Florida Elder Law Blog - ElderLawAssociates.com

One very useful Medicaid planning technique in the arsenal of a Florida Elder Law Attorney involves the creation of an irrevocable Medicaid Asset Protection Trust. With a Medicaid Asset Protection Trust a person or couple can transfer some of their property to the trust to hold and manage for their benefit during their live with the remainder paid to their family after their death.

Example: Joe and Joan have assets in their savings and stock accounts of $250,000. They currently live off income from their investments, social security, and other retirement benefits. They are concerned that if they need nursing home care they will not have enough money to support their lifestyle and pay for the medical expenses for the remainder of their life.

Solution: Joe and Joan decide to transfer $150,000 to a Medicaid Asset Protection Trust. The trust provides that all income is paid to them while alive and in the even one need nursing home coverage under Medicaid the income is paid to the other. Upon the death of the surviving spouse, the trust will terminate and distribute the remainder to their children. By using this type of irrevocable trust their assets are protected and they receive an income stream for their lives.

Potential Problems: The gift to the Medicaid Asset Protection Trust can cause the a period of ineligibility for Medicaid benefits. The length of the ineligibility period depends upon the value of the assets given away as well as how long before the care is needed they are disbursed. After the ineligibility period, the assets in the Medicaid Asset Protection Trust should be protected and not counted as a disqualifying asset for Medicaid planning purposes. In addition, this removes the assets from the reach of the spouses.

A Medicaid Asset Protection Trust is not for everyone, but it can be a means of protecting a family's financial security. These trusts can be complicated and must be tailored to the families resources and needs. It is important that you use a Florida Elder law attorney who is familiar with the Florida Medicaid laws and who has experience in creating this type of trust.

Please note: The Irrevocable Medicaid Asset Protection Trust is not the same as a "revocable trust", "revocable living trust" or "living trust" that is currently being sold through Trust Seminars. As always, when considering these types of instruments, please consult a Florida Elder Law Attorney.

Labels: Florida Elder Law Attorney, medicaid, Medicaid Planning

As our population continues to age, more and more individuals are concerned about how they will pay for care as they get older. Often individuals and families find that they are unable to take care of themselves and need assistance.

As medical costs have continued to rise, so have the costs of home health care. As a result we are seeing more individuals need the assistance of Medicaid. Too often we find individuals who have received advise from family members, friends, and professionals who do not understand Medicaid and only deal with elder law or estate planning issues. While it may be great to avoid the costs and fees associated with probate, what if you end up being disqualified from nursing home coverage. This could cost far more than the savings on probate.

Florida is a great state to live at the time you need Medicaid coverage because of the large exemption allowed on one's home. Generally you can protect up to $500,000 of equity in a Florida homestead. Unfortunately in an effort to save a few thousand dollars many individuals transfer a partial ownership in the property to their children with rights of survivorship. Often this is done with a life estate deed.

This can cause many problems for the owner in the event they ever need nursing home coverage. There is way to accomplish similar results without risking the tax detriments, gifting issues, loss of control, and Medicaid eligibility - use a Florida Enhanced Life Estate Deed.

If you would like a review of your estate planning that takes into account Florida Elder Law, Medicaid planning, and probate and tax issues Contact a Florida Elder Law Attorney who is familiar with estate planning and medicaid planning.

-- Ellen Morris, JD

Labels: florida elder law, Florida Elder Law Attorney, medicaid

In 2009, the spouse of a Medicaid recipient living in a nursing home (called the "community spouse") may keep as much as $109,560 without jeopardizing the Medicaid eligibility of the spouse who is receiving long-term care. Called the "community spouse resource allowance," this is the most that a state may allow a community spouse to retain without a hearing or a court order. While some states set a lower maximum, the least that a state may allow a community spouse to retain in 2009 will be $21,912.

Meanwhile, the maximum monthly maintenance needs allowance for 2009 will be $2,739. This is the most in monthly income that a community spouse is allowed to have if her own income is not enough to live on and she must take some or all of the institutionalized spouse's income. The minimum monthly maintenance needs allowance of $1,750 took effect July 1, 2008 and will not rise until July 1, 2009.

The new figures are effective January 1, 2009.

Of course, all Medicaid planning is best done with advice from a Florida Elder Law Attorney.

--Ellen S. Morris, JD

Labels: Florida Elder Law Attorney, medicaid

We've all known for a long time that the State of Florida has failed its obligations to provide seniors and people with disabilities access to long term care in the least restrictive setting and, if possible, in the community rather than in a nursing home. We're pleased to see that there are some who are doing something about it.

Take a look at this Associated Press article from September 20, 2008, Florida Medicaid Recipients Want Out of Nursing Homes by Matt Sedensky for details.

Labels: florida elder law, medicaid

A large majority of the American public still believes that the government will provide long term care when needed. It is this misconception that most likely prevents people from doing any planning at a younger age for the future need for care. According to the National Care Planning Council, many people believe they can give away assets prior to the need for long term care and qualify for Medicaid. The Council suggests that this belief prevents people from considering other ways to fund the cost of future care.

As a matter of fact, it may be possible to use the system and allow Medicaid to cover care but at what cost? Why would anyone want to plan to spend his remaining years in a nursing home--which is the preferred living arrangement for Medicaid. Why go through the expense and effort of trying to manipulate the system to get welfare care, when a little preplanning at an earlier age would be a better option?

In our Florida elder law attorney practice we hear frequent objection to long term care planning from people who think Medicare or the Veterans Benefits Administration will take care of them. While this is true to a certain extent, these people simply don't understand the limitations of these government programs.

Below are quotes taken from individuals who, over the years, have voiced misconceptions about long term care planning.

"Uncle Jim got along just fine with the government paying his care"

"I can give away my assets and have the government pay for it"

"We have a trust and all of our assets will go to our family so the government will pay for our care"

"I'm not interested in home care or assisted living, just stick me in a nursing home and Medicaid will pay the bill"

"Long term care insurance is too expensive"

Government could be more involved in providing care but our constipated system of delivery prevents this from happening. The National Aging Network, a government-sponsored program, is in the best position to help people receive long term care in their homes. And studies have shown that the cost of providing this kind of care is significantly less than the cost of providing nursing home care through government programs.

Unfortunately, for every dollar that supports a person through the Aging Network the government spends about $270 supporting a person in a nursing home. Because it has inadequate funding, the National Aging Network must confine its valuable services to people who have little income or for social reasons are disadvantaged. Moderate and middle income Americans can receive some services from the network but are mostly excluded from the more valuable caregiving services.

We believe the public's misunderstanding of Government long term care programs is an impediment to proper long term care planning. When people understand the limitations of relying on government programs they are most likely to be more motivated to plan for the future by making provisions in advance and providing advance funding to pay for care. Prior planning also allows people to have a choice in their care setting and in the type of services they receive.

--Ellen Morris, JD & Howard Krooks, JD CELA

Labels: elder care, long term care, medicaid

Wealth Counsel, a quarterly magazine for the estate planning community, recently published an article I wrote on the Deficit Reduction Act, entitled "How the DRA Has Affected the Use of Personal Care Contracts."

It specifically details how Medicaid agencies have responded to the upswing in the use of personal care contracts, and what you need to know when preparing a personal care contract for a loved one.

Click here to read "How the DRA Has Affected the Use of Personal Care Contracts."

-- Howard S. Krooks, JD, CELA

Labels: florida elder law, medicaid, personal care contracts

On May 28, I attended an Aging Policy Forum for aging network leaders conducted by The Florida Association of Aging Services Providers, through funding from the Florida Department of Elder Affairs. The purpose of the Forum was to identify key topics and share insights, expertise and experiences on emerging aging-related issues. Strategies for communication and collaboration on advocacy on behalf of older Floridians were also discussed.

The central theme of the session was for those involved in the senior community to become more active in grassroots lobbying for increased funding of programs for seniors and persons with disabilities.

Given the opportunity to address the group, I spoke about estate planning and Medicaid planning in regard to the serious lack of resources available to our clients and the almost desperate need to increase funding. Everyone in attendance agreed that the value of waiver programs which keep seniors at home or allow them to go to an interim facility is unparalleled. In comparison to a senior entering a nursing facility, waiver programs save everyone involved (the senior, the State, and the federal government) tremendous amounts of money while preserving the senior’s dignity. Hopefully the increased lobby efforts of leaders in the aging advocacy community will help achieve this most important and common sense goal.

- Ellen Morris, Esq.

Labels: elder care, medicaid