We try to make our clients as comfortable as possible, but nonetheless, meeting an attorney for the first time can be intimidating. Often, people don’t know what to expect. So in this post I’ll set down a few questions that we’ll typically ask elder law clients (or their families) who are interested in Medicaid and long term care planning.  If you have a loved one who may need long term care, it would be helpful for you to bear these questions in mind.

Questions We’ll Ask You:

Your goals?
What are you looking to accomplish by seeing a lawyer? From a legal / financial standpoint, if we could wave a magic wand and fix everything, what would you want us to do?

Your family?
Are you married? How many children do you have? Are your children married? Do they have children? Are any family members helping you? Do you have good relations with everyone in your family? Does everyone in your family have good relations with each other? Is anyone in your family disabled?

Your care needs?
Why do you need care? Are your medical issues physical, mental, or both? Do you use a wheelchair? Are you able to live at home with aides? If so, how much help do you need from aides? Can anyone else help with your care? If you have to go into a facility, can you get the care you need in an assisted living facility, or is a nursing home necessary?

Your finances?
What are your finances? Do you own your home? If so, what is the value, and is there a mortgage on it? What are your assets – bank, investment and retirement accounts, insurance and annuities, etc.? What is your monthly income, and what are your monthly expenses? How much do you expect your care needs will cost? Have you made any gifts in the past five years?  Do you expect to get any windfall money (lawsuit, inheritance, etc.)?

Documents and Insurance?
Have you ever executed a will? Have you given anyone power of attorney? Do you have an advance directive for healthcare (aka medical power of attorney)? Do you have long term care insurance?

There are many more specific questions we’ll ask in particular situations, but these are some of the broader general questions that folks should keep in mind when working with an elder law attorney.  If you’re interested in Medicaid and long term care planning, FriedmanLaw is here to help, call or email us today.

If you or a loved one is entering a long term care facility, you should be aware that the admission agreement may impose onerous obligations.  Nursing home agreements may include liability waivers and binding arbitration clauses that limit your ability to sue if the nursing home injures you.  Admission agreements may also include provisions that expose family members to liability if the resident can’t pay.  If your parent, spouse or other loved one is entering a nursing home and you sign as responsible party, the nursing home may try to collect against you if your parent has an unpaid bill.

In addition, one particular issue arises with admission agreements to assisted living facilities.  Assisted living facilities often require new residents to show they have enough funds to pay privately for a number of years before going on Medicaid (as Medicaid pays a lower rate than the private pay rate) – often two years.  In admission agreements, new residents are often required to disclose assets to prove that the resident can fund their care at the assisted living facility for two years.  The problem is these contracts also often include provisions to the effect that any assets disclosed on the application will be used to pay for the assisted living facility.  If you disclose more than you have to on the contract, this may limit your opportunities to do Medicaid planning.

Medicaid will pay for long term care, but only if you meet the various eligibility requirements.  One is that applicants must have less than $2,000 in Resources.  A major goal of Medicaid planning is to employ your savings to meet that $2,000 limit, without wasting your savings.  In other words, to spend the money in a way that meets your goals, meeting your needs and saving any excess for your family.  However, if your money is already committed to an assisted living facility, you may not be able to save that money through Medicaid planning, and may lose money to long term care costs that otherwise could have been saved.

All of this emphasizes the importance that before you sign an admission agreement to a nursing home or assisted living facility, you should review it with an attorney to make sure you understand what you’re signing, since the contract may affect your rights.

The federal government will issue a new rule holding financial professionals who manage retirement accounts to a fiduciary standard.

This means that advisers will have to put clients’ interests before their own.  For example, if there were a choice between two identical funds, and one had a higher fee for the client and higher commission for the broker, while the other offered a lower fee for the client and lower fee for the broker, the adviser would have to recommend the lower-cost fund.

The New York Times quotes Department of Labor secretary Thomas E. Perez saying:  “The marketing material I see from many firms is, ‘We put our customers first.’  That is no longer a marketing slogan.  It’s the law.”

This rule will have a big impact on the $14 trillion Americans have invested in retirement accounts.  The government expects the rule will save Americans $17 billion per year in fees, and analysts expect to see a shift in retirement accounts to lower-cost investments.

Also expected is upheaval in the financial services industry.  The new rule is expected to make operating more difficult for smaller advisory firms, because of new reporting requirements that will require more overhead costs.  There is also some confusion on whether the fiduciary standard will apply before a client invests with a firm – e.g., in an initial meeting.

Despite these issues, I think this is a positive development both for financial advisers and for their clients.  Millions of Americans have the bulk of their savings invested in their retirement accounts.  Many of these folks have no idea how their money is invested and rely on their advisers for guidance.  The best advisers already put their clients’ interests before their own, and with this new rule, the rest of the industry will have to follow suit.

As a segue into what we do… a lot of retirement accounts pass outside a will, directly to designated beneficiaries.  It’s important to make sure that your retirement account is invested wisely, and that it’s coordinated with the rest of your estate plan.  For guidance on estate planning and retirement account, call or email FriedmanLaw today.