Saturday, May 19, 2018

Is a Personal Care Home the Same as a Nursing Home?


[This article was written by Elizabeth A. White, CELA* an attorney with Marshall, Parker and Weber].
           Is a personal care home the same as a nursing home? This is a common question for families looking into care options for themselves or their loved ones. The answer is, no, although sometimes the two get confused.
           Personal care homes are residences that provide seniors support with instrumental activities of daily living and/or activities of daily living. Assistance with instrumental activities of daily living can include help with housekeeping and laundry, medication management, shopping and meal preparation, using the telephone, and making appointments. Examples of activities of daily living that personal care homes may provide assistance with include eating, toileting, personal hygiene, and bathing. Each personal care home can provide a description of what services they provide to their senior residents. Usually there are more and more varied activities available to seniors in personal care homes than to those in nursing homes, because personal care residents are better able to participate than those living in a nursing home setting.
           Although nursing homes also provide assistance with many of the activities listed above, seniors needs in a personal care home do not meet the higher level of services provided in a nursing home. While seniors in personal care home environments need some help with care, this help can successfully be provided in a more community like setting.
           Personal care homes are licensed by the Department of Human Services to protect the health, safety, and well being of the residents. There is staff available at personal care homes at all times in case of emergency, but not necessarily medical staff. Personal care homes are not reimbursed by Medicaid, and therefore you cannot apply for Medicaid benefits to pay for living in a personal care home. Options for payment include private pay and Veterans benefits. Generally, personal care home level of care is less expensive than nursing home level of care.
           Nursing homes provide a higher level of care than personal care homes. Like personal care homes, nursing homes are also licensed and inspected, but under a different set of standards. Skilled nursing and certain medical treatments are provided in nursing homes and medical supervision is available 24/7. Nursing homes do accept third party reimbursement though benefit programs such as Medicare and Medicaid.
           It is difficult decision for a senior to move from their home. Well intentioned children or family members often think that their parent or loved one needs to move from living independently to a nursing home. A personal care home may be a good in-between to provide the required services to the senior, but allow the senior more autonomy than they may have in a nursing home setting.  Detailed assessments of a senior’s assistance needs can help to determine the best place for a senior to thrive.
           ____                                                                                      __________________                                                                                                                                                 *Certified Elder Law Attorney by the National Elder Law Foundation under authorization of the Pennsylvania Supreme Court

Sunday, May 6, 2018

The Big Financial Danger Facing Older Adults


Recently I wrote about how death taxes impact Pennsylvania residents and their heirs. The conclusion was that for most of us, federal death taxes are not an issue. And Pennsylvania’s inheritance tax can take a modest bite from our accumulated wealth. [See my recent article Death Taxes For Pennsylvania Residents]
For many Pennsylvania seniors a much bigger risk to their goals of lifetime financial and personal security and passing along an inheritance is the possibility that their life savings will be used up paying for their care before death. Most seniors require care during an extended period of time prior to their deaths. The cost of that care, whether it is received at home, in assisted living, or in a nursing home, can quickly deplete a modest estate. The Pennsylvania Department of Human Services recently announced that the average cost of a private room in a Pennsylvania nursing home is $330 a day. That’s over $120,000 a year!
Before my father passed away some years ago he spent 2 ½ years in a nursing home. At the current rates his 2 ½ year stay in a nursing home would have cost over a quarter of a million dollars. That is enough to wipe out the savings of most Pennsylvania seniors. 
So, for most seniors, it’s the potential cost of long term care rather than death taxes that should be the focus of their estate planning. Expert long-term care planning with the help of an elder law expert can help ensure that seniors will be able to:
    * remain financially independent,
    * maintain control,
    * maintaining privacy,
    * involve family members without burdening them,
    * maximize available government programs, and
    * leave an inheritance.
It is possible to put together a plan that will reduce the risk of long-term care costs.
 While last minute planning is possible the most effective planning is accomplished by those who plan well in advance of their need for long-term care. Seniors in their 60s and 70s should be planning now to protect themselves and their families from financial devastation in their 80s and 90s.
 As President John Kennedy said: “The time to repair the roof is when the sun is shining.” John F. Kennedy, Annual Message to the Congress on the State of the Union. January 11, 1962
Pennsylvania seniors and their families can get expert planning guidance at any one of the four offices (Williamsport, Wilkes-Barre, Scranton and Jersey Shore) of my law firm, Marshall, Parker and Weber. Visit our website www.paelderlaw.com or call us toll free at 800-401-4552 for more information.

Thursday, April 26, 2018

Proposed Law Gives Visitation Rights to Families of Incapacitated Persons


(This article was written by Matthew Parker Certified Elder Law Attorney* with Marshall, Parker and Weber.)
        A bill introduced in Pennsylvania’s Senate proposes to bring “Peter Falk’s Law” to Pennsylvania.  The law provides visitation rights to the families of incapacitated persons who are under the legal custody of a court appointed guardian.  The law also gives notification rights to families regarding the incapacitated person’s change in residence, admission to a hospital and death. 
        The late actor Peter Falk played Lieutenant Columbo on the television series “Columbo” from 1968-1978.  Wearing a wrinkled raincoat, disheveled and absentminded, Columbo would solve crimes with skill and insightfulness. 
        Late in life, Peter Falk developed Alzheimer’s disease.  He was allegedly isolated from his family and friends by his second wife who had been appointed his court appointed conservator (guardian).  As his guardian, his wife allegedly prevented Mr. Falk’s daughter and family friends
from visiting him, did not notify them of changes in his health and allegedly failed to notify them of his death in 2011. 
        Peter Falk’s story is not unusual.  Many families have similar experiences.  Often a second marriage has caused a rift between the second spouse and children from a first marriage.   The caregiver spouse refuses access to the children of a first marriage or refuses to notify them of changes in the health, residence or even death of the parent.
        Across the country, 12 states have enacted versions of a law often referred to as “Peter Falk’s Law”. Pennsylvania Senate Bill 113 proposes to bring that law to Pennsylvania.  The law would prohibit a court appointed guardian from restricting an incapacitated person’s right to visit with family and friends.   There may be restrictions on the visitation rights, such as to those who pose a threat to the incapacitated person. 
        If the guardian refuses access, a family may proceed to court to have a judge order the visitation and possibly replace the guardian.   The language of the law provides that you can define those who will have visitation rights in documents such as a power of attorney or advance directive. 
        The law also proposes that the guardian will have to provide notice to designated persons of the incapacitated person’s residence change, admission to a nursing home or assisted living facility, a hospital and death.   Given the growing popularity of these laws across the country, Pennsylvania may soon be one of those states granting visitation rights to the families of incapacitated persons.  

·      Matthew Parker has been Certified as an Elder Law Attorney by the National Elder Law Foundation

Sunday, April 8, 2018

Death and Taxes in Pennsylvania


Should you be worried about death taxes?
Many Pennsylvania seniors share similar financial and estate planning goals. We want to be sure that we have enough resources to provide for our needs during our lifetime. And we want to pass a little something – as much as possible really – on to our families after our deaths.
For most of us, death taxes are a nuisance, but won’t prevent us from reaching these planning goals. Death taxes don’t affect our lifetime financial security because they only come into play when we die.  And with proper planning they won’t affect the financial security of our spouse because in most cases there is no tax on what we leave to our surviving husband or wife.
For most of us death taxes hit our families only when both spouses are gone and our home and savings pass to our children or other heirs.  At that point, they usually do take a bite.
Here is my simplified overview of how death taxes apply for Pennsylvania residents. Pennsylvania families face two forms of death tax, state and federal. This information is based on the tax laws as they exist in 2018.
Federal Transfer Taxes: The federal government imposes a set of taxes (estate, gift, and generation-skipping) on the transfer of wealth. Under current law few families are affected.
Generally, there is no tax on what you leave to your spouse or charity. And there is no tax on the first approximately $11,2 million (in 2018) that passes to your other heirs. A married couple can potentially protect approximately 22,4 million from the tax. These exclusions increase each year with inflation. There is the potential that the exclusion amounts could be reduced in the future, but they will still likely be more than most people require. If you are one of the few people who do have an estate over the exclusion limits you need to plan to avoid or limit federal transfer taxes. The tax rates are high – the federal estate tax is 40% on the excess – but that tax can be greatly reduced or eliminated by good advance estate planning.
While a 40% federal death tax is severe, it doesn’t affect many people. Fewer than 1% of all estates are subject to federal estate tax. For most of us, it is not a worry.
Pennsylvania Inheritance Tax: The Pennsylvania inheritance tax does affect the things that most Pennsylvania residents leave to their children and grandchildren after their deaths.  It will impact most Pennsylvania families.
Inheritance tax is imposed as a percentage of the value of a decedent’s estate transferred to beneficiaries whether the assets pass through probate or not. There is no bottom threshold – even small estates are subject to PA inheritance tax. The tax rate varies depending on the relationship of the heir to the decedent.
With a few special exceptions the rates for Pennsylvania inheritance tax are as follows:
  • –         0 percent on transfers to a surviving spouse or to a parent from a child aged 21 or younger;
  • –         4.5 percent on transfers to direct descendants and lineal heirs (see below for definitions);
  • –       12 percent on transfers to siblings; and
  • –         15 percent on transfers to other heirs, except charitable organizations, exempt institutions and government entities exempt from tax.
Direct descendants (4.5% rate) include all natural children of parents and their descendants (whether or not they have been adopted by others), adopted descendants and their descendants and step-descendants. Lineal heirs (4.5% rate) include grandfathers, grandmothers, fathers, mothers and their children. Children include natural children (whether or not they have been adopted by others), adopted children and stepchildren.
There are some inheritance tax exemptions written into the law. The proceeds of life insurance policies on the decedent’s life are not taxed, and special rules may apply to IRAs and other retirement plans.
Certain farm land and other agricultural property may be exempt from Pennsylvania inheritance tax, provided the property is transferred to eligible recipients. For more information about these agricultural exemptions and related requirements, see my earlier post: Pennsylvania eliminates tax on inheritance of family farms if law’s conditions are met.
Inheritance tax payments are due upon the death of the decedent and become delinquent nine months after the individual’s death. If inheritance tax is paid within three months of the decedent’s death, a 5 percent discount is allowed.
While the Pennsylvania inheritance tax can take a bite out of your estate, it is rarely devastating. Let’s say that when you die, your leave your home and investments to your children and that the net value of the inheritance is $300,000.  The PA inheritance tax would be 4 ½% of that, or $13,500, and the children would receive $286,500 in value.
If the $300,000 estate were left to a brother or sister the toll would be much higher. The PA inheritance tax would be 12% of that, or $36,000.
For more information on Pennsylvania Inheritance Tax see Elizabeth White’s article Common Pennsylvania Inheritance Tax Questions.