how to pay for the future medical and living expenses of the person with Alzheimer's is to start with an honest look at your family's current financial situation, as well as that of the person with Alzheimer's. Assemble the person's assets by locating such financial documents as:
- Bank account statements
- Bond certificates
- Stock portfolios
- Real estate deeds
- Insurance policies
Identify current expenses as well as anticipated future expenses, including:
- Ongoing medical treatments
- Treatment for other medical problems associated with aging
- Prescription medicines
- Personal care supplies such as incontinence supplies
- Adult day supervision services
- In-home care services
- Full-time residential care services
Consider working with a qualified adviser, such as a financial planner, elder law attorney, or accountant.
- To locate an elder care lawyer on the site of the National Academy of Elder Law Attorneys Inc., click here.
- To get a list of Free Legal Services, click here .
- To locate a geriatric care manager on the site of the National Association of Professional Geriatric Care Managers, click here.
Please note: We appreciate how important it is that the person with Alzheimer's receives good care. All referrals are for informational purposes only. The New York Chapter of the Alzheimer's Association cannot guarantee, endorse, or recommend any of the providers in the services listed. Furthermore, we do not receive any financial compensation from the providers.
back to top
|
The person with Alzheimer's may not have all of the financial resources he or she will need to pay for care. As the caregiver, you need to make important decisions about how much you can contribute. Review your own assets, such as savings, investments, and insurance plans. Perhaps you already need to replenish savings and replace income you used in providing care.
If the person with Alzheimer's is dependent on you financially, you may be eligible for medical expense deductions and dependent care credits on your tax return. Also consider what plans need to be in place in case something happens to you. Remember, as the caregiver, your economic role is more important than ever. You may need to increase your own life insurance or disability insurance to provide a financial safety net for yourself and anyone else who depends on your income.
back to top
|
The following are some legal and financial planning instruments that are important in managing the finances of the person with Alzheimer's disease:
Direct Deposit
Direct or automatic deposit into the person's bank account protects against loss, theft, or the destruction of checks. To arrange for the direct deposit of government funds, file a standard authorization form that can be obtained from the bank or the government agency from which the individual is receiving benefits.
To arrange to have your Social Security check deposited directly into your bank, you can call the Social Security Department for Direct Deposit toll-free weekdays from 7:00 AM to 7:00 PM at 1 800 772-1213.
Click here for more information on Social Security .
Representative Payee
When a family member or caregiver needs access to the retirement benefits of the person with Alzheimer's disease they can be set-up as a representative payee. Once approved, they receive the benefit checks that are then used to pay the individual's living and health care expenses. A representative payee does not automatically gain access to any other income or resources of the person with Alzheimer's disease. This option is available for benefits from the following:
Joint Bank Account
A joint bank account is an account held in more than one person's name, such as John Doe and Jane Doe. An account can be set up so that either party can access the account independently, or both people must sign in order to withdraw money. While joint accounts are a useful way to maintain access to another person's resources, they can cause complications when applying for Medicaid or other public benefits. Many government programs assume that the money in the account belongs only to the person applying for the benefits. Be sure to review any joint accounts with an elder law attorney or other benefits expert prior to making applications for public benefit programs.
Power of Attorney
A power of attorney document gives a person with Alzheimer's (the "principal") an opportunity to authorize an "agent" (usually a trusted family member or friend) to legally make decisions when he is no longer competent. The agent can deal with a wide variety of financial and property matters, ranging from the management of a single bank account to buying and selling assets, including real estate.
A change in New York law has made the Power of Attorney form more complex. Prior to executing the instrument, read it carefully and, if there are any provisions that are unclear, seek professional assistance.
Because Alzheimer's disease is progressive in nature a durable power of attorney is the preferred form. A durable power of attorney gives to the agent immediate power that continues after the person with Alzheimer's disease becomes disabled or incapacitated.
Living Trusts
A living trust is an entity that is created to hold assets of an individual called the "grantor" or "settler". The assets in the trust are managed by an individual or entity called the "trustee". The grantor is often the trustee of a revocable trust, but a third party is usually the trustee of an irrevocable trust.
An advantage of a living trust is that it may avoid the necessity of probate ("proving" the will to the court), which will allow for quick and easy distribution of the assets. Different types of trusts accomplish different goals. Certain irrevocable trusts can protect assets in the event of long-term health care needs. It is important to note that trusts do not always provide the Grantor with tax advantages.
Will
A will is a document created by an individual (the "testator") that sets forth how an individual's assets are to be distributed upon his/her death. The "executor" of the will manages the testator's assets until they are distributed to the testator's beneficiaries. Wills become effective only when the testator dies. An executor named in a will has no authority to act during the lifetime of the testator. A will cannot be used to communicate health care preferences. However, it can give an individual peace of mind that his wishes will be fulfilled after death. All persons, including those with Alzheimer's disease, can benefit from having a will.
Guardianship
Another option for managing the affairs of the person with Alzheimer's disease is to bring a guardianship proceeding in which a court appoints a guardian to care for the individual's person and/or property. This course of action is usually pursued when the patient has become incapacitated and had previously made no provisions for personal and/or money management. However, the guardianship proceeding can be expensive. For this reason, it is strongly recommended that a durable power of attorney and health care proxy be in place before the person with Alzheimer's disease becomes incapacitated.
back to top
|
Many people in the early stage of Alzheimer's disease want to ensure that their wishes concerning their health care will be carried out in the event they become incapacitated. They may provide instructions for their future care through a health care proxy and living will.
Health Care Proxy
New York's health care proxy law allows for the appointment of a person (the health care "agent") who can act on behalf of the patient (the "principal") and participate in the health care decision-making process on behalf of the principal. The agent has the power to make decisions regarding life-sustaining treatment; however, when it comes to decisions about artificial nutrition and hydration (feeding tubes), the agent must have specific knowledge of the principal's wishes. The principal should clearly state on the proxy itself that they have discussed artificial hydration and nutrition with their agent, and that the principal has authorized the agent to make those decisions on their behalf. The agent is empowered to make decisions only upon determination by the principal's attending physician, to a reasonable degree of medical certainty, that the principal has sustained the loss of his or her capacity to make health care decisions. Copies of the health care proxy should be given to the agent, the patient's doctor, home health care provider agency, hospital, elder law attorney, geriatric care manager and other family members or close friends.
New York State law limits family members from making certain treatment decisions for patients unable to make their own decisions, unless a court guardian is appointed or the individual has signed a health care proxy. A properly signed health care proxy may avoid a time-consuming and expensive guardianship proceeding s in the future.
The Healthcare Proxy should contain a HIPPA waiver. This is the document that is signed allowing the healthcare provider, doctor, pharmacist, etc. to release medical records to a third party. It is possible that without this language; doctors, etc. may not be able to speak to the agent and share information concerning the patient.
If the individual spends time in another state, then a health care proxy or medical power of attorney approved under that state's law should be executed.
The Living Will
The living will allows a person to declare his or her wishes regarding the use of medical procedures, including those that can delay death. While New York State does not have a statute that authorizes the use of living wills, they are recognized under case law.
However, the New York State Court of Appeals has upheld the right of an individual to have life-sustaining treatment withheld when, in advance, such a decision has been clearly indicated, such as in a living will. An appropriately drafted living will should meet the Court's standard of "clear and convincing evidence" of an individual's desires regarding personal medical treatment and should be consistent with the health care proxy.
The Living Will is a good supplement to the health care proxy, providing clear and convincing evidence of an individual's wishes. It may be presented if and when a health care agent's motives are being called into question.
The contents of a living will should be discussed with personal physicians, family members, and caregivers, and should be accessible if the need arises. It should be reviewed periodically.
back to top
|
The medical insurance coverage that may be available to help meet the particular needs of the Alzheimer's patient are Medicaid, Family Health Plus, Medicare, Veteran's Benefits and private insurance. Medicaid, is for those persons with low-income and limited resources, and covers the cost of the long-term custodial care associated with Alzheimer's disease. Family Health Plus is a New York State health insurance program for people who have incomes that are too high to qualify for Medicaid. Medicare covers skilled nursing care costs, which may be useful in some Alzheimer's cases. Private insurance may help meet the costs of caring for an Alzheimer's patient. Each medical insurance program is described briefly below.
For additional information contact:
- The NYC Chapter of the Alzheimer's Association Helpline. Call us at 800.272.3900, or contact us by e-mail by clicking here .
- The New York City Department for the Aging, Health Insurance Information, Counseling and Assistance Program (HIICAP) by calling (212) 333-5511, or click here to go to their website
Medicaid
- Overview of Medicaid
Medicaid is a joint federal, state, and city program proving medical assistance to people with low income and limited resources. It is a health care program covering prescription drugs, community-based day care and respite care services, in-home care, hospital care and nursing home care. Medicaid is the primary source of funding for long-term custodial care in New York.
- Eligibility for Basic Community Medicaid
As of January 2004, an individual may not have more than $3,950 in total resources and $659 in monthly income plus a $20 allowance for persons 65 or older, blind or disabled, for a total of $679 per month in New York City. If the individual has more income, he/she may still qualify for Medicaid under the Surplus Income Program, but will be required to contribute that surplus to the cost of care. It is impossible for Medicaid recipients to live on $679 per month. Fortunately, surplus income over the $679 can be placed into a self-settled supplemental needs trust for the use of the recipient. Prepaid funeral expenses as described below do not affect the resource level.
As of January 1, 1997, Medicaid recipients are allowed to prepay funeral expenses with an irrevocable funeral trust. There is no limit on the amount of money that can be placed in the irrevocable funeral trust. This law replaces the prior law that allowed for a $1500 burial fund to be set-aside for a Medicaid recipient. Burial funds, which were established prior to January 1, 1997, remain in effect. New applicants will not be allowed to maintain burial funds and irrevocable funeral trusts with non-burial space items.
- Eligibility for Nursing Home Medicaid
To be eligible for Medicaid in the nursing home, the same resource limit applies for the recipient. However, all income for an individual who does not have a spouse remaining in the community must be paid to the state to cover the cost of care, except for the cost of health insurance coverage and a monthly $50 personal needs allowance. If an unmarried individual enters the nursing home and the doctor agrees that the person may be able to return home within six months, Medicaid will allow the individual to keep up to $679 (the community Medicaid income allowance in 2004 to pay his or her rent for six months.) This is called the Rent Retention Program and must be requested at the time of admission. It requires a special form which has to be included in the application for nursing home Medicaid. A three-month extension may be applied for if the person is not ready to return home at the end of six months.
- Provisions for the Well Spouse under Medicaid
When a married individual applies for Medicaid coverage in a nursing home, the law provides asset and income guidelines for the spouse at home. In 2004, that spouse is permitted to retain a homestead and a minimum of $74,820 (where the assets are $149,640 or less) or one-half of the couple's resources up to $92,760. In addition, the community spouse is allowed $2,319 in income, which may be drawn or supplemented from the institutionalized spouse's income.
- Transfer of Assets for Medicaid eligibility
A law dubbed the "Granny Goes to Jail Act", which exposed the Medicaid applicant to criminal penalties for transferring assets, was repealed in 1997. Subsequently Congress included a provision in the Balanced Budget Act, which would impose criminal sanctions on anyone who, for a fee, advised a client to transfer assets in order to qualify for Medicaid. In September 1998, a federal judge entered a final judgment – which the government did not appeal—finding the law unconstitutional and forbidding its enforcement.
To become eligible for Medicaid, a married individual who requires nursing home care may transfer virtually all his/her assets to the well spouse and become immediately eligible for Medicaid. However, assets owned by the well spouse may be subject later to recovery by Medicaid. If assets are transferred to persons other than a spouse and certain specified individuals, a penalty period is incurred. During the penalty period, an individual is not eligible for Medicaid nursing home coverage. Note: There is no penalty period for transfer of assets when applying for non-institutional Medicaid (i.e. for home care, day care, etc.)
- Determining the Penalty Period for Medicaid
With proper legal planning, the maximum period during which an individual may be counted ineligible for Medicaid is three years (36 months) for outright, uncompensated transfers to another party. For transfers to certain trusts, the period is five years (60 months). Note that there is no cap so that without proper planning the period may exceed three years and five years respectively.
- Calculating if there is a Penalty for Medicaid
When a Medicaid application for nursing home coverage is made, Medicaid reviews all financial records of the applicant (and his or her spouse) for 36 months before the month that Medicaid is requested to begin. This is done to determine whether there were any uncompensated transfers that would incur the imposition of a penalty period. All uncompensated transfers (a transfer of funds for which there was no compensation or service provided, in other words a gift) by the applicant or his/her spouse are added together and the total is divided by what Medicaid has determined is the average cost of a month's care in a nursing home. For 2004, that amount in New York City is $8,695 (it was $8,157 in 2003). The result of the calculation is the number of months for which the applicant is ineligible for Medicaid coverage in the nursing home.
For example, Mr. S transfers $86,950 to a trust or a non-exempt individual. The $86,950 is divided by the average cost of a month's care in a nursing home in New York City or $86,950. $86,950 divided by $8,650 is 10. That means that Medicaid will not cover his costs in the nursing home for 10 months.
- Transferring the Home for Medicaid eligibility
Although the individual's homestead, a house, coop or condominium is an "exempt" resource for purposes of initial Medicaid eligibility, ultimately it may be subject to a Medicaid demand for reimbursement. Transfer of the home to a spouse and certain specified individuals, such as a disabled child, a caretaker child who has resided in the home for at least two years prior to institutionalization and a sibling with equity interest who resided in the home for at least one year prior to institutionalization will not trigger a penalty period. However, outright transfers to persons other than exempt individuals will trigger a penalty period. Caution: Many outright transfers will incur substantial adverse tax consequences. To minimize the penalty period and taxes, no transfers should be made without the professional advice of an elder law attorney.
- Medicaid Application for Nursing Home
In addition to requiring a 36-month retroactive review of the applicant's financial history, Medicaid requires extensive documentation to establish eligibility, including verification of identity, age, residency, citizenship, marital status, income and resources and additional personal information. The applicant must disclose all relevant financial records including bank statements, savings accounts, inventory of stocks and bonds, real estate, etc. for that 36 month period. Also required is documentation and explanation for all transactions of $1,000 or more. Compliance with this requirement is more complex when the applicant made substantial transfers. The elder law attorney's role in this instance is to document and clarify the consequences of these transfers.
All required information must be made available to the Medicaid authorities in a compact and easy-to-follow format, often prepared by an elder law attorney or other professional. Both spouses must provide complete, 36-month financial histories even if only one is applying.
- Medicaid Application for Home Care
When the applicant is applying for Medicaid home care assistance, the applicant may request a simplified asset review and provide a financial history for one month for the individual applicant, not the spouse. However, if the spouse's information is not provided, the case will likely be sent to Medicaid's legal division for possible recovery from the spouse. In addition, the application must include a physician's order designated as form M-11q in New York City. The decision to provide Medicaid services and the nature and amount of services to be provided are substantially predicated on the M-11q. A M-11q form that fails to fully explain the patient's medical needs may account for Medicaid's decision to deny service or provide service that is insufficient. If uncertain, an elder law attorney or geriatric social worker should be consulted to review the M-11q with the physician. For further information about the Medicaid application process for Home Care, contact the Alzheimer's Association about attending a Medicaid Home Care Seminar or click here to find out more about this Seminar.
- Family Health Plus
Family Health Plus is a public health insurance program for adults between the ages of 19 and 64 who do not have health insurance – either on their own or through their employers – but have incomes too high to qualify for Medicaid. Family Health Plus is available to single adults, couples without children, and parents with limited income who are residents of New York State and are United States citizens or fall under one of many immigration categories.
Family Health Plus provides comprehensive coverage, including prevention, primary care, hospitalization, prescriptions and other services. There are no costs to participate in Family Health Plus. Health care is provided through participating managed care plans in each person's area.
For more information about Family Plus, click here to go to the Family Plus website . It will answer your questions and guide you on how to apply.
Medicare
The Medicare program is a system of health insurance for the aged and the disabled. It is administered by the US Department of Health and Human Services through the Health Care Financing Administration and consists of two basic parts:
Part A provides coverage for the costs incurred by eligible beneficiaries for inpatient hospital care, inpatient care in a skilled nursing facility following a hospital stay, home health care, and hospice services.
Part B is a voluntary program in which eligible beneficiaries who pay a monthly premium are entitled to reimbursement for physician and other medical services and supplies. Medicare does not pay for care that is custodial, i.e., that is primarily for the purpose of helping the person with daily living or meeting personal needs, and could be provided safely and reasonably by people without professional skills or training. For example, custodial care can include bathing, dressing, helping to eat, administering medicine and supervision for safety reasons.
- Eligibility for Medicare
Primary Medicare eligibility is linked to eligibility for Social Security retirement and disability benefits. Disabled persons, and disabled widows and widowers under age 65 may also be eligible for Medicare. Some persons who are 65 years of age or older but not other wise eligible may purchase this insurance by applying to Social Security.
- Enrollment for Medicare
The initial enrollment period begins 3 months prior to the month of the person's 65th birthday and continues 3 months after that. There are significant penalties for late enrollment. A special enrollment period is available for the working aged and their spouses who delay enrollment because of primary, employer-based insurance.
- Benefits Under Medicare Part A
Medicare Update as of September 2001
Medicare has been modified so that Medicare patients are no longer automatically denied reimbursement for therapy treatments if they suffer from Alzheimer's disease. The theory behind this exclusion had been that physical and mental therapy treatments were not effective in dealing with an incurable disease such as Alzheimer's. But studies now show that Alzheimer's patients can benefit from such treatments, especially in the early stages of the disease. Medicare will now pay for the following expenses for people diagnosed with Alzheimer's:
Specific speech, occupational and rehabilitation therapies, services provided by doctors and healthcare providers for neuro-diagnostic testing, medication management and psychological therapy
- Inpatient Hospital Coverage:
Medicare Hospital Insurance (Part A) will pay for all medically necessary inpatient hospital care for the first 60 days of a patient's hospital stay minus a deductible of $876 per benefit period (2004) A benefit period begins the day you go to a hospital and ends when you have not received hospital care for 60 days in a row. If you go into a hospital after one benefit period ends, a new one begins and you pay the deductible for the new period. For the remaining days a beneficiary must pay substantial co-payments, which may be covered through his or her supplemental insurance (Medigap) policy (see discussion below). Major in-hospital services covered by Medicare Part A include a semi-private room, all meals, special care units including intensive care unit, coronary care unit, regular nursing services, and drugs furnished by the hospital during the patient's stay.
- Skilled Nursing Facility Care:
Medicare will also pay for up to 100 days in a skilled nursing facility. The first 20 days are fully covered, but for days 21 through 100, a $109.50 (for year 2004) daily co-payment is required. This co-payment may be covered by Medigap insurance. The patient must have been hospitalized for at least 3 days prior to entering the skilled nursing facility, and generally, must be admitted to the facility within 30 days after leaving the hospital.
- Home Health Care:
Medicare also provides home health care services that can continue for as long as the beneficiary is under a physician's plan of care, requires skilled nursing or rehabilitation care and is essentially confined to home. Skilled nursing services are those tasks which can only be performed by a registered nurse or under the supervision of a nurse or other certified professional. Physical, occupational and speech therapy and home health aide services are available. A prior hospital stay is NOT required. The number of home care hours is generally limited to no more than 35 hours per week under Medicare.
Please note: While the need for skilled care must be periodically recertified, there is no time limit imposed on this benefit.
- Hospice Care:
Medicare's hospice program includes both home care and inpatient care when needed, and a variety of services not otherwise provided by Medicare. To be eligible, a Medicare beneficiary must be certified by a physician to be terminally ill with a life expectancy of approximately 6 months or less. Those who choose hospice care receive non-curative medical and support services for their terminal illness. Regular Medicare continues for medical treatments not related to the terminal illness.
- Benefits Under Medicare Part B
Medicare Medical Insurance (Part B) covers a variety of medical services of particular importance to Medicare beneficiaries, including physician services in and out of the hospital, durable medical equipment, outpatient hospital services, physical, occupational and speech therapy and ambulance transportation. Part B coverage is voluntary. Most Medicare beneficiaries decide to enroll in the program and their monthly premiums are deducted from their Social Security checks.
There is a monthly premium of $66.60 (for year 2004) for Medicare Part B and an annual deductible amount of $100 that must be paid before Medicare benefits are reimbursed. Medicare pays 80% of the approved charge for services and the beneficiary is responsible for the 20% co-payment. Some Medigap policies cover these charges.
- Excluded Medicare Services
Services not covered by Medicare Part A include private duty nursing and, generally, private rooms.
Services excluded under Medicare Part B include most prescription drugs that do not require administration by a physician, routine physical checkups, immunizations (with some exceptions), eyeglasses or contact lenses, most dental care and hearing aids.
Generally, Medicare will not pay for hospital or medical services abroad, or for physician services on cruise ships beyond US territorial waters.
- Limiting charge for Medicare
There is a cap imposed on the amount doctors may charge Medicare patients for each service. In New York, doctors may not charge more than 5% above the Medicare-approved charge for most services.
Medicare Supplemental Insurance (Medigap)
Medicare beneficiaries generally decide to buy private supplemental insurance (Medigap). At present, there are 10 standard Medigap policies that may be offered in New York. The basic plan (Plan A) is a policy that pays:
- The patient's share of Medicare's approved amount for physician services (20%) after the $100 annual deductible
- The patient's cost of a long-term hospital stay through 150 days
- All approved costs not paid by Medicare after the 150 th day to a total of 365 days lifetime coverage
- Charges not covered by Medicare for the first three pints of blood.
Note that Plans A and B do not cover the co-pay of $109.50 per day for nursing home stays from days 21 through 100.For more information about Medigap call the Health Insurance Information, Counseling and Assistance Program (HIICAP) at (212) 333-5511.
Medicare Health Maintenance Organizations (HMOs)
Medicare Health Maintenance Organizations (HMOs) are an alternative to traditional fee-for-service Medicare and Medigap insurance. HMOs are less expensive and you typically must see the doctor in the plan. Fee for service is the original Medicare plan, with higher out of pocket costs but more choice in doctors. Medicare HMOs are required to provide the same coverage as traditional Medicare; however, many HMO manuals are unclear as to the comprehensiveness of coverage. Important considerations include:
- Whether the HMO provides a complete diagnostic assessment for Alzheimer's disease, including access to specialists and imaging tests
- Whether the HMO will prescribe the most recent drugs to treat Alzheimer's disease
- Whether the HMO covers day care and/or custodial home care (very few offer this option).
Prospective enrollees should be aware that they might lose some control over their overall health care by choosing this option. Generally, HMO plans have "lock-in" requirements. This means that an enrolled member is locked into receiving all covered care from the doctors, hospitals and other care providers who are affiliated with the plan. In most cases, if the enrollee goes outside the plan for services, neither the plan nor Medicare will pay, and the enrollee will be responsible for the entire bill.
Individuals must select a primary care physician who belongs to the plan. This physician oversees all the decisions regarding the patient's medical services. Having to change physicians may negatively impact an Alzheimer's patient who is already accustomed to a doctor who does not belong to the HMO network. In order to avoid this and other problems, consider whether the patient's current doctor and specialists belong to the HMO or whether the HMO will authorize the use of outside specialists.
For more information about Medicare HMOs call the Health Insurance Information, Counseling and Assistance Program (HIICAP) at (212) 333-5511.
Medicare Information, Counseling & Advocacy Referrals
For information, counseling and referral please contact:
Click here for more on Medicare Part D Prescription Drug Plan
Long Term Care Insurance
The cost of a nursing home stay in the New York metropolitan area can range from $72,000 to $165,000 per year. Even with Medicare and supplemental insurance coverage, patients may face devastating expenses for in-home or nursing home care.
Long-term care insurance is now available through a number of insurance companies. Some employers offer long term care insurance, but usually a person must purchase it independently.
Several carriers provide "indemnity" long-term care insurance policies. This means that they pay a set amount of money for each day a person is being cared for provided the individual meets the policy's eligibility requirements. The daily benefit is determined when the policy is purchased. Some insurance companies offer an inflation rider to step up the daily benefit to keep pace with inflation. Like other medical insurance plans, long term care policies may also have annual deductibles, waiting periods, benefit time limits and exclusions for existing conditions.
Long term planning should be arranged before a health problem arises. As there is often little or no time for planning with Alzheimer's disease, long-term care insurance is often unavailable, or is extremely costly, unless an individual purchases it well in advance of his or her disability. Most insurance companies make specific reference to Alzheimer's disease as a pre-existing condition; the policy will not provide coverage if the condition exists before the policy is put in place.
As an alternative to a long term care policy, certain insurance companies have developed long term care riders that you can add to a life insurance policy. These riders provide a monthly long-term care benefit equal to a fixed percentage of the death benefit. For example, a $100,000 policy may pay up to 2% per month ($2000) if the insured person enters a nursing home. This option must be purchased before the individual becomes incapacitated or disabled.For more information contact:
Several long term care insurance plans should be reviewed before selecting one that best meets the needs of the patient.
Veterans Benefits
Veteran's benefits are administered through the Department of Veterans Affairs. For most benefits, the claimant must be a veteran or a veteran's spouse, widow or widower, child, or parent. Further eligibility is determined based on cause of disability, character of discharge, period of service and length of service.
In addition to income benefits and burial benefits, there are a number of medical benefits available to qualified veterans and certain dependents and survivors. These benefits may include adult day care, home care, prescriptions, outpatient care, hospital care, domiciliary care and nursing home care.
For more information, click here to go to the US Department of Veteran's Affairs or call the US Department of Veterans Affairs at (800) 827-1000 or the New York State Division of Veterans Affairs at (888) VETS-NYS (838-7697)
COBRA – Consolidated Omnibus Budget Reconciliation Act of 1985
Some individuals who have left a job where they were covered by the company's health insurance plan, and are younger than 65, are eligible for COBRA insurance. Under COBRA, an employee who leaves an employer or whose hours are reduced to the point that he or she no longer qualifies for the health plan, may continue group plan coverage for up to 18, 29 or 36 months depending on the circumstances. The insured must pay the full cost of coverage, plus up to 2% to cover administrative costs.
COBRA can be very helpful until the person with Alzheimer's obtains new coverage through an employer or becomes eligible for Medicare. Individuals must activate the COBRA option within 60 days of leaving work or having their hours reduced. COBRA applies if the company has 20 or more employees.
back to top
|
The New Medicare Drug Benefit (Medicare Part D)
-
On January 1, 2006, Medicare will begin to pay for outpatient drugs for all Medicare beneficiaries. But beneficiaries must enroll to receive benefits.
-
Medicare beneficiaries can begin signing up for the new drug coverage on November 15, 2005.
-
The benefits available are significant, especially for people with low incomes and those with high drug costs.
-
Information on what drug plan choices will be offered in our area will be available by mid-October.
-
You should begin to gather information so you and your relative will be prepared to make a decision at that time. Waiting too long to enroll may result in penalties.
-
In addition, you can apply now to receive "extra help" paying for premiums, deductibles and co-insurance payments if you or your relative have limited income.
The New Medicare Drug Benefit and Alzheimer's Disease
On January 1, 2006, Medicare will begin to cover outpatient drugs to its beneficiaries. This is the largest expansion of Medicare benefits since its establishment in 1965. Unlike other Medicare benefits,the drug benefit will only be provided through private entities, such as health insurance or managed care plans. Beginning November 15, 2005, beneficiaries will begin to enroll in a plan for drug coverage (called Part D).
Although there is a standard benefit, each plan has some flexibility to set its own premium, deductibles, coinsurances and benefits, within certain guidelines established by the government. Each plan may limit coverage to a specific list of drugs (called a formulary) and the list can change during the year. It is estimated that the 2006 premium will be approximately $37 a month.
The standard benefit is:
|
$250 |
Beneficiary pays initial deductible |
|
$251 - $2,250 |
Plan pays 75% - Beneficiary pays 25% |
|
$2,251- $5,100 |
Beneficiary pays 100% co-payment |
|
Above $5,100 |
Plan pays 95% - Beneficiary pays 5% |
Four Options for Medicare Beneficiaries
The drug benefit will be provided through private entities, such as health insurance or managed care plans, and enrollment will begin November 15, 2005. The following four options are available for Medicare beneficiaries:
- Stay in traditional fee for service Medicare and enroll in a stand alone prescription drug plan (called a PDP). For people on Medicare and Medicaid, beginning January 1, 2006, Medicare will cover prescriptions through a Medicare drug plan instead of Medicaid. These individuals (also called dual eligibles) will be automatically enrolled in a Medicare drug plan by the government to ensure that there is no loss of drug coverage. However, they can change to a different plan at any time.
- Join or remain in a Medicare Advantage plan (such as an HMO or PPO) and get all Medicare benefits through the plan.
- Remain with current coverage from another source. For individuals who receive drug coverage from another source, such as an employer, union or Medigap policy, they will be notified by their current plan if the current drug coverage is at least as good as Medicare drug coverage. They will need to find out how the current drug plan works with Medicare before making a decision to enroll in a Medicare drug plan.
- Decide not to enroll in a Medicare plan at this time. If individuals do not have drug coverage at least as good as the Medicare drug plan and wait until a later time to enroll, they will have to pay 1% more per month on their premium for every month they waited to enroll. The individuals will have to pay this higher premium for as long as they receive Medicare drug coverage.
Important Benefit for Beneficiaries with AD
Given that the cost of prescription drugs has been increasing rapidly each year, this new benefit will help relieve some of the financial pressures, especially for beneficiaries who do not have health insurance to help cover the cost of prescription drugs. Through our advocacy efforts, all Medicare drug plans are required to have at least two cholinesterase inhibitors, as well as memantine, on their formularies, and therefore covered by the plan.
Medicare will also cover most of the other drugs that people with Alzheimer's disease need, such as the antipsychotics, and drugs related to other conditions, such as diabetes or heart disease.
For low-income beneficiaries, Medicare will offer drug coverage with no premium or deductible and low copayments. In addition, all Medicare beneficiaries who are also on Medicaid will begin to get drug coverage through Medicare and must enroll in a Part D plan as well. It is estimated that one-third of Medicare beneficiaries will qualify for low-income assistance under the new Part D benefit. Almost 40% of Medicare beneficiaries with Alzheimer's disease and other dementias are also eligible for Medicaid.
When Deciding About Drug Coverage
When making a decision,it is important to compare your current drug coverage, including which drugs are covered with the current coverage and cost of the Medicare drug coverage plans in our area. As you make decisions about enrollment,you should think about what prescription drug needs you will have in the future as well as today.
Here are a few suggestions that you might consider:
- Find out about your current health insurance coverage and what drug coverage you have. Are prescriptions drugs covered? Some Medicare beneficiaries have other types of prescription drug coverage that might offer comprehensive coverage for prescription drugs, such as through a former employer, Medigap, TRICARE and the Veteran's Administration. If you currently have prescription drug coverage, you will be notified by your insurance plan if your current drug coverage is at least as good as Medicare prescription drug coverage. If you are on Medicaid, beginning January 1, 2006, Medicare will cover your prescriptions through a Medicare drug plan instead of Medicaid.
- If you have limited income and resources, you may be eligible for extra help paying for deductibles, premiums and coinsurance. In general, you will be eligible if your annual income is below $14,355 for an individual ($19,245 for a married couple) and your resources (not including your house) are $10,000 ($20,000 for a married couple.) To get more information or to apply you can call the Social Security Administration (SSA) at 1-800-772-1213 or visit www.ssa.gov on the Internet to complete an application. Applications can be submitted to the SSA or the local Medicaid office. Some people, such as people on Medicaid, Supplemental Security Income (SSI) and Medicare Savings Programs, will be automatically eligible for this extra help and do not have to file an application.
- Make a list of the name, dosage, frequency and cost of the prescriptions you or your relative uses. Since different plans will cover different drugs, this information will help determine which plan best meets your prescription needs. Your pharmacy may be able to print a list of the drugs and their cost for you. Through the Alzheimer's Association's advocacy efforts, all plans are required to pay for most Alzheimer's drugs.
- Beginning in October, information will be available about what plans are available in our community. In mid-October, the government will publicize this information by mail, the Internet and the 1-800-Medicare toll free number. By this time, there will be specific information available about what drugs are covered by the plan and how much they will cost.
- You can enroll in a plan from November 15, 2005 - May 15, 2006. If you enroll before December 31, 2005, you will begin receiving drug coverage from the plan on January 1, 2006. If you wait until after December 31, 2005, you will begin receiving your drug coverage on the first day of the month following the month he enrolled. For example, if you enroll in a plan on January 10, 2006, your coverage will begin on February 1, 2006. You can get free one-on-one counseling and assistance from the Department for the Aging's, HIICAP (Health Insurance Information Counseling Assistance Program) at 212-333-5511.
- If you join a Medicare drug plan after May 15, 2006, you may have to pay a higher monthly premium later. If you did not have drug coverage from another source that is at least as good as the Medicare drug plan, you will have to pay 1% per month for every month you waited to enroll. You will have to pay this higher premium as long as you have Medicare drug coverage.
- The Alzheimer's Association will regularly have updated information over the next few months. You can check our web site or contact us at 800-272-3900 if you have general questions.
Summary Checklist
- Review current coverage
- Apply for "extra help"
- Make list of current drugs
- In October, check out available plans
- Enroll beginning November 15
- Check resources for updated information
- Remember to enroll in a Medicare drug plan for yourself too
- Check back with the Alzheimer's Association or Medicare for updated fact sheets or information
Important Dates
October 2005 - Government publishes information about prescription drug plans available in each region.
Fall 2005 - Government sends letters to Medicare-Medicaid beneficiaries notifying them of the Medicare drug plan into which they have been automatically enrolled.
November 15 - May 15 2006 - Initial enrollment period for Medicare drug benefit (Part D.)
January 1, 2006 - Medicare drug benefit begins. Medicare begins coverage of drugs for its Medicare-Medicaid beneficiaries. Medicaid drug coverage for Medicare beneficiaries ends.
For more information, you can look on our web site, the National Alzheimer's association web site (www.alz.org), the government's web site at medicare.gov or call 1-800-Medicare.
back to top
|
Disability Insurance
Disability insurance provides income for a worker who is no longer able to work because of illness or injury. If an employer provides the disability policy, it usually replaces between 60 – 70 percent of a person's gross income. The benefits from an employer-paid plan are taxed as income.
If the person with Alzheimer's disease bought a personal disability policy, then the benefits paid will be the amount he or she chose. The benefits from a personal policy are free of income tax.
Life Insurance
Life insurance can be a valuable source of cash. You may be able to borrow from a policy's cash value, or the person with Alzheimer's disease may be able to receive a portion of the policy's face value as a loan. This is called a "viatical loan" and is paid off at death.
Some life insurance policies may offer "accelerated death benefits" where a portion of the insurance benefits can be paid if the insured is expected to die within 6 to 12 months from a terminal illness. The payout may run as high as 90 – 95% of the policy's face value, also free of tax.
Also check if your life insurance policy contains a "waiver of premium" rider. That means that the insured, if disabled, does not have to pay premiums to continue coverage.
Be careful, the cash value in a life insurance policy is considered an asset for Medicaid purposes.
Retirement Benefits
Benefits from retirement plans, individual retirement accounts (IRAs) and annuities can provide critical financial resources, even if the person hasn't reached retirement age. Pension plans typically pay benefits before retirement age to a worker defined as disabled under the plan's guidelines.
The person may also be able to withdraw money from his or her IRA or employee-funded retirement plan before age 59 ½ without paying the typical 10% early withdrawal penalty. However, this money usually will be considered regular income, and taxes will have to be paid on the amount withdrawn. In that case, if withdrawals can be delayed until after the person leaves work, income taxes due will most likely be less because he or she will probably fall into a lower income-tax bracket.
Social Security benefits are also available before retirement age in the event the person becomes disabled or blind.
Continuing to work – the impact of continuing to work in the early stages of Alzheimer's
If the person you are concerned about is under age 65, in the early stages of Alzheimer's Disease, you can help them continue to work. This may mean working at a less demanding job for the same employer or perhaps working in a part-time job. The American with Disabilities Act (ADA) offers limited protection to those with Alzheimer's disease. The ADA requires companies with at least 15 or more employees to make "reasonable" accommodations for job applicants and employees with physical or mental disabilities. For example, an employer may switch the worker to a less demanding job or reduce work hours. Talk with the person's employer about Alzheimer's disease and the symptoms.
If you believe the person with Alzheimer's has been treated unfairly at work, try to resolve the problem first with the employer. If that doesn't work, you can file a claim under the ADA through the Federal Equal Employment Opportunity Commission or under your state's disability law.
Employee Benefits
If the person with AD continues to work, review the employer's benefits handbook and talk to the benefits specialist to determine what benefits may be available. For example, the employer may provide paid sick leave or other short-term disability benefits (usually for one year or less).
The employee may be able to convert an employer-provided life insurance policy to an individual plan. He or she may also be eligible for a flexible spending account, which allows for the payment of out-of-pocket medical expenses with pre-tax dollars (essentially saving 20 – 30% off the cost). Be sure you have written confirmation of all benefits that are available.
Real Estate – Using Real Estate as a Source of Income
Real estate that you own, such as your home, can be a source of income. For example, a home can be sold and the money invested. Or the equity in a home can be converted into income through a process called a reverse mortgage. This type of home equity loan allows a person of age 62 or older to borrow against their home in cash, while retaining ownership. The amount they are eligible to borrow is generally based on their age, the home's equity and the lender's interest rate. Reverse mortgages do not affect Social Security or Medicare benefits, although they can affect qualifying for some government programs.
Be sure to consult an attorney before initiating any real estate transaction.
back to top
|
There are many financial assistance programs that are available, particularly for people with low income and resources. Click here to get a list of the financial and other assistance programs.
In addition, click here to go to an Online Benefit Calculation Program that may help you identify the financial assistance programs that meet your particular needs.
( Please note: The New York Chapter of the Alzheimer's Association appreciates how important it is that the patient receives good care, however we do not guarantee, endorse or recommend any of the programs you identify on this website.)
Source: "Alzheimer's Disease, A Legal and Financial Planning Guide for New Yorkers", Third Edition, Published March 2000, by the New York City Department for the Aging.
Contrary to popular belief, Alzheimer's is not just a disease of old age. Early-onset Alzheimer's, which accounts for up to ten percent of Alzheimer's cases, affects people under the age of 65 - some in their 40s and 50s.If you have early-onset Alzheimer's disease, it's important to understand that your life is not over. You can live a meaningful and productive life by engaging in the activities and interests you can still enjoy, and finding comfort in your family and friends. Living with Alzheimer's means dealing with some life transitions sooner than you had anticipated. It is important to know that:
- You are still the same person.
- The changes that you are experiencing are because of a disease of the brain – dementia.
- Each person is affected differently and symptoms will vary.
- This is an illness that was not acquired by any action or inaction on your part.
- You will have good and bad days.
- You are not alone. There are people who understand what you are going through and can help.
SEEKING SUPPORT
Many people are not ready to seek support. Sometimes they feel overwhelmed by the diagnosis, or not well enough to socialize or talk to other people. Apathy and social withdrawal are common and may be experienced early on in the disease. Understanding this may assist you to embrace help and reach out to others. Sometimes you will encounter well-intentioned people who will challenge your diagnosis and put you on the defensive. You may get comments like, "You don't look like you have Alzheimer's (dementia)", or "What makes you think you have dementia"? If you reply with an anecdotal experience, people may say, "Oh, that always happens to me".
Try not to take this as a personal affront or discounting of your diagnosis. Most people are simply trying to support you as best they know how. Unfortunately, most of society is uneducated about early dementia and have a stereotypical image of someone with dementia as being very old and fragile in appearance and severely cognitively impaired.
One of the best places to get support is by joining a support group with others diagnosed with dementia. It is often very helpful to connect with peers who are experiencing similar feelings and reactions. Click here for a list of Early Stage Support Groups, organized by the New York City Chapter of the Alzheimer's Association.
Don't be afraid to continue to learn - challenge yourself. Many resources are available to you for the positive support you need. Remember to accept help when it is offered, and ask for help when you need it. Click here for helpful tips on dealing with memory changes.
back to top
|
| Many people do everything necessary to plan for the care of the patient while they are alive, but do not make provisions for end of life arrangements. At the time of death there is often limited time to attend to all the details, which leaves many families feeling overwhelmed. To get more information on planning a funeral, click here to go to the website
of Dignity Memorial.
back to top
|
|
|
|
