There comes a
time in our life when old age suddenly dawns upon us. There are exceptions of
course. Those who die young never experience old age and those whose health
deteriorates comparatively early, no doubt have more warning of the approach of
old age.
For me it is
still on the horizon and not actually here yet (silence you rude buggers!).
However for my parents it has definitely arrived. Now old age doesn’t need to
be a bad thing, but one thing is for certain; it definitely changes a lot of
things.
Sadly none of
the Governments of the last fifty years seem to have paid much attention to the
changing demographic make-up of our country. They have all told us plenty of
times along the way that we were heading towards a time when the oldies would
outnumber the young ‘uns, but they seem to have taken very little account of it
in their planning.
What this has
led to is a very messy situation in regards to the needs of those older people.
Health services for the elderly are notoriously complicated and difficult to
access and unless as an older person you have a tenacious advocate working for
you it is likely you will miss out on many things you could be entitled to and
get ignored by many agencies that would have us believe they are there to help older
people.
Rules have been
devised to ensure assistance is not wasted on those who have amassed fortunes
along the way, but those rules have been developed without a broader overview
of the developing situation. Nowhere is this more noticeable than in the area
of housing for the elderly.
I will share
some of what I have found out over the course of the last couple of years in
the hopes that some of my readers might be saved some of the grief I have
encountered while trying to negotiate this slippery path.
The options when
an older person can’t live in their own home any longer are as follows:
·
Move
in with kids
·
Council
housing
·
Retirement
village
·
Rest
home care
·
Renter
units in a retirement village or rest home
The first of
these is often not possible for any number of reasons. The house might not be
suitable for example it might have stairs; it might not be large enough to
accommodate two extra people; the kids might not live anywhere suitable; or
they might not be able to afford to stop working and look after their parents.
In many cases more than one of these factors will prevent this option from
being a goer.
Council housing
The option of council
housing is only available to those with absolutely no means, so unless your
folks are absolutely boracic this one is out of the picture. The asset limits
might differ slightly around the country, but in Tauranga for example the limit
is $30,000. This means if your parents have just sold their house they will be
well outside those limits.
Retirement villages
Retirement
villages have a lot of obvious benefits and several hidden fish-hooks. Here
your parents will have a chance to ‘buy’ a small villa, apartment or cottage
within a secure environment with a lot of useful age-related services available
on-site. But don’t ever let them sign up for one of these without very
carefully examining the licence to occupy yourself or getting your solicitor to
do so if legal documents are not your thing.
The fish-hooks
you will need to look out for are pretty damned sharp and you need to know what
their implications will be. For example they are not actually ‘buying’ the
property in the normal sense we Kiwis understand. They are entering into a licence
to occupy which means the property can only ever be sold back to the company
that owns the village. It therefore follows that at the very most they will
only get back the amount that company has specified in the agreement at the
outset.
In other words
they will not see any capital gain from their investment and in some cases they
could actually lose on the deal. I have seen one such agreement where, if the unit
cannot fetch the same amount from the next occupant then the outgoing one takes
the loss rather than the company.
Now that might
sound fair enough, but when you realise that at the end of tenure, the company
also charges a further 30% of the ‘purchase price’ back to the outgoing
occupants you begin to get the picture of a greedy corporate ripping off
vulnerable elderly people. Some agreements even require the outgoing occupant
(actually this is usually their heirs as there is normally only one way you
leave these places), to redecorate before the new occupant comes in and often
they are forced to use contractors chosen by the village owners, so no chance
to make any savings there either.
There is also a
weekly fee of about $100pw to see that the windows are washed rubbish is
collected, and as a part contribution to general village maintenance and access
to various village facilities.
Rest home care
Rest homes involve
a good deal of preparatory work and can also be a trap for the unwary. Of
course a rest home environment means they will only have one small room to live
out of and will have to get rid of nearly all of their personal stuff due to
the space constraints involved with that.
If you are
considering such an option you will first require an assessment carried out on
behalf of the DHB to establish what level of care is required. An assessment
level indicates whether or not they are entitled to subsidised care. This is
very important because if they are not entitled to subsidised care the full costs
will have to be borne privately.
The assessment
involves three basic criteria; care needs; asset levels; and income. Assets
cannot exceed approximately $230,000 for a couple, which if they have just sold
a house means they will probably not qualify. Income will not be a problem if
their only source is NZ Superannuation, or a benefit for a widow, invalid or service
veteran.
The care needs category
is the where the assessors have the most scope to disqualify. Problems arise when
one half of a couple qualifies for care and the other does not and trying to
find out exactly what qualifies is damned near impossible as the actual
criteria are shrouded in DHB jargon and mystery. I can only conclude the DHB is
suffering from a variety of paranoia which causes them to keep this stuff
secret in case anyone learns how to qualify and constructs an elaborate opera
to act out to achieve their ends. Good luck to anyone trying to do that with an
old person who has forgotten what you told them ten minutes ago!
However what I
have been able to learn is that unless your parent has dementia – and good luck
getting a diagnosis of that despite tons of visible evidence – or an inability
to feed or dress themselves, they will almost certainly be classified as fit to
look after themselves and ineligible for subsidised rest home care.
Fair enough; you
might think. Why not just pay for their care? For the uninitiated I will now
reveal the cost of care in such establishments when the subsidy is not
available. Are you sitting down? For just
one person to be cared for in a rest home you are likely to be paying between
$800 and $1200 per week (between $41,600 and $62,400 per year).
That sum
probably isn’t unreasonable when you consider all their needs are theoretically
being met, but on an affordability level it can be another matter altogether.
Hospital level
care in a rest home falls into the same price range.
Renter units in a retirement village
Renter units
sound like a good option when contrasted against the costs of rest home care if
a subsidy is not available. But at around $500pw ($26,000 per year) they can be
costly if your relative stands a good chance of living for some while yet.
It’s a minefield
dear readers and one which some of us have already almost had our legs blown
off on and which many more of you will have to negotiate sometime in the
future.
After seeing all
the options, the retirement village option doesn’t seem so bad. Just make sure
you check that agreement first.
Good luck, guys
and gals. You will need it.
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