Monday, August 18, 2014

Adding Elder Care to Elder Law



When I returned home to Pennsylvania in 1980, I wanted to develop a law practice that was devoted to the legal needs of older people. Some friends told me this was a shortsighted idea. They said it was foolish to limit my practice so narrowly, especially in a small town in rural Pennsylvania.
One longtime family friend was a local judge who told me, “Jeff, you have a wife and two children. Don’t be too picky. You need to take every good piece of business that knocks on your door.”
But I was always stubborn. And from personal experience I knew that the legal issues facing seniors were complicated and were going largely unmet. They needed a lawyer. And, perhaps most of all, I liked working with older adults – it was what I wanted to do.
So, during the 1980s I worked hard to learn all I could not just about taxes and wills and traditional estate planning, but about Medicare and Medicaid and Social Security and other government programs that are critical to the welfare of older individuals.
Medicaid became a particular focus of my studies, because the program is so important to the many seniors whose care needs outgrow their ability to pay to meet them. As a result I was able to help a lot of people qualify for Medicaid payment for nursing home and other long-term care services. I became a widely recognized expert in what began to be known as “elder law.”     
The Need for more than Elder Law
Helping my clients find ways to pay for the care they needed was surely important. But I soon found that even those seniors who had the financial resources to pay privately for their care still faced a lot of barriers to getting their needs met. They had to navigate our crazy and uncoordinated system of health care and long-term care delivery. It’s actually more of a maze than a system.
To get the services and support they required, my clients had to solve a multitude of problems. For example:
  • they needed to understand what services and resources were available and how much they would cost; 
  • they needed help in realistically evaluating all the options for where they could live; 
  • if staying home, they needed someone to coordinate the aides coming in and out, to resolve problems with the aides, and to find a substitute when an aide was out sick; 
  • they needed help making a smooth transition when their health required a change in their living situation; 
  • they needed a realistic and flexible plan that could be modified as their health situation changed; 
  • they needed an advocate who worked only for them and was answerable only to them; and,
  • their family members needed relief from the overwhelming burdens and stress of caregiving and to know that mom or dad was safe and secure. 
In short, when faced with declining health, my aging clients often needed much more than strictly legal services. They needed an expert guide and advocate who would help them sort through their care options to find the best solutions; resolve inevitable problems; and manage things over time as their health and personal care demands changed.

Adding Elder Care to Elder Law
It became clear to me that these non-legal concerns were often the most critical issues facing an older client, especially if they were sick or frail, or had suffered a stroke, or were dealing with Alzheimer’s or Parkinson’s. 
As an elder law attorney I was able to deal with my clients legal problems and help them find ways to pay for their care. But finding and coordinating that care were not legal problems. They were beyond my legal training. 
I realized that I was going to need additional assistance if I wanted to provide these clients (and their families) with the expert guidance they required. So, in 1990 I hired a social worker who had spent years dealing with the health and long term care concerns of seniors. He was a godsend (to me as well as to my clients). By combining his care management skills with my legal knowledge, we were able to solve many more of the problems facing our clients and their families.   
This combination was so successful that I hired more case managers with elder care, social work and/or nursing backgrounds. [We now refer to them as “elder care coordinators”]. 
Although I didn’t know it yet, my law firm had become what is now known as a “life care planning” firm. We had moved beyond elder law to add elder care to our services. 
Here is an illustration of how we were then able to help our clients by providing a mix of elder law legal services and the ongoing care management provided by our elder care coordinators. [The following story is about my real clients - but I’ve made some changes to their identities to preserve confidentiality.]

Ron and Miriam
Ron and Miriam had become my clients in 1980, soon after I opened my office. Both were retired. Ron had been a very successful local business man and entrepreneur. Miriam had been a homemaker. They had one child, Dave, a professional who resided in Seattle with his wife and two children.
My initial work for Ron and Miriam involved somewhat sophisticated estate planning. In 1981 the federal estate tax exemption was only $175,000 and the maximum tax rate was 70%. Their net worth was way above the exemption amount, so we set up a plan to minimize the impact of the tax.
In addition to saving taxes, the couple had a number of other estate planning goals. They wanted to provide for and protect Miriam (who was not financially savvy like Ron) in the event Ron predeceased her. They wanted to preserve their son’s inheritance from potential loss in the event of his future divorce or other financial problems. And they wanted to make sure that their grandchildren had sufficient funds for college and post-graduate education, and to get their families started. We were able to craft a plan involving wills and trusts that would help them meet all of these tax and non-tax goals.
Ron died in 1989. Although she could have moved to Seattle to live with Dave, Miriam decided to remain in Pennsylvania. It was where she was born and had always lived and where her friends and church were located. She didn’t want to move. And she especially didn’t want to become a burden for Dave. She wanted to stay in the beautiful home she and Ron had built in the woods.
Miriam didn’t have to worry about finances and investments – those were being handled though the plan that the couple set up in 1981.  It was her non-financial needs that were to be the greater concern. But, at this point she was healthy and fully competent to handle her daily decisions and tasks at hand.
By 1996, Miriam had started to decline. She needed some help. One of my firm’s elder care coordinators (ECCs) and I met with her. Miriam agreed to have the ECC do an assessment and come up with a care plan – basically a road map of Miriam’s needs and how to best meet them. We then went about implementing that plan. It worked well. Miriam got the support she needed at home, and was able to continue to go out to lunch with her friends, and attend her church.  
In 1999, Miriam had a stroke. She was admitted to a local hospital where our ECC went to work to make sure she would receive the best care. The ECC was able to prevent the hospital from discharging Miriam too early. The early discharge was not in her interests and would have prevented her from getting Medicare coverage when she was later transferred to a nursing home for rehabilitation. 
When she was ready to be discharged, our ECC helped select the nursing home that could best meet Miriam’s therapy requirements and get her back on her feet again.
Miriam did spend several months in the nursing home. Miriam’s ECC was her advocate throughout that time and helped ensure she received the best care. 
The ECC represented Miriam at care conferences where she made sure that all appropriate nursing home staff were present, and that all issues of concern were addressed. The ECC was able to work out the problems that Miriam was encountering in the nursing home and ensure that all her therapy needs were met. In the end, Miriam actually thrived in the nursing home and was able to return home in about 8 weeks.
Of course the return home presented a lot of problems. But Miriam’s ECC was able to make sure that everything went smoothly. The home was adapted for Miriam’s safety. Lighting was improved and a ramp was added along with a walk in tub to make bathing a lot easier and safer.
Since Miriam’s health was not as good as it had been before her stroke she required a lot more assistance every day. Initially, Miriam needed caregivers on the premises all day and night. Her ECC helped find the right caregivers, coordinate their schedules, educate them as to Miriam’s needs and preferences, and then monitored their performance. 
As is not uncommon, Miriam didn’t feel comfortable with one of the initial caregivers hired. But her ECC figured this out quickly and the caregiver was replaced with someone Miriam liked and with whom she was more compatible.   
One night in 2002 Miriam passed away in her sleep. She was 93 years old and was still living at home, in her beautiful house in the woods. Her strong desire had been to stay there and never have to move to assisted living or a nursing home. With lots of assistance from her ECC she was able to turn that desire into reality. She died in peace in her own bed.  
It was terribly sad to lose Miriam - even though she had told me several times: “Jeff, don’t feel bad when I’m gone. God has blessed me. I’ve had a wonderful life.” She was a remarkable woman and we had become very close over more than 20 years.  
She wasn’t one of those clients for whom I'd prepare a will and power of attorney and then not see again for years. I was really involved with Miriam’s life. I was part of the team that was providing her with ongoing support and helping her attain the best quality of life.
Despite the personal loss I felt, Miriam's passing was bittersweet. For I knew that the support and services our elder care coordinator and I had given had helped Ron and Miriam meet their goals and had enhanced their lives.  
Now it’s 2014 and Miriam’s son Dave has sadly also completed his life’s journey. His children are grown and long ago completed their educations. The funds in the trusts created by their grandparents have paid off a mortgage and resolved some other financial issues for both grandchildren. And there are still some funds left to provide for the education of Ron and Miriam’s great-grandchildren. Knowing how important education was to them and to Dave, I can’t help but think they are all smiling. 
Personally, I’m aging too and have moved into semi-retirement. But I’m pleased that the law firm I started continues to combine elder law with elder care so that it can more completely meet the broad range of advocacy needs of its aging clients.
I’m smiling too.      

Tuesday, August 12, 2014

FTC Warns Older Veterans about Pension Poachers



In the past I’ve suggested that older veterans need to be cautious when someone offers to help them secure VA Pension related benefits through the purchase of an annuity or a trust. See: Beware the Boondogglers selling Trusts for VA Pension Benefits.
The VA Pension program provides basic income security to “wartime veterans” who are over age 65 or who have been disabled (unrelated to their military service) and who have limited means to provide for their own support. The periods of “wartime” are very broadly defined so today’s older veterans usually fit.
Pension can provide additional income so that an older veteran (or the surviving spouse of a deceased veteran) can pay for critically needed health and long-term care services.  It can mean that the veteran can stay at home and not be institutionalized. Or it can help pay for care at an assisted living facility.
The intent underlying the VA Pension program is to ensure that our disabled and older veterans who honorably fought for our nation will never live in poverty. It is an expression of our nation’s gratitude to our veterans.
Veterans have to know about the Pension program and apply for it before they can receive benefits. Elder Law attorneys, Veterans Service organizations, County Service Officers and Directors of Veterans Affairs, work to alert older veterans to the existence of the Pension program. Nevertheless, many qualified veterans remain unaware of their potential Pension benefits, which thus go unclaimed.
Over recent years unethical “advisors” have taken advantage of this information gap by selling high fee services and products to older veterans without providing accurate information about the potential consequences. Veterans who reside in assisted living facilities are frequent targets.         
Recently the Federal Trade Commission issued a new warning about the problem.  In a recent posting on its website it notes that
unscrupulous brokers try to convince veterans to transfer their assets to a trust ­ or to invest in insurance products ­ so they can qualify for Aid and Attendance benefits. What they don’t reveal is that these transactions could mean that the veteran loses eligibility for Medicaid services or loses the use of their money for a long time. Adding insult to injury, the advisers are charging fees that range from hundreds to thousands of dollars for their services. See Veterans' Pensions Protect Your Money From Poachers.
The “Aid and Attendance” (A&A) referred to by the FTC is a supplement which increases the Pension amount for qualified veterans who are in need of the aid and attendance of another person. See 38 U.S.C. Section 1521(d).     
The FTC provides the following useful description of the trust and insurance/annuity schemes:
The so-called advisers offer to help you complete the paperwork to file your benefits claims. If your assets are above the required threshold, their goal is to convince you to restructure your finances so you can qualify for A&A. That’s how they earn their money: by selling you an annuity or creating a trust. For instance, the more money you put into certain insurance products, the more money the insurance adviser gets paid.
Here’s what you need to know:
    Transferring assets. Under current rules, it is not illegal to shift your assets to family members or to a trust to make you appear needy and qualify for A&A benefits. But transferring assets can have serious consequences: it can disqualify you for A&A benefits rather than qualify you. If disqualified, you would be required to return any A&A benefits already paid to you. Also, A&A benefits may not be enough to fund your long-term care expenses, and you may need to apply for Medicaid, the government’s program for people who cannot afford medical care. But Medicaid has a 60-month look-back period: If you’ve moved substantial assets at less than market value during the previous five years, you may be ineligible for Medicaid services.
    Annuities. If you buy an annuity, you pay a premium and then you get regular payments over time from an insurance company. People often use annuities to provide a steady stream of income. But depending on the annuity, if you need money early and have to withdraw it, you may have to pay very high fees. Annuities aren’t right for everyone: their suitability depends on your age, needs, and particular situation. For more information about deciding whether an annuity is right for you, visit the National Association of Insurance Commissioners.
It is important to understand that trusts and annuities are not always bad. They can be useful planning options for some seniors in some situations. But, if appropriate at all, trusts and annuity purchases need to be implemented as part of a comprehensive plan that takes account of factors such as the veteran’s possible need for liquid funds and Medicaid benefits.
If you are approached about setting up a trust or buying an annuity to qualify for VA benefits, I suggest you get a second opinion from a lawyer who is experienced in long-term care planning. Get the big picture before you sign anything. 
For some ideas about how you can find a lawyer see my recent posting: How to Find a Good Lawyer for Older Adult Issues.
Further Reading: