Suffolk County, NY Estate Planning and Elder Law Blog
Friday, February 24, 2017
Question: “I am considering applying for Community Medicaid for my father, but I am not sure if my mother will accept a home health aide into her home. What, if anything, could Community Medicaid offer other than a home health aide?”
Answer: The Community Based (Homecare) Medicaid program can offer alternatives to home health aides; however, you must know the requirements in order to enroll in the program. Once approved for Community Medicaid, the individual may be enrolled in a Managed Long Term Care Company (MLTC). The MLTC will be in charge of coordinating the recipient’s healthcare needs including, but not limited to, a home health care aide.
In order to enroll in a MLTC the recipient must either have a home health care aide or be enrolled in a Medical Model Daycare program. If the family wants a home health care aide, the MLTC will determine the amount of hours per day and days per week that the individual is entitled to have the aide depending on the individual’s need. The home health care aide can assist with all activities of daily living, including, but not limited to, bathing, grooming, toileting, ambulating, meal preparation, laundry and light housekeeping. Medical Model Daycare programs offer a place for seniors to go during the day and then return home at night and will provide meals, rehabilitation, monitoring of health conditions and assist with personal hygiene. Unlike Social Model Daycare, the individual must require assistance with activities of daily living to qualify for Medical Model Daycare. Once the individual is approved for either a home health aide or Medical Model Daycare, the individual may be enrolled in a MLTC.Read more . . .
Wednesday, February 22, 2017
Question: My mother has an irrevocable trust she set up for Medicaid planning purposes. My sister is the trustee and she is paying moms bills from the trust. Is that correct?
Answer: No, if the irrevocable trust was set up properly to protect your mom's assets in case she needs long term care from the Medicaid program, then your sister is not correct.
An irrevocable trust of this kind is meant to protect the principal of the assets placed into it. This may be a residence, brokerage account, bank account, etc. Your mom is only entitled to the income earned on the assets. Therefore, to the extent your sister paid the bills beyond the amount of income produced by trust assets, she improperly invaded the trust, which can put all trust assets in jeopardy.
The concept behind this type of trust is that since mom is not able to access the accounts in the trust beyond the income, she cannot use those funds for her long term care costs and can seek assistance from the Medicaid program. If your mom needs long term care in the home, including a personal care aide to assist her with activities of daily living, then the assets properly held in trust are not considered hers for eligibility purpose starting on the first of the month after which she transfers the assets into the trust. If your mom needs to reside in a skilled nursing facility, then the assets must be in the trust for five years before they will be deemed unavailable to her for eligibility purposes. As you can imagine, if Medicaid sees that your mom is using the trust principal for her benefit, it would be expected that she would also be able to use that money to cover the cost of her care. Read more . . .
Monday, February 13, 2017
Question: My mother is 85 years old and in good health. She has $75,000 in a joint bank account. If she becomes ill and needs Medicaid, is that money protected? Is there any way she can gift those monies to me and still be eligible for Medicaid if she requires care in a Nursing Home?
Answer: First, to answers your questions, monies held in a joint bank account are presumed to be 100% the property of the applicant unless it can be proven that the money does not belong to t the applicant. Should your mother transfer or gift that that money within five years of needing nursing home care, a penalty will be assessed for that transfer. It is important to note that there is no look-back when applying for Community Medicaid (care in the home) and therefore a transfer in that instance would not create a penalty. When, and if, your mother applies for Medicaid, she is only permitted to have $14,850.00 in liquid, non-retirement assets. She is also permitted to have qualified or “retirement” funds in any amount so long as she is taking a monthly distribution, an irrevocable pre-paid burial account in any amount is also an exempt asset. The money in the joint bank account will be deemed 100% belonging to her despite the fact that the account is held jointly with you. You can overcome that presumption if you are able to prove that you deposited those monies into the account and that they belonged to you prior to the deposit. As is in most cases, assuming that these funds belong to your mother and your name exists on the account for convenience purpose, the entire account will be considered hers.
The rule is different if the funds were held in a joint stock account. There is no presumption that the account belongs solely to your mother. Each one of you is deemed to own one-half of the joint stock account. So, if you mother transferred her $75,000 bank account to a joint stock account, she will effectively be transferring one-half to you at the time the new account is set up. Read more . . .
Wednesday, February 8, 2017
Question: My spouse and I each have children from previous marriages. While we want to provide for our surviving spouse when the first of us passes away, we want to ensure that each of our respective estates is ultimately going to our respective children. Is there a way to accomplish this?
Answer: That is not an uncommon question at all. There are several issues for you to consider, the first consideration being the execution of a post-nuptial agreement, wherein each of you agree to waive certain interests that spouses have in the other’s estate.
New York law states that a surviving spouse has a right of election, that is, a right to receive one-third (1/3) of their spouse’s assets at the death of the first spouse. That means that even though you might effectively “disinherit” your spouse by distributing probate and non-probate assets to your respective children, the surviving spouse can still elect to receive one-third of your estate (this may include assets that pass through or outside of your Will, such as joint accounts). Although you each may profess to have no interest in the other spouse’s estate, that does not prevent the surviving spouse from changing his or her mind when the first spouse dies. A pre-nuptial agreement or a waiver of the right of election can solve this problem. In this way, each spouse mutually waives their right to take 1/3 of the first deceased spouse’s estate. While the right of election is usually only exercisable by the surviving spouse, there are some instances where someone appointed to act on behalf of the survivor could receive court approval to assert this right to an elective share.
The manner in which assets are titled and the type of investments make a difference. The surviving spouse may have a right of election against some but not all of your assets. The simple use of designated beneficiaries, or holding property jointly with another person with rights of survivorship, may pass those assets to your selected beneficiary but may not prevent the spouse from electing against those assets. By changing the way assets are invested, you may be able to avoid the right of election. For instance, life insurance is not subject to the elective share. Finally, you should carefully review all of your assets (including life insurance and retirement funds) to see how they are titled and review the designation of beneficiaries as well.Read more . . .
Wednesday, February 8, 2017
As you may know, Medicare will pay for a patient to receive rehabilitation in a facility if they have a qualifying stay in a hospital: being admitted to the hospital for two nights. The first twenty days of rehabilitation are completely covered by Medicare. The twenty first day through the one hundredth day will have a co-payment of $161 per day. This co-payment may be covered by a Medicare supplemental plan. However, it is important to note that while there is a potential to receive one hundred days of rehabilitation, it may not be determined that rehabilitation is no longer needed and the discharge will be set up.
The facility is required to give written notice that they believe Medicare will no longer cover the patient. This comes as a “Notice of Medicare Non-Coverage.” This notice gives the patient the right to appeal the decision. In order to make an effective appeal, it is important to know the appropriate standard that the law requires the facility use in making a determination.
That standard was inconsistent with Medicare regulations. The true standard is whether the patient needs the rehabilitation to maintain.
In 2011, a Federal Court case was decided on this issue. In that case, Medicare skilled nursing service recipients, challenged the failure to improve standard. The settlement agreement by the parties rejected the failure to improve standard and stipulates that the standard for terminating services is not whether the patient’s condition is likely to improve, but rather whether the condition will worsen if services are terminated. Therefore, skilled services should be continued so long as skilled therapies are needed to maintain the patient’s ability to perform routine activities of daily living or to prevent deterioration of the patient’s condition. This is the represents the current legal standard for denying skilled nursing coverage under Medicare.Read more . . .
Friday, January 27, 2017
Question: My father died without a Will leaving only a checking account in his sole name with a balance of $15,000. My brother and I are his only heirs. I have heard that there is a proceeding in the Surrogate’s Court to handle small estates. Can you tell me about it?
Answer: It is important to note that not all estates require a full probate or administration proceeding. The small estate also known as a voluntary administration proceeding is a simplified Surrogate’s Court procedure available if the decedent passed away after January 1, 2009 and had $30,000 or less in personal property. The voluntary administration proceeding cannot be used if the decedent died owning real property held solely in his/her name. If the decedent conveyed most of his/her property to a trust but there remains some property titled outside of the trust, the voluntary administration proceeding may also be available to collect those assets. The proceeding is available if the decedent died with or without a Will.
The person who files the “Affidavit of Voluntary Administration” and asks to be appointed as Voluntary Administrator is either the nominated executor in the decedent’s Will or the closest living relative if the decedent died without a Will. The person filing the Affidavit is asking the Court to let them collect the assets of the decedent, pay any debts and distribute the property to people who have a legal right to inherit either under the Will or under the laws of intestacy if the decedent passed away without a Will. Read more . . .
Friday, January 20, 2017
Question: My father is a widower and was recently diagnosed dementia. I am worried he is becoming incapable of taking care of himself. He never executed a health care proxy or a power of attorney. Can he sign them now? If not, what options do I have to get him the care that he needs?
Answer: Just because your father has a diagnosis of dementia, does not necessary mean he is unable to execute the advance directives he needs to designate you to take care of his personal and financial needs.
The capacity that your father would need to sign these documents differs depending on what document he is signing. For instance, the level of capacity your father needs to sign a health care proxy is very low. He only need know who you are and that he would like you to make medical decisions for you. The law presumes that a health care proxy is valid unless evidence is introduced to support its invalidity. The law requires a higher capacity level for a durable power of attorney. To execute a valid durable power of attorney, your father would need to know who you are, but also have a thorough understanding of what he was signing and the implications thereof. While analyzing capacity may seem easy, it can be a tricky task. Therefore, the decision of whether or not your father has the requisite capacity should be made by an attorney who has experience in Elder Law.
Unfortunately, if your father’s dementia has progressed to a point where it is too late for him to execute advance directives the only option is to make an application to the court in the county in which your father resides to be appointed as guardian of his person and property, pursuant to Article 81 of the Mental Hygiene Law. This involves filing of a petition with the court in support of your position that your father is incapacitated, does not fully understand or appreciate his lack of capacity and, therefore, is likely to suffer harm if you are not appointed as guardian to protect him. Read more . . .
Friday, January 20, 2017
Question: My aunt has been diagnosed with Alzheimer’s disease. She is in the early stages, can she sign a power of attorney? Who determines if she has capacity?
Answer: This is an excellent question and one that comes up often in the practice of Elder Law. The fact that your aunt has a diagnosis of Alzheimer’s disease, does not necessarily mean that she cannot execute a power of attorney. While it may seem like a decision to be made by her doctor, it is actually the lawyer who will determine if she or he feels your aunt has capacity. An Elder Law attorney has an ethical obligation to make sure that the client has the requisite ability to hire the attorney and to understand the documents that are being executed. Under New York law the standard for capacity for executing a power of attorney is defined as the “ability to comprehend the nature and consequences of the acts of executing and granting, revoking, amending or modifying a power of attorney, any provision of a power of attorney, or the authority of a person to act as agent under power of attorney.”
This means that your aunt should understand what a power of attorney is and each and every power given under the document. Therefore she must understand that the power of attorney is likely to have powers well beyond the task of collecting her income, assets and payment of bills. An experienced attorney should be capable of making that determination.Read more . . .
Wednesday, January 11, 2017
For many, the question of how to best care for our aging loved ones becomes a reality sooner than we think. Most people, when given the option, would prefer to age in place, remain in their homes for as long as possible receiving the care services they need in a familiar setting surrounded by family. For many, the Community Based Long Term Care Program, commonly referred to as Community Medicaid makes that an affordable and therefore viable option.
Oftentimes we meet with families who are under the impression that they will not qualify for these services through the Medicaid program due to their income and assets. In most cases, that is not the case. Although an applicant for Community Medicaid must meet the necessary income and assets levels, it is important to note that there is no “look back” for community Medicaid. What this means is that for most people, with minimal planning, both the income and asset requirements can be met with a minimal waiting period allowing families to mitigate the cost of caring for their loved ones at home. An individual who is applying for homecare Medicaid may have no more than $14,850.00 in non-retirement liquid assets. Retirement assets will not be counted as a resource so long as the applicant is receiving monthly distributions from the account. An irrevocable pre-paid burial fund is also an exempt resource. The primary residence is an exempt asset during the lifetime of the Medicaid recipient however, where the applicant owns a home it is advisable to consider additional estate planning to ensure that the home will be protected once the Medicaid recipient passes away. With respect to income, a single applicant for Medicaid is permitted to keep $825.00 per month in income plus a $20.00 disregard. However, where the applicant has income which exceeds that $845.00 threshold, a Pooled Income Trust can be established to preserve the applicant’s excess income and direct it to a fund where it can be used to pay his or her household bills. These pooled trusts are created by not-for-profit agencies and are a terrific way for persons to take advantage of the many services available through Homecare Medicaid while still preserving their income for use in meeting their monthly expenses. Functionally, the way that these trusts work is that the applicant sends a check to the fund monthly for that amount which exceeds the allowable limit. Together with the check, the applicant submits household bills equal to the amount sent to the trust fund. The trust deducts a small monthly fee for servicing these payments and then, on behalf of the applicant, pays those household bills. As you can see, this process allows the applicant to continue relying on his monthly income to pay his bills, and at the same time, reduce his countable income amount to the amount which is permitted under the Medicaid rules. Read more . . .
Friday, January 6, 2017
Question: My husband may require care in a Nursing facility. I was considering applying for Medicaid but I have heard that we could lose everything if we accept assistance through the Medicaid program. Is this correct?
Answer: No, however this is a common misconception. Medicaid is a means tested program and accordingly applicants must meet certain income and asset requirements. Rest assured, despite these requirements, there are protections for spouses who remain in the community. In 2017, applicants for Chronic Medicaid (this is the program which will assist in paying for Nursing Home Care) may have up to $14,850.00 in resources in order to be eligible. In addition, the applicant may have qualified (retirement) accounts in any amount assuming distributions are being taken on a monthly basis based on the life expectancy table used in the specific county you are applying in. Finally, an irrevocable pre-arranged burial account in any amount is an exempt asset. Federal guidelines permit community spouses to retain up to $120,900.00 in assets plus a primary residence with a maximum value of $828,000.00. Assuming your husband has assets which exceed the allowance; these assets can be transferred to you to bring him below the Medicaid threshold amount. However, New York’s spousal refusal provisions provide even more protection in that a community spouse can elect to sign a document which allows them to retain assets in any amount, including assets which were previously in the name of the spouse that requires care in a nursing facility.
Income is treated a bit differently. An applicant for Chronic Medicaid may only retain income in the amount of $50.00 per month, everything in excess of that must be contributed to the cost of his care. Where there is a community spouse that spouse is entitled to keep the greater of: (1) all of her income, or (2) her income plus enough of her spouse’s income to bring her to a total income of $3,022.50. Read more . . .
Friday, December 30, 2016
Question: My parents are in their late 70’s. My mother is in good health, but my father has suffered a series of strokes over the past years which have left him weak and in need of some assistance with his daily activities. As a family we feel strongly about keeping Dad at home, however we are concerned about Mom’s health as she is his primary caretaker these days. Mom and Dad own their home and each receive social security and a pension. Other than that, they do not have much in savings. I have heard that Medicaid will cover this type of care so long as the recipient is under the income and asset limit set by Medicaid. Is there a way to preserve Dad’s income for Mom and secure services for him at the same time?
Answer: Yes. The situation that you have described is a situation in which many elderly couples find themselves. The good news is that an elderly person’s high income does not automatically disqualify them from receiving Medicaid Homecare Benefits. With careful planning and the use of a Not-for-Profit Pooled Income Trust many elderly persons are able to age in place, get the homecare services that they need, and preserve their monthly income for payment of household bills. For starters, in order for a person to be eligible for Medicaid Homecare services they must be over 65 and disabled. In addition, because Medicaid is a means tested program, the homecare applicant must not exceed certain income and resource thresholds. For 2017, a Homecare Medicaid Applicant is permitted to keep $825.00, plus a $20.00 disregard (totaling $845.00) of his income and remain eligible for Medicaid services. Typically, Medicaid would be entitled to any income received by an applicant in excess of this amount as a reimbursement. For many couples like your parents who rely on their entire income to live, turning over this “excess” income would leave them impoverished and for that reason, Medicaid does not seem like a viable option. Read more . . .
Nancy Burner & Associates, P.C. has offices in Setauket, Westhampton Beach, and Manhattan New York.