The Hidden Cost of Elder Financial Abuse

abilene medicaid long-term care

I've written before about fraud that targets the elderly. But one thing I didn't mention then is that Elder Financial Abuse - the use of funds belonging to elderly persons for self-benefit can create problems securing Medicaid benefits.

What is Elder Financial Abuse?

Elder financial abuse is a lot bigger problem than most of us think. Studies show that $2.9 Billion are lost every year because seniors are either unable to protect themselves or unaware that they should be doing so in the first place. As the baby boomer generation grows older these numbers will only increase. The Older Americans Act defines financial exploitation as using fraudulent or otherwise illegal or improper means of using an older person’s wealth and finances for personal gain. This type of abuse may happen in the form of: writing checks in a fraudulent or unauthorized fashion, stealing income checks or identity theft.

To make matters worse, one of the most disheartening aspects of elder financial abuse is that the perpetrator involved is often a relative or friend of the victim. These wrongdoers take advantage of the trust placed in them for their own greed and financial gain.

Unfortunately, financial exploitation has some serious, unforeseeable consequences, including a possible denial of Medicaid benefits that may be crucial for the elder's long-term care.

Denial of Medicaid Eligibility

When applying for any type of federal program it’s vital to have your documents in order. Unfortunately, when an elder entrusts this task to the relative or guardian who happens to be stealing from them, that person may have cause to either refrain from producing these documents or destroying them altogether. If someone has been abusing bank accounts or writing checks without permission, they will not want to provide these records to the federal agency in charge of awarding Medicaid benefits. Sadly, because of these events that were beyond their control seniors may not be given the benefits which they need desperately.

Worse yet, elder financial abuse may also impact severely the “look-back” process in which the government exams any large financial gifts they may have given to loved ones in the past five years. If an abuser has been essentially gifting funds to themselves, the elder may have difficulty securing benefits.

How to Protect Yourself or Your Loved One

There are common methods of manipulation that offenders may employ to steal from the elderly. One of the primary ways that a guilty party will attempt to separate the elderly from their money is through social isolation. In this scenario, the guardian keeps the elder away from other relatives or outsiders who may inquire about the elder’s finances.

Another warning sign to watch out for is if a guardian or someone close to a senior asks to create a joint account. In such a situation, both parties are equal owners and have equal access to the account’s funds. This means that a senior may find their bank account emptied without notice. Unless the senior person thinks there is a legitimate reason to do this, the answer should be “no.” Honest guardians should help aging family members with their affairs without taking any ownership rights.

If a person becomes unable to make their own decisions, then a caregiver should consult an elder law attorney about establishing legal rights to gain full access to the finances by becoming a guardian or conservator in the local probate court.

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