Is my cousin getting bad advice?

[Anonymous]

If you have a set pension then you can't spend down. We just went through this with my MIL. Her pension is 11k a month. The facility is 6.5k a month-- least amount of care needed. She literally only pays for her Medicare, car insurance, toiletries and phone. Lunch out with the ladies sometimes. But her costs aren't more than 1k a month. The rest goes into her savings. She also has 150k in savings from the sale of her house. If she needs more stepped up care it will have to come from that.

10k may be cutting it close for the monthly. Do you have a better handle on all their finances? Like car insurance, Medicare supplemental, etc? My MIL was really hesitant to move but now loves the ease of not having to maintain her house.

[Anonymous]

How much of the pension dies with the husband? Not every pension provides for a survivor benefit and those that do can be small.

[Anonymous]

Anonymous wrote:If you have a set pension then you can't spend down. We just went through this with my MIL. Her pension is 11k a month. The facility is 6.5k a month-- least amount of care needed. She literally only pays for her Medicare, car insurance, toiletries and phone. Lunch out with the ladies sometimes. But her costs aren't more than 1k a month. The rest goes into her savings. She also has 150k in savings from the sale of her house. If she needs more stepped up care it will have to come from that.

10k may be cutting it close for the monthly. Do you have a better handle on all their finances? Like car insurance, Medicare supplemental, etc? My MIL was really hesitant to move but now loves the ease of not having to maintain her house.

Yes, we got access to bank account online and ran it through an aggregator tool (Monarch Money, highly recommend). Most of their expenses are things they’d drop if they moved into AL. Utilities, property insurance, community HOA, groceries. They’d still have the phones and whatever incidentals they’d pick up. They actually get reimbursed for the cost of Medicare insurance through his union.

[Anonymous]

Anonymous wrote:If you have a set pension then you can't spend down. We just went through this with my MIL. Her pension is 11k a month. The facility is 6.5k a month-- least amount of care needed. She literally only pays for her Medicare, car insurance, toiletries and phone. Lunch out with the ladies sometimes. But her costs aren't more than 1k a month. The rest goes into her savings. She also has 150k in savings from the sale of her house. If she needs more stepped up care it will have to come from that.

10k may be cutting it close for the monthly. Do you have a better handle on all their finances? Like car insurance, Medicare supplemental, etc? My MIL was really hesitant to move but now loves the ease of not having to maintain her house.

This is not quite true. Medicaid has a medically needy category in nearly all states (if not all) where if your medical costs eat up so much of your income that it makes you Medicaid-eligible, you qualify. You’d of course need to have high qualifying medical costs, but that becomes increasingly likely once people age (even with Medicare/Medigap/retiree coverage).

[Anonymous]

Assisted care level facilities generally do not accept people with progressive dementia. Idea is they accept people who can get around and may need some help with meals - they are not staffed or equipped to handle people who need total care. Have you all checked to see if assisted care place would accept the husband? Skilled level care is different from the extended care you are looking at - you are looking for a nursing home/extended care facility. Is the $9000 a month net of taxes and insurance withholding? Memory care units run about $16,000 a month many places, and that is not all inclusive. Hiding income is a very bad idea - usually is attempt to illegally qualify people for Medicaid (Medicare does not pay for long term care) by lying about assets. They usually find out and then you have a criminal case on your hands. Isn’t decent to lie and expect other taxpayers to pay for care instead of using assets to pay for that care.

[Anonymous]

Anonymous wrote:How much of the pension dies with the husband? Not every pension provides for a survivor benefit and those that do can be small.

On the federal she’d get about $2500. I have to call the state when I’m up there next and find out that one. I don’t know about SS. They get two payments. One for around $1500 and a second for around $500. I assume the higher amount is from his working years and hers is the smaller. I don’t know how SS works in that scenario. Do spouses get anything when the higher-earning spouse passes away?

[Anonymous]

Anonymous wrote:Assisted care level facilities generally do not accept people with progressive dementia. Idea is they accept people who can get around and may need some help with meals - they are not staffed or equipped to handle people who need total care. Have you all checked to see if assisted care place would accept the husband? Skilled level care is different from the extended care you are looking at - you are looking for a nursing home/extended care facility. Is the $9000 a month net of taxes and insurance withholding? Memory care units run about $16,000 a month many places, and that is not all inclusive. Hiding income is a very bad idea - usually is attempt to illegally qualify people for Medicaid (Medicare does not pay for long term care) by lying about assets. They usually find out and then you have a criminal case on your hands. Isn’t decent to lie and expect other taxpayers to pay for care instead of using assets to pay for that care.

The places I’m talking to have enhanced licenses and will care for patients through end of life and with dementia. My uncle does not currently need total care. He can walk around, dress and feed himself. At this point he needs bathing help. My aunt orients him but he does get confused about where he is and what is going on. He does not need skilled nursing at this point and I think would do better living with my aunt in assisted living where they didn’t have to worry about things like grocery shopping and preparing meals. The places I’m talking to seem to have tiers of care, usually 5 or 6 and at this point my uncle would most likely be tier 2 or 3 for them.

The $9k is net of taxes. Near as I can tell they got $2k refunded in taxes last year. Plus they are eligible for the $2.3k/m veterans benefit. I agree hiding income is a bad idea. Like I said, these conversations started before we knew what their income was and we all thought it was much lower. I don’t really know what my cousin is being told.

[Anonymous]

I just visited my mom in her independent living facility, and some of the residents told me that aides are now allowed in the building, when before if you needed an aide, you needed to move to AL.

Will your aunt and uncle be able to get an aide, if needed, in the AL facility? If so, does it only have to be part-time (i.e., 7a-7p), or can they get a full-time aide if they have a 2-bedroom apartment in the facility?

Just another thing to think about, since hopefully this will be their last move.

Good luck, OP! I hope you and your sister are able to figure all of this out for your aunt and uncle and help them in their final years.

[Anonymous]

I think the thing that you haven’t addressed yet are the step down issues. Really it doesn’t matter what the needs are today. It’s whether you can fund it into the future when they become MA eligible. At some point your uncle is going to go into a higher level of care and your aunt won’t. I don’t see how you prevent your aunt from losing her housing.

And you really don’t see to grasp that expenses don’t go away. There will always be things they need to pay for.

[Anonymous]

Anonymous wrote:I think the thing that you haven’t addressed yet are the step down issues. Really it doesn’t matter what the needs are today. It’s whether you can fund it into the future when they become MA eligible. At some point your uncle is going to go into a higher level of care and your aunt won’t. I don’t see how you prevent your aunt from losing her housing.

And you really don’t see to grasp that expenses don’t go away. There will always be things they need to pay for.

The well spouse is allowed to keep their house - it doesn’t impact the Medicaid application, I don’t think.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How much of the pension dies with the husband? Not every pension provides for a survivor benefit and those that do can be small.

On the federal she’d get about $2500. I have to call the state when I’m up there next and find out that one. I don’t know about SS. They get two payments. One for around $1500 and a second for around $500. I assume the higher amount is from his working years and hers is the smaller. I don’t know how SS works in that scenario. Do spouses get anything when the higher-earning spouse passes away?

Flagging this, not to give you a hard time but because if you don't know the answer, you are nowhere near ready to help them make a decision here.

Yes, spouses get something when the higher-earning spouse dies. It's half of the worker's "primary insurance amount." So for her, around $750 a month. It replaces, not supplements, her $500.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I think the thing that you haven’t addressed yet are the step down issues. Really it doesn’t matter what the needs are today. It’s whether you can fund it into the future when they become MA eligible. At some point your uncle is going to go into a higher level of care and your aunt won’t. I don’t see how you prevent your aunt from losing her housing.

And you really don’t see to grasp that expenses don’t go away. There will always be things they need to pay for.

The well spouse is allowed to keep their house - it doesn’t impact the Medicaid application, I don’t think.

Not if they’re both in an assisted living facility together. In that case, the house would be an asset. This is a complicated situation and it makes sense to get lawyers to advise on it.

[Anonymous]

There is something odd about those social security figures. A spousal benefit, while both are alive, is ordinarily half the insured person's primary insurance amount. A survivor benefit is ordinarily the full PIA. If your aunt's own benefits are less than half her husband's she should talk to the people at Social Security about perhaps taking her spousal benefits instead. Some benefits, however, are lower if people take them early; it's complicated enough that I wouldn't dare try to explain. Somebody should talk to the Social Security people.

[Anonymous]

OP, this is a super complicated situation with many, many layers - emotional, financial, and legal.

I kinda get the advice that the son is getting - not the illegal and immoral hiding of assets, but spending down the assets to get the dad qualified for Medicaid and the mom set up as the Medicaid community spouse. It's the most expedient, but perhaps not the most appropriate given the circumstances.

You may want to talk with your county's senior services office and get their take on what to do given the circumstances. They may come up with a different scenario on how they can remain together in a community care setting, then split up as needed. FWIW, Medicaid does not pay for AL.

The emotional here may be the most difficult to disentangle. Do your cousins look to you and sister here for support and this kind of involvement? What is the relationship b/t the brother and sister? How does she feel about her brother dictating she provide free labor for caring for her mom given the early life experiences? That's a helluva lot of nerve for one sibling to ask of another.

GL to your aunt and uncle here - hope they are able to get in a setting works for them as well as others.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Hiding assets is never a good idea. Aging in place often turns into a nightmare for person who lives closest and if they live long enough and decline it is totally unsustainable no matter how house is set up. You cannot force a sibling to take someone in. I would get council on aging and other experts involved to find a long term residential setting that fits their budget. Person who refuses needs to be willing to take them in.

Yes, and honestly Medicaid/the state will find it and take it anyway. There’s a reason there’s an asset test for Medicaid. It is for indigent elderly, not for people who have assets they want to pass on to their children.

First, 9k is not much money. It’s at least 4k/month for independent living and AL goes up from there. That is just housing. If they need food, supplies, transportation, OOP medication, medical copay/coinsurance, clothing, non-covered medical services (e.g., PT where there’s no improvement expected) that’s all on top.

It does make sense if he can possibly qualify for IL/AL to get them both into a CCRC with a Medicaid-certified nursing home, and the sooner the better. They could stay together for a while and not need to reapply/get denied in the future when they need more care. What will happen then is that as they need higher levels of care, they can move up in intensity, draw down their assets, and qualify for Medicaid once they meet the income/asset tests. But you need a 1) CCRC that will move people along to higher levels of care without a waiting list; 2) an affiliated NH that takes Medicaid. AL/IL facilities with Medicaid NHs are also generally better equipped to handle behavioral problems (or at the very least are less likely to discharge someone for them).

9K would probably not just be for housing for God’s sake! It usually includes meals, transportation to doctors, social events, etc. I found a wonderful elderly condo place for my folks that costs 200K for a buy in into a. 2br/2ba(you own it - about 1100 sq ft) and the fee is 2400/month for meals, transportation to doctors, etc. It’s very social as well. These places DO exist. No, it doesn’t cover in home care but 9K/month is a LOT of money and they could easily hire in whoever they want, even a live-in caregiver. My FIL and MIL are in one of those soup-to-nuts places that costs 8K and let me tell you, the services they offer aren’t that great. Did you know most assisted living places that charge that much only provide 45 minutes A DAY of assisted living? That’s NOTHING