Tuesday, November 18, 2014

Now is a Good Time to Review your Power of Attorney

If you are an older adult, your power of attorney (POA) may be your most important legal document. It is crucial that the right people are named as your agent and that their powers and duties are tailored to your particular circumstances and goals.

A well drafted POA can be the key to protecting financial security for you and your family. A poorly drafted document can be a license to steal.  
A financial POA allows you to name someone you trust to act on your behalf in the event you ever need help managing your income and assets. In your POA document you can control the powers and duties your agent will have.
For example, would you like your agent to be able to transfer some of your assets to your spouse or children to protect them from health and long term care costs? Then you must specifically give your agent that power in your document.  
Pennsylvania Changes Law on Financial Powers of Attorney
Last summer Pennsylvania made important changes to the laws that govern POAs. The most noticeable of these changes take effect on January 1st. This means that December and January are perfect times for you to review your POA and make sure that your document (1) has the right provisions for your situation and (2) is updated, as needed, to conform to the new law.
The law has some new forms that must be used in documents signed in 2015 and thereafter. So, if you review your POA in December you may want to wait until January to sign your new document.
"Hot Powers" and Duties
The new law (Act 95) tries to walk a fine line between allowing you to give your agent the powers you want and protecting you from potential financial abuse. It says that you can give your agent broad powers to transfer your assets and make other changes to your estate plan, but only if you specifically authorize these “hot powers” in your POA.
Older adults should carefully consider whether to give any hot powers to their agent. Some people may want their spouse or a trusted child to have virtually unlimited authority. Others, depending on their own particular situation, may want to ensure that their agent has no hot powers.
It is also important to review the standards of accountability to which you want your agent to be held. Act 95 places strict duties and limitations on your agent unless you designate otherwise. For example, the law mandates that your agent keep your funds separate from those of the agent. You may determine that this is inappropriate in your situation because you want to allow for joint accounts. If so, you can release your agent from that duty in your POA. 
One Size does NOT fit all
Hot powers and the agent’s duties are some of the important issues that you will want to discuss with a lawyer who is an expert in POAs and understands the complexities of Pennsylvania’s new law. Your POA should not be “one size fits all.”  It’s hard to overemphasize the importance of getting truly expert legal assistance to make sure your document is right for you. Don’t take chances with the preparation of your most important legal document.    
Further Information
[The new law (Act 95) applies mainly to POAs used in financial and property matters. POAs that are limited to health care and mental health matters are pretty much unaffected.]

Thursday, November 13, 2014

Elder Law Firm Offers Care Management Services

Currently, about 12 million Americans require long-term-care services. Today, most of those care recipients rely on unpaid care from family and friends, but eventually many require paid in-home care, or must move to assisted living or a nursing home.
Our elder law firm offers care management services to help families provide the best care for their loved-ones. We can relieve the overwhelming demands and stress placed on care givers and families. We can help families locate the most high-quality care providers and connect them with needed local and state resources. We can help keep a frail older adult at home for as long as possible and help the family make the best residential transition if that ever becomes necessary.
Our goal is to promote and maintain the health, safety, well-being and quality of life of our elder client whether they are at home or live in a residential facility. And we want to unburden, assist and guide their care-givers.
Marshall, Parker and Weber's care management services are available to individuals residing in Northcentral and Northeastern Pennsylvania and their families. Care planning can be provided as a stand-alone service or it can be coordinated with legal planning where appropriate and desired by the client.
Marshall, Parker and Weber is a good choice to be your care planning law firm.  It is one of only eight law firms in Pennsylvania that have been selected for top tier Best Law Firm status in the area of elder law by US News Best Lawyers®. It is also one of only a few law firms in Pennsylvania that is a member of the Life Care Planning Law Firms Association.

If your family is caring for an aging family member, our care management services might be a good fit for you. Marshall, Parker and Weber has two care coordinators who will be happy to talk with you about how they might be able to help. You can find out more by calling Marshall, Parker and Weber 1-800-401-4552 and asking to speak with Karen Griswold (Williamsport and Jersey Shore) or Kelsey Pazanski Wargo (Wilkes-Barre and Scranton) or by contacting them at webmail@paelderlaw.com.

Friday, November 7, 2014

Medicare Open Enrollment: Traditional Medicare vs Medicare Advantage

It’s the Medicare open enrollment time until December 7th and many Medicare beneficiaries are considering their options and trying to choose between traditional Medicare and a Medicare Advantage plan.  
I’ve given my two cents in a prior posting regarding why I chose to stick with traditional Medicare. See: Choosing Between Original Medicare and Medicare Advantage. But I realize that each beneficiary’s circumstances are different, and the factors that were important to me might not be quite so important to others.
If you are currently struggling with this choice, the Kaiser Family Foundation (KFF) has just released a helpful review of the literature comparing the quality and access provided under traditional Medicare and Medicare Advantage plans. Here is a link to the Kaiser review: http://tinyurl.com/ovhmw8k
Here is an overview from the Executive Summary:
On the one hand, the evidence indicates that Medicare HMOs tend to perform better than traditional Medicare in providing preventive services and using resources more conservatively, at least through 2009. These are metrics where HMOs have historically been strong. On the other hand, beneficiaries continue to rate traditional Medicare more favorably than Medicare Advantage plans in terms of quality and access, such as overall care and plan rating, though one study suggests that the difference may be narrowing between traditional Medicare and Medicare Advantage for the average beneficiary. Among beneficiaries who are sick, the differential between traditional Medicare and Medicare Advantage is particularly large (relative to those who are healthy), favoring traditional Medicare. Very few studies include evidence based on all types of Medicare Advantage plans, including analysis of performance for newer models, such as local and regional PPOs whose enrollment is growing.
KFF notes that “studies comparing overall quality and access to care between Medicare Advantage plans and traditional Medicare tend to be based on relatively old data, and a limited set of measures.” Better evidence is needed. “At a time when enrollment in Medicare Advantage is growing, it is disappointing that better information is not available to inform policymaking.
Medicare’s blog recently noted that convenience can be an important factor in making a choice. See, Medicare Open Enrollment: the value of convenience.
Further Reading
Choosing Between Original Medicare and Medicare Advantage, Marshall Elder and Estate Planning Blog, April 8, 2013.
Medicare Open Enrollment: the value of convenience.

Apprise: A free health insurance counseling program that helps older Pennsylvanians with Medicare. Phone 1-800-783-7067. 


Tuesday, November 4, 2014

Don’t Use New Power of Attorney Forms before January 1, 2015



Pennsylvania has passed a new law that makes extensive changes to the rules governing powers of attorney (POAs). A POA is a vital legal document that allows someone else to manage financial and property matters for you in the event you are unavailable or become incapacitated.
In its many pages Act 95 of 2014 makes numerous changes to the law governing POAs. The most obvious changes are to the notice and acknowledgment forms that must be signed by the principal (the person creating the POA) and the agent.
The principal signs a notice form that contains state mandated information about the significance of the POA. Act 95 revises the language that is to be used in this notice.
The agent signs an acknowledgment form accepting the duties that go with acting as an agent, and agreeing to act in conformity with the principal’s expectations, in good faith and only within the scope of the authority granted in the document. The form must be in substantial conformity with the new language set out in the Act. An agent has no authority to act until he or she has signed this acknowledgment form and it is affixed to the POA document.   
Act 95 was signed into law on July 2, 2014. Since then I’ve noticed that some lawyers have already begun using the new notice and acknowledgment forms. This is a mistake.  
Act 95 delays the effective date for use of new forms in order to give everyone time to prepare for the change. The law says that its provisions regarding the use of the new forms are not effective until January 1, 2015. That means that the use of the old notice and acknowledgment forms remains mandatory until January 1, 2015.
The bottom line: Act 95’s provisions regarding the new language in notice and acknowledgment forms do not take effect until January 1, 2015. POAs signed before that date should continue to use the language and forms from the prior law.  
Further Reading

Monday, November 3, 2014

PA Law Encourages Expansion of Community Respite Services



Pennsylvania’s new Community Adult Respite Services Program law gives senior centers, adult day centers and licensed long term care facilities the ability to offer supportive services for seniors (over age 60) who are living at home. The legislation (HB 1702 now Act 166 – 2014) was introduced by Representative Chris Ross (R-158) and signed into law on October 22nd.
The Act targets individuals who need more than the normal scope of services offered at senior centers, but not the full attention of licensed Adult Day Centers.  Programs will be overseen by local Area Agencies on Aging.
HB 1702 was inspired by an assisted senior program that has been operated for over 20 years by the Kennett Area Senior Center. A similar program is in operation at the Downingtown Area Senior Center. 
The legislation authorizes the licensing and oversight of “community adult respite services" programs. These programs are intended for seniors who are living at home and require only minimal assistance. They provide the senior with social interaction, exercise and cognitive stimulation, thereby enhancing the potential for longer-term independence. And they provide family members with a much needed break from caregiving duties.
Program participants must be age 60 and over and be able to actively or passively engage in social and leisure activities with others. Participants may suffer from mild cognitive or physical impairment and need cueing. But the program is not intended for seniors with higher care needs such as individuals needing assistance with medication, personal hygiene care or whose behaviors may compromise their safety or the safety of others.
Participants will be subject to ongoing assessment. Those who develop more intense care needs are to be transitioned to other providers.
The Act clarifies the role to be provided by senior respite programs like the Kennett Area Senior Center program. It demarcates them from the higher level of assistance available in adult day care centers. Adult day centers provide personal care, nursing services, social services, therapeutic activities, nutrition and therapeutic diets and emergency care. [See the Directory of Pennsylvania Adult Day Services Providers here.]
The Act provides a safe harbor which helps clear the way for additional senior centers and other providers to offer senior respite services. It may energize the geographic expansion of programs to other senior centers across the state. It may also encourage other non-profit and for-profit organizations to offer senior respite.  
An ultimate goal of this type of support program is to allow seniors to continue to live in their communities for as long as possible. It can help participants maintain independence by enhancing their abilities and supporting their caregivers. It represents another small cog in the continuum of care.
Licensed long-term care service providers will be able to provide senior respite services without a separate license. But they must notify the Department of Aging of their intent to operate a program. Other providers must obtain a license.
For the purpose of this exemption, licensed long-term care service providers include:
An assisted living residence.
A continuing-care provider.
A Life program.
A long-term care nursing facility.
An older adult daily living center.
A personal care home.
Within a year and a half of enactment, the Department of Aging is charged to develop guidance for the program – via regulations or statements of policy.
Program monitoring will be provided by either the Department of Aging or by local area agencies on aging (AAAs) acting “as agents of the Department.” Programs may be operated by existing AAA senior centers as well as other providers. Employees of senior respite services programs will be prohibited from serving as power of attorney or guardian for a participant.
The Act includes no provision for funding. The lack of any public financing means that programs will need to come up with creative ways to pay for the services provided. It’s possible that senior centers could offer respite on a sliding-fee schedule based on ability to pay. Other providers could subsidize their respite services as a means of marketing or for charitable reasons.  
Act 166 takes effect in 180 days (April 2015).

Sunday, November 2, 2014

2015 Estate and Gift Tax Exemptions



The IRS has released annual inflation adjustments and tax rate schedules for 2015. Included are the new gift and estate tax exclusion amounts for 2015.  The new inflation adjusted numbers are available in Revenue Procedure 2014-61, issued October 30, 2014. 
Estate and Gift Tax Exclusion amounts for 2015
$5.43 million - Federal Estate Tax Basic Exclusion Amount
$5.43 million - Lifetime Gift Tax Exclusion
$14,000 - Annual Gift Tax Exclusion
The new estate and lifetime gift tax exclusion amounts are an increase of $90,000 from 2014. Because a husband and wife each get their own exemption, a married couple can give away $10.86 million tax-free in 2015 (provided they have not previously used up any of their exemptions.)
The top tax rate on amounts above the exemption limit is 40%. The high exemption amounts have pretty much done away with estate tax as an estate planning consideration for most people. Fewer than 4,000 estates are expected to owe federal estate tax this year.
Income Tax Brackets for 2015
The top federal income tax rate of 39.6 percent will affect singles whose income exceeds $413,200 ($464,850 for married couples filing jointly) in 2015. The other marginal rates are described in the Revenue Procedure:  http://www.irs.gov/pub/irs-drop/rp-14-61.pdf
Standard Deduction Amounts for 2015
$6,300               Standard deduction for single taxpayers
$12,600             Standard deduction for married couples
$9,250               Standard deduction for heads of households
$1,250               Additional standard deduction for the aged or blind.This additional standard deduction amount is increased to $1,550 if the individual is also unmarried and not a surviving spouse.
Long-Term Care Insurance Deduction Limits for 2015
The IRS also released the long term care insurance premium deduction limitations for 2015:
Attained Age                           Premium Limit
40 or less                                             $380
More than 40 but not more than 50     $710
More than 50 but not more than 60     $1,430
More than 60 but not more than 70     $3,800
More than 70                                       $4,750

Saturday, November 1, 2014

Income Cap Increasing for Aging Waiver and LIFE Programs



Pennsylvania’s Aging Waiver and LIFE programs provide support and services that allow frail older adults to continue to live in their homes. Both programs are financed with Medicaid funding which requires applicants to be financially eligible. 
The Medicaid eligibility income limits are going to increase on January 1, 2015.   
In October, the Social Security Administration announced a 1.7% cost of living adjustment for the SSI program. With this increase the maximum federal SSI benefit for an individual will rise from $721 per month (2014) to $733 (2015).
Income Cap Increasing to $2,199 per Month
The federal maximum SSI benefit amount (see above) is sometimes referred to as the Federal Benefit Rate (FBR). 
The FBR is used as a base to determine income eligibility for a number of Medicaid funded public benefit programs including Pennsylvania’s Aging Waiver Program and Life Program. These programs are important supports for frail seniors who want to receive needed long term care services at home rather than an institution.
Medicaid’s income limit for the Aging Waiver and LIFE programs is equal to 300% of the SSI Federal Benefit rate for an individual. This means that effective January 1, 2015 the new income ceiling (or “income cap”) will be $2199 per month. 
Otherwise qualified individuals with incomes above this ceiling will be denied Medicaid funding for Aging Waiver or LIFE services. 
Care recipients and their families should consult with an experienced elder law attorney for further information and assistance with qualification for these important home care programs.  
Related Reading
Social Security Changes (Social Security Administration)