Social Security Added 52 Conditions to the SSDI Compassionate Allowances (Fast Track) Program
August 10, 2012
Good News on Pooled Trusts
August 9, 2012
When a single person is entering a nursing home, and if she needs MassHealth to assist her with paying for that, then she needs to bring her assets down to $2,000. Elder law attorneys often recommend setting aside a “cushion” in a pooled trust – since $2,000 amounts to bubkes, really. Having a cushion set aside in the pooled trust provides the elder with the opportunity to buy things that MassHealth doesn’t provide, like hearing aides, a better bed, companion care, extra therapies, etc.
In the last few years, states across the county have been trying to shut down this opportunty for seniors, saying that anyone over 65 can’t transfer assets to the pooled trust and then expect MassHealth to help with the nursing home bill. Well, we can now breathe a little easier – the federal court that covers Pennsylvania has ruled that in fact, anyone 65 and over can establish a pooled trust account, and the states cannot say otherwise. This Circuit Court’s opinion is not binding on Massachusetts, but there is a strong tradition of federal courts in the same area of the country taking cues from each other.
To date, MassHealth has still permitted elders to transfer funds to pooled trusts so that they can have cushions while in the nursing home. From time to time MassHealth talks about prohibiting that practice. Now it looks even less likely that they can stop elders from using pooled trusts. That is good news for single seniors who need nursing home care and want to hold on to a little something so that they can pay for things not provided by MassHealth.
Is Your Spouse Moving to a Nursing Home? Are You Scared of Using up Your Savings on the Nursing Home Bill?
August 8, 2012
When one member of a couple needs nursing home care, and if you are asking MassHealth to assist with the monthly bill, then the healthy spouse at home may keep only $113,640 in liquid assets, in addition to her home. For a younger spouse with many years ahead of her, reducing her liquid assets to only $113,640 can be a very scary proposition.
One option for the healthy spouse to hold onto more of her savings is to convert the liquid into real estate, namely, to make improvements to her home. Now is the time to make the repairs you’ve been putting off – new heating system, new roof, etc. Think about what modifications will allow you to stay in your home for as long as possible, like widening doorways and remodeling a bathroom to be easier to use if you have less mobility. And if you are not planning to stay in your home for much longer, then think about what improvements will help you sell your home.
Another option for helping a healthy spouse hold on to more of her savings is an annuity. MassHealth permits an at-home spouse to convert her excess assets to an annuity that meets very particular requirements. You absolutely must work with an elder law attorney if you want an annuity for MassHealth purposes. Most financial advisors are not familiar with the MassHealth annuity requirements. And those advisors that do know the requirements don’t want the liability of advising you themselves.
When one member of a couple is entering a nursing home, it is critical for the at-home spouse to meet with an elder law attorney to understand her options. Adjusting to living alone is hard enough. You shouldn’t also have to learn how to live with the fear of running out of money.
Heard in the Office: “I Don’t Want the Nursing Home to Take My House.”
August 6, 2012
I hear this a lot. Let’s be clear on the very basics. If you’ve watched friends go to a nursing home and “lose the house,” it’s not the nursing home forcing them to sell. Like all medical providers, nursing homes need to be paid.
Your Medicare and supplemental health insurance policy (ex. MediGap) will pay for up to 100 days – after that, you are on your own. At that point, some people have the ability to privately pay, and they use their savings, and perhaps even sell the home to pay the monthly bill. Other people don’t have savings or even a home to convert, and they ask the state to pay the bill (that’s MassHealth, also called Medicaid).
And there is a third category of folks, where there is a spouse living at home who simply can’t afford to use her savings to pay $10,000 – $12,000 per month to the nursing home if she is going to be able to continue supporting herself at home. She may do some planning so she can ask MassHealth to pay for her spouse’s nursing home care while also being able to retain enough of her assets to support herself at home without living in fear of poverty.
If you are living at home and your spouse needs nursing home care, contact our office so we can help you protect yourself while also making sure your spouse receives the medical care he needs.
Heard in the Office: “I Want to Name My Son Executor under My Power of Attorney.”
August 2, 2012
I hear this a lot. This post is about vocabulary.
A Durable Power of Attorney is the document where you name someone to help you while you are living – you name someone (usually a spouse, child, sibling, or best friend) to help you in case you are unable to manage your finances yourself, for example if you are in the hospital, develop dementia, or – gasp – go on vacation. When you name someone in your Durable Power of Attorney, we call her an “Agent.” You Agent can help you, while you are living, with banking and personal business, like paying bills, applying for a reverse mortgage, changing the amount of your IRA distributions, etc.
After you die, the Agent’s power ceases. Now your Will comes into play, and whomever you have named as your “Personal Representative” takes over managing your finances. (Wait! What happened to the word “Executor”? See this post.) Your Personal Representative will pay your last bills, cash out your life insurance, probably consolidate multiple bank accounts into one account, sell your house, etc., and then, once all the dust has settled, divide the proceeds up among your heirs.
The “Agent” under the Durable Power of Attorney and the “Personal Representative” under your Will have essentially the same jobs. And quite likely, you have named the same person in both documents. (Usually, whomever a client wants handling her money while she is living is the same person she wants handling it after she dies.) But to avoid confusion when your Agent is dealing with the bank or other financial institution, make sure the Agent refers to herself as the “Agent” and not the “Executor.” If she introduces herself as the “Executor,” people will think that means that you have died – and most of us would rather not have others thinking that until the time actually comes.