Add comment October 28th, 2009
David Cutner on CBS Evening News
Add comment October 28th, 2009
Add comment October 28th, 2009
A caregiver agreement with a lump sum advance payment can be an effective way of supplementing care in a nursing home while, at the same time, reducing a Medicaid penalty or spend down. Under such an agreement, the patient pays in advance for caregiver services that the nursing home does not provide, which improves the patient’s well being and quality of life. The caregiver can be an independent individual, an agency, or a family member.
The keys to creating a caregiver agreement that will be accepted by Medicaid are: (a) specifically define the services and hours to be provided by the caregiver, (b) calculate the lump sum payment using a reasonable life expectancy and market rates for the services involved, (c) discount the lump sum payment to present market value using a reasonable rate of interest, and (d) require the caregiver to keep a daily log and submit a detailed written invoice of the services and hours actually provided.
In one of our cases, our client was in a nursing home and needed extra care and companionship beyond what a nursing home can provide. Her daughter was willing to provide these services, so we prepared a caregiver agreement that allowed her daughter to be compensated with an up-front payment. The arrangement got the mother the extra services that she needed, and benefited the family as well.
In another case, our client was in a nursing home and needed assistance with feeding and other activities of daily living (“ADL’s”) to a much greater extent than is normally available in a nursing home. We prepared a caregiver agreement between our client and an agency, under which the agency provided the needed services. The individualized attention given to this client made all the difference in his quality of life. The agency’s fee was fixed in advance and paid as a lump sum, which facilitated the client’s Medicaid eligibility.
Add comment October 28th, 2009
Estate planning and Elder Law are related but distinct legal practice areas. In some instances, individuals and married couples will have excellent estate plans that become entirely inadequate if they need long-term care. The estate planning attorney is not to blame; his client had different objectives in mind at the time.
The current recessionary environment has exacerbated these situations. Even clients with substantial assets have been significantly affected by investment and property losses, in addition to income disruption when employment is terminated. Older individuals have less time to recover from these financial blows. These realities coupled with high estate taxes often create devastating financial scenarios for ill people and their families.
The solution is to have a careful review of any existing estate plan you may have by an Elder Law firm. Even under normal circumstances, it’s a good idea to have a periodic review of an estate plan to make any necessary revisions based on any changes in your situation or perspectives. However, when critical illness is a factor, it’s absolutely vital to your economic well-being and security to review and potentially to revise your estate plan.
Wills or trusts may have to be revised or updated. A Health Care proxy to effectuate your wishes about medical care may have to be drafted. Typically, these and other considerations need to be examined and addressed.
You can get a better sense of the interface between Elder Law and estate planning by reviewing strategy #18, #19 and #20 in Lamson & Cutner’s Special Report, 25 Strategies to Prevent Financial Ruin from Long-Term Health Care Costs. There’s also a separate section of the firms website devoted to the topic here.
Add comment October 23rd, 2009
Governor David Patterson has previously directed New York State agencies to recognize same-sex marriages that are legal in the states and countries in which they were performed.
Now, the Governor is pressing New York legislators to make gay marriage legal in New York as well. Mayor Mike Bloomberg, and New York Senators Chuck Schumer and Kirstin Gillibrand, are all in favor of the proposed legislation.
Hopefully, New York will soon follow the trend being set in other states that have legalized gay marriage, such as Massachusetts, Connecticut, Iowa, Vermont, Maine and New Hampshire.
With legalization of same-sex marriage in New York, members of the GLBT community would gain significant financial advantages in circumstances involving debilitating illness and long-term health care options.
For example, if you are married and become ill and in need of long-term care, you can transfer your assets to your spouse and become immediately eligible for Medicaid benefits. Such transfers are exempt, and are not subject Medicaid’s “look back” and “penalty” rules. This makes it possible for cash, investments, real estate and other valuable property to be preserved within the family unit. For GLBT couples confronting serious illness, valid marital status would make it easier to preserve the assets that the couple has saved up over a lifetime.
When the same Elder Law strategies that currently work so effectively for married couples can be utilized on behalf of gay partners, it will unlock the full spectrum of planning for long-term health care.
All that being said, there may still be challenges even if New York votes same-sex marriage into law. There will likely be conflicts with existing Federal law, particularly the Defense of Marriage Act, which does not recognize same-sex unions and may be an obstacle to achieving eligibility for Medicaid benefits. Nevertheless, legalization in this state will move us one step closer to equal rights for GLBT couples.
You can learn more about Elder Law planning approaches for GLBT couples here: Gay and Lesbian Couples – Elder Law Planning
Add comment October 22nd, 2009
The Alzheimer’s Association has released the 2009 Alzheimer’s Disease Facts and Figures report, which reveals a disturbing statistic. Those over 65 with Alzheimer’s and other dementias have total health care costs that are three times greater than others who are not afflicted with these illnesses. This fact translates into an often unbearable financial situation for the victims and their families.
According to the report, today “Alzheimer’s Disease is the most common cause of dementia.” How specifically do these illnesses increase expenses by a factor of three? In the following ways:
The current recessionary environment imposes additional financial strain on people with dementia, along with their families. It’s for this reason that Elder Law strategies are especially valuable right now. With an attorney’s guidance, these techniques can allow an individual to become Medicaid eligible and receive full payment for needed treatment and health care services. Additionally, these strategies can preserve the money, income and assets of the ill person, so that this money can be used to keep the patient’s lifestyle intact as long as possible.
See Lamson & Cutner’s Special Report, 25 Strategies to Prevent Financial Ruin from Long-Term Health Care Costs to learn more about specific solutions and case studies relating to Alzheimer’s patients. Home care and nursing facility options are both discussed in detail. You can also see an overview of a detailed Elder Law approach to your specific situation at www.lamson-cutner.com. Just click on the scenario that matches your circumstances.
You may also view the Alzheimer Association’s 2009 Alzheimer’s Disease Facts and Figures report.
Add comment October 19th, 2009
A book review in The Wall Street Journal of the 2009 memoir, Welcome to the Departure Lounge: Adventures in Mothering Mother, explores the challenges in caring for elderly parents. The author or the book, Meg Federico, is a journalist who chronicles her experiences with an ailing mother and stepfather in the later years of their lives.
New York State’s highest court has referred to long-term health care costs as “ruinously expensive.” Although the review points out that Ms. Federico’s parents were affluent, the costs and sometimes unforeseen expenses associated with their care were extraordinary: “At one point, the annual budget for Addie and Walter’s care is $400,000.” They receive care in their home, with their needs attended to by a team of personal aides.
Affluent families often operate under the misconception that a mother or father cannot qualify for Medicaid because of their substantial assets or income. This is simply untrue. With proper planning, parents can transfer their assets and obtain benefits that can provide for their needs during the remainder of their lives. This is the unique advantage what Elder Law has to offer seniors and their loved ones. Heirs can receive what is left when a parent is gone.
The WSJ article clearly portrays the family’s difficulties in confronting dementia and Alzheimer’s Disease. Ms. Federico travels back and forth between her home in Canada and her parent’s house in New Jersey to assist with and coordinate their care. In a situation like this one, an Elder Law attorney can help you with presenting your case to Medicaid that both parents require home care aides.
The creation of one or more trusts may be an important part of the plan to protect your parents’ assets. With trusts, multiple objectives can be achieved, including Medicaid eligibility, protection of assets from future creditors, avoiding probate, reducing taxes, and continuous management.
You can learn more about Trusts in Strategy # 8 and # 9 in Lamson & Cutner’s free Special Report, 25 Strategies to Prevent Financial Ruin from Long-Term Health Care Costs.
Add comment October 16th, 2009
Achieving Medicaid eligibility with Elder Law methods techniques is accomplished using a series of sophisticated planning tools. One of the most important techniques involves transferring assets to family members or to trusts, so that your total financial profile is within Medicaid’s eligibility requirements. One option for transferring money is by means of non-taxable and non-reportable gifts.
Under our tax laws, the annual gift allowance has been increased to $13,000. What this means is that you can make a monetary gift of up to $13,000 per year to anyone you choose, without paying any gift tax, and without reporting it. If you give a son or daughter $13,000 now, you have also removed that amount from your estate, and have avoided eventual estate taxes on it.
The beauty of this simple procedure is that you can make as many of these $13,000 gifts as you like each year. For example, if you have three children and five grandchildren, you can transfer $104,000 ($13,000 x 9 = $104,000) to them free of gift or estate taxes, and help yourself to gain eligibility for Medicaid benefits.
A well-designed Elder Law plan achieves Medicaid eligibility and also commonly helps preserve assets for your heirs. Oftentimes, it allows them to receive or inherit cash and property they otherwise wouldn’t. Making non-taxable and non-reportable gifts is sometimes an important part of the plan.
There are additional considerations in using gift and other transfer strategies when in comes to Medicaid eligibility. You can get a preliminary overview of them here, depending on your particular situation. Your best option of course is to get a consultation with an experienced Elder Law attorney who can advise you appropriately.
Add comment October 5th, 2009
The housing crisis and decline in the financial markets have had a dramatic impact on the lives of many seniors. The inability to sell their homes has stopped a significant number of the elderly from taking essential steps to provide for their long-term health care and general well-being. A typical scenario might be the inability to fulfill plans to sell a house, condo or co-op, and then use the proceeds to enter an assisted living community with services for older adults.
An article published earlier this year on MSN Money cited a study examining these incidents, along with other predicaments the elderly find themselves in increasingly nowadays.
One very calamitous scenario involves those whose limited resources force them to choose between paying for medical care or housing costs. Some are buying inexpensive medications, or reducing or discontinuing their prescriptions altogether, due to sudden and unanticipated changes in their financial condition.
The problem with decreased property and portfolio values is that the elderly individuals generally don’t have the time or ability to recoup their losses, as most younger people do. That makes the current economic crisis especially devastating for them. In fact, the article calls attention to the precipitous rise in seniors who must now move in with their children to survive financially, up 57% since 2000.
As sad as this is, there are solutions many seniors and their families are unaware of. Elder Law makes available a wide variety of special techniques that allow an individual to retain the benefit of his or her money, income and assets, while qualifying for full Medicaid coverage of health care needs. With effective planning, most seniors will never be in the heart-wrenching circumstance of having to go without medications or doctor visits, or being subject to other dangerous or demeaning situations.
New York State funds Medicaid programs generously, and Medicaid eligibility is a possibility even for most who think they can’t qualify for benefits. If you’re facing financial difficulties imposed by the recession, it’s a good idea to consult with an Elder Law attorney to get specific advice about your situation. An experienced lawyer can provide immediate and accurate answers, shortening the time frame for obtaining benefits.
There are a number of common situations most people find themselves in when it comes to eligibility for Medicaid benefits. You can read about the solution most applicable to your circumstance here: www.lamson-cutner.com
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