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Even State Legislatures Look to HECM as Recommendation…

shutterstock_Money under lock & key 49213123State Campaign Points to Importance of Reverse Mortgages in Long Term Care

 

March 17th, 2014  |  by Elizabeth Ecker Published in News, Retirement, Reverse Mortgage

A state and federal initiative launched in 2012 has resulted in a report to lawmakers on long term care financing including the use of reverse mortgages to help Americans fund longevity.

The Own Your Future initiative in Minnesota was launched in 2012 to make recommendations to state and federal lawmakers on paying for long term care. Between 2005 and 2009, 26 states each sponsored Own Your Future campaigns to educate their residents about long term care challenges and make them aware of options and planning methods.

In Minnesota, the campaign was expanded to include an ongoing public awareness campaign throughout the state; efforts to make more affordable and suitable long-term care products available to Minnesota’s middle-income households; and evaluation of possible changes to Medical Assistance (MA) to better align with and encourage private payment for long-term care.

Among the recommendations developed by the state initiative: the use of reverse mortgages. An advisory panel has accepted the recommendations of the subcommittee with a separate set of recommendations having been sent to Congress.

“The Lieutenant Governor [Prettner Solon] has assured us that now that the report is out, it’s not a report that sits on the shelf. Action will be taken,” says Beth Paterson, a Minnesota originator who was appointed by the state’s governor to serve as the reverse mortgage representative on the advisory panel.

The report covers 11 recommendations, narrowed down from 16 that were considered, toward solving long term care funding problems for older Americans.

“The current long-term care financing marketplace consists of insurance products, home equity options  such as reverse mortgages, and health and retirement savings plans,’ the report states. “None of these products has seen widespread use recently due to a number of factors, including the perception of their stability, their safety and their benefit levels.”

Specific to the reverse mortgage market, the report indicates, are public perception challenges that are making it even more difficult for reverse mortgages to gain a place in the long-term care conversation.

“The market for reverse mortgages (RMs) is likewise in a difficult position,” the report writes.”Recently, state and federal  agencies have changed regulations governing the program to address consumer issues with the program, but the perception persists that RMs, as currently constituted, do not have adequate consumer protections.”

Advocates have developed action items for helping the perception around and access to reverse mortgages among Minnesotans.

Written by Elizabeth Ecker

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Help Seniors Prevent Medical Identity Theft

Fishing for Social SecurityIdentity theft is one of the fastest growing crimes in the United States. According to the Federal Trade Commission’s (FTC’s) Identity Theft Survey Report, almost 10 million Americans were victims of some form of identity theft in 2002, with an average loss of $4,800 per person. Identity theft is the fraudulent use of another person’s name, Social Security number, driver’s license, bank account, PIN, or credit / debit card number.

Medical identity theft

Medical identity theft is more specific than standard identity theft; it involves the theft of insurance information to obtain goods or services related to medical care.

Medical identity theft / fraud forces victims to sort out what happened with doctors, hospitals, insurance companies, credit agencies and sometimes even lenders that might have granted a loan for medical reasons. The average cost of medical identity theft is $20,160 per victim. According to a National Study on Medical Identity Theft, conducted by the Ponemon Institute, nearly half of medical identity theft victims lose coverage as a result of the theft. And Medicare fraud is one of the most common forms of medical identity theft / fraud, with 1 in 10 Medicare claims determined to be fraudulent.

Vulnerability of seniors

According to an Experian survey, 11 percent of people over age 65 have been victims of identity theft. Seniors are especially targeted by identity thieves because they have higher cash reserves and home equity than younger adults, they are typically less technologically savvy and don’t research scams online, and they often don’t monitor their credit and financial accounts very closely.

Senior consultant Minda Cutcher postulates that older adults are also vulnerable to identity theft for the following reasons:

  • Seniors belong to a trusting generation, and they remember a time when door-to-door salesmen were common — and legitimate.
  • Seniors as a group are more homebound than the average population, which makes them easily accessible targets.
  • Seniors raised during the Depression learned how to save for a rainy day and may have sizeable nest eggs.
  • Seniors may be reluctant to report crimes, out of a sense of shame or guilt — particularly if the perpetrator is an acquaintance or family member.
  • Sometimes, seniors who have memory problems can be poor witnesses when they are victims of a crime — a fact that many criminals count on.

How thieves steal identity information

Identity security expert Ora DeMorrow explains that thieves steal data in a variety of ways.

  • Personal theft: Personal information is stolen by an employee, nurse, relative or friend.
  • Wallet or purse theft: Many seniors carry their Social Security card or Medicare card.
  • Phone scams: Thieves pose as insurance companies, charities or other businesses.
  • Dumpster diving: Scammers dig for personal information in the trash of homes and businesses.
  • Record theft: Medical records, Social Security records and other personal documents.
  • Online fraud: Fake emails and Web sites (i.e., phishing).

Identity Theft Resources

Nationwide Credit Reporting Bureaus:

Equifax
P.O. Box 105873
Atlanta, GA 30348-5873
800-685-1111
http://www.equifax.com
Fraud reporting: 800-525-6285

Experian Information Services
P.O. Box 949
Allen, TX 75013-0949
888-397-3742
http://www.experian.com
Fraud reporting: 888-397-3742

TransUnion
P.O. Box 390
Springfield, PA 19064-0390
800-888-4213
http://www.tuc.com
Fraud reporting: 800-680-7289

National Crime Prevention Council resources for preventing fraud and identity theft:
http://www.ncpc.org/topics
/fraud-and-identity-theft

Preventing identity theft

Tips to protect against identity theft, including medical identity theft, include the following:

  • Sign up for the National Do Not Call Registry.
  • Don’t give out any personal information over the phone unless you initiate the call.
  • Protect your Social Security number and Medicare number. Don’t carry the cards in your wallet, and don’t give out your numbers unnecessarily.
  • Keep sensitive documents at home in a locked file cabinet.
  • Photocopy the contents of your wallet, and store the photocopy in a safe place in case of loss or theft.
  • Shred all sensitive financial documents.
  • Opt out of receiving prescreened offers based on your credit data.
  • Cancel any lost or stolen credit cards immediately.
  • Check your financial statements and credit report regularly.
  • Research the authenticity of charities and other organizations before you donate any money.

Recovering from identity theft

Identity thieves can wreak havoc on anyone’s life, but especially a senior’s. They can open new bank and credit accounts, drain existing accounts or rack up credit card charges, obtain loans, refinance victims’ homes and even obtain medical care.

Identity theft can take years to recover from — years that older adults might not have. Seniors will need the help of their trusted and knowledgeable advisors to prevent and recover from this type of crime.

 
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Posted by on November 1, 2010 in Uncategorized

 

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