REITS: The Truth about Your Elderly Parent's Montlhy Service Fees

Creative Commons License; Brett VA

You know that monthly service fee for the grandiose residents where your senior mom is living? Or how the monthly fee doubles when you or your elderly parent moves from independent living into assisted living - even though his or her bedroom/living room space is half the size? You may think that increase is going to increase services, which your elderly parents increasingly need. Then how come it doesn't? And how come you're so frustrated?

Where do you think the funds that your parents - or you, if you're supporting them - are paying are going to?

My mom lives in senior housing that began as senior housing run by Quakers and that is now one site owned by a national corporation. I used to think her service fee is split between her specific location, and the national corporation, each getting a piece. I thought I was so brilliant for figuring out that not all the money goes to getting her good care, but rather also to "the corporation."

Now even that turns out to be naive.

Have you ever heard of a REIT? You may not have but plenty of investors in it for the long haul have.  It stands for Real Estate Investment Trusts and this category of investment fund was created in 1960 by Congress. One type of REIT is Healthcare. We start with the fact that the land and physical facility on which you or your elderly parent live, or will live, is owned not by the senior services company but by the Real Estate Investment Trust.

Almost immediately after this type of stock portfolio was created, investors loved REITS. 

Read this from Forbes: 3 Recession-Proof REITs With Yields Up To 7.6%

or this from RealMoney:Top Healthcare REITs to Play an Aging Population

One reason why healthcare REITS are in demand is that they are required to distribute at least 90% of their income as shareholder dividends. In a normal company, profits would go back into the company in the form of better services, improved facilities, land maintenance and land improvement. Not so with REITS. 

AT LEAST 90% of their income is going to shareholder dividends!!!

Where my mom lives, the company advertises 74 acres that include 6-hole executive golf course,community garden plots, a greenhouse and hiking trails. But when you go there, the land is decrepit, the golf course overrun and uncared for. Bittersweet has overtaken acres and acres, shrouding out the tall trees that are probably hundreds of years old, squeezing the life out of them, now bare except for a few branches at the tippy top, and the REITS company does not cut the bittersweet down. Their way of dealing with it is to clear cut the trees and where they haven't clear cutted, the bittersweet just continues to overtake.

Once, I brought my golf clubs down. The land was soggy and pockmarked. The boundaries were overrun by bushes and invasive species that narrowed the fairways. To get from one green to the next hole, I had to wind my way through overgrown bamboo and bushes, often unsable to see to the next hole.  


This is not land stewardship. This is doing the least amount possible, to increase profits the most. There is no incentive to steward the land.

Every now and then an infrastructure improvement is made. But think about it: To get a physical structure improvement, the request has to go all the way from this individual facility to the REIT. 

I'll stop here for now, because I have a laundry list of improvements that could be made to the land and to the physical structure where my mom lives, and I have a laundry list of how services could be improved. But just start where it counts: 90% of the income of the assisted living facilities goes straight out to shareholder dividends.

What you don't have control over

Somebody recently hearing my lament said "You have to accept what you don't have control over." Ha. Sounds like a good soundbite - but it's very cheap advice. I hate cheap advice. 

I check all my power of attorneys. This account checks out. The next account checks out. But one account I've never filed my power of attorney with them. For sure I was too overwhelmed - busy with some critical "other". I won't say it was a mistake. I'll have rachmanus on myself. but it definitely adds new stress.

THIS BANK I have to overnight it in....  And I quickly check all the rates - FedEx, US Priority Overnight... And the US Priority overnight wins. I can save a few dollars by doing it online and printout out my mailing label. It won't accept the address. I'm frantic. Aha - I've misspelled the street.  Now everything is ready. I've printed out the PoA. Added my cover letter. Everything is in the packet, sealed, ready to go. Next a trip to the post office. I didn't plan this for today. Like I have nothing else to do today.

It's been well over one week. They're saying it's not processed - it's 7-10 BUSINESS days, which can be over two weeks. I call on a Saturday night - They can't even tell me IF it's been received. And THAT office is closed weekends.

I'm freaked because HE - Unidentified Male Relative - is on his way to my mother's. That can mean only one thing. 

"You have to accept what you don't have control over." Easy for you to say.

After a while, I hear he has called her again and said he has turned around due to delays on route. 


I'm off the hook for another day or two... Maybe the bank will process this PoA by the next move....

Why Isn't THIS Considered Elder Abuse?

I've been doing my damnedest to stop this flow of money from my mother's accounts TO unidentified family member.

Huge amounts of money going out..  YOu want to guess? Thousands? Hundreds of thousands? Sneaky purchases of the Vanilla Card made on her credit cards... The cash then used to purchase drugs... Other fraudulent sneaky ways to get at her money. Lying about why UFM needs the money is a biggie.

At that time I contacted county personnel to see if there were elder abuse provisions that could be used. NO. If she willingly gives her credit card or writes a check, it doesn't fall within their provisions of ELDER ABUSE. She knows the person. Not elder abuse.

IN CALIFORNIA, it DOES!!!  I'm going to write more about this later, but it just points to the difficulty I'm having WHEN a FAMILY MEMBER has a way of exploiting a senior's emotional and physical (yes actual fear of being physical hurt by another if she says "NO" and sticks to her guns) weaknesses to get money.  Laws in other states only step in if it's a non-family member OR if the card is stolen, etc. It's been so frustrating - because it's definitely abuse of an elderly person but the laws will not help me at all.

When it happened again a few weeks ago, and my mom was living in a new county, I called that county. Same thing. Must be state laws administered by counties. 

OH and they all say that if she comes in they'll be willing to talk to her. RIGHT. That's going to really help.