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In 2012 about 6 months before I needed to move to TX to care for my parents (a surprise change), I took on the responsibility of caring for an elderly lady in my home town in CO and set up Medical and Durable POAs for her. But almost a year ago she broke her hip and was placed in a Nursing Home for rehab under Medicaid and has remained there. The issue with her dementia is the same reason I took on responsibility for her: She can't make wise decisions about money. "You can't squeeze blood from a turnip," is her excuse for not paying all the bills she wracks up when the real issue of dementia means that she should not have any ability to spend money. She only has $50 per month to spend on anything outside of her basic care, and she goes through that regularly for hair appts, nails, out-to-eat, trips to the dollar store. So she has been ordering all kinds of books, magazines, clothes, etc. with no money to pay for these. I'm not sure how she got the ads for some of these things since her mail has all been forwarded to me. But that is a moot point. There is no one there in my home town who would take on the responsibility of making sure that she does not order any of these things. And the NH cannot interfere with her mail: everything has to be delivered to her that has come to the NH.

Any ideas about how to control her spending?

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Close credit cards or reduce limits; Put a hold on her credit report if you have an active DPOA so she can't open new ones. if she is responsible for own actions still and DPOA is not active, not much you can do. At some point if she owes too much they won't ship to her. Sad but true.
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You are too far away to do much to stop her. Personally I would resign the POA's in writing to her NH and Medicaid Caseworker and let the state of Colorado take over as her Guardian. I just don't understand how she can order things without a credit or debit card, both of which can be stopped.
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charmin, I am curious how someone who is in a nursing home can leave the building to go shopping? Can someone of authority in the nursing home refuse any UPS or mail packages that come to their building in her name that look like it was from a store?
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