Boston Estate Planning and Probate Lawyer & Attorney : Gosselin & Associates Law Firm : Serving Boston, Winchester, Hingham, Wellesley, Manchester

I admire Roto Rooter. Few other businesses are so financially successful using a single tool - such as the spiraling drain cleaning tool. As an elder law and Medicaid attorney in Massachusetts I am starting to feel like Roto Rooter. New Medicaid regulations and qualifications have made it nearly impossible at the time of nursing home admission to protect an elder's assets. Despite the strict guidelines and pre-planning requirements of the Deficit Reduction Act and interim state and federal regulation, we are still winning the battle of family asset protection.

 Of course, our one tool in Massachusetts is the Medicaid Qualifying Immediate Annuity, also called Single Premium Immediate Annuity (or SPIA). These annuities are quite simple, the Medicaid applicant or their community spouse contributes a lump of funds to an annuity account with an insurance company and the insurance company returns the money to the annuitant over a fixed period of time consistent with their life expectancy under the HCFA life expectancy tables. When the annuitant dies then either the family or the Commonwealth of Massachusetts Division of Medical Assistance gets the remaining funds depending on very specific rules.

 But there are several other options for elders and their families facing long term care financing and Medicaid qualification. There is an exception for the principal residence where the nursing home resident's spouse is still living in the home. This exception also applies to siblings, minor, blind or disabled children. The other major exception is for children who are caregivers for their parents (the "caregiver exemption") in the two years prior to the elder's nursing home admission.

 From an estate planning perspective and for non-real estate assets, our choices are more limited. Besides the Medicaid Annuity, Special Needs Trusts can also be used without disqualification for anyone in the Medicaid applicant's family. Disqualification for Medicaid is the term used by the Massachusetts Division of Medical Assistance (MassHealth) to describe the time period for which a Medicaid applicant or nursing home patient is ineligible for Medicaid benefits.

 Of course, advance estate planning can solve a lot of these Medicaid qualification issues. Generally, if an elder client is in good health,  under 80 years of age and has the wherewithal to pay annual premiums, then Long Term Care Insurance is a great option. Premiums can be costly on a cash basis, but I have never had an elder law client who had has a claim with her Long Term Care Insurance company complain about the benefits. The benefits are generally cash payments for home care and nursing home care. Many people call Long Term Care Insurance "nursing home insurance," but it is really much more than that as it also includes a home- care benefit.

 With the same foresight as an insurance applicant, elder law clients at Gosselin Law are often advised when they are healthy (or as I like to say "when you are still buying green bananas") to set up irrevocable trusts that preserve the step-up in tax basis and remove the elder law client's assets from inclusion in their resource calculation by MassHealth. The "trick" is that after setting up and funding these types of Medicaid trusts, the elder is not elegible for Medicaid for five years. At one time the waiting period was much shorter on transfers and trusts, but now, it is a uniform five years before the trust's Medicaid "protections" kick in.

That's about it for asset protection and Medicaid qualification. Whatever you do, do not apply for Medicaid without speaking with an elder law attorney, no matter how much the nursing home pushes you to sign papers or an application company, such as Medi-Services encourages you to 'just get it done' - keep your pen in your pocket until you speak with an elder law attorney. If you are facing the spectre of paying the outrageous costs of a Massachusetts nursing home from your own funds, please call Gosselin Law for a free telephone consultation to review your Medicaid asset protection options. Our phone number is (toll free) 877-325-6746 or 781-729-0313. We have offices throughout Massachusetts (Boston, Hingham, Wellesley, Winchester and serve Amherst, New Bedford, Barnstable and Pittsfield through satellite and in-home appointments.

 

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I admire Roto Rooter. Few other businesses are so financially successful using a single tool - such as the spiraling drain cleaning tool. As an elder law and Medicaid attorney in Massachusetts I am starting to feel like Roto Rooter. New Medicaid regulations and qualifications have made it nearly impossible at the time of nursing home admission to protect an elder's assets. Despite the strict guidelines and pre-planning requirements of the Deficit Reduction Act and interim state and federal regulation, we are still winning the battle of family asset protection. If you are facing the spectre of paying the outrageous costs of a Massachusetts nursing home from your own funds please call Law for Life for a free telephone consultation to review your Medicaid asset protection options. Our phone number is (toll free) 877-325-6746 or 781-782-6000. We have offices throughout Massachusetts (Boston, Hingham, Wellesley, Winchester and serve the Worcester, Springfield, New Bedford/Fall River, Barnstable and Pittsfield areas through satellite and in-home appointments.

Often our only tool in Massachusetts is the Medicaid Qualifying Immediate Annuity, also called Single Premium Immediate Annuity (or SPIA). Although pooled income trusts have their place, we are not convinced that they will be available much longer as an emergency planning tool. These annuities are quite simple, the Medicaid applicant or their community spouse contributes a lump of funds to an annuity account with an insurance company and the insurance company returns the money to the annuitant over a fixed period of time consistent with their life expectancy under the HCFA life expectancy tables. When the annuitant dies then either the family or the Commonwealth of Massachusetts Division of Medical Assistance gets the funds depending very specific rules.

But there are several other options for elders and their families facing long term care financing and Medicaid qualification. There are exception for the principal residence where the nursing home resident's spouse is still living in the home. Same with siblings, minor, blind or disabled children. The other major exception is for children who are caregivers for their parents (the "caregiver exemption") in the two years prior to the elder's nursing home admission.

From an estate planning perspective and for non-real estate assets, our choices are more limited. There is the Medicaid Annuity (for which Law for Life is recognized as a Massachusetts source for the design and implementation of annuity based plans), but also the use of Special Needs Trusts that can be establish without disqualification for anyone in the Medicaid applicant's family. Disqualification for Medicaid is the term used by the Massachusetts Division of Medical Assistance (MassHealth) to describe the time period for which a Medicaid applicant or nursing home patient is ineligible for Medicaid benefits.

Of course, advance estate planning can solve a lot of these Medicaid qualification issues. If an elder client has good health, is generally under 80 years of age and has the wherewithal to pay annual premiums then Long Term Care Insurance is a great option. Premiums can be costly on a cash basis, but I have never had an elder law client that went on claim with Long Term Care Insurance complain about the benefits. The benefits are generally cash payments for home care and nursing home care. Many people call Long Term Care Insurance "nursing home insurance", but it is really much more than that as it includes a home care benefit that can be even more important to elders in need of services.

With the same foresight as an insurance applicant, elder law clients at Law for Life are often advised when they are healthy (I like to say "when you are still buying green bananas") to set up irrevocable trusts that preserve the step-up in tax basis and remove the elder law client's assets from inclusion in their resource calculation by MassHealth. The "trick" is that after setting up and funding these types of Medicaid trusts, the elder cannot qualify (or apply) for Medicaid for five years. At one time the waiting period was much shorter on transfers and trusts, but now it is a uniform five years before the trust's Medicaid protections kick in.

That's about it for asset protection and Medicaid qualification. It is imperative to speak with a competent elder law attorney such as us experts at Law for Life (our phone number is 781-782-6000 or toll free at 877-325-6746) regarding your personal situation as the regulations are very complex and change often during the year. Whatever you do, do not apply for Medicaid without speaking with an elder law attorney, no matter how much the nursing home pushes you to sign papers or an application company, such as Medi-Services encourages you to 'just get it done' - keep your pen in your pocket until you speak with an elder law attorney.

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It's difficult to know which is the proverbial cart and which is the horse, but it would seem that aside from grief over the loss of a spouse (often the husband has passed first), the isolation and worry are caused by financial insecurity. When an elder lacks financial resources to purchase groceries let alone take part in ordinary social rituals (church, bingo, social clubs) for fear of the stigmatization of poverty they withdraw from the very community that should be there to support them emotionally in their time of need. In most elders' minds American society rewards financially successful people with acceptance and shuns those that cannot achieve their own financial security.

Over time this withdrawal from community compounds the issues of limited financial resources and depression. The further effects of malnutrition, reduced medical care (often in the form of splitting pills to non-therapeutic doses) and the physical dilapidation of the elder's home leads the elder to long term care facilities and being forced to sell their home in an unplanned manner. The elder's "house rich" circumstances control the situation and the inevitable outcome. Many elders have children who lack either the means or will to provide financial aid to their parents (if they could provide financial support to their elder parent homeowner, I can recommend looking at the new program offered by Circle Lending (not a lender) called Family Advantage - it's basically a privately funded reverse mortgage). While selling the home is always an option it seldom helps the elder and often further sends them the message that they have failed to maintain the lifestyle to which they had worked for throughout their lives. I have been witness to miracles brought about by elders making the decision to help themselves by obtaining a reverse mortgage. Contrary to the conventional "wisdom" that has shrouded reverse mortgages for years; reverse mortgages are good solutions in the right situations. "You mean I will receive $1,100 every month for the rest of my life? - I'm going to start swimming again at the Y." That is what I heard just yesterday at a reverse mortgage closing.

By being able to tap the equity in the real estate that they own elders can access value without disrupting their personal culture and well being by selling their home. It is an empowering thing to be given freedom from lingering debt or years of insufficient income. Anecdotally, I have seen many elder law clients of my law firm emerge from their funks and indeed their depressions, to get back on their feet using their home equity. Contrary to some popular thinking, despite the cost of obtaining a reverse mortgage (nothing in this life is free from what I can tell) and the thought that there will be less inheritance left for the aforementioned good for little children; reverse mortgages are lifelines for the elder community. Reverse mortgages solve problems. Reverse mortgages unlock the paper appreciation in real estate over a lifetime of hard work. Reverse mortgages are the friend of the elderly. Reverse mortgages make elders smile. As I work further towards building a strong presence in the blogosphere, I want to thank my hundreds (thousands?) of readers for keeping me moving in the right direction. Soon you will be seeing a whole new blog, indeed a whole new blog experience, as we migrate this simple site to LexBlog, the leading website for blogging lawyers. LexBlog will provide me with substantial software resources so that I can incorporate many new useful features to my blogs. The topics will remain the same, although I am now working with several reverse mortgage lenders on bringing new lending programs to the market so I hope to be a resource for the reverse mortgage community on trends and traps in the industry. I will also continue to provide clear insights on the risks of dying without an adequate estate plan and the accompanying costs and hassles of probate in Massachusetts. Thanks again for your continued support!

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(From The Boston Globe) The cost of nursing-home care has risen 17 percent across the country over the past five years, a new survey shows. While the rate of increase was slightly lower in Massachusetts at 16 percent and even lower in Boston at 10 percent, the cost of care in Massachusetts was still well above the national average. One year in a nursing home private room costs $109,396 in Boston and $106,321 in other parts of Massachusetts. That compares to the national average of $76,460, according to the Cost of Care Survey conducted by Genworth Financial, a company based in Richmond, Va., that sells long-term care insurance. Alaska has the most expensive care, at $187,902, followed by New York City at $145,392. Connecticut is also more expensive than Massachusetts, at $119,678. The annual survey of long-term care also looked at the cost of assisted living, hourly home care, and adult day health care. In Boston a one-bedroom unit in an assisted-living facility cost $54,052 per year, in the rest of the state it cost $46,440, and an average of $36,090 in the rest of the country. Alaska again topped the list, at $54,809. The hourly rate for a home health aide was $23.40 in Boston, $22.41 outside Boston, and averaged $19.18 across the country. Adult day health care is a spot of moderation in Massachusetts. Five days a week cost $15,337 a year in Boston, $14,009 in the rest of Massachusetts, and an average of $15,236 nationally.

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I have just come to another milestone in my life. My oldest son (10) decided that he will no longer be calling me "Daddy", but that I am forever more to be referred to as "Dad." As school kids are wont to do, my son was teased by a classmate for calling his parents "Mommy and Daddy". To conform to the bully's wishes my son just made me middle aged. I'm Massachusetts most recent middle aged lawyer father. I was a twenty something and had been enjoying my thirty somethings when this came out of the blue. In my elder law practice I am asked by prospective clients about what is and what is not elder law. Some fifty somethings ask whether they can 'qualify' to use my services for a trust or a will, while some octogenarians don't feel old enough to seek services meant for the elderly, after all "they're old people." What it all comes down to is that age is a state of mind. I tell my elder law clients that how old you think you are is so much more important than how old you are according to your birth certificate. If you need assistance with Medicaid or a will or trust you just need legal help, it's not a question of being elderly. When you need Medicaid or an estate planning attorney you can call me (781-729-0313) and, you can call me 'Daddy'.

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The American Association for Retired People is in Boston this weekend for a national conference.

Watch your wallets.

AARP started out speaking and advocating for older Americans who were not well-represented in Washington. Success brought more and more older Americans into the fold. AARP soon realized there was gold in the mailing list of elders looking for a voice in a sea of special interest lobbyists, corporate welfare and multi-national hand-outs.

At first, the mailings were but a trickle of approved companies soliciting the business of older Americans. AARP members gave these first mailings careful consideration because they came from a respected organization. But AARP's lure and the lust for the buck grew along with the mailing list.

The trickle became a rampaging flood as the mailboxes of elders strained to keep up with the assembly-line parade of ads for nearly anything that could be sold. Liver spot bleach, incontinence pads, denture glue - you name it and AARP will pitch it to its members for a piece of the action.

The age for membership in this association of retired people dropped to 50. How many 50-year old folks retire these days? Not many, but boy did that age drop plump up the mailing list and the coffers!

AARP's big weekend event - the Boston conference? The Life@50+ National Event & Expo is nothing more than a huge trade show - more chances to sell something, anything to the droves of people flocking to the show. Representation and service of elders is the banner AARP always waves, but it seems to this cynical eye the real purpose these days is to feed and grow the marketing machine.

Yes, the trade show will present even more opportunities to sign up even more elders for non-stop health insurance salesman, sellers of chair lifts and call-alert systems for when you've fallen and can't reach your wallet.

Congress might soon have to pass a DO NOT SOLICIT THE DEAD Bill, to protect surviving family members from the deluge of direct mail that will try to follow elders into eternity in the hope of one last sale.

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I am afraid of being robbed. I am afraid of losing my privacy. I must be, I spend a lot of effort and aggravation protecting myself from the Big Bad Wolf.

House key, car key, office key, mailbox key, house alarm, car alarm, office alarm, cell phone lock code, email password, log in password, ATM password, bicycle combination code - not to mention literally hundreds of passwords needed to access just about any information that has become indispensable in the past ten years.

Robert Frost is my favorite poet. It's the Yankee (the good New England kind, not the evil New York kind) ingenuity and connection with both nature and ordinary things that speaks to me on so many levels. In "Mending Wall", Frost makes a point about the identity of the evil in the world:

"Before I built a wall I'd ask to know

What I was walling in or walling out,

And to whom I was like to give offence."

Often when I meet with elder law clients I am amazed at their fear of so many things in everyday life. As their bodies weaken they feel at risk to so many evils around them. To fight the evil they lock their doors, they stay awake at night listening for an intruder, and when in public they walk guardedly holding their possessions near to them.

It's no wonder the elders in America are scared. Reading the morning paper or beginning the daily ritual of oft repeated news programs - there is one theme: the world is a dangerous place. Murder, mayhem and plunder are so sensationalized as to make elders feel that they could be at peril to these risks at any minute.

Roosevelt was right; the only thing we have to fear is "fear itself." But in my experience in Massachusetts elder law I have witnessed fear consume what quality of life elders have remaining. Fear saps the joy from all that it touches. The ally of aging is not only a falling body or mind; it is the dark cloud of fear.

Another great influence of the twentieth century, John Lennon, imagined a world where peace, love and mutual respect come together so we "live as one". Imagine.

Imagine. If elders could leave their doors unlocked, invite neighborhood children into their homes; enjoy the sounds of the night through open windows?

What the heck? I am going to leave the doors to my car unlocked today. I am going to change all my passwords to 1-2-3-4. My kids can go to the local park alone to play on the swing set. The infernal beep of my house alarm is a thing of the past. Who's afraid of the big bad wolf now?

Won't you join me in my revolution?

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Over the years, we have met with many families in a crisis mode, struggling to find services and preserve assets for loved ones needing long term care. When statistics tell us about one out of two people will need long term care, it's appalling that most of the current generation of elderly have not planned for this crisis in their lives. And the current pre-retirement generation is doing no better.

Sometimes I think Americans are about as unprepared as the ancient tribes of Israel wandering in the desert. When the time comes for long term care, most people believe help will come to them like manna from heaven. In most cases this won't happen. I've encountered it so many times, I am no longer surprised when people ask me if there's not some kind of government program that will pay them to quit their jobs and to stay at home and provide long term care for their loved ones.

According to research by the National Care Planning Council only about 16% of long-term care services are covered by the government. The other 84% are provided free of charge by family caregivers or provided by services paid out-of-pocket by families or from those receiving care. And the bulk of government care services are provided only after a care recipient has depleted all of his or her savings. The Council also estimates that at any given time approximately 22% of the population over age 65 is receiving some form of long term care support. According to an April 2005 congressional hearing press release from Congresswoman Nancy L. Johnson (R-CT), Chairman, Subcommittee on Health of the Committee on Ways and Means, "...In 2004, according to CBO, approximately $135 billion was spent on long term care for the elderly. Sixty percent of this amount was financed through Medicaid and Medicare, one third through out-of-pocket payments, and the remainder by other programs and private insurance. This funding excludes the significant resources devoted to long term care by informal caregivers (primarily spouses and children). The CBO estimates that informal care is the largest single component of long term care...."

In conjunction with the spending estimates above, the National Care Planning Council has actually estimated the equivalent cost of care provided for free by informal caregivers. We think it is close to a staggering $313 billion for the year 2005. This is almost four times the amount the federal and state governments currently pay for all long term care services nationwide. It would bankrupt the federal and state governments if they had to pick up the cost of these free services. Many groups are pushing for the government to do just that -- pay a greater share of informal care services.

The process of long term care planning involves seven steps that embody the following four principles: Knowledge is the key to success. Professional help is crucial in saving time, money and stress. The planning process is most effective when there is money available. Success is assured through a written agreement with all parties involved. "Guide to Long Term Care Planning" is a new online resource developed by the National Care Planning Council for use by the public and to support the Long Term Care Consumer Awareness Campaign from the Department of Health and Human Services. This free, noncommercial source of information is the largest and most comprehensive work on long term care planning ever produced. This public-service, online publication contains over 670 printable pages including 96 charts and graphs. It is written by eight experts and organized into 35 chapters. It also includes a section on helping seniors with the new Medicare prescription drug benefit. The URL for this online publication is found at www.longtermcarelink.net/guide.

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The death of emergency Medicaid planning is official. Let us mourn the techniques of the estate planning and elder law bar that allowed elders to qualify for Medicaid benefits despite having significant assets. Due to the Deficit Reduction Act of 2005 (passed in 2006) most planning opportunities now involve five year plans and more complex trust instruments. While we are still working on these more complex trusts, including irrevocable trusts, intentionally defective grantor trusts and the like; the demand for our services at the time of Medicaid application has diminished markedly. Despite the law change in Massachusetts (and Federal law), there are still steps we can take for asset protection for elders at the time of application including promissory notes, certain annuities and special needs trusts for certain family members - Medicaid planning is not entirely hopeless, but the best opportunities for elder law attorneys have been signed away by the governments lawyers and Congress. So, what is a lawyer to do?

We are not the type to passively sit by as other lawyers eat our lunch. We have been working diligently for the past several months re-tooling the asset protection aspects of our law firm to be more directly focused on the asset protection needs of high and ultra high net worth individuals who are concerned with protecting assets from all types of judgment creditors. This planning involves the use of trusts, corporate entities and legal jurisdictions where the laws favor the protection of assets (in exchange for bringing new cash to places perhaps not normally thought of as centers of the legal or financial world - like Nevada and Alaska).

In the coming weeks I will be participating in significant training and axe sharpening programs to help make sure that our law firm is on the cutting edge of asset protection, not only in the US but also in cooperation with certain off-shore legal jurisdictions where certain planning can be beneficial for particular clients. I leave shortly for a conference in Las Vegas where the Nevada trust industry will woo my estate planning asset protection attention. In a nutshell, asset protection involves transferring legal ownership of assets to another person, in most cases this person is a trustee and under the various state laws (such as Nevada asset protection law) at least of these trustees must be a Nevada trust company. By so transferring the legal ownership, as well as structuring the language and documentation of the trust so that it conforms with state law, you can achieve protection from certain types of creditors over time (in Nevada you can protect assets in as little as two years), including judgment creditors and even spouses in a divorce.

Our law firm works cooperatively with Nevada legal counsel to make sure that all asset protection documents conform to Nevada legal requirements as these are not Massachusetts documents. We will be revisiting this topic in much greater detail in the coming months as our law firm will be working diligently to bring our clients up to speed on this exciting estate planning opportunity. The main advantage of Nevada asset protection and other state and countries is the use of charging orders (how creditors are paid in the event of a claim) and certain tax benefits. Not only is this legal, but it is a prudent use of client's resources as it is one of the few ways that we can preserve estate tax planning opportunities while locking in the protection of assets.

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My father always said that the first 100 years were the hardest in life. From the looks of things in the growing number of centenerians in the world, I'd say he was right on the money. Look here from some amazing statistics about aging in the US. Life expectancy in the US has been increasing among the population as a whole dramatically, even in just the past 10 years. This increase of course is mostly due to medical advances, improved communication about diseases allowing for early diagnoses and the end of the Boston Red Sox' "curse of the bambino" (just my theory).

In elder law practice this shift towards amazing longevity has caused us to re-examine some of our most basic tenets for planning, and indeed with more clients living longer increasing the range and scope of our services. As people live longer and longer, or at least as their bodies do, diseases that cause memory loss (such as dementia, Alzheimers) or forms of psychoses (particularly severe depression) and other neurological conditions that reduce either or both cognitive or communication skills of the patient are increasing dramatically. Often families do not have any history of the diseases as noone had ever reached such ages in past generations.

As we counsel clients we no longer make the assumption that clients will have relatively short periods of skilled care, but rather we must take very seriously the prospect that a client could not only outlive their personal financial resources, but also need skilled care for many years. This long term care period could last years beyond what we've considered the conventional wisdom for convalescent care. In addition, we have several client situations where two generations of a family are in nursing care at the same time - perhaps mom is in her 90's and her child in her 70's and both are in long term care. Which leaves adult grandchildren and great-grandchildren in fiduciary roles once reserved only for children. Not only does this expand the family tree and the size of the inevitable "committee" that makes decisions, but also the burden on the younger generations to manage both their own families and the decisions of the elders that are depending upon them.

I will come back to this topic again as the impending arrival of the baby boomers in their troisieme age is changing everything. GosselinLaw.com >

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