Medical Assistance

The ‘Sandwich Generation’ – Taking Care of Your Kids While Taking Care of Your Parents

“The sandwich generation” is the term given to adults who are raising children and simultaneously caring for elderly or infirm parents.  Your children are one piece of “bread,” your parents are the other piece of “bread,” and you are “sandwiched” into the middle.
Caring for parents at the same time as you care for your children, your spouse and your job is exhausting and will stretch every resource you have.  And what about caring for yourself? Not surprisingly, most sandwich generation caregivers let self-care fall to the bottom of the priorities list which may impair your ability to care for others.

Following are several tips for sandwich generation caregivers.

• Hold an all-family meeting regarding your parents. Involve your parents, your parents’ siblings, and your own siblings in a detailed conversation about the present and future.  If you can, make joint decisions about issues like who can physically care for your parents, who can contribute financially and how much, and who should have legal authority over your parents’ finances and health care decisions if they become unable to make decisions for themselves.  Your parents need to share all their financial and health care information with you in order for the family to make informed decisions.  Once you have that information, you can make a long-term financial plan.
• Hold another all-family meeting with your children and your parents.  If you are physically or financially taking care of your parents, talk about this honestly with your children.  Involve your parents in the conversation as well.  Talk – in an age-appropriate way – about the changes that your children will experience, both positive and challenging.
• Prioritize privacy.  With multiple family members living under one roof, privacy – for children, parents, and grandparents – is a must.  If it is not be feasible for every family member to have his or her own room, then find other ways to give everyone some guaranteed privacy.  “The living room is just for Grandma and Grandpa after dinner.”  “Our teenage daughter gets the downstairs bathroom for as long as she needs in the mornings.”
• Make family plans.  There are joys associated with having three generations under one roof.  Make the effort to get everyone together for outings and meals.  Perhaps each generation can choose an outing once a month.
• Make a financial plan, and don’t forget yourself.  Are your children headed to college?  Are you hoping to move your parents into an assisted living facility?  How does your retirement fund look?  If you are caring for your parents, your financial plan will almost certainly have to be revised.  Don’t leave yourself and your spouse out of the equation.  Make sure to set aside some funds for your own retirement while saving for college and elder health care.
• Revise your estate plan documents as necessary.  If you had named your parents guardians of your children in case of your death, you may need to find other guardians.  You may need to set up trusts for your parents as well as for your children.  If your parent was your power of attorney, you may have to designate a different person to act on your behalf.
• Seek out and accept help.  Help for the elderly is well organized in the United States.  Here are a few governmental and nonprofit resources:
  • www.benefitscheckup.org – Hosted by the National Council on Aging, this website is a one-stop shop for determining which federal, state and local benefits your parents may qualify for
  • www.eldercare.gov – Sponsored by the U.S. Administration on Aging
  • www.caremanager.org  -- National Association of Professional Geriatric Care Managers
  • www.nadsa.org – National Adult Day Services Association

A Minnesota Elder Law Attorney Discusses Ways to Make Your Home Safe When Caring for an Aging Parent

Let’s face it – it’s tough getting old. The aches, pains, and pills often associated with aging are things that many members of the baby-boomer generation know all too well by now. Though you might not be able to turn back time, you can help an aging loved one enjoy their golden years by giving them a safe, affordable place to call home. If an aging parent is moving in with you and your family, there are many quick fixes for the home that will create a safe environment for seniors.

Start by taking a good look at your floor plan. Are all the bedrooms upstairs? You may want to think about turning a living area on the main floor into a bedroom. Stairs grow difficult with age, especially for seniors with canes or walkers. Try to have everything they need accessible on one floor, including a bed, full bathroom, and kitchen. If the one-floor plan isn’t possible, make sure you have railings installed on both sides of staircases for support. A chair lift is another option for seniors who require walkers or wheelchairs.

Be sure to remove all hazards in hallways and on floors. Get rid of throw rugs – they can pose a serious tripping hazard. Make sure all child or pet toys are kept off the floor. Add nightlights to dark hallways for easy movement during the night when necessary. Also install handrails for support near doorframes and most importantly, in bathrooms.

Handlebars next to toilets and in showers are essential for senior safety. Use traction strips in the shower, which should also be equipped with a seat and removable showerhead. To avoid accidental scalding, set your hot water heater so that temperatures can’t reach boiling. You may also want to consider a raised seat with armrests to place over your toilet, to make sitting and standing easier.

This applies to all other chairs in the house as well. Big, puffy chairs and couches can make it very difficult for seniors to sit and stand. Have living and dining room chairs with stable armrests, and consider an electronic recliner for easy relaxation.

To keep everyone comfortable and help avoid accidents, store all frequently used items in easily accessible places. Keep heavy kitchen items between waist and chest height.

Even with appropriate precautions, not all accidents can be avoided. Purchasing a personal alarm system like Life Alert can be the most important preparation you make for a senior family member. If they are ever left alone, Life Alert provides instant medical attention with the push of a button that they wear at all times.

Amidst all the safety preparations, remember that it’s important to keep the brain healthy, too. Have puzzles, cards, large-print books and magazines, computer games, and simple exercises available to keep seniors of healthy body and mind.

These simple preparations can not only help extend the life of your loved one, but help to make sure their remaining years are happy and healthy.

Gov. Mark Dayton is seeking a waiver from the Federal Government that will allow Minnesota to put into place its own bipartisan plan that should make it easier to connect people to services, steering them out of institutions and into home-based care. In seeking the wavier, the state asserts that instead of paying the astronomical cost of institutional care, the ability to go into a Medicaid recipient's home and install ramps, or bring in home-care workers who could allow the person to stay at home comfortably and will provide services at a more affordable price for the state. Rather than waiting until a worker loses a job because of a disability, the reforms would allow the state to reach out to employers and craft a plan to keep them working.

The Governor feels that this reform could save the state $151 million over the next five years. Minnesota estimates it could save another $9.2 million over the next five years by giving families more options for home-based care, and $15 million by expanding counseling and other support to people faced with a choice between expensive nursing home care and more affordable home care. At the center of the waiver request is the state's plan to offer incentives to health care providers that make preventive care available to Minnesotans on Medicaid.

The U.S. Department of Health and Human Services will respond to the state's proposal after a 30-day public comment period. If approved, the reforms would go into effect in 2014.

An article in the Star Tribune reported today that the number of Minnesotans on Medicaid - called Medical Assistance in Minnesota - shot up at nearly twice the national rate over the past two years, while state costs increased by 40 percent.  The total number of Minnesotans enrolled in the state-federal health insurance program increased by 125,000 in the last to years to reach a total of about 733,000.

The National Governors Association and the National Association of State Budget Officers issued a report this week stating that the growing Medicaid budget - approximately $450 billion this year - will place a large burden on sates trying to climb out of the most recent recession.

A large part of the rise in Minnesota's portion of the cost -- from $2.9 billion in 2011 to an estimated $4.05 billion this year -- is due to two things: 1) enrollees who transferred into Medicaid and out of programs that were funded solely by the state; and 2) the end of the federal government's economic stimulus package, which for a time raised the federal Medicaid match from about 50 percent to 60 percent.

Medicaid was set up by Congress in 1965 to provide health care to low-income adults and children, including some people with disabilities; it also covers about two-thirds of people in nursing homes who have outlived their savings. While low-income families represent the majority of people on Medicaid, most of its outlays go to long-term care for the elderly and disabled.

Minnesota's program is expected to add another 60,000 people by the end of 2014 with further expansion of the federal Affordable Care Act, if the law's expansion of Medicaid rolls survives the recent Supreme Court challenge.

In 2014, Minnesota's Medicaid costs are expected to rise by about 10 percent, surpassing $4.4 billion, while the federal share is forecast to soar 23 percent to $5.1 billion with the program's expansion.

In many states, Medicaid is the largest single portion of state spending, at nearly a quarter of state budgets, and some states are struggling to control costs by cutting provider payments, drug costs and other benefits, the report said,

With all this uncertainty, people should think about the possible long-term care needs not just for themselves but for parents or even grandparents.  We can't rely on government programs to be there 2, 5 or 10 years from now.  I meet people weekly who are having to make decisions on what to do for Dad or Mom - in some cases a spouse - when they can no longer care for themselves and neither can the family.  Please plan now.

 

 

The Basics of Conservatorships

Sometimes, bad things happen to good people. A tragic accident. A sudden, devastating illness. Have you ever wondered what would happen if a loved one became incapacitated and unable to take care of himself? While many associate incapacity with a comatose state, an individual, while technically functioning, may be considered incapacitated if he cannot communicate through speech or gestures and is unable sign a document, even with a mark. In some cases, an individual may have no trouble communicating, but may not be able to fully appreciate the consequences of their decisions and hence may be deemed to lack capacity. With proper incapacity planning which includes important legal documents such as a durable power of attorney, healthcare proxy and living will, the individuals named in such documents are empowered to make necessary financial and medial decisions on behalf of the incapacitated person without obtaining additional legal authorization.  Without proper incapacity planning documents, even a spouse or adult child cannot make financial and healthcare decisions on behalf of an incapacitated individual.  In such cases, a conservatorship (or guardianship) proceeding is necessary so that loved ones are able to provide for their financial and medical healthcare needs.

A conservatorship is a court proceeding where a judge appoints a responsible individual to take care of the adult in question and manage his or her finances and make medical decisions. The court appointed conservator will take over the care of the conservatee (disabled adult).  When appropriate, the court may designate an individual “conservator of the estate” to handle the disabled person’s financial needs and another person “conservator of the person” to manage his healthcare needs. One person can also serve as both. If you are planning to serve as someone’s financial conservator, be prepared to possibly post a bond that serves as a safeguard for the conservatee’s estate. Individual states have their own guidelines for conservators, so check your local rules for more information.  

To minimize the incidence of mismanagement or fraud, the court holds the conservator legally responsible for providing it with regular reports, called an accounting. Additionally, the conservator may not be able to make any major life or medical decisions without the court’s approval and consent. For example, if you have been named the conservator for a relative, you may not be able to sell his or her house without the approval of the court.

The best safeguard to avoid going through court to get a conservatorship, however, would be to establish a durable financial power of attorney, a power of attorney for healthcare, each authorizing a family member or trusted individual to act on your behalf in case of incapacity.  While your agents have a legal obligation to act in your best interest they won’t have to post an expensive bond either.  Make sure the power of attorney clearly states that it will be effective even if the principal becomes incapacitated.

Guardianships & Conservatorships and How to Avoid Them

If a person becomes mentally or physically handicapped to a point where they can no longer make rational decisions about their person or their finances, their loved ones may consider a guardianship or a conservatorship whereby a guardian would make decisions concerning the physical person of the disabled individual, and conservators make decisions about the finances.

Typically, a loved one who is seeking a guardianship or a conservatorship will petition the appropriate court to be appointed guardian and/or conservator. The court will most likely require a medical doctor to make an examination of the disabled individual, also referred to as the ward, and appoint an attorney to represent the ward’s interests. The court will then typically hold a hearing to determine whether a guardianship and/or conservatorship should be established. If so, the ward would no longer have the ability to make his or her own medical or financial decisions.  The guardian and/or conservator usually must file annual reports on the status of the ward and his finances.

Guardianships and conservatorships can be an expensive legal process, and in many cases they are not necessary or could be avoided with a little advance planning. One way is with a financial power of attorney, and advance directives for healthcare such as living wills and durable powers of attorney for healthcare. With those documents, a mentally competent adult can appoint one or more individuals to handle his or her finances and healthcare decisions in the event that he or she can no longer take care of those things. A living trust is also a good way to allow someone to handle your financial affairs – you can create the trust while you are alive, and if you become incompetent someone else can manage your property on your behalf.

In addition to establishing durable powers of attorney and advanced healthcare directives, it is often beneficial to apply for representative payee status for government benefits. If a person gets VA benefits, Social Security or Supplemental Security Income, the Social Security Administration or the Veterans’ Administration can appoint a representative payee for the benefits without requiring a conservatorship. This can be especially helpful in situations in which the ward owns no assets and the only income is from Social Security or the VA.

When a loved one becomes mentally or physically handicapped to the point of no longer being able to take care of his or her own affairs, it can be tough for loved ones to know what to do. Fortunately, the law provides many options for people in this situation.  
 

Cancer Treatment Often Leads to Bankruptcy

These days, it seems like everything under the sun, and even the sun itself, causes cancer. A recent study shows that cancer may cause yet another hardship for those diagnosed—Bankruptcy.  There are a number of reasons for this.  A patient may be unable to work during treatment or only able to earn an income during periods of remission. However, the primary cause is the enormous medical expense associated with the treatment of cancer, especially for those who are uninsured or under insured.

The study, “Cancer diagnosis as a risk factor for personal bankruptcy,” published in the Journal of Clinical Oncology, examined 231,799 cancer patients, and found that 4,805 of them, or 2.1 percent sought bankruptcy relief under Chapter 7 and Chapter 13 in the years following their cancer diagnoses. This corresponds to about a 700% increase in the incidence bankruptcy filings over that of the general population.

The study also found that certain types of cancer resulted in significantly higher rates of bankruptcy. Patients afflicted with lung, thyroid and leukemia/lymphoma cancers were most likely to seek bankruptcy protection, with 7.7 percent of lung cancer patients filing for bankruptcy within five years of being diagnosed. The study also found that surgery and chemotherapy increased the risk that some cancer patients would file for bankruptcy.

Researchers concluded that medical bills are a primary cause of the connection between cancer and bankruptcy because younger cancer patients sought bankruptcy relief at higher rates than older cancer sufferers. They believed this was due to the fact that older Americans have access to Medicare, and therefore do not bear the same costs for cancer treatment as younger patients.
 

Joint Bank Accounts and Medicaid Eligibility

Like most governmental benefit programs, there are many myths surrounding Medicaid (called Medical Assistance in Minnesota) and eligibility for benefits. One of the most common myths is the belief that only 50% of the funds in a jointly-owned bank account will be considered an asset for the purposes of calculating Medicaid eligibility.

Medicaid is a needs-based program that is administered by the state.  Therefore, many of its eligibility requirements and procedures vary across state lines.  Generally, when an applicant is an owner of a joint bank account the full amount in the account is presumed to belong to the applicant. Regardless of how many other names are listed on the account, 100% of the account balance is typically included when calculating the applicant’s eligibility for Medicaid benefits.
    
Why would the state do this? Often, these jointly held bank accounts consist solely of funds contributed by the Medicaid applicant, with the second person added to the account for administrative or convenience purposes, such as writing checks or discussing matters with bank representatives. If a joint owner can document that both parties have contributed funds and the account is truly a “joint” account, the state may value the account differently. Absent clear and convincing evidence, however, the full balance of the joint bank account will be deemed to belong to the applicant.
 

Important Issues to Consider When Setting Up Your Estate Plan

Often estate planning focuses on the “big picture” issues, such as who gets what, whether a living trust should be created to avoid probate and tax planning to minimize gift and estate taxes. However, there are many smaller issues, which are just as critical to the success of your overall estate plan. Below are some of the issues that are often overlooked by clients and sometimes their attorneys.

Cash Flow
Is there sufficient cash? Estates incur operating expenses throughout the administration phase. The estate often has to pay state or federal estate taxes, filing fees, living expenses for a surviving spouse or other dependents, cover regular expenses to maintain assets held in the estate, and various legal expenses associated with settling the estate.

Taxes
How will taxes be paid? Although the estate may be small enough to avoid federal estate taxes, there are other taxes which must be paid. Depending on jurisdiction, the state may impose an estate tax. If the estate is earning income, it must pay income taxes until the estate is fully settled. Income taxes are paid from the liquid assets held in the estate, however estate taxes could be paid by either the estate or from each beneficiary’s inheritance if the underlying assets are liquid.

Assets
What, exactly, is held in the estate? The owner of the estate certainly knows this information, but estate administrators, successor trustees and executors may not have certain information readily available. A notebook or list documenting what major items are owned by the estate should be left for the estate administrator. It should also include locations and identifying information, including serial numbers and account numbers.

Creditors
Your estate can’t be settled until all creditors have been paid. As with your assets, be sure to leave your estate administrator a document listing all creditors and account numbers. Be sure to also include information regarding where your records are kept, in the event there are disputes regarding the amount the creditor claims is owed.

Beneficiary Designations
Some assets are not subject to the terms of a will. Instead, they are transferred directly to a beneficiary according to the instruction made on a beneficiary designation form. Bank accounts, life insurance policies, annuities, retirement plans, IRAs and most motor vehicles departments allow you to designate a beneficiary to inherit the asset upon your death. By doing so, the asset is not included in the probate estate and simply passes to your designated beneficiary by operation of law.

Fund Your Living Trust
Your probate-avoidance living trust will not keep your estate out of the probate court unless you formally transfer your assets into the trust. Only assets which are legally owned by the trust are subject to its terms. Title to your real property, vehicles, investments and other financial accounts should be transferred into the name of your living trust.
 

Most people are aware that probate should be avoided if at all possible. It is an expensive, time-consuming process that exposes your family’s private matters to public scrutiny via the judicial system. It sounds simple enough to just gift your property to your children while you are still alive, so it is not subject to probate upon your death, or to preserve the asset in the event of significant end-of-life medical expenses.

This strategy may offer some potential benefits, but those benefits are far outweighed by the risks. And with other probate-avoidance tools available, such as living trusts, it makes sense to view the risks and benefits of transferring title to your property through a very critical lens.

Potential Advantages:

• Property titled in the names of your heirs, or with your heirs as joint tenants, is not subject to probate upon your death.
• If you do not need nursing home care for the first 60 months after the transfer, but later do need such care, the property in question will not be considered for Medicaid (Medical Assistance in Minnesota) eligibility purposes.
• If you are named on the property’s title at the time of your death, creditors cannot make a claim against the property to satisfy the debt.
• Your heirs may agree to pay a portion, or all, of the property’s expenses, including taxes, insurance and maintenance.

Potential Disadvantages:

• It may jeopardize your ability to obtain nursing home care. If you need such care within 60 months of transferring the property, you can be penalized for the gift and may not be eligible for Medical Assistance for a period of months or years, or will have to find another source to cover the expenses.
• You lose sole control over your property. Once you are no longer the legal owner, you must get approval from your children in order to sell or refinance the property.
• If your child files for bankruptcy, or gets divorced, your child’s creditors or former spouse can obtain a legal ownership interest in the property.
• If you outlive your child, the property may be transferred to your child’s heirs.
• Potential negative tax consequences: If property is transferred to your child and is later sold, capital gains tax may be due, as your child will not be able to take advantage of the IRS’s primary residence exclusion. You may also lose property tax exemptions. Finally, when the child ultimately sells the property, he or she may pay a higher capital gains tax than if the property was inherited, since inherited property enjoys a stepped-up tax basis as of the date of death.

There is no one-size-fits-all approach to estate planning. Transferring ownership of your property to your children while you are still alive may be appropriate for your situation. However, for most this strategy is not recommended due to the significant risks. If your goal is to avoid probate, maximize tax benefits and provide for the seamless transfer of your property upon your death, a living trust is likely a far better option.

Contact the firm now so we can discuss your options

I have recently been approached by several people seeking assistance on an increasingly common situation: what to do with a parent who suddenly needs living assistance.  One thing to note for these clients is that they are not alone. According to the statistics related by the department of human services, 557,000 Minnesota residents received Medical Assistance (Minnesota’s Medicaid program).

In the past Medicaid assistance has meant receving money to put a loved one into institutionalized care. Originally, Medicare would not pay to keep someone out of instituionalized care. But that is changing as people seek to care for loved ones in a more familiar environment. Recognizing this trend, Minnesota’s Human Services Commissioner, Lucinda Jesson, is set to requestapproval from the federal government for large scale changes - a so called "global waiver" - that would allow the state to have increased flexibility in how it can spend federal human-services funds.

In a recent interview, Ms. Jesson stated that the waiver would allow Minnesota to use Medicaid funds to pay for home and community-based services first.  She believes that people would rather stay in their homes and communities than go to a facility.  While there is currently a system of exceptions that allow members of certain populations to remain in their homes or communities, it is very difficult to determine which programs cover what population. Ms. Jesson feels that, if given the chance, Minnesota could design a better system.

The hope is that under a new program, the Minnesota Medical Assistance program would have the ability to serve people at their level of need by offering more services overall.  For instance, offering Meals on Wheels or personal care attendants to seniors instead of requiring that the person needing such services be institutionalized. Ms. Jesson predicts that these changes would, ultimately, save Minnesota money as it costs 3 times more to have someone in a nursing home than to care for that person in his or her home.

The DHS plans to have its proposal ready to submit to the federal government in early 2012. If this is of interest to you, please note that there will be a public comment period later this fall.