4CRB: Aged Care – Is it Time?

Listen to 4CRB radio segment ‘Aged Care – Is it Time?’ with Troy Theobald of RFS Advice.

Popular New Year’s Resolutions for Pre-Retirees:

Where do we start with Aged Care? And what is the process involved in getting care?

It can feel overwhelming, so let’s break it down.

Step 1: Do not pass go without an ACAT

Nothing can happen without what is called an ACAT assessment.

This ACAT assessment (that stands for Aged Care Assessment Team) opens the door to both home care packages and also respite care as well as permanent residential aged care (nursing home entry). This is arranged through “Myagedcare” and their number is 1800 200 422 or online myagedcare.gov.au. The ACAT assesses care needs and then provides a report which specifies what services the government is willing to contribute to, to respond to those care needs.

So what is the wait time for an ACAT?

Unfortunately, to get an ACAT assessment can take some time and the wait time can vary anywhere between a couple of weeks (in good times) through to a 6 month wait. The ACAT assessment is a long interview which can be done in person or sometimes via telephone or even with an online meeting. It is a thorough assessment of what the physical and mental challenges are for you or your loved one. And it is important to be honest about the things we’re struggling with rather than being stoic and letting pride get in the way of accessing services that we need. Considering the potential wait times, don’t delay in getting the assessment if you might be needing care in the coming months.

Step 2: Find a provider Take your time and interview a few.

Whether you’re looking for a home care provider or a nursing home, you’ll want to make sure that you have a good fit. Comparing a few different providers will highlight what you find appealing and what you’re concerned with.

What’s the best way to find a provider?

Ask around among friends and family and also have a look at the online reviews. There are also agencies that specialise in finding providers for you. Once you make a choice, you’re still able to change your mind and move to another provider or another nursing home, but it is important to understand any financial implications or exit fees should you choose to do so. Consulting an aged care specialist for advice can be invaluable. There are a lot of providers out there who can assist in sourcing the right provider for you with the services that you need.

Step 3: Do the paperwork

There will be Centrelink paperwork to be completed for either a home care package (called an income tested fee) or a nursing home (called a means tested care fee). It is important to complete this correctly because if it’s not done right, you can end up paying a lot more than you should.

Is it Mandatory to do the paperwork?

It’s not mandatory, but you could end up paying the maximum amount of Income Tested Fee or Means Tested Fee if you don’t do the assessment paperwork.

Services Australia have FIS (Financial Information Services) Officers that are able to assist with this and it’s a free service. But, you may want to do a bit of a health check with a financial adviser before you trot off to see the FIS officer, particularly if you’re looking at residential aged care. There are some substantial financial consequences to making decisions about care, and plenty of misconceptions to be aware of. Getting financial advice can save you from costly mistakes. It can be the difference between running out of money or having a sustainable solution; or the difference between having nothing to leave the kids vs a healthy inheritance.

Step 4: Sign the contract

There will usually be some form of agreement that needs to be signed either with a home care provider or a retirement village or a nursing home. It is vitally important to understand what you’re signing before you commit. Sometimes that requires a lawyer to look over agreements, and sometimes its relatively straightforward and you may be comfortable to sign off, but always important to read it all the way through, and not a bad idea to lean on family support. If nothing else this keeps everyone on the same page.

What are some common misconceptions around care?

You have to sell the family home if you’re going into a nursing home.

That’s sometimes the right strategy, but it’s sometimes completely the wrong strategy and can result in loss of Age Pension.

A family trust will help to shield assets from assessment

Actually Centrelink look through a trust to the source and control (even informal control) of the trust and it’s seldom any good for social security purposes. It can be a good outcome from other perspectives, but not generally social security.

If I transfer my assets to my kids I can get out of paying aged care fees

That’s generally called gifting or sometimes known as deprived assets and there are strict limits on what is permissible. This one can get people into significant strife so make sure you understand what is allowable before making any gifts.

When I calculate my Means Tested Care Fee (MTCF) on the calculator, that’s what I’ll always pay.

Unfortunately, that’s not necessarily true. When you put in your assets and income into the calculator it will spit out the estimated Means Tested Care Fee for your current situation, but as soon as you start moving assets to pay for residential aged care fees, the Means Tested Care Fee will change – sometimes a little and sometimes a HUGE amount.

If I lose capacity, my spouse will still be able to drive my finances even if I don’t have a Power of Attorney document in place. .

Well potentially, but maybe not without a QCAT order – that stands for Queensland Civil and Administrative Tribunal – sometimes it’s necessary to request power from the state to deal with someone’s assets and finances, and as with any government process, that can take time and is certainly a step with a lot more paperwork involved than having a correctly set up Power of Attorney document in place. We also need to think about what happens if our spouse has lost capacity and someone else may need to drive the ship – you would want that someone to be of your choosing, not a person who won’t take your preferences into account.

How do we untangle all the financial implications of decisions around care and the costs of that?

Sometimes, our situation is really straightforward, and we just need someone to tell us we’re heading in the right direction, and other times there might be options that we’re unaware of. You won’t know what you don’t know until it’s too late, unless you engage with a financial planner who specializes in Aged Care advice.

Too often the Enduring Powers of Attorney are the ones who need to make difficult care decisions and there is a huge responsibility in managing someone else’s money. Getting professional advice can save on headaches later on when others question the decisions and the financial wisdom of those decisions.

Aged Care specialists or professionals are aware of all the tips and traps that a person walking the journey for the first time cannot reasonably be aware of. The financial advice process should start with your adviser thoroughly understanding what your personal circumstances are as well as what your personal goals and priorities are. They should be able to provide you with a recommendation that meets your needs for a sustainable solution or demonstrate to you how you will need to adjust your priorities to afford your care. The advice you receive should be documented for you and also explained to you in a manner that you understand.

As with most things in life, timing is important. To be able to access the care that you need at the time when you need it, you will need to meet the challenge sooner rather than later. Being prepared, with assessments completed and preferred providers identified can assist you to have things on your terms – that is, you control the process not the other way around.

If there is one cardinal tip I always give its to be proactive in identifying how you want your care journey to look and make no mistake we are all likely to have a journey of SOME kind. The more proactive you are, the more control you will have. And consult a financial Aged Care specialist, even if the only information they give you is that you don’t need advice because you’ve got everything under control, you will be better served than not seeking any advice at all.

Top Tips:

Be proactive

Get advice before you make any financial decisions.

Do your research ahead of time

Make sure your family members all know your wishes so that they don’t have to argue about anything

Get your Enduring Power of Attorney and Advanced health directive sorted no matter what age you are.

Talk to you children about your estate planning

Be realistic about the fact that we will all likely need care at some point in some form

Make sure your Centrelink record stays updated – they really can’t see your bank account and if you sell shares or get rid of assets they won’t know unless you tell them

You can nominate representatives to help you both with myagedcare and also with centrelink

Lean on your family for support but be mindful of the fact that there is other support available out there that can assist in alleviating the burden on your spouse and or kids.

Commonist mistakes:

Selling assets without getting advice and not being aware of the tax implications

Estate planning that creates difficulties in paying for care in a manner that doesn’t disadvantage particular beneficiaries.

Unqualified people providing advice on financial outcomes because they don’t understand the complexities of certain income streams or how those impact Means Tested Fees.

Choosing a care solution that is not sustainable financially.

Most time consuming aspects of the process:

Waiting for the ACAT assessment – it can get done quicker if you’re in hospital and its an emergency, but then everything in the whole process becomes more pressurised.

Dealing with Centrelink to get the assessments you need

Sometimes finding an appropriate bed when there is a bed shortage, for residential care.

The most frustrating aspects of the care journey can be:

Getting all family members on board and going in the same direction. If your Enduring Powers of Attorney are the ones making the decisions and you haven’t had conversations around what you want out of your care journey, then there can be a lot of different opinions and some heated discussions.

When an urgent unplanned solution is required it is seldom easy to get the best outcome. Someone may urgently need a high level of home care but because there aren’t ACAT codes in place and the wait time for the high level care packages is too long, they end up in residential care instead of at home.

Summary:

Our specialist aged care team is able to make sense of all the confusing jargon, provide you with the best pathway forward financially, and assist in all aspects of the process of accessing appropriate care.

We’re advocates for the idea that planning ahead can save a lot of heartache and sometimes also a lot of money. Our team will meet with you to understand your needs and goals, provide you with a financial roadmap that shows you the optimal pathway financially so that you’re able to achieve what you want to, and even assist with the paperwork that’s required along the way. You’re likely to walk this journey once maybe twice with a loved one, but we do it everyday, so we’re aware of all the tips and traps that you can’t be expected to know. We’re here to ease your burden.