Archive for November, 2014

Think shopping for gifts is hard? Try shopping for healthcare!

Posted on: November 25th, 2014 by Mark R. Friedman

Happy Thanksgiving!

Thanksgiving and Black Friday mark the unofficial start of the holiday shopping season.  But what about shopping for healthcare?  Prices for TV’s and computers are clearly marked, but prices for healthcare are completely opaque.  It’s very difficult to find out how much you’ll pay for a procedure until you get the bill, and almost impossible to comparison-shop.

This is becoming a problem as more people are buying “high-deductible” insurance sold under the Affordable Care Act (aka Obamacare).  These are plans in which the insured pays more of their healthcare costs until they reach the deductible amount, which may be over $2,000.

For consumers, the price of healthcare matters.  And different providers offer wildly different prices for the same services, based on insurance contract rates that seem arbitrary and bear little relation to quality or patient outcomes.  The same procedure may cost four times as much between one provider and another.

Price transparency in insurance was a cornerstone of the Affordable Care Act, which gave consumers the ability to easily comparison-shop for insurance through exchanges like  More price transparency and comparison-shopping are needed in healthcare.  Efforts are being made – Massachusetts has just started requiring insurers to post the cost of procedures between different providers online.  California public broadcasting is even crowdsourcing healthcare prices, building a database by asking patients how much they paid.  But in New Jersey, obtaining this information is difficult.  The New Jersey Hospital Association has an online tool, but it is difficult to use for laypeople unfamiliar with medicine.

For the holidays this year, I want more price transparency in healthcare.

Will You Be Liable for Your Parent’s Nursing Home Bill?

Posted on: November 17th, 2014 by Lawrence A. Friedman

Will you be liable for your parent’s nursing home, assisted living, long term care, or other health care costs?  You probably are thinking, “No way!”  And that may be true if you work proactively with a good elder law attorney to plan in advance.  But if you aren’t careful filial responsibility laws or even ordinary care facility contracts could make you liable for a parent’s care.

How can that be?  While it’s one thing to charge a parent for a minor children’s health care costs, children don’t expect to be hit with charges for a parent’s care.  However, 29 states have filial responsibility laws on the books that make a child in decent financial shape cover essential costs for an indigent parent.  Since health care is a necessity, filial responsibility laws can ensnare children in states that have filial responsibility laws. While filial responsibility laws traditionally have been something of a paper tiger, that may be changing.

In 2012, a court held that Pennsylvania’s filial responsibility law required a son to pay his mother’s $93,000 nursing home bill even though the son said he couldn’t afford to pay.  Health Care & Retirement Corporation of America v. Pittas (Pa. Super. Ct., No. 536 EDA 2011, May 7, 2012). To make matters worse, the son bore full responsibility because his initial response to the lawsuit didn’t raise claims against other family members who could have shared the obligation.  While the case occurred in Pennsylvania, it may have repercussions throughout the country.

Even children in states without filial responsibility laws can take on liability by signing a care facility agreement without fully understanding the effect. Although nursing homes can’t require a child to guaranty a parent’s bill, courts can enforce a guaranty that is considered voluntary.  This can be a major issue where a child signs documents to admit a parent to a care facility without consulting a lawyer.

A lawyer also can make sure a child doesn’t agree to other unfavorable contract terms that are hard to understand or even notice. In Cook Willow Health Center v. Andrian (Conn. Super. Ct., No. CV116008672, Sept. 28, 2012), the court held that a child can be liable to ensure a nursing home is paid if the child signs a care facility admission contract as “responsible party.”  Because the child signed the agreement without counsel, she didn’t understand that she was taking on this obligation.

How can children avoid liability?  Simple, follow two golden rules.  Don’t sign any admission papers or care contract until it has been reviewed by an elder law attorney. Since filial liability only kicks in when a parent is indigent, work with an elder law attorney to qualify the parent for Medicaid if the parent becomes indigent. FriedmanLaw often helps clients understand facility agreements and negotiate more favorable terms. We also help people qualify for Medicaid to pay for care instead of leaving children saddled with their parents; nursing home bills.

The moral of these cases  is pretty simple: consulting elder law counsel early on can yield major savings down the road.

Protecting Children from a Previous Marriage with a QTIP Trust

Posted on: November 11th, 2014 by Mark R. Friedman

If you’ve ever been divorced, you may be wondering how to provide for both your new spouse, and your children from a prior marriage.

When it comes to estate planning, you’re right to wonder. If your will leaves everything to your new wife or husband, then when you pass away, your spouse could disinherit your children and leave all your money to his or her own children instead. Or give all your money away, or spend it, or lose it to medical costs or a scam or lawsuit. Either way, your children lose.

It’s natural to want to provide for your spouse, but it’s also natural to want to protect your children. Fortunately the law offers a way to do both, with a QTIP trust.

With a QTIP (Qualified Terminable Interest Property) trust, you set aside money when you die, under the control of a trustee and for the benefit of your spouse. The trustee must pay all trust income to your spouse (e.g., investment income), and you may also allow payment of principal (i.e., the money in the trust) to meet your spouse’s needs. However, your spouse has no right to access or take money from the trust. When your spouse dies, the remainder left in the trust is distributed to your children.

A QTIP trust offers a way to provide income to your spouse for life, while ensuring that your estate will go to your children. It also protects your estate from your spouse’s creditors, in case your spouse is a spendthrift, or runs up big medical bills, or gets sued or targeted by fraudsters. A QTIP trust is a valuable estate planning tool. To discuss including one in your will, call or email us today.

NY gift incurs Medicaid penalty even when used to pay for care

Posted on: November 5th, 2014 by Mark R. Friedman

A New York appeals court ruled that a mother’s gift to her daughter incurred a Medicaid transfer penalty, even when the daughter used part of the money to pay for her mother’s care.

Petitioner Martha Weiss gave $78,237 to her daughter, who used the majority ($41,600) of the money to pay her mother’s care costs in an assisted living facility.  New York Medicaid rules provide that where a portion of assets that were gifted are returned to a Medicaid applicant, the transfer penalty period can be reduced for the returned portion.

However, the Court took a narrow reading on what constitutes a return of assets.  The regulation says an asset is returned if it’s used to pay for the applicant’s “nursing facility services.”  The NY Medicaid agency took the position that care in an assisted living facility is not “nursing facility services,” and the Court agreed.  Ms. Weiss was hit with the full penalty period.

It seems to me an overly technical position.  However, it’s worth noting that in New Jersey, the Petitioner wouldn’t have even gotten that far.  Under NJ Medicaid rules, the penalty period is reduced only for a full return of assets.

Elder law attorney pleads guilty to stealing client funds

Posted on: November 5th, 2014 by Mark R. Friedman

South Jersey elder law attorney Barbara Lieberman reportedly plead guilty today to stealing millions of dollars from her clients.

According to the American Bar Association: “Prosecutors said Lieberman… used fake powers of attorney… to steal from clients who often had no close family members to intervene. All told, victims were bilked of millions between 2006 and 2013, the government contended… Lieberman put her name on client bank accounts, wrote checks for her own personal expenses, transferred assets into her law firm’s accounts, helped clients draft wills and then stole more while serving as executrix… according to the attorney general’s office.”

According to the Philadelphia Inquirer: “Lieberman paid off six-figure credit-card bills, while Van Holt bought a Florida condominium and two Mercedes-Benzes, authorities said.”

Lieberman will reportedly forfeit $3 million, her law license and a BMW, and faces up to ten years in prison.

FriedmanLaw has no independent knowledge of the facts surrounding this case, but if the government’s allegations are true, then this is a very sad situation.

As elder law attorneys, our job is to protect some of society’s most vulnerable members. Our clients put their trust in us.  We work hard to deserve the trust of seniors and people with disabilities, who rely on our help. When one lawyer takes advantage of clients’ trust, it affects us all.

Lawrence Friedman was invited to give a presentation on elder law ethics to New Jersey’s Office of Attorney Ethics, the state agency charged with regulating the legal profession. We hope that our contribution will help the state ensure that this doesn’t happen again.

Do you need a special needs trust?

Posted on: November 3rd, 2014 by Mark R. Friedman

If you are unable to work due to a long-term disability, then you may be eligible for subsidized healthcare (Medicaid), cash assistance (SSI), and other benefits.  (For people with developmental disabilities, Medicaid is especially important, as New Jersey’s Division of Developmental Disabilities (DDD) now requires people to be on Medicaid for residential services.)
However, these programs have very strict financial limits, and applicants must have minimal assets to qualify.  If you have nearly any money at all in your possession, Medicaid will quickly show you the door.

Fortunately the government created a way to set aside private funds to help a person with disabilities, without affecting the person’s eligibility for benefits – the special needs trust.

A special needs trust is a legal arrangement in which money is set aside under the control of a trustee, who uses it to buy things that benefit a person with disabilities.  Because the person with disabilities doesn’t own the money, the person is still eligible for benefits like Medicaid and SSI, even though the money can only be used to help the person with disabilities.

The idea is that money for a person with disabilities should supplement government benefits, not replace them.  Benefits meet the person’s basic needs, and the trust pays for special needs.

We usually help clients establish a special needs trust in two scenarios.  First, if a parent has a child with a disability (or sibling, spouse, etc.), then the parent’s will should include a special needs trust, so that any inheritance will be protected.  Second, if a person with disabilities recovers money in a lawsuit (often for medical malpractice), then the money should be set aside in a special needs trust in order to maximize its value.

If you or a loved one is unable to work due to a long-term disability, then it may be advisable for you to consider a special needs trust.  Please see our Q&A’s and Articles, or call us today at (908) 704-1900 for advice specific to your situation.

As this website provides general information and isn’t tailored to your particular situation, it doesn’t constitute legal advice and may not take into account rules and exceptions that affect you. Although updated from time to time, this website may not take account of recent legal developments or differences in laws from state to state. For safety sake, obtain individual legal advice before you act! You assume all risk of acting on information contained in this website. This website doesn’t constitute legal advice, and no attorney-client relationship exists unless FriedmanLaw and you execute a written engagement agreement. Please contact us at 908-704-1900 to discuss engaging FriedmanLaw to help resolve your legal concerns.
Homepage photo: Cows grazing at Meadowbrook Farm, Bernardsville, NJ by Siddharth Mallya. October 23, 2012.
Interior photo: Somerset hills pastoral scene by Lawrence Friedman.