Retirement Living News

October, 2007

HEADLINES  (Click on headline to read story)

• Some Americans Look to Mexico for Senior Services
• Regulators Target Fraud Against Older Investors
• AARP Polls Workers 50+ About Job Expectations
• Aging Population in New England Expected to 
  Impact Workforce and Economy
• MetLife Offers a Series of Helpful Guides for Seniors and Caregivers
• CMS Announces Small Rise in Medicare Premiums for 2008

Archive of Past Issues                          New Retirement Communities

NEWS STORIES

Some Americans Look to Mexico for Senior Services 

Retirement facilities are relatively new in Mexico, but more older Americans are heading south of the border to live in retirement communities, assisted living facilities, and nursing homes because of the lower cost of living. Some U.S. companies have begun investing in Mexican assisted living communities; however, there are concerns about quality of care. 

An estimated 40,000 to 80,000 American retirees already live in Mexico, USA Today reports. "Mexico's proximity ... low labor costs, and warm climate make it attractive, although residents caution that quality of care varies greatly in an industry just getting off the ground here." 

Many expatriates in Mexico are Americans or Europeans who retired years ago and are now becoming frail. Others are not quite ready for a nursing home but are exploring options such as in-home health care services, which can provide Mexican nurses at a fraction of U.S. prices. 

Retirement homes are relatively new in Mexico. There is little government regulation and some have gone bankrupt forcing residents to move. Some American residents have said they have doubts about the quality of Mexican medical facilities and would go back to the U.S. if they became seriously ill.

Developers of independent living facilities for seniors are beginning to take a look at Mexico. A Spanish-U.S. venture is building Sensara Vallarta (http://www.sensaravallarta.com/), a 250-unit condominium complex aimed at 50-plus residents in the Pacific Coast resort of Puerto Vallarta. In the northern city of Monterrey, El Lagado (http://www.solutionsabroad.com/a_ellegado-intro.asp) is marketing itself as a "home resort" for seniors.

The Tijuana Economic Development Council is seeking funding from Mexico's federal government to build more retirement homes. They believe that with the right facilities in place, Mexico could give American retirees a better quality of life at less cost than in the United States.
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Veteran Loan Program

Veterans who are purchasing their first home may not be aware that they can actually be given a loan through the VA.  The VA home loan is designed to help veterans who have less than perfect credit to obtain a home loan at a competitive rate.  Find more information about the VA Loan Program by visiting the VA Mortgage Center.com.

Regulators Target Fraud Against Older Investors

U.S. regulators, stepping up efforts to rein in securities fraud involving seniors, found that more than a third of "free lunch" seminars aimed at older Americans focused on unsuitable or fraudulent investments. 

The Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and state regulators said in a report released last month that half of the 110 securities firms investigated made exaggerated claims at the meetings, including promises of adding $100,000 to participants' net worth. FINRA is the brokerage regulator formed through this year's merger of the NASD and the New York Stock Exchange's enforcement unit. 

The report titled Protecting Senior Investors: Report of Examinations of Securities Firms Providing "Free Lunch" Sales Seminars found that 23 percent of the firms offered inappropriate advice, and 13 percent may have committed fraud and now face enforcement or disciplinary action. 

"The stakes for our investor-protection mission couldn't be higher," SEC chairman Christopher Cox said during a Senior Summit of federal and state regulators who met to discuss ways to protect the elderly from fraud. "If we fail, millions of seniors will be at risk of falling victim to scam artists." 

Regulators are cracking down on firms that lure retirees with misleading tactics, such as overstating their employees' expertise in retirement planning. The SEC brought more than 40 cases in the past two years involving attempts to swindle seniors. 

U.S. households run by someone age 50 or older control more than 75 percent of the nation's wealth, making them prime targets for fraud. Free lunch sales seminars are routinely targeted at senior citizens and are commonly held at upscale hotels, restaurants, retirement communities and golf courses. Research by FINRA's Investors Education Foundation has found that 78 percent of seniors received a free lunch seminar invitation and that 60 percent received six or more in the past three years. 

Last month, the SEC sued 26 people and companies on charges they duped retirees into investing in timeshares in Cancun, Mexico. In the alleged $428 million scam, the timeshare operators used money from new clients to make purported rental payments to earlier investors, the SEC said. 

Fraudulent practices found in the seminar study included sale of phony investments, misrepresentation of potential returns, and liquidation of customers' accounts without authorization. The regulators' recommendations include encouraging securities firms to step up oversight of free-lunch seminars and educating older Americans about what can happen at the meetings.
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AARP Polls Workers 50+ About Job Expectations 

What do older workers think about age-based discrimination in the workplace? How satisfied are they with their current jobs? Do their past expectations match today's reality? At what ages do they think they will stop working completely and not work for pay at all? What types of work arrangements are prevalent among older workers? 

These questions and others were included in an AARP-commissioned telephone survey of 510 workers age 50+ who were employed full-time, part-time or temporarily unemployed. Among the findings were the following: 

• Retirees returning to the workforce: 38 percent of workers age 60+ reported having retired from a previous career, but that number dips to 11 percent among age 50-54 workers. 
• Past expectations match today's reality: 90 percent of workers age 50-54 expected to be working at their current age, but only 66 percent of age 60+ workers anticipated this. 
• Full retirement age projected to be 65 or 70: 23 percent think they will stop working completely at 65 and not work for pay at all, while 16 percent estimated age 70, and 7 percent indicated they never plan to stop working.
• Older workers are satisfied with their overall job, but not so much with certain elements of their job: 90 percent reported being satisfied with their jobs; satisfaction dropped to 67 percent when asked about their benefits, 72 percent about current pay, and 75 percent about their current managers.
• Self-employment increases with age: 14 percent of the 50-54 year old workers stated they were self-employed, but that number doubles to 30 percent for the 60+ workers. 
• Few experience age-based discrimination in the workplace: When asked about different types of discrimination, very few workers (about 10 percent) reported having experienced any of these actions. The percentages do increase slightly with age.
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Aging Population in New England Expected to 
Impact Workforce and Economy

Having the nation's oldest population, Maine now faces some of the most daunting economic challenges that will also be shared throughout New England. New England Council President and CEO, James T. Brett, warns that the region's employers will become increasingly dependent on older workers - those age 55 and above - to meet the demand for skilled workers as the six states' workforce grows older. "The ability to retain and recapture those older workers in the labor force will be critical to the long-term economic prosperity of the region, says Brett.

The council is an alliance of businesses, colleges and universities, nonprofit and other agencies. It has launched the Older Worker Initiative to focus on retirement and pension regulations as well as company-designed programs to foster knowledge transfer and retain older workers. 

In a series of studies conducted for the New England Council by Northeastern University's Center for Labor Market Studies, there was agreement that the issue of an aging population will have an impact on the future of the workforce in all of the New England states. Out-migration trends, particularly among the young and educated population, are exacerbating the problems which are anticipated for the future of the workforce. Some states may begin to see labor shortages earlier than others, and relatively soon. 

Maine is already focused on the issue. In Rhode Island after 2010 there will be virtually zero labor force growth in the state. While New Hampshire is the only state in the northeast that will outpace the nation in growth of the working age population from 2005 to 2015, there is not a lot of foreign immigration into the state. This fact may contribute to New Hampshire being more dependent on the older population in the future. 

Connecticut is expected to experience a significant reduction in its workforce from 2010 to 2015. Massachusetts is expected to lag behind the rest of New England and the nation in population growth from 2005 to 2015. 

The report notes that there are many barriers for older workers who wish to stay in the workforce. One is Social Security income limits and penalties for those who try to work and collect retirement income at the same time. Another is pension regulations which may encourage a person to retire early but will not allow them to return to the former employer and collect retirement income. Yet skilled people can move on and work for a competing company. 

Other barriers reported may include training in new technologies. Some older workers do not have the required skill level on computers. Transportation may be a problem in rural areas and some seniors may not want to drive at night. Older workers are also looking for flexible hours. On the plus side, older workers have less absenteeism and higher productivity.
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MetLife Offers a Series of Helpful Guides for Seniors and Caregivers

MetLife's Mature Market Institute is offering a series of "Since You Care" guides that provide useful tools and information on a variety of specific care-related subjects. The guides are prepared by the Institute in cooperation with the National Alliance for Caregiving and MetLife's Nurse Care Managers. So far 17 guides have been published. 

Medicare and Medicaid Programs - The Basics is the most recent publication. It explains how these two programs assist with the provision of health care for older adults. Medicare, it states is available to individuals age 65 and older as well as to people under 65 with certain disabilities. The Medicaid program pays for medical assistance in support of certain individuals and families with low incomes and resources. To read the 20-page guide, click here. 

The other 16 guides in the series cover such topics as long distance caregiving, preventing elder abuse, final arrangements, hospice, choosing an assisted living facility, selecting a nursing home and understanding options for home care. You can access any of these and others by clicking here. 
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CMS Announces Small Rise in Medicare Premiums for 2008

The U.S. Centers for Medicare & Medicaid Services (CMS) announced that the standard Medicare Part B monthly premium will be $96.40 in 2008, an increase of $2.90, or 3.1 percent, from the $93.50 Part B premium for 2007. The 2008 amount is the smallest percentage increase in the Part B premium since 2001 and is $2.10 less than the increase in the premium for 2007. 

Most of the 43 million beneficiaries pay the standard premium for Medicare Part B, which covers doctors' services, outpatient hospital care, X-rays, laboratory services and other diagnostic tests. 

About 5 percent of beneficiaries, with annual incomes exceeding $82,000 for individuals and $164,000 for couples filing joint tax returns, will pay higher premiums on a sliding scale. 

The maximum will be $238.40 a month for the most affluent -- individuals with annual incomes exceeding $205,000 and each member of a couple reporting combined income of more than $410,000. For an individual with annual income from $102,000 to $153,000, the premium will be $160.90 a month. Most beneficiaries pay separate premiums for Medicare coverage of prescription drugs on top of the standard premium. The drug premiums typically range from $25 to $40 a month. 

The increase in the standard Part B premium was less than many experts had expected, in part because officials decided to correct an accounting error. As a result of the error, money for certain hospice benefits was inadvertently drawn from the Part B trust fund rather than a separate trust fund that pays hospital costs. The money will be paid back in the coming year. 

In addition, the premium for 2008 is artificially low because it assumes that Medicare payments to doctors will be cut about 10 percent next year, as required by law. Congress has usually stepped in to avert such cuts, and the cost is passed on to beneficiaries in subsequent years. For a CMS fact sheet on the new rates, click here. 
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