Building Legacies that Last Estate Planning and Elder Law

Social Security Can Be Fixed

MP900390083 (1) People who are opposed to the Social Security system claim that it is about to go broke and disappear soon. That is not true.

Social Security opponents and opponents of government spending in general, like to make the claim that Social Security is going to go broke or bankrupt. They then normally use this piece of information to get people to support cuts to Social Security benefits or increases to the age of retirement.

They are using  recent government reporst as ammunition to suggest that if something is not done, then Social Security will go broke in 2022. The problem is the claim is not true, as Forbes discusses in "Fake News: Why Social Security Isn't Going Broke."

Social Security currently takes in more money every year than it pays out in benefits. That has created a surplus in the Social Security Trust Fund. What will happen in 2022 is that, due to demographic changes, Social Security will start paying out more than it takes in. However, since there is a surplus, current benefits will not have to change. The surplus can be spent down. It will not run out until 2034. When that happens, Social Security will not disappear. Instead benefits will be cut slightly, as the program will only be able to pay out as much money as it takes in.

This means is that politicians have a lot of time to fix Social Security, if they are willing to do so. They do not need to raise the retirement age or cut benefits. They can also fix things by increasing funding for the program.

Reference: Forbes (June 18, 2018) "Fake News: Why Social Security Isn't Going Broke."

 

Why You Need an Estate Plan

If you think that you do not need an estate plan because you do not have very many assets, then you do not understand that estate planning is not just about your property. Mac-glasses

There are millions of Americans who do not have very many assets that need to be distributed after they pass away. It is not the case that they are all poor. Many of them are just younger people who have not yet lived long enough to accumulate assets.

People often think they do not really need estate plans, if they are young and with limited assets. In some sense they are correct.  If people do not own any real estate and do not have any other valuable property, it will not be too difficult for their families to handle their estates. However, estate planning is about more than that, as the Times Herald-Record discusses in "Everyone can benefit from an estate plan."

Almost all estate plans today also include some legal documents that are traditionally considered elder law documents. Despite the term "elder law", even young people need these documents because they are really about planning for disability.

That is planning for the possibility that you could have an accident or illness that does not kill you.  However, it can leave you legally incapacitated, even if it is only on a temporary basis. These documents include a health care power of attorney, so someone else has the authority to make health care decisions on your behalf.  It also includes a general durable power of attorney, so someone else can handle your finances, if you are unable to do so.

Reference: Times Herald-Record (May 17, 2018) "Everyone can benefit from an estate plan."

 

A Faster Way to Stop Elder Abuse

MP900400332One of the many challenges in fighting elder abuse, is that even when it is discovered, it can be difficult to stop it quickly.

Elder abuse can occur in several different ways.  However, one of the most pernicious ways is when a person entrusted to help an elderly person, uses that trust to gain access to financial account information. The “trusted” person then commits abuse by managing an elderly person's accounts for his or her own benefit.

When this financial abuse of the elderly is discovered or suspected, it is not always easy to put a quick end to it through the legal system.  Therefore, the abuse continues for longer than it should.

To fix this problem, some New Hampshire legislators think they have come up with a solution as Seacoast Online reports in "House bill would help elder victims of financial abuse."

The idea is to create a fast track for disabled people and the elderly to get legal relief, similar to how victims of domestic violence can get protective orders. Some elderly victims do currently qualify for domestic violence protective orders but not all.

The process varies from state to state.  However, all states have some sort of process, whereby a domestic violence victim can get a quick protective order from a judge for immediate relief. Giving the same level of protection to victims of elder abuse, would speed up the process greatly.

Talk to an elder law attorney, if you have questions about what to do in your state to help victims of elder abuse.

Reference: Seacoast Online (March 17, 2018) "House bill would help elder victims of financial abuse."

 

Planning After You Retire

Happy-old-coupleAfter you retire, you should continue to make plans so that you will be ready in case anything happens.

Everyone knows that it takes a lot of planning to retire properly. You must make sure that all of your finances are in order. You also should make sure that you have completed everything you need to receive Social Security benefits, when you want to start them and to enroll for Medicare.

It might be tempting to stop planning after retirement.  However, there is still some planning left to do, as the Wills, Trusts & Estates Prof Blog explained in "Post-Retirement Planning: A Checklist for Seniors."

Retirees need to plan for emergencies and the possibility of no longer being able to handle their own affairs. They need a general durable power of attorney, a health care power of attorney and a living will.

Fortunately, those documents are easy to get from elder law attorneys. However, just getting those documents is not quite enough.

If something happens to a retired person, the people designated to help immediately need to be able to step into their roles. That means all the information necessary for them needs to be gathered into one place.  This information includes a list of financial, investment and digital accounts. It also means that the legal documents need to be stored in the same place. Finally, a trusted friend or family member should be told where to find everything, if needed.

Talk to an elder law attorney, if you have questions about what you need to do to plan after you retire.

Reference: Wills, Trusts & Estates Prof Blog (March 20, 2018) "Post-Retirement Planning: A Checklist for Seniors."

 

Protecting Assets from Medicaid

MP900309139If Medicaid ends up needing to pay for your nursing home care, the government will seek to take any assets that you have to pay for its costs. You might be able to create a trust to get around that problem.

One of the realities of aging in America, is that people who need to stay in long-term nursing home care cannot pay for their stays without losing all of their assets. There is nothing left for their children to inherit. They spend everything they have left, and only then will the government pay for their care through Medicaid.

If the elderly person has a home, the government will even seek to claim that and sell it after no one else is living there. That creates an awful feeling for many elderly parents, because they have nothing to leave their families.

There are some ways around this problem, including using a certain type of trust as the Times Herald-Record discussed in “Benefits of Medicaid Asset Protection Trust.”

A Medicaid Asset Protection Trust is a trust that set up specifically to protect assets from Medicaid, while still qualifying an elderly person for Medicaid assistance with long-term care. These are irrevocable trusts and any assets put into them at least five full years before applying for Medicaid are protected. The trusts are not perfect, since the trust settlors cannot use any of the principal in the trusts.  However, income can be used.

If you are interested in a Medicaid Asset Protection Trust, talk to an elder law attorney about one and  other options you might have.

Reference: Times Herald-Record (March 8, 2018) “Benefits of Medicaid Asset Protection Trust.”

 

Elder Fraud Charges Brought

MP900202201[1]Federal law enforcement officials have announced actions against hundreds of scammers accused of defrauding the elderly.

One of the worst aspects of elder fraud is that it often seems like there is very little that can be done about the fraud. After a scammer has taken advantage of an elderly person, it is difficult for the elderly person to recover any lost money. Local law enforcement and elder law attorneys are sympathetic, but they are often unable to help very much.

This might lead some people to think there is little reason to even bother reporting minor incidents of elder fraud. Nothing could be further from the truth, as the recent FBI announcement explains. It is titled "Law Enforcement Action Aimed at Those Who Victimize Senior Citizens."

Federal law enforcement officials working with other agencies have announced massive actions taken against the perpetrators of elderly fraud. In fact, 250 people have been charged.

It is believed that those charged were responsible for victimizing 1 million elderly persons at a cost of approximately $600 million. This action comes on top of 200 cases filed against individuals for elder fraud issues last year.

It is important to report fraud against the elderly. Each report helps federal authorities develop these big cases that will eventually put the scammers out of business.

Reference: FBI (Feb. 22, 2018) "Law Enforcement Action Aimed at Those Who Victimize Senior Citizens."

 

Medicaid Planning

MP900442211[1]Americans who need long-term care assistance and cannot pay for it, can get help from Medicaid, if they plan ahead.

It seems almost cruel in a way that nursing homes are as expensive as they are. People who have saved well for their retirements and intended to leave something to their heirs in an estate plan, often face steep nursing home bills. If a stay in a nursing home is long enough, then all their savings can be wiped out and there will be nothing left for the heirs.

Many older Americans look around for other ways to pay for long-term care in a nursing home, if they ever need it. Some will be able to purchase insurance for it, but it is expensive and difficult to get. Other people might have to rely on Medicaid for their care as CNBC discusses in “Here’s a surprise source you can tap for long-term care services.”

The big catch with Medicaid is that it is only available for poor people. To be eligible for Medicaid to pay for nursing home care, the patient needs to have fewer than $2,000 in assets. To get around this problem, patients cannot just give all of their assets away to family members when they need to go into a facility. Any such transfers will be deemed fraudulently made and will disqualify them from receiving help.

There are ways around this problem for people who plan ahead. An elder law attorney can help you develop a plan for your assets that will not make you ineligible for Medicaid. This planning must be done years in advance, so do not delay getting an appointment for long-term planning for Medicaid eligibility.  Medicaid crisis planning is also available.

Reference: CNBC (Feb. 27, 2018) “Here’s a surprise source you can tap for long-term care services.”

 

Hospital Discharge Planning

Bigstock-Doctor-with-female-patient-21258332[1]Before a Medicare patient can be discharged from the hospital, there must be a plan in place for any needed continual care. Patients and their families should double check some information in that plan.

When Medicare patients are ready to leave a hospital after an extended stay, they often are not ready to go home and resume their normal lives. They might need to be transferred to another facility, such as a nursing home or a rehabilitation center. It depends on the needs of the specific patient being discharged.

Medicare requires that a plan for care be developed with a social worker who can help the patient understand the plan. Just taking the word of the social worker about what options are available, is not always advisable as the Pittsburgh Post-Gazette points out in "Doublecheck when they say the rehab center doesn't have room."

Patients are sometimes told that their preferred facilities for care after being discharged from the hospital do not have room for them. Sometimes that is true, but it is not always true.

Hospitals that have financial interests in other facilities, all too often try to steer patients into those facilities and away from others. For that reason, it is a good idea for patients and families to call facilities for themselves to ask about availability.

If you think a hospital is not doing what Medicare requires it to do, then it is a good idea to contact an elder law attorney.

Reference: Pittsburgh Post-Gazette (Feb. 26, 2018) "Doublecheck when they say the rehab center doesn't have room."

 

Common Elder Scams

MP900387640Some scams against the elderly are well-known.  Nevertheless, they continue to work.

People who seek to scam the elderly out of money are not always very subtle about it. Not every scammer is patient enough to slowly get to know an elderly person and then con them out of their money. Some scams used against the elderly are demanding.

A common one is for an unknown person to call a grandparent and tell him or her that a grandchild is in trouble and needs cash wired immediately. The trouble normally consists of a problem with the police, where bail money is needed.

Another common scam the Minneapolis Star Tribune points out in "As senior population grows, so do scams targeting their money," is for a voice message to be left on an elderly person's phone claiming to be from the IRS. The elderly person is instructed to call a number right away for their last chance to settle a problem with the IRS by sending money.

Those schemes might seem like obvious scams to most people, but they continue to work on many of the elderly. The scammers seek to take advantage of the elderly person's diminished capacity and by demanding the money right away, the victim does not have the time to think through the request or ask anyone else about.

These and other scams against the elderly are unfortunately increasing. Elderly people should be aware of them and never agree to send money over the phone to someone, until they discuss the matter with someone else.

Reference: Minneapolis Star Tribune (Feb. 16, 2018) "As senior population grows, so do scams targeting their money."

 

Report Finds Problems with Assisted Living Oversight

Bigstock-Doctor-with-female-patient-21258332[1]One way that Medicaid can save money is by paying for assisted living care for seniors who are eligible for it, instead of paying for nursing home care. A new report found that because of a lack of oversight, that is not happening.

Medicaid was not originally designed to pay for seniors' stays in assisted living facilities. However, as more and more money was being spent on nursing home facilities and the costs at those facilities continued to rise, the federal government granted states waivers to use Medicaid funds for the generally less expensive assisted living facilities.

This should have saved the federal government quite a bit of money.

A group of Senators asked the Government Accountability Office to study how the government's money was being used. The results were not good as The New York Times reported in "U.S. Pays Billions for 'Assisted Living,' but What Does It Get?"

Every year the government spends approximately $10 billion on assisted living facilities. The discouraging news? It is almost impossible to determine how much of the money is well-spent and how much of it is not. The GAO found that a lack of regulations and proper oversight made it impossible to get even basic information about patient outcomes and critical events in many states.

This is disturbing since Medicaid is expected to need even more money in the future to pay for the nursing home care and assisted living care of an aging population. If the oversight problem is not fixed, it will be seniors who are most harmed by the problems.

Reference: New York Times (Feb. 3, 2018) "U.S. Pays Billions for 'Assisted Living,' but What Does It Get?"