By David Inabinett, Attorney at Law
May is National Elder Law Month and Older Americans Month. It’s a great time to look at planning for tomorrow.
The United States has been experiencing significant growth in its older population due to factors such as increased life expectancy and the aging baby boomer generation. As of 2020, according to the US Census Bureau, 55.7 million people or 17% of the US population are 65 or older and that number is expected to grow to 80.8 million by 2024. An aging population faces new practical and legal challenges. Let’s take a closer look.
As people are living longer, there is a greater potential for age-based discrimination in employment, housing and healthcare. Laws have been put in place to fight these types of discrimination. An elder law attorney can help protect you or someone you care for from these illegal discriminatory practices.
Social Security retirement benefits are available to individuals who have worked and accumulated work credits by paying Social Security taxes during their working years. The calculation for this benefit is based upon such variables as the claimant, their work history, the income they have earned and the taxes they have paid. Social Security may also provide benefits in the event of disability, and there may be survivor benefits available to surviving spouses and/or children based upon the work credits accumulated during the employment of the deceased. Seniors will not experience any reduction in social security benefits if they earn income after age 65, and social security benefits deferred beyond full retirement age increase at the rate of 8% per year. However, that increase in benefits no longer applies after age 70 so there is no benefit to waiting to defer beyond that age.
Healthcare is another concern as we age. Individuals may be eligible for resources from the state and/or federal government, including Medicare and Medicaid. Medicare is a federal health insurance program for anyone 65 and older, and for some people under 65 with certain disabilities or conditions. It is important to apply for Medicare parts A (hospital insurance) and B (medical insurance) as soon as you are eligible. The application window begins three months before you turn 65 and ends three months after your 65th birthday. Signing up outside of this window may result in challenges. Many individuals also choose to purchase supplemental Medicare policies to cover some of the out of pocket or prescription costs.
Medicaid is a joint federal and state program that provides healthcare coverage to those individuals with limited resources and/or income. Medicaid planning can be an important tool to protect your loved ones as you look toward the future. These programs can be quite complex and having the help of an attorney to navigate them can be beneficial.
Long-term care insurance plans are intended to provide coverage for nursing care. These policies have gotten particularly expensive and no longer provide as much coverage as they once did or offer the lifetime benefit they once did. However, new products exist which provide more of a long-term care “benefit” which is more akin to an up-front investment that multiplies if the owner later requires long-term care placement but requires no premiums and is not “lost” if the owner never needs to seek long-term care. These documents and benefit options are complicated and lengthy policies that include not only benefits, but also contain exceptions to such coverage. It is a good idea to read the policy carefully so you understand what coverage and/or benefits are provided.
Another legal term that may be part of a discussion of elder law is guardianship. While guardianship is often associated with minors, the court may appoint a guardian for an adult who is incapable of making medical, mental health, and/or financial decisions. Guardianship is different than a power of attorney (POA); when an individual grants power of attorney (either general or specific, i.e., just for healthcare or financial matters), he or she is of sound mind and is granting that POA voluntarily. The same is not true with guardianship.
Another area to consider as we age is estate planning. When one dies, there is the issue of what becomes of the person’s assets and property and the payment of any taxes and/or probate fees. Estate planning governs such administration and distribution of assets, property and finances through the creation of wills, trusts and other legal documents. Such planning also includes naming certain individuals to carry out one’s wishes pursuant to these documents. The better and more thorough the documentation, and the more that potential contingencies are addressed in the documents, the smoother the process and less likely the estate will be contested or a need arise for the courts to get involved. As part of the estate planning process, it is important to create advanced directives, including a living will. This document is a written statement detailing a person’s desires regarding medical treatment so that the party appointed agent can make medical decisions based upon the individual’s wishes. We strongly encourage everyone to put estate plans and advanced directives in place as soon as they reach adulthood. These plans should be updated with every lifestyle change, i.e., marriage, divorce, birth of children, etc.
Sadly, elder abuse, neglect, and financial exploitation are significant concerns for older adults and their families. Attorneys familiar with elder law can help put protections in place to prevent individuals from being taken advantage of or may help remedy the inappropriate situation should it occur. If you suspect any form of elder abuse, you should report it immediately by contacting your local North Carolina Health and Human Services office.
While people often put off planning for the future, it is much better for an aging adult to understand his/her rights and benefits and put estate plans in place while they have the ability to make sound decisions and share their wishes with others. If you need help with an elder law issue or estate planning, please contact our offices for an appointment.