Michigan Estate Planning Blog

Hospice: Medicare and Medicaid Profit Center?

Healthcare lawsuits involving the various ways that the elderly can be taken advantage of turn up in the news on a daily basis these days. Why? Well, partly for political reasons and partly for the sheer number of egregious situations that have been created. As an informed citizen/taxpayer, it’s important to think about and understand the big picture. However, as a family member, it’s vitally important to remember them for the sake of your elderly loved ones. A new legal battle has begun to churn, as recently reported at Kaiser Health News. Yet another healthcare company is being accused of taking advantage of the elderly and their families to draw the greatest yield from Medicare and Medicaid coffers. Here a large company, operating across several states, is accused of actively recruiting and cycling patients through nursing home and hospice services. Such companies are compensated by Medicare based on the length of time patients receive care. Medicare picks up the entire nursing home tab for the first 20 days (after that the patient has to contribute), and conversely, if a patient spends too much time in hospice care, Medicare demands their money back since the patient was clearly admitted to end-of-life care under false pretenses. Here’s the rub: If you cycle between nursing home regimens and then jump into hospice care as early as possible (but not too early), Medicare will pick up the entire tab and for the maximum amounts, and that’s the issue. The legal battles, as well as the politics and economics aside, stories like these also demand a certain amount of attention since they could directly impact your family. If you have a loved one in need of nursing home and/or hospice care, it’s important that they find and receive that care… and that they not be abused by an uncaring system.

Reference: Kaiser Health News (January 4, 2012) “Lawsuit Accuses Company of Fraudulently Cycling Patients through Nursing Homes, Hospice Care.”

ELDER CARE – TRANSITION TREVAILS

Moving between hospitals or into rehabilitation and other care centers can be a stressful time, especially for an elderly loved one. Unfortunately, too, these “care transitions” can create far greater problems than stress, as they also are prone to creating problems with the patient’s care. Potentially, these problems can have long-term affects. Care transitions are not a recent concern of health professionals, but been on their radar screen for some time. In fact, a recent study is the subject of a recent post on the New York Times’s blog series, “The New Old Age.” According to the study, a very large Canadian study of older adults and published in the Journal of the American Medical Association found that the main problem is with essential medications. It seems these meds can be accidentally stopped by healthcare professionals when the patient is in transition. And, older persons can be on many medications at once, often with little understanding of each drug and with complete faith in the multiple doctors prescribing them. For example, what happens if an elderly loved one (who may be on as many as 10 medications) has an “episode” requiring a trip to the emergency room? The emergency room staff may have to take them off some of those medications to administer needed care. Unfortunately, thereafter the doctors may forget to have those medications started up again once they are stabilized, moved to regular care or even transferred out to a rehabilitation center. In turn, your loved one might not notice any changes without the meds, or simply might assume the doctors know what’s best. Ultimately, this lack of communication and coordination in transition care can be life threatening. It’s something that happens all too often, particularly with medications for cardiac and blood conditions, such as statins (e.g., Lipitor) and blood thinners (e.g., Plavix). All of this gives family caregivers one more thing to bear in mind when tending to an elderly loved one, but it can also be an important one. It’s important to ask questions and be aware of all medications an elderly loved one is taking, and if these meds change (or stop) after a hospital visit… find out why.

Reference: The New York Times Blogs (September 8, 2011) “A Big Risk in the Health Care Handoff”

Tax Breaks for Caregivers Worth A Look

If you have had to arrange for a caregiver for an aging loved one, then you have some appreciation of the enormity of the costs often involved. It’s important, then, not to overlook tax breaks that just might help reduce the economic pain. A recent article from Forbes offers a helpful reminder. The costs of a caregiver, under certain circumstances, can be partially tax deductible as medical expenses. After all, they are, in fact, very important and very costly medical expenses. However, conditions for taking the deduction essentially amount to proving that fact to the IRS. So, what are some of these key conditions? For one, you must document a care regimen for someone who is chronically ill. This means a licensed health care practitioner has to prescribe it. Unfortunately, it can’t be up to your own discretion, but such prescriptions and suggestions are common for aging persons, especially when they suffer from dementia. Next, there is an expense threshold. Medical expenses are deductible only to folks who itemize, and then only to the extent that the expenses exceed 7.5% of adjusted gross income. Itemizing taxes can be a little more of a burden, but with the associated medical costs involved it is generally easy to qualify. Caregiving expenses are generally rather expensive and include the wages, employment taxes, and actual medical costs along with the associated living costs from meals to even costs of rent, if live-in care is needed. Finally, this deduction is not without caveats and the IRS watches those who try to abuse it. For example, if the cost of the caregiver is covered by insurance (e.g., long-term care or medical insurance) then you can’t double-dip and claim both costs. This is a complicated issue. There are many moving pieces. Fortunately, the Forbes article shares some anecdotes from some illustrative cases and tax court challenges. Nevertheless, if you’re using a caregiver now (or will in the future), don’t overlook this potentially valuable deduction.

Reference: Forbes (December 8, 2011) “Tax Breaks For Caregiving Expenses Help Sandwich Generation”

When Medicine Becomes a Menace

The four types of medicine are also very common. Listed below in order, from the greatest to the least percentage of adverse instances per drug, whether taken together or separately: 1. A blood-thinning medication called warfarin (Coumadin, Jantoven) 2. Insulin 3. Antiplatelet drugs used to prevent blood clots such as aspirin and clopidogrel (Plavix) 4. Oral hypoglycemic agents – a diabetes medicine The most important fact, however, is that nearly two-thirds of all such cases were not just the drugs themselves; they were the result of unintentional overdoses. It’s scary to see such common medicines listed, and if you or loved ones use them there is cause to take notice, but the real lesson is awareness and care. There are real consequences when care is not received properly or when an elderly person is not able to accurately gauge their medications.

Reference: USA Today (November 25, 2011) “Four Common Meds Send Thousands of Seniors to Hospital”

Filling the Medicare Donut Hole

There is some good news for many Medicare recipients, present and future. According to new Medicare figures, the cost of falling into the “doughnut hole” is shrinking. The “doughnut hole,” as many know all-too-well, is the treacherous territory you fall into when you have spent too much of your Medicare Part D benefits to continue receiving full benefits (but not so much of your own money to qualify for “catastrophic coverage”). It’s an easy hole to fall into, especially if you have a special medication. With the new health law, however, pharmaceutical companies have begun offering a 50% discount on medications to beneficiaries in the gap, and that has meant a great deal of savings. According to the figures, the average beneficiary who falls into the coverage gap already would have spent $1,504 this year on prescriptions. Yet, with the new law, that cost fell to $901, with each individual doing better or worse depending on which medicines they use.

Reference: ABC News (November 27, 2011) “AP Newsbreak: Medicare’s Drug Coverage Gap Shrinks”

The “Holiday Reality Check”

The Holidays bring families together, which is a great thing, especially for those family members separated by geography. But since the holidays also mean spending time with your parents and elderly loved ones, it can be a shock. The New Old Age Blog at the New York Times recently referred to this shock as the “Holiday Reality Check”. All those months of checking in over the phone or getting reports from a sibling might have led you to believe that all was well with your elderly loved ones. Now, when you actually see them face to face, all is not well on the home front. It hits in greater and lesser degrees: Finding a loved one to be fairly forgetful, much more than before. Perhaps it’s finding stacks of unpaid bills and old food filling the fridge, or discovering that the nursing home selected was the wrong choice. No doubt many readers already have encountered their own Reality Check during a Thanksgiving visit, but the important thing is that the holidays aren’t over yet. No, they are just ramping up. As we venture deeper into the holiday season, you may seize the opportunity to pay more attention and begin to right some wrongs sooner rather than later. For many, this might mean an up-front and realistic discussion about what needs to happen, whether that be planning for the estate, writing advanced directives, or pursuing care. However, there also are more gentle steps that can be taken and some pragmatic ones as well. Fixes that you can offer from afar might mean hiring helpers or even professional geriatric care managers to work in your stead. The important thing is what the holidays mean about and for your family. Consider this a clarion call to be proactive while there still is time to plan, rather to be reactive when time to plan is past.

Reference: The New York Times: The New Old Age Blog (November 25, 2011) “The Holiday Reality-Check”

Government Medical Care And Senior “Double-Dippers”?

Are you or an elderly loved one receiving benefits from Medicare or Medicaid? If yes, then likely you already appreciate the funding problems facing Congress and its appointed “super committee” regarding the future of these programs. However, for many of today’s elderly, certain changes to these programs may be real and immediate. As a result, careful attention to the associated political developments is important. One area of specific focus is “dual-eligibles.” Seniors receiving aid from both Medicare and Medicaid are so-called “dual-eligibles” and, as such, their benefits are under scrutiny from the super committee. In fact, changes may be in the wings, according to Reuters. Medicare and Medicaid spend about $300 billion a year for “dual-eligibles,” making them a prime target. Here’s what that means: Roughly 39 percent of the Medicaid program costs and 27 percent of Medicare costs are going to 15% and 16% of program enrollees respectively - and at the same time. Of course, these patients also tend to be the ones in the greatest need, with half of them under treatment for five or more chronic conditions. What’s going to happen? As usual, that’s far from clear. Many states and insurers are pushing for managed care options to handle all aspects of care. This would help reduce the present bureaucratic overlap and, hopefully, cut costs. On the other hand, there are the detractors. The problem of dual-eligibles is likely to continue to rise in budget and debt discussions, along with a host of other little issues. What can you do? Keep a close eye (and open ear) on the decision-making process (and the decision-makers), especially if those changes may threaten your health care. It probably wouldn’t hurt to contact your representatives in Congress.

Reference: Reuters (September 28, 2011) “Debt panel eyes dual Medicare/Medicaid patients”