Caregiver of 38 Years Loses Home to Medicaid Nursing Home Costs

Will Medicaid take my home if I need to go to a nursing home?  How can I protect my house? These are two of the most common questions I hear as an elder law attorney.

On Monday, Rita Price of The Columbus Dispatch published a related story entitled "Thanks to Medicaid, Caregiver Faces Eviction - Forced Sale of Home".

Murrell Lewis cared for owner Alma O'Brien, 94, for 38 years

Price tells the tale of Murrell Lewis, a single man in 1973 with a doctorate in physics that needed a place to live, and Alma Ruth O'Brien, a widow that opened her home to Mr. Murrell.

Beware of Nursing Home Arbitration Agreements

Nursing Home Arbitration Agreements are something to pay close attention to when entering a nursing home or assisted living facility.  Many residents sign these without a second thought, but some  commentators characterize these contracts as an "incredible disservice" to nursing home residents and their families.

Why are these considered a "disservice"? Well, some would say these arbitration clauses are often "buried" within 20, 30, or even 40 pages of legalese text, not unlike that which might be seen when buying a car. You might say that this can make it difficult to understand the full terms of the contract.

In a 2009 case, Hayes v. Oakridge Home, the Hayes family alleged that Mrs. Hayes was a victim of negligence, as she suffered serious injuries when she fell from a wheelchair while at a nursing home.  The nursing home produced the arbitration agreement indicating that Mrs. Hayes had agreed to forego a lawsuit in favor of binding arbitration.

The family felt that they should not be held to the arbitration clause because:

Hayes lacked any business or contract experience; no one explained the terms of the agreement to Hayes, including the fact that she could alter the agreement; the rescission clause was buried among a myriad of terms, and she was required to fill out numerous other forms at the same time; and there were no alternative sources of supply because finding a quality nursing home is difficult.

Regardless, the court found the clause to be enforceable and the Hayes family did not have the option of following through with the lawsuit in court.

Before you or a loved one signs anything, make sure to read it closely.  If you are not comfortable with agreeing to take any complaints or disputes to arbitration rather than court, ask them to strike the arbitration agreement clause, or speak to an elder law attorney before signing.

Steps To Take When A Loved One Dies

My clients know that if they lose a family member or friend, they can simply call me for help as a Probate and Trust Administration Attorney. Unfortunately, many folks don't even have a will in place, so their family members don't have any written guidance to refer to, and may not even know an attorney that will help them with their questions.

Recently, Portland Oregon Estate Planning Attorney Candice Aiston compiled this helpful list of things to do (edited slightly for Ohio estate planning purposes), which I hope you find helpful,though I don't pretend that it is a complete list.

1. Notify doctor, coroner, and/or police officer (depends on whether death occurs at home or hospital).
2. Contact family and friends. Hopefully, the deceased has compiled a list of people to notify in his or her estate plan.
3. Funeral arrangements. If they're not prepaid, they can be paid from the estate of the deceased. This is also something that the deceased may have expressed wishes about in his or her estate plan. Determine whether the deceased will have military or police officer honors.
4. Prepare obituary. Again, the deceased should have helped you with this in his or her estate plan.
5. Contact an Estate Planning Attorney as soon as possible. If there is a Will, it may need to be filed with the Probate Court by a certain date, and the Federal Estate Tax return is due 9 months after the date of death. You may have a state estate tax return as well; the existence and rules vary state to state. You also only have 9 months to decide on the use of disclaimers to save on estate taxes. Without a Will in place, probate may need to be opened depending on the size of the estate. If there is a Trust in place, there will probably be a lot of paperwork that needs to be completed, and this is best handled by an attorney. Also, many states require that estates notify creditors publicly, and the estate must remain open during the statutory time period, so it's a good idea to contact an attorney early on so that the clock can begin.
6. Use a team of advisors (attorney, CPA, financial advisor). There will be many legal, financial, and tax issues that come up and it's best to have the advice of professionals in those fields.
7. Locate estate planning documents and asset information. Hopefully, the deceased has communicated his or her plan with you prior to death, and hopefully, the documents aren't in a super secret safety deposit box. Having an attorney to turn to at this point is invaluable.
8. Arrange care for surviving family and pets. Guardians for minor children must petition the court to have guardianship approved.
9. Obtain the death certificate. It's best to get several copies, because many of the institutions you'll be dealing with will need a copy.
10. Secure real and personal property and make an inventory of all personal property.
11. DO NOT immediately accept benefits (retirement, annuities, investments). Contact your Estate Planning Attorney and inquire about the use of disclaimers. There may be tax savings in doing so.
12. Create inventory of assets (real property, valuable personal property, bank accounts, stocks, retirement accounts, life insurance, etc.). If the deceased has done thorough planning, a spreadsheet of these assets should be with his or her estate planning materials.
13. Contact IRS for new Tax ID number for estate or trust.
14. Compile list of creditors.
15. Notification for benefits and insurance. Provide employee benefits, insurance, Social Security, and Medicare offices with: Decedent's name, Social Security number, date of death, whether death was due to illness or accident, your name and address.
16. Other notification: Veterans Pension or Survivor benefits, club and credit memberships, disability insurers, utility companies, homeowners, landlord, anyone providing home maintenance.
17. If the decedent was a business owner,there are obviously additional items to consider. One is whether the decedent had a Buy-Sell Agreement or other type of business succession plan.

With Identity Theft of Deceased becoming a common problem, Ms. Aiston also provides some tips to avoid identity theft.

1. Request the deceased's credit reports from the three credit bureaus.
2. Request that the credit bureaus suppress the deceased's credit file.
3. Send a copy of the death certificate to all creditors.
4. Immediately notify Social Security of the deceased's death.
5. Cancel all of the deceased's ID cards.
6. Safeguard documents that have the deceased's Social Security number.
7. Avoid giving too many details in the death announcement (like mother's maiden name, etc.).

As you can see, the amount of work to be done when someone you love passes away can quickly become overwhelming - especially during a time of severe grief.  To help ease the burden of those you love, get a will or trust estate plan done.

Make sure that all relevant documents are in one conveniently accessed location.  I use a will or trust portfolio (binder) that has tabs for all the legal documents, life insurance policies, retirement plans, memorial instructions, etc.  Don't make your family members dig through boxes in the basement to try to construct your financial picture.  Give them the gift of having your estate plan completed and your affairs organized.

To get started on the most important planning you'll ever do for your family, call Golowin Legal at (614) 453-5208 to get started.

Protect Your "Virtual Assets"

USA Weekend highlighted a commonly overlooked piece of estate planning in "Create A Plan Now For Your Virtual Assets". Jill Golden asked:

Millions of Americans use e-mail, blogs and social networking sites to stay connected with friends and relatives. But what happens to your accounts after you die?

It seems that we all have online banking & brokerage accounts, Yahoo or Gmail, EBay, PayPal, Facebook, Twitter, and more. When we die, the material stored in these accounts can become unreachable or dissapear unless we ensure our loved ones have access through our login information.

I heard a story of a U.S. Marine who was killed in action while serving in Iraq, and his family was not granted access to his Yahoo! email account due to privacy reasons. This ended up being very traumatic for the Marine's family because they wanted to remember him in his words, and his writings were lost forever when the account was deleted.

The author of this article introduced several companies that will forward user names, passwords and personal instructions to a person of your choosing after your death, which include LegacyLocker.com, AssetLock.net, and MyWebWill.com.

Whether you use one of these web services, or just create a handwritten list of user names and passwords and leave it in a safe-deposit box, make sure that losing access to these "virtual assets" does not cause stress or heartache for those you leave behind.

Ways To Help Your Aging Relative With Their Finances

Sometimes aging loved ones need a little help managing their money. Many times they don't need everything handled for them, but a little guidance or a review is helpful.

In my prior post, Help Your Aging Relatives With Their Finances, some of the warning signs of financial meltdown were discussed, along with the need to bring up the issue early. Here are some tips on how to help without taking over completely.

• Set up direct deposits for Social Security, Pensions
• Set up automatic billpay for recurring expenses
• Minimize the number of accounts ***Do your parents have 15 CD's at 15 different banks? Do they have 5 different brokerage accounts? In my opinion, these accounts should be consolidated with a qualified, trusted advisor in the first place...but even if not, the number can be pared down to make it easier to keep track of what's happening with the money***
• Set up regular meetings to review
• Arrange for duplicate bank and bill statements to be sent to you so you can track income and spending

Do NOT add your name as joint owner on your parent's bank accounts or brokerage accounts to help them manage the money. Many times, mom may name the in-town child as the joint owner because the other three children live across the country and have a more difficult time going into the bank. This causes large problems at death, when the entire value of the account passed to the joint owner in-town child, and leaves out the other children or loved ones entirely.

Instead, consider the use of a Revocable Living Trust with the in-town child named as co-trustee. That way, the in-town child can deal with the bank, but the money will pass in the intended fashion (perhaps equally to all four children). Another alternative, a little more risky, is to give the in-town child power of attorney to deal with the finances. Either one, however, is better than adding a joint owner to the account.

Help Your Aging Relatives With Their Finances

Keeping an eyes on your elderly relatives may provide signs that they could use your help with handling their finances. Don't wait to get involved!

Eileen AJ Connelly of the AP writes:

[a]t first, you might notice a pile of unopened mail. Your normally fastidious mother might be getting sloppy with her checkbook. Your elderly uncle might be behind on his electricity bill. The signs are often subtle, but they might indicate that aging relatives are no longer able to handle their finances.

Once you have noticed a possible problem, now is the time to have a conversation where you offer help. Don't wait, as that will risk compounding any problems that already exist. The longer the topic goes unspoken, the greater the chance that once the problem is critical, that your offer of assistance will be met with resistance or denial. However, don't avoid the topic because you think there will be trouble...sometimes the elder may simply assume you're too busy and they don't want to bother you with their troubles.

Sometimes is is easier to enlist the assistance of one of the elder's professional resources: their lawyer, CPA, financial advisor, or doctor. Connelly writes:

Once the conversation is started, be sure to discuss a budget, income, assets and insurance policies. It also can be a good time to make sure that a will is in place, and discuss whether a health-care power of attorney is appropriate.

While I agree that this is an excellent time to discuss whether your parents have an appropriate estate plan in place (at a minimum: Will, General Durable Power of Attorney, Health Care Power of Attorney, Living Will, Organ Donor Registration, HIPAA Release), I strongly disagree that this is the time to "discuss whether a health-care power of attorney is appropriate".

A health care power of attorney is always appropriate from the moment one turns 18 years old. There is no reason to wait and risk having the court be involved in order to appoint the one in charge of making medical decisions on your behalf should you be incapacitated. All adults should have a health care power of attorney!

Should the financial problems be a result of limited, fixed income, investigate state or federal programs that might help with some of the monthly bills. Your local Area on Aging is a good place to start.

Warning Signals:

Signs to watch for if you suspect an elderly relative might be having trouble handling finances:

• Unopened mail
• Late or unpaid bills; collections actions
• Confusion or lack of interest about what bills have been paid
• Bounced checks
• Disorganized personal paperwork
• Uncashed checks or unclaimed property reverting to the state
• A large number of magazine subscriptions
• Unusual or increasing direct mail or shopping-channel purchases

Read the entire article, Aging Relatives May Need Help With Finances.

Long-Term Care Insurance: Pricey But Necessary?

One of the most common questions I get is "Should we purchase long-term care insurance? Is it worth it?" The answer to that question is up to the individual client, but usually people feel that it's "too expensive" as they pay it while healthy, and it transforms into a "lifesaver" when one becomes ill and the insurance is paying out.

The following is an article from AP Business Writer Dave Carpenter.

cHICAGO – Joyce Smith visited friends recently at a modern nursing home that made her thankful she has long-term care insurance. With relatively plush conditions, including large private rooms and lots of space and privacy, this was the type of safety net she could live with someday.

Turning to her husband, she said: “You keep paying that long-term care, Harry!”

While the Green Valley, Ariz., couple are healthy and hope they are years away from filing a claim, they figure they’ll end up in much better hands thanks to the long-term care policy they secured six years ago when Harry was 54 and Joyce was 60. They acted after watching Joyce’s mother Gladys fall ill and go into a nursing home without such protection, draining her life savings of $200,000 in 2 1/2 years.

“If you’re able to, you should have it,” Joyce says of the coverage. She takes comfort in knowing that she and her husband will be able to provide for any daily assistance they may need in later years.

The Smiths are among 8 million Americans with long-term care insurance — an area where insurers expect big growth as baby boomers zero in on their senior years.

The projections are high because the reality is that about 70 percent of people over 65 will require some type of long-term care services during their lifetime, according to the National Clearinghouse for Long-Term Care Information. It might come at any age, actually; 40 percent of people currently receiving long-term care are 64 or under.

But adding a significant extra cost can be daunting, especially at a time when many are focused on saving for retirement.

So can figuring out what level of benefits you want and how long a period to pay for. Most people get three, four or five years of coverage, because only 20 percent of today’s 65-year-olds will need care for more than five years. The more you sign up for, the higher the cost.

The price varies widely based on age, policy type, benefit level and number of years purchased, among other things, and can range from hundreds to thousands of dollars a year. Someone seeking protection equal to today’s average annual cost of care, about $55,000, would pay $1,064 a year for a standard policy purchased at age 55 or $2,013 for a similar policy at age 65, according to the American Association for Long-Term Care Insurance, an industry group.

As a benchmark, Consumer Reports Money Adviser recently noted that, in general, coverage may be largely unaffordable for people with a net worth below $200,000 to $300,000, not including their home. If you’re in that category, you will likely have to rely on government programs for any long-term care, which can cost you your choice of care facilities and, like Gladys, all your savings.

Other drawbacks also exist, including the limits and conditions of many policies.

But foregoing it is risky. Retiree health costs can be enormous without even factoring in the savings needed to cover long-term care expenses.

A man retiring at 65 in 2008 will need anywhere from $64,000 to $159,000 in savings to cover health insurance premiums and out-of-pocket expenses in retirement just for a 50 percent chance of having enough money, according to the Employee Benefit Research Institute, and $196,000 to $331,000 for a 90 percent chance.

A woman the same age would need $86,000 to $184,000 for a 50-50 chance and $223,000 to $390,000 to have a 90 percent chance.

The Smiths, who are retired, pay $4,995 a year for a joint policy with MassMutual that will provide extensive long-term care benefits for an unlimited time — now rare — when they become eligible by virtue of needing help with daily living activities. They consider themselves fortunate they locked in for that amount, having been told by their agent recently that it might cost triple the amount today.

“It’s one of those insurance products that’s kind of difficult to understand,” says Harry, a retired firefighter. “I studied it for nearly a year. ... But it gives you peace of mind to have it.”

Having the insurance also protects children from a potentially heavy burden.

“We’ve had friends tell us ‘We’re not getting long-term care, let the kids take care of us,”’ says Joyce, who with her husband has two daughters and a son. “Well, that’s not being very nice to the children. We don’t want our kids to have to take care of us.”

Long Term Care's Impact On The Family

"Families are not necessarily drawn together in a time of crisis. Very often, they are blown apart." says Nancy Dykeman, an educator of long term care planners.

Nancy illustrates this problem with an example:

Imagine a young family. The father is working toward a career promotion; he coaches his kids' soccer teams. His wife works part time. They have two children. The mom's parents are retired, healthy and live in Arizona, playing golf and loving life. Then the unthinkable happens - the young mom suffers a stroke. Months of rehabilitation and care at home follow. Grandma and Grandpa travel back and forth from Arizona, often staying for long periods to help, even though their retirement dream is slipping away.

Dad must continue working to support his family, but his employer is tired of the time he spends on the phone and his coming in late or leaving early. A promotion is off the table.

What about the kids? Their mom, confidante and best friend is hurting and no longer fun. All of her energy goes into trying to recover. Kids' roles change too. They must help prepare meals, keep things picked up, and support their dad and grandparents.

Who knew this young wife and mother would need long-term care? Would the impact be different had it been one of the grandparents? Whenever anyone of any age needs long term care, it's a family issue.

Dykeman says that Long-term care insurance (LTCI) would have been a priceless gift for this family because it "protects the family, allowing them to think and work together without the stress and sacrifice of constant crisis mode." It also allows each family member to keep their normal role, rather than that of a caregiver.

Make sure you have a plan - it's critical for all adults, of any age. Whether it includes long term care insurance, annuities, or Medicaid planning and asset protection, consult with a professional to ensure you and your family are taken care of.

Do Your College Age Children Have Healthcare Directives? DO YOU?

We should all protect our families and our assets with legal documents like wills and trusts, but what are our essential needs and what can we do on our own to save on legal fees? Family financial and legal expert, Alexis Martin Neely, is the author of "Wear Clean Underwear: A Fast, Fun, Friendly and Essential Guide to Legal Planning," and shared some valuable advice in an appearance this week on View From the Bay on KGO in San Francisco.

Alexis is the founder of the estate planning law firm of Martin Neely & Associates in Southern California, as well as the Family Wealth Planning Institute, a nationwide cadre of Personal Family Lawyers guiding parents to make the best legal decisions throughout life and being there for loved ones afterward.

She says everyone over 18 needs an Advance Health Care Directive & Durable Power of Attorney. If you have assets, you should also have a Will & a Living Trust. If you have minor children, you should also have a Kids Protection Plan.

She raised a great point that many parents don't think about - go watch the show to find out the important legal documents that all young adults need to have in place.

During the segment Alexis shares what legal documents you must have in place for you, and your kids! At the end, listen as she explains, what you should look for and the questions you should ask when searching for the perfect attorney to handle your family planning for a lifetime.

If you have college age kids, this is a VERY TIMELY and IMPORTANT topic. Make sure BOTH you and your adult kids have these important documents in place to avoid problems in the event they are injured or incapacitated.

Before you send them back to school, make sure these documents are in place!

If you have prepared these documents in the past, be sure to have them reviewed for compliance with HIPAA laws! Our office can help you with those needs, as well as the Kids Protection Plan, Wills and Living Trusts. If we can help you with these things, please contact us at 614.487.8887 x3 or through the Golowin Legal Website.

A Grave Issue of Parenting – Writing Wills and Choosing Guardians

The following article, which appeared in the Orange County Register, features an interview with fellow Personal Family Lawyer Darlynn Morgan of The Morgan Law Group in Newport Beach, California.

Tips for making sure your children are cared for in the event of your death.

"Mommy, what happens after you die?"

It's a question most kids ask at some point – and we may quickly paint a picture of fluffy clouds, golden roads, rainbows and go about our day.

It's a question parents rarely want to truly consider. But ask yourself – what would happen to your kids if you died? Who would take care of them?

"A will may not be enough," says attorney Darlynn Morgan of The Morgan Law Group in Newport Beach. Morgan, a personal family lawyer, offers estate planning tips and advice to parenting and moms' groups, with a particular focus on children.

Here are her tips for ensuring your children's future in the event of your death:

•If both parents can't agree on a suitable guardian for the children, don't give up. Find a mediator who can help you to come to a mutual agreement for the benefit of the kids.

•When you name a couple to act as guardians, be sure to indicate what should happen if the couple broke up or one of the partners in the couple died. You want to ensure your children don't end up in the care of someone you wouldn't really want.

Name several alternate guardians if your first choice can not serve.

•It isn't necessary to take into account the financial resources of potential guardians when deciding who should raise your children. Your guardians are the people who will be in charge of your kids' emotional, spiritual and physical well-being, not necessarily their money.

It's your responsibility to leave enough money behind to take care of your kids either through savings or life insurance, and someone to manage that money if the guardians are not good money managers.

It's also a good idea to provide someone to manage your children's money so a lump sum doesn't go to your children at age 18 – without adult supervision.

•Be sure to name short-term guardians as well as long-term guardians. Short-term guardians will offer immediate care of your kids if you were in an accident. Otherwise, your kids could be taken out of your home and into the arms of strangers (child protective services) until the authorities figure out what to do.

•Be sure to specially name anyone you want excluded as guardians – those who might challenge your decisions or who you would never want raising your kids. (A grandparent or aunt or uncle, for example, who may fight the guardians for custody).

For a list of Morgan's upcoming speaking events, visit Morgan Law Group.

SOURCE: Orange County Register in an article written by CYNTHIA RUPE

Couples Face Pitfalls When Estate Planning In A Second Marriage

Attorney Stephen M. Worrall writes the following in his Georgia Wills, Trusts and Estate Planning Blog. This centers upon an issue that is constantly overlooked, creating drastic and unfortunate impact upon the estates of many people! Don't overlook the importance of planning in second marriage situations.

Our greatest challenge is planning the estate for second marriage clients. The blended family carries with it a number of competing concerns as we prepare wills and trusts to meet their needs.

If the couple is financially sound with adult children from their former marriages and have a prenuptial agreement, our task becomes fairly easy. The challenge comes with the scenario wherein the surviving spouse would need the assets from the first to die, yet the first to die would ultimately want for his or her children to inherit once the surviving spouse passes.

The problem with leaving all of the assets to the spouse is that the spouse is under no legal duty whatsoever to include the children of the deceased spouse in his or her will or trust. The children of the first to die become disgruntled when their relationship with their step-parent begins to fade for fear they will never inherit anything from their parent. Invariably they feel that their parent would never have intended the inevitable result.

By way of illustration, let's assume that Tom has two children from his previous marriage, Terri and Tim. His wife, Julie, has two children from her previous marriage, Jack and Jennifer. Should Tom's will leave his assets to Julie? What about Terri and Tim? What should Julie's will say? In such a scenario, there are several options.

We explain the options to our clients as spectrum ranging from complete control of the assets from the grave to little or no control. The first-to-die spouse can control the assets by giving the surviving spouse lifetime rights over the assets, but when the survivor dies, the remaining assets must pass to the children of the first to die. This can work well for those children, but the surviving spouse often is uncomfortable with the feeling of being controlled .

The other end of the spectrum would be to simply leave the assets to the surviving spouse and trust that the survivor would provide for the deceased spouse's children in his or her trust in the future. While this latter option sounds nice, often the relationship between the stepchildren and step-parent fades as years go by and the stepchildren are typically disinherited in the end.

We like to see a hybrid approach taken. First, using our example, we recommend that Tom's estate plan provides that Terri and Tim first be left some amount outright and then provide the remaining assets to Julie - some restricted and some not restricted. The assets typically not to restrict would be the marital residence and retirement assets.

Life insurance proceeds and other investment liquid assets could pass to a "QTIP" trust whereby Julie could withdraw funds from this trust for the rest of her lifetime, but at Julie's subsequent death, the remaining QTIP trust assets revert back to Terri and Tim. "QTIP" stands for Qualified Terminable Interest Property and was created by Congress in early 1980s.

Each and every case is different but perhaps some combination of the above should be considered when the difficult challenge of planning the estates of the blended marriage is encountered.

SOURCE: Naperville Sun in an article by Richard W. Kuhn

Heath Ledger's Will Fails His Family

This morning I saw that the newest Batman movie, "The Dark Knight" had earned about 1/8th of the total summer box office. I began wondering how much money Heath Ledger, starring as the Joker, earned from this blockbuster.

I didn't find a current estimate of his take, but whatever it was, it's the center of a heated debate. Heath Ledger joins the list of wealthy celebrities that died without a proper estate plan. As you can see in this article from several months ago, Mr. Ledger's will was outdated (I'm shocked he even had one) and did not leave a penny to his child!

Remember - estate planning isn't a one time event. To ensure you and your loved ones are protected, it takes regular review to make sure your wishes are fulfilled.