We talk about elder law a lot on this blog because it’s such an important and growing area of the law that is constantly evolving based on the changing economic climate facing seniors. Over this last weekend Governor Jerry Brown signed the Elder Economic Planning Act of 2011. Ok, great, well what IS the Elder Economic Planning Act of 2011? It is a new law enacted in California that mandates the use of the Elder Index as the official standard for assessing the financial situation for seniors.
Why is this important? It’s important because the Elder Index takes into account geographic expenses for housing, food, health care and transportation in contrast to the Federal Poverty Level. Ultimately it should help seniors qualify for certain government assistance, whether it’s job placement or entitlement programs, so seniors don’t have to spend their entire Social Security checks on housing/rent and have no money left for anything else. This article from Sign on San Diego sheds some additional light on this topic and goes into more detail about the elder care issues we have facing us here in our local community as well as California at large. For example, 42% of elders 65 and older (a whopping 131,000 seniors!) in San Diego County alone fall below the Elder Index. In California as a whole that percentage jumps to 47% of elders 65 and older.
What this all means is that the government is beginning to realize how difficult these current economic conditions have been for seniors. Why so hard for seniors? Because seniors (those that are retired) generally live on a fixed income. Those who are not at least moderately wealthy, are usually in C/D’s and money market accounts and those are not paying very high interest right now.
And that brings up another point. What about those who are moderately wealthy. Let’s say in the net worth range of $1-2 million. Many of those people are my clients and have been for decades in some cases. And often, they told me there was no way they were going to take government benefits.
Now, 15-20 years later, health has deteriorated for some of them and they are in an assisted living or skilled nursing facility. And now, they are very interested in Medi-Cal and Medicaid or Veterans Aid & Attendance Non Service Connected Pension. In fact, I’m very surprised as to how many are concerned about Medi-Cal taking the house from the children’s inheritance in situations where the parent is not even on Medi-Cal yet and how a QMap Trust can help. I’m not saying they shouldn’t be worried about this, only that it surprises me that they are.