How Do I Bring Up the Topic of Estate Planning to My Parents?

In Worcester, just as everywhere else in the nation, there is a tendency for people to put off estate planning.  Elder law attorneys, like Kristina Vickstrom, recognize that there are multiple factors that lead people to procrastinate when it comes to the estate planning process.

One of the biggest factors, of course, is that most people don’t want to consider their own mortality, and estate planning forces you to do just that.  When it comes to adult children, we are just as guilty of not wanting to think about the inevitability of losing our parents, and therefore, we choose not to push them.

There are other complex reasons that come into play as well.  An adult child who wants to encourage his or her parents to set up wills and trusts may worry that the parent or other family members will mistake concern for greed.  If the parent has remarried, then even more complex family dynamics can come into play, with the adult child remaining quiet on the subject rather than creating waves.

Elder law attorneys understand these considerations and so many more, but we also know what happens when advanced planning isn’t given enough attention.  When a parent passes away or becomes incapacitated without an estate plan, the fallout can be devastating.  It may fall to the courts to determine who should be given power over medical and/or financial decisions for the parent, and the court’s opinion often does not reflect the wishes of those involved.

Really, having a plan in advance of a tragic event is the best way to ensure it will be handled according to your parents’ desires; and framing the request in this way can be helpful.  At a time in life when they are finding themselves with less and less control, it can be reassuring to know that some of the most important decisions regarding health, money, and property are theirs to make; and that when they can no longer make those decisions, substitute decision makers of their choosing are ready to step in.

In order for this to happen, though, parents need to meet with their elder law attorney while they are still able to make sound decisions and legally sign documents.  Again, most people don’t want to think about losing their mental acuity, but it can be very common.

Creating wills and trusts and setting up powers of attorney and a health care proxy can give your parent the sense of control that they may feel slipping away.  During your discussions with your parent, it can also be helpful to point out that estate planning:

• Allows them to determine who they want to have in charge of their money
• Provides the opportunity to designate who will receive which assets (or none at all)
• Keeps the courts out of the process, or limits their involvement, saving time, money, and hassle for those left behind
• Ensures that THEIR wishes are the ones that matter
• Minimizes the taxes that will be paid out of the estae

Life is busy, and it’s easy to say that estate planning is something that we’ll get to “later.”  However, “later” doesn’t always come when you think it will.  Instead of leaving the decisions (and potential hassles) in someone else’s hands, empower your parents to have a say in their future and the future of their family. Contact Vickstrom Law today for more information about encouraging your parents to handle their estate plan and to set up a consultation.

I Take Care of My Mother. Can I Legally Get Paid for That?

As the number of family members providing care for aging parents increases, the solutions to find help with loss of income because of time off from employment for caregiving has become a major concern for many. The demands on both the time and energy needed to provide the needed care can make it impossible to maintain both a full time job with full time caregiving.

Angela is a registered nurse. Her mother, Renee, has been experiencing a gradual decline in her health due to her Alzheimer’s and stroke and recently moved in with Angela. Angela is taking more and more time off from work to give Renee the care she needs. Sometimes she misses out on important overtime that her household finances depend on. Angela started paying herself out of her mother’s account for the care that she gives Renee. She pays herself some weeks, and doesn’t on others, even though she is providing the same care.

It is understandable that Angela would want to be paid for the care she is giving her mother, especially when it is interfering with her current job. Also if it wasn’t for this care, Renee would be in a nursing home. But, Angela must be sure to go about getting paid correctly.

The National Family Caregiver Support Program was created by the federal government to support family caregivers. While reviewing this site, Angela found out where she can get respite care for Renee, so she can take a much needed vacation with her husband. She also discovered how she may get paid, without feeling bad about her mother’s dwindling funds, and how these payments can continue after her mother runs out of money.

Often overlooked, the Veteran’s Aid and Attendance pension benefit is a great source of money to pay family caregivers to provide care at home. This money is available to veterans who served during a period of war. Pension money is also available to the widows of these veterans. This benefit, under the right circumstances, can provide up to $1,949 a month in additional income to pay family members to provide care at home. Luckily, Angela’s late husband was a WWII veteran and she qualifies for aid. However, she must have a professionally drafted caregiver contract in place, get a medical evaluation, meet income and asset qualifications, and have proof of medical expenses and care needed.  

Alternatively, or sometimes in addition to, a long term care insurance policy covers home care and payment to the care giver from this source could be arranged. Some policies require the care provider to be through a licensed home care agency, but others will pay for individual aides certified as such. This would require some training by the family member to become certified, unless they had a nursing background, like Angela. Renee did not have a long term care insurance policy in place. However, there are policies that pay a daily benefit amount to the insured to use as they want to pay for their care.

In some cases the elder has the funds to pay for their own care. If a family member is giving care it is very important that a professionally drafted caregiver contract be in place. Without one, any payments could disqualify the elder from certain MassHealth/Medicaid long-term care payments. Lump sum payments for care and/or retroactive payments are never a good idea.

A caregiver contract prepared by an elder law attorney like Attorney Kristina R. Vickstrom, will be a signed and dated agreement will outline the services provided as well as the amount of pay for these services. The contract will eliminate questions about what is expected from both parent and caregiver as well as providing a legitimate contract and a clear and consistent payment record of services to qualify for MassHealth/Medicaid. The contact will be treated as an employer/employee relationship and payroll records must be kept with taxes paid. Retroactive payments for care-giving are almost never allowed when applying for MassHealth/Medicaid.

The family member providing such care, like Angela, can not only save their loved one from needing nursing home services outside of the home, but also could protect assets in the event that long-term care is needed in the future. Please contact Vickstrom Law to set up a consultation if you are interested in learning more about the right way to get paid to take care of your loved one.

The Difference Between Alzheimer’s Disease and Dementia

Many people use the terms Alzheimer’s disease and dementia interchangeably, but they have very different meanings. Although dementia is a group of symptoms that include memory loss, the term itself doesn’t explain what is causing the symptoms. Alzheimer’s disease is the leading cause of dementia, but there are many other causes.

Dementia is a general term for memory loss that is severe enough to interfere with daily life. The signs of dementia may include forgetfulness, difficulty making plans, thinking ahead, or using language, as well as changing character traits, among other symptoms. Alzheimer’s disease accounts for 50 to 80 percent of dementia cases according to the Alzheimer’s Association, but there are other causes, including vascular dementia, Lewy body dementia, frontotemporal dementia, and Wernicke-Korsakoff syndrome. For a list of the different causes of dementia, click here. Some causes of dementia are treatable, so it is important to understand the cause.

Alzheimer’s disease is a partially hereditary disease that causes a loss of brain cells. The symptoms start out mild but grow progressively worse over time. There is no cure, but there are medications that can treat the symptoms and slow the disease’s progress. An early symptom of Alzheimer’s is difficulty learning new information. It can then progress to more severe symptoms such as forgetting names and places, disorientation, mood and behavior changes, and an inability to relate to others. Eventually, it can lead to the inability to talk, walk, or eat. Check out the Alzheimer’s Association for more information.

Dementia, whether caused by Alzheimer’s disease or some other underlying disease, is not a normal part of aging. If someone you love is exhibiting signs of dementia, they should get immediate medical attention to understand what is causing it.

This blog originally appeared in a post from Elder Law Answers.

EAEDC Financial Planning for Rest Home Care in Massachusetts

The limited number of subsidized Assisted Living slots has made Rest Homes a viable alternative for many physically and mentally impaired elders in Massachusetts. The care in a Rest Home is greater than that of an Assisted Living facility, but not as encompassing as traditional Nursing Home care. Although Rest Homes are less expensive than Nursing Home care, they are not a long term solution for many families. If financial planning begins early, Emergency Aid to Elders, Disabled and Children (EAEDC) may be an alternative to help you or a loved one cover the costs of continued Rest Home care.

After he experienced frequent debilitating strokes, Maura decided to move her father, Joe, from his condominium in Newton to a local Rest Home less than ten minutes away from her house in Worcester. At a cost of $7,500 per month, Maura figures that Joe’s assets of $275,000 will finance just three years of Rest Home care. She knows that Rest Homes do not accept MassHealth for payment, like her mother-in-law is currently taking advantage of in a Nursing Home. Joe doesn’t need that type of care yet and Maura would like to keep him as active and independent as possible. The director of the Rest Home mentioned the EAEDC program and how it may assist Maura and Joe in financing his care in the long run. He recommend that they speak with an Elder Law attorney familiar with the program. Maura learned with the right financial planning Joe can be approved for EAEDC payments to the Rest Home and some of his hard-earned assets can be kept within the family.

A state-funded welfare program administered by the Massachusetts Department of Transitional Assistance, to qualify for EAEDC, you must be a senior aged sixty-five or older, with very little resources, not qualifying for other cash assistance programs such as Supplemental Security Income (SSI) or Veteran’s Services Benefits (VSB). The maximum value of your money and property cannot exceed $250, including bank accounts, IRAs, stocks, bonds, cash, and surrender value of life insurance policies and cars. To reach this miniscule amount, like Joe, one often has the choice of either exhausting available resources in effort to apply for EAEDC and similar state-funded programs, or transferring assets to his or her family members to render eligibility for state funding.

One significant advantage of the EAEDC program concerns its “look-back” period on the transfer of assets. If Joe were to transfer his assets to Maura for less than fair market value within the twelve months prior to the date of application for EAEDC, he would be subject to a period of ineligibility. In comparison with MassHealth’s five year “look-back” period, EAEDC appears much more generous. Additionally, applicants for EAEDC lose the right to retain individual health insurance coverage, but become eligible for MassHealth coverage (even if a person’s income exceeds the limits normally established for MassHealth).

However, one must be careful not to disqualify themselves for future MassHealth coverage of the Nursing Home stay due to sloppy EAEDC planning. Sometimes a person can deteriorate and no longer be appropriate to continue in a Rest Home. Both programs qualifications vary and are very specific. If you or a loved one plans on entering a Rest Home in the near future but want to keep hard-earned assets within the family, your best bet would be to undertake advanced financial planning with an Elder Law attorney, like Kristina Vickstrom, who is experienced in both the MassHealth and the EAEDC programs.

Applying for MassHealth: Is the No-Cost Solution Really “No-Cost”?

Medicaid, or MassHealth as it is referred to in Massachusetts, is an avenue available for funding long-term nursing home care. To qualify, you must meet asset thresholds that many elders exceed. Additionally there are income requirements for MassHealth/Mediciad. Adequate understanding of MassHealth/Medicaid law and proper strategizing is a critical component of any plan for the future. With the proper planning of an elder-law attorney, you can protect your property, spouse, and assets.

After attempting to cope with his mother’s diagnosis of dementia for several months, Joe has finally decided to research local nursing homes for his mother. However, he is concerned about the cost while protecting his mother’s multiple properties, which have been in the family for generations. During a vist, Lindsay, a social worker from the facility, reached out to Joe, offering to complete a MassHealth application for his mother at no-cost. While Joe likes the concept of this free service, he can’t help but wonder if there is a catch involved.

Employed by the nursing home, social workers and other nursing home advocates focus on the rights of the nursing home and not the resident. The nursing home has a vested interest in keeping someone on “private-pay” for as long as possible because their private pay-rates are much higher than the amount received in MassHealth/Medicaid reimbursement. This means more out-of-pocket costs for residents than may be necessary.

Further, even if nursing home advocates do have the best of intentions, the MassHealth/Medicaid process is riddled with complex rules and regulations that are difficult to navigate for those not educated in the eligibility requirements and advantageous planning opportunities available under MassHealth/Medicaid. For instance, an individual encouraged to apply too soon might be ineligible for an extended time period and have to pay privately for a longer duration. Alternatively, the “advocate” may not inform the family that they can pre-pay for funeral expenses as part of a spend down, thereby reducing the burden on family members when the applicant passes.

Individuals that enlist family members to fill out their MassHealth applications or file themselves may face similar problems. Unfamiliar with eligibility requirements and liable to miss prime planning opportunities, these individuals are likely to encounter harsh penalties or confusion when faced with the application process, as well as income and asset verifications. Once they receive their denial notice in the mail, it will be much more expensive to get an Elder Law attorney involved at that point. Additionally there are strict time periods that must be adhered to in order to have any change at being sucessful in a MassHealth/Medicaid appeal.

Nursing home advocates and family members, although the cheapest solution up front, do not have the requisite knowledge, skills, or ability to compose trusts, devise appropriate estate plans, and represent you in an appeal setting if the need should arise. Rectifying the mistakes of an advocate or self-handled application may be more costly than a properly executed plan formulated a skilled elder law attorney. By hiring an elder law attorney to guide the MassHealth application process, you will ensure that your savings, your spousal support, and your family’s inheritance will not be jeopardized by lost opportunities in a last minute planning strategy.

Hiring a lawyer to handle your MassHealth application is a necessary investment. Elder law attorneys can save clients and their family members an amount greater than the cost of their legal services. If you are interested in learning more about the MassHealth application process or long-term care planning, contact Vickstrom Law today!

What Do You Mean Medicare Won’t Pay for Dad’s Nursing Home Stay?!

A three-day hospitalization often serves as a gateway for a senior citizen’s transition into a skilled care facility. When the patient is discharged to a skilled care facility for occupational, physical, or speech therapy, the patient’s health insurance (Medicare) will continue to finance treatment for up to 100 days per stay (as long as the person continues to benefit from rehab). Medicare coverage ultimately ends, and when it does, the patient must pay from income, savings, long-term care insurance, Medicaid, or a combination of these resources.

Jo-Ann’s ninety year-old father, Ed, recently suffered a massive stroke. After spending four days in the hospital, Ed was transferred to the Odd Fellows Home in Worcester, Massachusetts for round the clock skilled care. Medicare covered the entirety of Ed’s expenses for the first 20 days of his stay, and Ed fronted a $95 copayment for days 21-100. It is now day 101. Medicare refuses to pay for Ed’s care because the program contends coverage has ended and that Ed now must meet his skilled care expenses from another source.  Ed has been primarily dependent on monthly Social Security checks after running through his savings a few years ago. Jo-Ann is a single mother of four children who fears that she won’t be able to keep her father in a nursing home due to her financial inabilities and his exhausted savings. She thought that since Ed paid taxes his whole life it would have guaranteed him government-funded nursing home care. What are Ed’s options?

It is easy to confuse Medicare with Medicaid. Medicare is a federal health insurance program. Anyone who has paid their taxes and meets specific qualifications (is over the age of 65, or who has been blind or disabled for the past two years) is entitled to Medicare coverage. Hospitalization, immunizations, medical equipment, and physician visits are covered by Medicare, while deductibles and co-pays are often covered by a form of supplemental policy. Medicare applies regardless of financial need but will not pay for nursing home care except in extremely limited circumstances, and then only for small durations.

Ed might benefit from applying for Medicaid, or MassHealth in Massachusetts. A joint federal and state program for individuals with certain medical needs who are financially needy, Medicaid/MassHealth is often the chief financier for nursing home care. An applicant may have no more than $2000 in countable assets (cash, savings, mutual funds, retirement accounts, houses) before requesting Medicaid/MassHealth. To achieve Medicaid/MassHealth payouts, many individuals will seek to transfer their assets to loved ones to demonstrate financial need. It is important to note that the transfer of assets for less than their fair market value will result in a corresponding ineligibility period for Medicaid/MassHealth coverage of nursing home care.

The average cost of a nursing home in Massachusetts is an astounding $11,000 per month. If you or a loved one has exhausted all means of paying for skilled care, it is important to contact an Elder Law attorney to discuss your options. After recommending Medicaid/MassHealth, an Elder Law attorney may suggest ways to set aside funds and assets for your family without jeopardizing the patient’s medical care and “spend down” ideas which benefit the patient.

Medicaid/MassHealth rules are complex and confusing. Further, nothing in this area is concrete or insulated from legal or policy change. Vickstrom Law can help explain the interrelationship between Medicaid/MassHealth and nursing homes and can assist with protecting and preserving assets for a spouse or other family members.

Can I Contest My Sister’s Will?

In the coming years we will see a  marked increase in the number of cases challenging the legality of a will on the grounds of mental incapacitation of the person making the will. Though the reason for the increase in will contests is debatable, the growing number of elders with medical issues affecting their cognition; the transfer of wealth between World War II and baby boomer generations; and the change in the traditional nuclear family certainly play a role.

Mary lived alone on a large estate for fifteen years following her wealthy second husband’s death. Her only living relative was her sister, Louise. The two have been close since childhood, but in recent times the frailty of both women has led to fewer and fewer visits. Mary passed away in January after a three-year battle with endometrial cancer. Although weakened by age and sickness, often delusional and dependent on prescription medication, Mary executed a second version of her will in 2010 (unbeknownst to Louise) with the assistance of her live-in caregiver, Kate. When the terms of Mary’s will are administered, Louise discovers that she is to receive just $1,000 while Kate is the primary benefactor of Mary’s $450,000 estate.

Many times, the relative of one who has recently passed believes that they were unjustly left out of a will. Perhaps due to the mental state of the deceased, the relative might believe that the deceased was delusional in granting a non-relative a financial windfall. In the above example, Louise would like to know whether she has any legal recourse to challenge Kate’s award. She feels that Kate knew about Mary’s delusional capabilities and possibly took advantage of Mary in receiving the majority of Mary’s estate, and finds it hard to believe that her sister would not have left her more. However, it is also reasonable to see that Mary might have felt indebted to Kate and wanted to provide her with a genuine token of appreciation for her services.

In order to create a valid will in Massachusetts a person must possess “testamentary capacity”. In most states, this means that the person creating the will understands the nature of the document, the worth of her assets, and her relationship with whomever she is transferring them to. Testamentary capacity requires freedom from delusion which is the effect of disease or weakness and which might influence the disposition of her property. The person executing the will needs only to be aware of her actions during the period of time she is making the will. The fact that he or she doesn’t remember it the day after does not invalidate a will.

Although wills contests arise frequently, proving that a person is without testamentary capacity is difficult because signing a will does not require a great deal of coherence nor consistency. Louise would have be allowed to contest Mary’s will in the probate court, but it likely would lead to a lot of costly litigation. Most often the disagreeing parties will negotiate a settlement to mitigate the litigation.

If a relative finds themselves in a similar position, they should contact an attorney experienced in Estate Administration to discuss the possibility of a legal claim. If you considering disinheriting an heir who might attempt to challenge a will’s provisions, speak to an experienced Estate Planning attorney about avoiding the probate process altogether through the use revocable or irrevocable trust planning.

Contesting a will is a procedural and difficult process. Yet, if you feel that a loved one lacked the mental capacity to transfer his or her estate, contact our office to discuss your options.

Parent-Child Role Reversal

Joint Bank Accounts for Seniors: Yay or Nay?

Many seniors currently need assistance paying their bills and managing their finances, or may need help sometime in the future.  It’s important to have a trustworthy person authorized to manage your finances should you be unable to do so yourself.  Are joint bank accounts a good option?

Here’s a common  scenario

Florence, an 86-year-old widower, decided to have her eldest daughter, Marie, listed on all her bank accounts after her husband’s passing. She needed some help getting to the bank and figured it was easier to have Marie do it for her. Sometimes, Florence needed Marie to help her write out the monthly bills because she was also starting to have memory issues.

Marie took this responsibility very seriously and made weekly trips to the bank for her mother. A few times Marie helped herself to $200 here and there, just to get her through to her next paycheck. She always put it back… except for the last three times. She just can’t seem to get caught up. Maybe Marie would be able to take on more hours at work but she is very stressed about her 16-year-old son who just severely injured someone in a car accident. She’s thinking about filing for bankruptcy to ease the financial situation.

Be sure to properly assess potential risks

For Florence, adding Marie, or another other loved one, as co-owner on bank and brokerage accounts seemed to be an easy and convenient way of managing her assets and making sure her bills are paid on time.  However, many seniors do not take into account the risks and potential consequences of joint ownership, and the alternatives that can mitigate those risks.

First,  a joint owner has complete access to your accounts and make unlimited withdrawals without your approval. Marie has been helping herself to a little bit here and little bit there for a while now. Florence never knew about it and when she did find out she didn’t ask for it back because she felt bad for Marie. Unfortunately, these were considered disqualifying transfers or “gifts” when Florence applied for MassHealth. She was denied coverage for her nursing home stay because to qualify for MassHealth (Medicaid) you can’t give gifts (or other disqualifying transfers) for five years.

Your co-signer’s liabilities could now be your responsibility

Second, a joint owner is considered owning 100% of the assets, just as you are, regardless of who contributed them in the first place. This leaves your assets vulnerable to their debts and liabilities. If Marie is sued because of her minor son’s  accident, Florence’s bank accounts are at risk. Florence’s bank accounts could also be at risk if Marie files for bankruptcy. If your co-owner goes through a divorce, has a business failure, or gets sued for any other reason, your money could also be exposed to those claims.

Your estate plan could be undermined

Third, when you die, the assets in a jointly-owned account will automatically become the property of the surviving owner.  Florence’s Will directed her estate to be split equally amongst her three children when she died. When she died she only had a few personal effects and a few bank accounts with roughly $10,000. Since Marie was listed as joint owner on all accounts, the funds became legally hers when her mother passed. She knows she has a moral obligation to follow what the Will says, but nobody can make her do it. After all, her brother hasn’t bothered to see her mother in two years and her sister is pretty well-off; she needs the money more than they do anyways. 

Protect your assets

One simple alternative is to have a Durable Power of Attorney prepared by an Elder Law Attorney. Your agent under your Power of Attorney would be able to manage your finances on your behalf, including making withdrawals and writing checks without your permission, but the assets would be owned by you alone. 

Your agent would have a legal duty to manage your finances on your behalf and in your best interest; your assets would not be subject to your agent’s liabilities; and your assets would not automatically pass to your agent upon your death.

It’s important that you speak to an Elder Law attorney about planning for a time when you may be incapable of managing your own affairs.

How the New Massachusetss Safe Driving Law Affects You or Your Elderly Loved One

The Safe Driving Law has officially become effective in Massachusetts as of Sept. 30, 2010.  Massachusetts now joins an increasingly growing number of states that ban texting while driving.  However, a major part of this bill is also targeted at elderly drivers who are over the age of 75.

On June 2, 2009, a 93-year-old driver hurt a mother and toddler in a stroller when he drove his car into a Danvers Wal-Mart. He stepped on the gas pedal because he thought he was stepping on the brake.  The next day, a 73-year-old Middleboro driver accidentally drove her minivan into a crowd of people attending a Vietnam War Memorial in Plymouth. As a result, eight people went to the hospital. Read this blog for more information.  In an effort to reduce the number of accidents involving elderly drivers, Massachusetts legislators passed the new Safe Driving Law.

The new Safe Driving Bill is eight pages long but can be reduced to a few major points affecting elderly drivers:

• Drivers can no longer compose, send or read text messages while driving.
• If you’re 75 years old or older, you must renew your drivers license in person at the Registry of Motor Vehicles.
• If you’re 75 years old or older, you have to take a vision test every five years when you renew your license.
• A health care provider or police officer who feels an individual cannot mentally or physically operate a motor vehicle safely can request an evaluation of the person’s ability to possess a license.  Such a request, however, cannot be made solely based on a person’s age.

The law is also designed to remove problem drivers from the road and encourage people to drive more carefully by reducing the number of “surchargeable incidents” (anything that causes insurance premiums to rise, including at-fault accidents, speeding tickets, etc.).  A driver involved in three such incidents in a two year time span faces license suspension.