What if Mum needs to
go into Aged Care today?
Yes been
there & done that. We have had that question ourselves & when it does
it needs an answer. As we said then ‘’we care but we are not carers’
However
just as in economics it could be this or it could be that. It depends.
We read in
the Weekend Australian 9/04/12 titled ‘Aged fear rip-offs to fund their care’ that
the Minister for Aging Mark Butler say s ‘the
conversations point to an industry in crisis.’
And again ‘the overwhelming message is that older
Australians are not getting the quality of care & support that they deserve
from the current system.’
when it was
time to enter residential care ‘the price
they pay…is based on how much money they have in their pockets rather than a
reflection of the true cost of care & value for money’’.
and yes ‘ accommodation bonds paid to get into
residential care cost an average of $264,000 but that can be more than a
million and are usually raised through forced fire sale of the family
home at a time of crisis’.
We had heard elsewhere
the average was $365,000 & usually forced fire sale can mean a $50,000 to $100,000
which is only a 10% reduction.
What if it is a sale
15% below estimated by the real estate agent?
You need
to be ready
o
The
Need to enter aged care is often Sudden.
o
A
significant bond payment maybe required.
o
There
are ways to minimise how much the ‘resident’ pays.
o
Trusts
maybe an effective strategy.
o
Planning
with good advice is the key.
Decisions
need to be made
o
What
is the right facility?
o
How
much will it cost?
o
How
does it all work?
o
What
happens to the family home & other assets?
Steps -
a family Checklist
·
Get
ACAT approval which determines low, high
or respite care.
·
Select
home i.e. location, facilities care, culture. Then add name to waiting list.
·
Negotiate
the fees & sign the residential agreement. [you won’t know the daily rate
until after 28 days in there.]Yep.
·
Do
we keep or sell the home? You will need to pay entry fees & review
investments.
·
Has
estate planning including Power of attorney been actioned?
·
Move
Mum’s home into her unit. We still remember that part vividly.
o
There
is an entry fee payable if assets exceed $40,500.
o
There
is an upfront bond or daily charge.
o
There
is a basic daily care fee which is currently
15,089 p.a.
o
Then
an income tested fee based on private income & government support.
o
At
lastly there is an extra service fee which depends on the market &
facility.
·
As
above the average is $ 350,000 but if it is $264,000 then that’s not small.
·
The
facility uses it for debt reduction, or investing or building say.
·
It
can retain 318p.m. for up to 5 years.
·
It
is repaid when resident dies or leaves.
·
It
is government guaranteed & paid back
within 14 days.
·
It
is asset tested exempt.
What do
you do when the moment or rather the decision is made?
You can DIY
which usually means sell the house & pay what is negotiated.
·
This
often means an extra income from the bank interest earned. This will have the consequence of increasing
the cost of care, the daily care fee, the income tested fee and the extra
service fee.
·
It
will also reduce the pension.
As ‘it depends’
& everyone is different but you may be able to
·
reduce the income tested fee & the extra service fee.
·
You
may be able to increase the pension.
·
Retaining
the health card is also important.
Nothing has changed as good preparation means
less stress later.
Here to help you negotiate through the aging
minefield when you wish.
Yes Dad might need it too although Jack
selected a better & more tranquil
place where dolphins pod & cruise ships berth to exit the stage.
John McAuliffe
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