Mom and Dad, We Need to Talk! Elder Law Basics for Your Next Family Meeting.
What is an Elder Law Attorney?
An Elder Law attorney specializes in issues affecting older people, typically including estate planning, Medicaid/Medicare, long term care issues, and planning for incapacity. An elder law attorney can help families address navigate complex legal issues which may be complicated by questions of competency, family conflict, access to community resources, financial insecurity and popular misconceptions about how the system works.
Questions to ask:
How long has the attorney been practicing?
What percentage of the attorney’s practice is devoted to elder law?
Does his or her practice emphasize a particular area of elder law? (For instance, guardianship or Medicaid)?
Is the attorney a member of the Elder Law Section of the Michigan Bar Association?
Can the attorney describe the difference between Medicaid and Medicare?
Will the attorney be representing the children’s interests or the parent’s interests?
If I can’t make my own medical and personal care decisions, who decides?
Michigan allows you to name someone to make decisions about your medical care by signing a Patient Advocate Designation, also known as an Advance Directive or Medical Power of Attorney. This document is only effective when your doctor determines that you can’t make your own decisions. You can leave instructions about your wishes, including end of life decisions. It is important to talk to your family about your wishes so that you can answer questions, prevent family disagreements about your wishes, and provide information about your medical needs and preferences. If you haven’t signed this document, your family may have to go to court to have a legal guardian appointed.
Here are two excellent resources:
Making Choices Michigan Tool and Resources for Health Care Decision Making: http://makingchoicesmichigan.org/
ABA Toolkit for Health Care Decision Making: http://www.americanbar.org/groups/law_aging/resources/health_care_decision_
If I can’t take care of my own finances, who will pay my bills and manage my money?
Spouses, adult children or people named as personal representative of your Will have no right to act on your behalf in managing your financial affairs in the event of your incapacity. You can sign a Durable Power of Attorney appointing someone to pay your bills, manage your money and property, file your taxes, sign contracts, deal with insurance companies and other financial affairs. The person you appoint only has those powers specifically listed in the document and Michigan law imposes additional technical requirements. The Durable Power of Attorney can be written so that it is effective immediately. Alternatively, it can be a “springing” Durable Power of Attorney that it is effective only after a court or your doctor finds that you are incompetent. Doctors are sometimes reluctant to sign such a statement due to the HIPAA privacy laws, so it can be harder to use a springing Durable Power of Attorney.
Your family may need to go to court to have a conservator appointed if:
You have not signed a Durable Power of Attorney
Your family believes that your agent under your Power of Attorney is not acting in your best interest or
Your family believes that you are incapacitated but you believe that you are fine
What is Estate Planning?
Estate planning includes Wills, Living Trusts, probate avoidance and minimizing tax exposure after a person dies. Your estate plan determines who receives your remaining assets at your death and who will be in charge of tying up your affairs, paying your bills and distributing your assets according to your instructions. Most estate plans include a Patient Advocate Designation and Durable Power of Attorney. Most elder law attorneys are also estate planners.
How do I pay for home health care, assisted living and nursing home care?
Medicare. Medicare, and private Medicare supplemental insurance, generally only pays for skilled rehabilitation care after a hospital admission, typically for a maximum of 100 days, but usually for much less. Medicare won’t pay for skilled nursing care after a hospitalization that is characterized as “observation only.”
Medicaid. Medicaid is a means-tested program available to people with limited assets and income. Vet Medicaid generally pays for skilled nursing home care, not assisted living or home health care. However, the Medicaid Waiver program pays for limited home health care and assisted living expenses for people who meet the program’s income cap. Certain assets including a house, a car, qualified pre-paid burial arrangements and personal property are exempt. An asset limit of $2,000 applies to single people. Special rules apply to married couples which allow the spouse who is not in the nursing home to protect half of the couple’s assets on the first day of long term care, up to a maximum of about $120,000. Sophisticated planning techniques may be used to protect additional funds for the non-nursing home spouse. Medicaid ignores prenuptial agreements and holding assets separately. A five year divestment penalty applies to any transfer for less than fair market value including gifts, loans that will not be repaid, paying a family member’s bills, selling items for less than full price, and even paying a family member for care. Medicaid’s estate recovery program puts a lien on assets passing through probate at the death of a Medicaid recipient. Medicaid is trying to broaden the reach of estate recovery, but for now elder law attorneys can help avoid estate recovery claims
Veterans Aid and Attendance Enhanced Pension. Veterans who served during specified “periods of war” may qualify for the Veterans Aid and Attendance Enhanced Pension. This benefit helps the veteran or a spouse who is incurring high medical expenses including home health care and assisted living. The Aid and Attendance benefit currently allows a veteran to have a home and a car plus approximately $80,000. There is no specific asset limit; instead the Veteran’s Administration has its own calculation based on income, medical expenses, dependents, and life expectancy. The benefit may be available to veterans who need assistance with activities of daily living like using the bathroom, eating, dressing, bathing, or who have cognitive impairment that requires significant supervision to avoid risk of harm. The Aid and Attendance benefit currently does not have a divestment penalty, but regulations have been proposed which would impose a penalty as well as clarifying other eligibility requirements. The maximum benefit for a married veteran is $2,120; for a single veteran is $1,788 and for a surviving spouse is $1,149.
Kent County Veterans Services:
Veteran’s Aid Organization: http://www.veteranaid.org/
Family Resources. People are often reluctant to spend their hard-earned family financial resources on care. Older people who lived through the Depression sometimes prefer to sacrifice their own well-being than use up the money they want to pass on to their children. As middle-aged children have suffered their own financial set-backs, they have come to rely more and more on gifts and an eventual inheritance from parents as their retirement plan. But refusing to pay for help when it is needed comes with a price. Privately paying for care opens up options since the older person is not limited to what governmental programs will pay for, and may allow the person to get the best possible care in the least restrictive environment.
What can I do to avoid scams, abuse and exploitation?
Unfortunately, older people are frequent targets of scams, abuse and exploitation. Cognitive decline, loneliness and isolation make older people more vulnerable to scam artists. Scams and exploitation may come in the guise of “sheltering assets” or “protecting money from the nursing home.” Fear is a powerful sales tool for unscrupulous (or possibly misinformed) financial advisors, annuity sales people, and others.
Acquaintances, caregivers and even family may exploit older people for money, and may misuse common estate planning devices like joint ownership and durable power of attorney to obtain control of an older person’s money. Verbal, emotional and physical abuse can occur due to poorly trained or screened caregivers or from caregiver burnout. Older people are often very private about their finances, but this sense of privacy can be used to hide scams and exploitation until it is too late. Communication, financial transparency, and checks and balances between money managers and caregivers can help prevent financial scams and exploitation.
Kent County has an organized response to scams, abuse and exploitation at Kent County Elder Abuse Coalition: http://www.protectkentseniors.org. This group consists of social service providers, law enforcement, prosecutors and others who are dedicated to responding to this type of abuse. In addition, the Kent County Probate Court has taken a strong leadership role in addressing abuse and exploitation.
Family caregivers provide the lion’s share of all long term care for older people. Are there resources that can help?
As people live longer, but not necessarily healthier, unpaid family caregiving has become the primary source of long term care. A caregiving spouse often predeceases the chronically ill spouse due to exhaustion and inattention to their own medical needs. Many caregivers feel overwhelmed and underappreciate. The first step is to realize that you are a caregiver. Whether it is a daily phone call, providing transportation or groceries, coordinating medical care or financial matters, or moving in with an elderly loved one, these are caregiving tasks that take a toll on the caregiver. The second step is to look for resources and support. Resources are available for caregivers at the Caregiver Resource Network: http://www.caregiverresource.net.
Family members who are not providing primary care often have unrealistic ideas of how well an aging parent is doing and how much work it is to provide care. Sometimes a third party health care provider, social worker, lawyer or professional mediator can help families develop plans to provide care which put the older loved one’s needs first, but recognize that it may no longer be realistic to do it alone.
Are there other resources?
Area Agency on Aging of West Michigan: http://www.aaawm.org/
Alzheimer’s Association: http://www.alz.org/
Elder Law of Michigan: http://www.elderlawofmi.org/
AAA Senior Driving Resources: http://seniordriving.aaa.com/
If you have any questions on this article, you may contact the author, Laurie Murphy. If you need assistance with the legal and practical aspects of planning for long-term care, applications for Medicaid, and planning for family members with disabilities or special needs, you may contact any of Miller Johnson’s elder law and disability planning lawyers.