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The Forum > Article Comments > From onion sandwiches to filet mignon: the changing of the guard in residential aged care! > Comments

From onion sandwiches to filet mignon: the changing of the guard in residential aged care! : Comments

By Jim Toohey, published 13/2/2009

Generally everyone uses the proceeds from the sale of their old home to finance their new one. Aged care should be no different.

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My mother is already doing as suggested. When at the age of 91 she made the decision to go into care, she was able to buy her way into an aged facility where she has a single room in the complex. She needed the care before her home could be sold, so her son put up the money. My mother will be 93 this year. Probably when I need care, I too will take similar action.
Posted by Country girl, Friday, 13 February 2009 1:11:47 PM
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Jim,
A thoughtful article. Thanks.
My partents are in the process of selling up to move somewhere smaller and more manageable. I understand they could buy a really expensive house and get the pensions, but couldn't get the pension if they had a little house but kept some other assets.
They are not ready for aged care, but I had understood it would need to be purchased, how did Mary manage to get it free?
Posted by Jennifer, Friday, 13 February 2009 11:01:03 PM
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My darling partner and I have discussed this. Mutual suicide is far more appealing than a retirement village or... shudder... a nursing home.

I will make a point of maintaining acquaintances in certain circles whereby I can procure a couple of grams of heroin when the time comes.
Posted by CJ Morgan, Friday, 13 February 2009 11:13:50 PM
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Thanks Jennifer,
Anyone considering or even preparing for residential aged care should seek some independent financial and legal advice ; the rules around assets,income and pensions are complex.
However, generally the home, up to a certain threshold, is exempt from assets tests.
If an elderly person requires permanent residential care, they own their own home and do not have a spouse or dependent living with them,then they will generally be asked to pay an upfront accommodation bond if they enter a hostel (low care facility).

This bond is held by the care provider for the duration of the occupancy and refunded ( less legislated deductions - about 2% a year on an average bond ) when the resident leaves or (ususally) passes away.

A government regualted prudential fund ensures the refund is guaranteed.

This system introduced by Labor in the Hawke/Keating days has worked well to ensure a pretty good standard of low care facilities.

In high care or nursing homes such a contribution is not permitted by law and the standard of most nursing home buildings reflects this.

Centrelink are generally very helpful in assisting elderly people with information about aged care payments as are many online services
Posted by jtoohey, Saturday, 14 February 2009 9:13:39 AM
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Privacy and familiar surroundings should not be conceived of as a 'luxury'. Neither should adequate nurse to resident ratios; or decent food; or where possible outings; regular visits by dentists; access to information technology etc...

I mention this and more in a paper of mine on this subject which should be published here at OLO on Tuesday.

Let's be frank: we live in a class-stratified society. Not all elderly home owners are 'equal'. And neither are their families.

For some holding on to the family home could be a matter of survival - the only alternative to which is destitution.

And what of those who may - for instance - have a modest weatherboard family home which is the product of a life's work? Should these people be treated on equal terms with those who own inner city mansions valued at $1m or more? Finally: what of those who do not possess property at all? Do we just 'let the market sort us out'?

Requiring the sale of property as a condition of entry into High or Low intensity care is tantamount to a 'flat tax'. In fact - it is close to a 'defacto' regime of death duties - only an extremely regressive formulation...

If we want to tax peoples estates, though, surely it would be better to be up front about it - and have a progressive, bracketed regime of inheritance taxes?

And surely social class ought have nothing to do with the quality of care our elderly receive. Into the future - we need humane and decent standards for our frail and vulnerable.

And if the only way of pay for this is through a reformed system of taxation - such seems a reasonable price to pay.

Sure - the wealthy will resent it - but assuming it's in most peoples' interests - together we should be able to overcome their protestations. It is a matter of basic human decency...
Posted by Tristan Ewins, Saturday, 14 February 2009 8:02:33 PM
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Tristan,

I agree that privacy and familiar surroundings in modern, purpose built facilities should be the norm Ė the question is who pays for it?

As I understand it, you are suggesting a big increase in taxpayer outlays?

Aside from the lack of political kudos any government gets for investing in aged care, the numbers and expectations facing us in the future means we have to consider a greater contribution by those who are able to afford it.

Access to aged care for those with no significant assets isnít a problem - the existing system works well in this respect; about 32% of existing high care residents are considered "concessional" and providers must reserve places for these people and so receive an additional taxpayer subsidy on their behalf.

It isnít clear who could be made "destitute" by selling the family home; the rules state that this can only occur if there are no dependents or spouse living in the home and the person leaving the home nearly always leaves for good.

Inheritance taxes certainly might be a solution but politically itís an even more difficult option than refundable accommodation deposits !

Finally, I think the focus should be on choice; long-term accommodation in top-quality facilities cost a great deal more money than the government is currently prepared to pay.

Residents and families need to make a choice which fits their circumstances; it may be that a family elects to pay higher accommodation charges on an ongoing basis rather than a lump sum bond, other families may like to rent the vacant home out and use the rent to defray some of these expenses or mortgage the property - the emphasis should be on flexibility for whatever suits individual circumstances.

Jim
Posted by jtoohey, Monday, 16 February 2009 12:08:09 PM
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