Upcoming Event - Kansas Medicaid: Helping Your Clients Navigate KanCare

 Click on the link below for complete details and to register.

https://drive.google.com/file/d/0B9JhZVsi7bYpSXVNU3pHOGhmUlk/view?usp=sharing

Legal Recourse for Aging Parents When Their Adult Children Won't Visit?!?!?

 In Shanghai, not visiting elderly parents could harm children's credit ratings

Posted 4/7/2016

From China Daily - Children in Shanghai who fail to visit their parents regularly will find their credit standing adversely affected, according to a new rule set to take effect on May 1.

If a child refuses to visit an elderly parent, the parent can file a lawsuit. If the child still refuses to follow through with their obligations after the court makes a ruling, it will be recorded into a credit platform, which could adversely affect their future work and general life.

The rule, aimed at better protecting the rights and interests of senior citizens, also requires children who have sent their parents to nursing homes to regularly visit. If they fail to do so, nursing services have an obligation to remind them.

Shanghai has also stepped up legal support for senior citizens, including a series of free authentication services.

The city had a registered population aged over 60 of about 4.36 million by the end of 2015. The number will surpass 5 million by 2018, and exceed 5.4 million by 2020, according to statistics released by local authorities.

 

Four Social Security Myths Debunked

From Elder Law Answers

There are a lot of misconceptions surrounding the Social Security system. Here are four common myths and the truth about how Social Security works and its future prospects.

Myth 1: You Should Collect Benefits Early
This is one of the biggest Social Security myths. In 2015, more than half of Social Security recipients began collecting benefits before their full retirement age (66 for those born between 1943 and 1954), potentially costing themselves thousands of dollars in additional benefits. If you take Social Security between age 62 and your full retirement age, your benefits will be permanently reduced to account for the longer period you will be paid.
On the other hand, if you delay taking retirement, depending on when you were born your benefit will increase by 6 to 8 percent for every year that you delay, in addition to any cost of living increases. There are a lot of factors that go into the decision as to when to take Social Security benefits, but if possible it is usually better to wait until your full retirement age or older.

Myth 2: Your Money Goes into an Account with Your Name on It
When you pay into Social Security, the money is not set aside in a separate account, as with a 401(k) or IRA. Instead, your contributions are used to pay current recipients. When you start receiving benefits, people paying into the system will be paying your benefits.

Myth 3: Social Security Will Be Out of Money Soon
Many young people believe the Social Security system will run out of money before they have a chance to collect anything. Currently, the Social Security trustees predict that the trust fund will run out of money in 2034. Politically, it seems unlikely that Congress and the President would let this happen. Changes will likely be made to the system by either raising taxes (such as by lifting the cap on income subject to Social Security tax), reducing benefits for high-income individuals, increasing the retirement age, or doing something else that will allow Social Security to be fully funded. However, even if the trust dries up and there isn't enough money to pay all the promised benefits, people will still be paying into the system and Social Security will be able to pay at least 75 percent of benefits.

Myth 4: If You Haven't Worked, You Cannot Collect Benefits
If you haven't worked outside of the home, you will not be able to collect Social Security benefits on your own record, but you may be able to collect them based on your spouse or ex-spouse's record. Spouses are entitled to collect as much one half of a worker's retirement benefit. This rule applies to ex-spouses as well, as long as the marriage lasted at least 10 years and the spouse applying for benefits isn't remarried.
To learn more about Social Security, click here.

What is Alzheimer's Disease?

Click on the link to watch a brief but informative video on this all-too-common disease:

https://www.youtube.com/watch?v=9Wv9jrk-gXc

Treasurer Zweifel announces participation in nine-state consortium to establish ABLE program in Missouri

 From Missouri State Treasurer Clint Zweifel:
Multi-state effort will allow for access to a lower-cost, higher-quality plan for Missourians


JEFFERSON CITY – State Treasurer Clint Zweifel announced today Missouri’s commitment to work with a nine-state consortium to create and implement an ABLE program in Missouri. “Achieving a Better Life Experience” legislation passed Congress in 2014 and in Missouri in 2015. It allows states to create tax-advantaged savings accounts for expenses related to disabilities and special needs. By participating in the consortium, Missourians will be able to leverage their savings with those in other states to solicit a lower-cost plan with higher-quality investment options, increasing the value for users.

“In creating these ABLE accounts, our priority first and foremost is to serve the needs of Missourians with disabilities in a fiscally sound way that honors their circumstances,” Treasurer Zweifel said. “These accounts will give families more financial security and empower them to make long-term planning decisions surrounding their specific needs.”

ABLE accounts come with advantages similar to 529 savings programs like MOST—Missouri’s 529 College Savings Plan. For Missourians, those advantages include a tax deduction of up to $8,000, or $16,000 if married and filing jointly. Savings also grow tax deferred and may be withdrawn tax-free when used for qualified expenses.

“Enactment of ABLE in Missouri was an enormous victory for families and people with disabilities in Missouri,” said Bill Bolster, Chairman of the Board for Autism Speaks St. Louis. “Now, through Treasurer Zweifel’s work with nine other states in implementing the ABLE Act, Missouri families with disabilities will be able to save and invest in the future of their loved ones. We applaud and thank Treasurer Zweifel for his work on behalf of Missourians with disabilities.”

Currently, nine states are committed to working together to help individuals and families with special needs - Alaska, Illinois, Iowa, Kansas, Minnesota, Missouri, Nevada, Pennsylvania, and Rhode Island. These states represent more than 47 million people across the country. While a majority of states have passed ABLE legislation, none are yet offering ABLE accounts at this time.

“The ABLE Act offers an important promise: sustainable independence for people with disabilities through the opportunity to save for future expenses without losing necessary benefits,” said Aimee Wehmeier, Executive Director and CEO of Paraquad. “Joining this consortium and sharing expertise is an efficient way to start investing in the future of people with disabilities. We are grateful for Treasurer Zweifel’s leadership and vision.”

The Treasurer’s website now has more information on the background and goals of the program, frequently asked questions, and resources related to ABLE. Individuals can also sign up for ABLE-related email updates here.

Following the establishment of the consortium, the next step is to seek public bids for investment services, record keeping, and marketing services. Although working together for the procurement, the nine-state consortium encourages, and in no way jeopardizes, individual state autonomy in the administration of these accounts.

Nursing homes increasingly eject residents; are they following the law?

From the American Bar Association Journal:

Nursing homes are increasingly ousting residents, often expelling patients who are considered undesirable because they require more care or because their families complain more often, according to elder advocates.


Federal law restricts the reasons that nursing homes can evict residents, but advocates say the nursing homes sometimes bend the rules, the Associated Press reports. Complaints about evictions were the top grievance reported to the Long-Term Care Ombudsman Program in 2014, which found eviction and discharge complaints have increased about 57 percent since 2000.


Federal law allows residents to be transferred from nursing homes if the facility closes, the resident doesn’t pay, the resident poses a risk to others, the resident no longer needs nursing home services, or the nursing home can no longer meet the person’s needs. Federal law also requires nursing homes to hold beds for Medicaid patients who are hospitalized for a week or less.


Even when residents’ families appeal an ouster and win, nursing homes don’t always obey the rulings. A February 2016 story by National Public Radio highlights one such case. Bruce Anderson had been a resident at Norwood Pines Alzheimer’s Care Center in Sacramento, California, before his May 2015 hospitalization for pneumonia. When Anderson was ready to go back to the nursing home, it refused to admit him.


Anderson’s family appealed to the California Department of Health Care Services, which oversees Medicaid, and won. Yet the nursing home still refused to permit Anderson’s return. The decision has spurred a lawsuit filed on behalf of Anderson and two other nursing home residents that seeks a court decision requiring California to enforce its own rulings.

The nursing home says in court documents that it refused to readmit Anderson because he is a danger to staffers and residents. Anderson’s daughter, Sara Anderson, told AP she believes the nursing home refused because she had complained about its use of restraints on her father. Bruce Anderson remains in the hospital, which costs Medicaid about 2½ times more than the nursing home does.

Written by: Debra Cassens Weiss

Things Not to Include in a Will: Documents Have Limitations, and Some Language Is Not Suitable

 Written by: Hyman G. Darling & Todd C. Ratner

A will is an essential estate planning document that everyone should have. If drafted properly, your will serves important purposes such as nominating a personal representative to administer your estate according to your wishes and designating guardians for minor children. However, a will has a number of limitations, and include certain items and language are not suited to be included there.

Property Held in Joint Tenancy
Property owned by two or more joint tenants is automatically distributed to the surviving joint tenant(s) by the operation of law. Therefore, upon your death, the joint property passes directly to the surviving joint tenant(s), despite will language to the contrary.
Property in a Living Trust
Providing language in your will to distribute property that is already delegated to someone by a living trust is inconsistent. The property in the living trust is automatically distributed to the beneficiaries, as directed by the living trust, and is managed by the trustee(s) set forth by it. In the event that you wish to make revisions to the beneficiary provisions, you must do so through the living trust and not through your will.
Accounts with Designated Beneficiaries
Certain assets, such as financial accounts and life insurance are often are distributed to beneficiaries pursuant to a designated beneficiary form and cannot be distributed to someone else through a will. To revise a named beneficiary, you should complete a subsequent beneficiary designation form provided by the financial or insurance company.
Nomination of Joint Guardians
The ability to nominate a guardian for minor children is a significant benefit of a will. However, nominating joint guardians to serve together is not always in the child’s best interest. If you nominate a guardian and his or her spouse jointly, each will have equal rights to the child’s care. In the event of a divorce, each proposed guardian will have the legal right to be the guardian, which right may become contested and impede the child’s care.
Provisions for Pets
Under Massachusetts law, you cannot distribute funds in a will directly to a pet. A pet is considered to be personal property, not a person or entity, and cannot receive funds. If you attempt to leave funds directly to your pet in your will, the distribution language would be null and void, and those funds would pass to the beneficiary inheriting the residue of your estate. The alternative to distributing assets to the pet in a will is to create a Massachusetts Pet Trust.
Funeral Instructions
It is not proper to leave your funeral, memorial service, and/or burial instructions in a will, since a will is oftentimes reviewed after the funeral occurs. It is better practice to have a meaningful conversation with your loved ones, leave a letter of instruction, and/or include language within your health care proxy, as that document is oftentimes reviewed immediately prior to death. You may also pre-arrange your wishes with a funeral home.
Language to Eliminate or Minimize Estate Taxes
Assets distributed by a will are still subject to estate taxes. In the event that you have a taxable estate, which is currently defined as having assets in excess of $1 million upon death for Massachusetts purposes, you may wish to consider a trust specifically designed to eliminate or minimize estate tax obligations.
Provisions for those with Special Needs
Providing assets for people with disabilities requires special estate planning, and a will is not the appropriate document to distribute such assets. There are certain types of trusts, such as special or supplemental needs trusts that specifically address the management of the specific needs of a disabled loved one.
Information You Wish to Keep Private
Upon your death, a will is filed at the requisite probate court and is available to the public. If this is a concern, you may wish to contemplate planning with a trust. A trust is a private document and is not available to the public.

It is a common misconception that having a will automatically causes you to avoid the probate process. This is incorrect. Financial assets that are distributed through a will are required to be administered through the probate process. Probate is the court’s supervision of the process that transfers the legal title of property from the decedent to his or her beneficiaries. If you wish to avoid probate, you may designate beneficiaries, hold assets jointly, or create and fund a trust.
A will is a necessary document that, if drafted properly, can save your loved ones time and expense as well as provide you with peace of mind. However, if drafted improperly, there is the very real potential that the distribution of assets and final instructions will not be administered as you wished. The advice of an experienced estate planning attorney will greatly assist you in avoiding the pitfalls of an incorrectly drafted will.

Advising the Elderly: What Every CPA Should Know About Medicaid Eligibility and Spousal Responsibility

As clients progress through their retirement years, it is incumbent upon the trusted adviser, the CPA, to become acquainted with the basics of Medicaid in the context of long term care. Specifically, the CPA should have a working knowledge of the Medicaid laws preventing Spousal Impoverishment, including the Division of Assets process. In the past, the CPA could effectively advise clients with only a cursory knowledge of Medicaid; this is no longer the case. Our clients are living longer. The number of our clients who are over age 65 is increasing. Baby boomers are turning 65 at a rate of 10,000 a day and approximately 1 out of every 4 of these boomers will spend time in a nursing home. At a median cost of $180 per day, the cost of nursing home care in Kansas can cause financial hardship and ruin to couples of moderate means; hence the need for Medicaid.

In Kansas, the Medicaid program is called Kancare. Kancare is a needs based program. It is typically a program for the indigent (assets less than $2000), except in the case of married couples. In lieu of impoverishment or divorce, married couples of moderate means may turn to Kancare when one spouse requires nursing home care. The theory behind the division of assets process and the spousal impoverishment laws is to prevent divorce and to protect the financial well-being of the spouse in the community.

If a married couple has long term care insurance or adequate assets to pay for a nursing home for a period of two to three years without suffering financial drain (anticipated cost for two to three years exceeds $200,000), eligibility for Kancare may not be necessary.  However, if the cost of $200,000 for nursing home care is overwhelming, then the couple may need to consider Kancare.

In order for an individual to be eligible for Kancare, a nursing home resident must have no more than $2000 of “non-exempt” or countable assets. If the nursing home resident is married, assets of both spouses count toward the $2000 limit. This particular fact is shocking to many clients. In addition, even if the couple entered into a pre-nuptial agreement the assets of both spouses count toward the $2000. The federal and state law is unambiguous on this issue. All is not lost. Spousal impoverishment is not the only answer. The spouse of the nursing home resident, called the community spouse, can complete a process called a Division of Assets to prevent impoverishment.

Division of assets describes the process of splitting the couple’s assets when one of the two spouses needs nursing home care. First, all assets of both spouses are considered in the Medicaid eligibility equation, regardless of how the assets are titled. An asset is not protected simply by removing the name of the sick spouse from the asset. In addition, an asset is not protected for Medicaid eligibility purposes because the asset is titled in the name of a revocable living trust. Quite the opposite is true in Kansas.

Next in the division of assets process, certain assets are considered exempt. This means that the community spouse can keep these assets and the assets are not part of the eligibility equation. For example, the primary residence is exempt (up to a value of $552,000 in 2016) and the community spouse may remain living in the family home. The family car is also exempt. In addition, the pre-paid irrevocable funeral plans for both spouses are exempt. In Kansas, the retirement assets (IRA, Pension, 401K) of the community spouse are exempt. This last exemption is a significant benefit for Kansans. Notably, the retirement assets of the community spouse are not protected in the adjacent state of Missouri. Income producing assets are also exempt in Kansas, such as rental properties, businesses and farms. Non exempt assets include cash, CDs, bank accounts, stocks, bonds, annuities, jewelry and gun collections, boats and trusts.

Once a list of all non-exempt assets is complete, the total asset value is divided by two. One half of the value, up to a total of approximately $119,220 of the non-exempt assets, are allocated to the community spouse. The least that the state allows the well spouse to retain is $23,844. In other words, if the combined assets of both spouses is $23,844 or less then the community spouse can keep the total of $23,844. The community spouse has 90 days after Medicaid eligibility to change the title of these assets into his or her name. The second half of the assets is allocated to the spouse in the nursing home. In order to qualify for Kancare the spouse in the nursing home may have only $2000 in his or her name. The process of reducing the assets to $2000 is called spend-down.

Spenddown can be accomplished in a number of ways. The couple may purchase personal supplies, hearing aids, adaptive equipment, eye glasses, furniture, funeral plans and clothing. In addition, the couple may make home improvements or purchase a more reliable vehicle. Legal fees can also be part of spenddown. The couple may also purchase a Medicaid compliant annuity or loan assets in return for a Medicaid compliant promissory note.

Once spenddown is complete, the couple can apply for Medicaid benefits. Additional factors to consider include: whether either spouse is a veteran, whether the couple has a child with a disability and whether the couple has transferred assets for less than fair market value within the past five years. Each of these factors requires additional analysis and the assistance of an elder law attorney is encouraged.

The Gift Myth

CPAs are often approached to provide guidance to a Medicaid applicant in the context of gifts and taxes. The distinction must be drawn between the IRS and its view of gifting and the Kancare program and its view of gifting. While an individual may gift up to $14,000 per year (and a couple $28,000) and not be subject to a federal gift tax, this gift tax rule will not trigger immunity from the a transfer penalty in the Kancare program. If an individual gives away assets, including a gift of $14,000 or less, within the 5 year look-back period for Medicaid eligibility, the gift will be subject to a transfer penalty.  

For additional information, please feel free to contact The Shepherd Elder Law Group, LLC.