Monday, March 30, 2020

Scams and the COVID-19 Epidemic

Leslie Salvo

As we attempt to adapt to our “brave new world” with COVID-19 at the center of our attention, let’s not forget to be vigilant for those individuals who are always ready to take advantage of a bad situation. Regrettably, there are people using this pandemic to line their pockets with your money. Here are a few scams to be aware of:

(1)  Receiving a call, email or text message that there is a vaccination available for COVID-19. At this time, there is no vaccination available at any cost. You should also avoid responding to calls regarding home test kits. Hopefully these will be available soon, but for now, beware.

(2)  Services offering to clean your home but requesting prepayment for the service. Also be wary of online retailers selling cleaning products claiming to kill the virus. 

(3)  Charity scams offering assistance to those affected by the virus. If you want to contribute to a charity, please contact the “tried and true” charitable agencies - The Red Cross, The Salvation Army, or even your local United Way chapter. 

(4)  If someone offers to do your grocery shopping for you, that’s wonderful! But if you’re going to give someone money upfront to do so, make sure you know the person. There may be some honest strangers out there offering to help, but this is a situation ripe for taking advantage of your vulnerability.

Please take care of yourself and your community during this difficult time.

Tuesday, February 25, 2020

Banks vs. Lawyers: The Best Way to Access a Loved One’s Bank Account

Catherine E. Sears, Esq.

Frequently, clients tell me that they have certain assets (often, a checking or savings account) titled jointly with one or more of their children.

“This way,” they tell me, “my daughter can step in and pay my bills if something happens to me.”

Nearly always, when I ask whose idea this was, the client informs me that an employee at the bank said that this was the best way to allow family members to help in case of a crisis. However, at the risk of irritating any bankers reading this blog, I can say with complete certainty that naming someone as a co-owner is NOT the best way to give another person access to your finances. Instead, you should name your child as your agent under a Durable Power of Attorney.

When a bank account is jointly owned, legally, that bank account belongs to both of the co-owners. This means that your child can do whatever he or she wants with that money, and is not bound by any legal obligation to use the money in your best interests. Even if you trust that your child would not go on a shopping spree with your money, your account can still be subject to your child’s creditors if, for example, your child gets into a fender-bender and gets sued, or if he goes through a divorce. Additionally, co-ownership often creates a “right of survivorship.” This means that, upon your death, the entire bank account will belong to your co-owner child, regardless of the provisions in your will or revocable living trust which may state that your assets are to be divided equally among all of your children.

I recently had a client who had named her adult child as co-owner of her checking account many years ago. In fact, this happened so long ago that the bank no longer had records showing that the account had, at one time, been titled in my client’s sole name. Sometime after adding her child as co-owner, the client’s child developed a disability, could no longer work, and began receiving Supplemental Security Income (SSI) and Medicaid. Both of these programs are means-tested, which means that the child could only receive these benefit programs by meeting certain financial eligibility requirements. The child had been receiving these benefits for several years, and these programs were the child’s sole source of income and health insurance coverage.

Recently, though, the Social Security Administration learned that the child was co-owner on my client’s checking account. Though my client was by no means wealthy, she had money in the account in excess of the low limits which are required to maintain SSI and Medicaid coverage. The child’s benefits stopped, which was problematic because the child had a home-health aide, who had been paid through the Medicaid coverage, and this left my frail, eighty-something year-old client in charge of providing very physically-demanding care to the child. Additionally, the child received word that he owed tens of thousands of dollars to the Social Security Administration because, due to this co-owned account, he should never have been eligible to receive these benefits.

I was heartbroken to learn of this situation, because the family’s problems would have been solved if the client had not listened to the bank employee all those years ago and had simply executed a Durable Power of Attorney naming the child as her agent. Then, the child would not have any legal claim to the money in the client’s account. If the client had needed assistance, the child could simply have paid bills by showing a copy of the Durable Power of Attorney and by signing “Child’s Name, POA for Client’s Name.” This also would have held the child to the fiduciary standard, which means that, if he had happened to misuse the client’s money, he would have gotten in trouble for it.

So, please learn from this family’s mistake. Nobody knows what the future will hold; clearly, this client thought that she would be the first family member to need help, not her child. If you ever have any doubts about the proper way to title any type of asset, consult an experienced estate planning or elder law attorney – not just the person sitting behind the counter at the bank.

Tuesday, January 21, 2020

Happy New Year!

Barbara Armstrong

Happy New Year!

Here we are already into the middle of January. Where does time go? Before you know it, daylight savings time will be upon us, daffodils and tulips will be blooming, and of course, allergies will be thriving!

Last year was a whirlwind. The year started out uneventful, but in July, tragedy struck our family. Our youngest granddaughter nearly drowned. She was saved due to the fast work of her other grandmother, who knew CPR, the police officer that arrived next and took over, and then the EMTs. She began breathing on her own, but the prognosis wasn’t good. 

After two MRIs while at CHKD, it was discovered that she had suffered major brain damage. The little girl we knew was no longer with us. She was in CHKD in the PICU for almost two months and on a ventilator for a month. She suffered severe “storms” during this time. The doctors inserted a feeding tube. She and her family suffered greatly. 

During that time, a GoFundMe page was set up. Through the generosity of folks, her parents were able to take family leave from their full-time jobs and took turns staying with her so that one of them would always be with her and the other with the other two girls. They were able to do some remodeling so that they could bring her home when the hospital finally released her. When she was released, it was a happy day. She was smiling when she heard a familiar voice. She started tracking with her eyes. She began moving her legs and arms so much more, although she couldn’t sit up.
Fast forward to this year. Our little one is now sitting up, and the other day, tried to stand! What tenacity she has. Through the diligence of her parents, she is continuing physical therapy and was accepted into a school program which she just started this month.

Although the doctors told us that we would never have our little girl back in the way she was before the accident, we are eternally grateful for the fact that she is still with us and I truly believe that she will walk again one day and begin to dance like she used to.

A new year brings new hope! God Bless.

Wednesday, December 18, 2019

Gaining Perspective

Leslie Salvo
I have worked in the area of elder law and estate planning for many years, but until the last 3 years, my perspective of having a parent with dementia was shaped only through clients’ stories.  And then it hit home.  Just before my father died, he and I were having a conversation about how we were going to take care of him once he came home from the hospital.  He was quick to tell me he was not worried about himself but was concerned about my mother.  He said “something isn’t right, she can’t cook things like she did before”.  While that seems like a simple (and maybe silly) thing for him to say, it spoke volumes to me.  My mom had always been a good cook.  Sadly, my dad did not live very long after his discharge, and I had moved home to take care of him.  Since I was now living with my mom, it didn’t take long for me to see that Daddy had been correct – something wasn’t right.  After a visit to a neurologist and some follow up tests, we had the diagnosis of dementia, likely of the Alzheimer’s type. My sisters and I were devastated. And now, I have the first hand experience of watching my mother slip away from us piece by piece.  My mother was always smart, witty, and kind.  Every once in a while, she will say something funny and it catches me off guard.  For a minute, I think “Mom’s back” but sadly, it’s just a glimpse of her old self. I hope that through this personal experience with my mom, I will be better able to help our clients.  At least, I have now walked in those shoes.  

I am thankful that my parents listened to me years ago when I asked them to get all of their estate planning documents in order, purchase long term care insurance, and pre-plan their funeral arrangements. Working in this area of law has taught me a lot.They did all of that and thus, have made the events of the last few years a little easier to navigate.  I encourage everyone, young(ish) and old, to make things a little easier for your loved ones to handle the aging process by getting your legal affairs in order.  It doesn’t bring your loved one back or make the disease progression go away, but in a small way, it helps.  It’s one less stressor for the caretaker(s) and believe me, that can make a big difference.   

Wednesday, October 30, 2019

Happy Fall, Y'all!

RaShanta Jennings
Legal Assistant

Time to grab your jackets, boots and cozy socks: Autumn has arrived! I absolutely love when the season changes. Out of the four seasons, I have to say that Fall is my favorite. There are so many reasons to absolutely love this season, the weather is near perfect, and a couple of my favorite holidays (Halloween and Thanksgiving) are celebrated.

For me, this time of year is when I get to pull out my crock-pot recipes; plan fun, crafty, fall-ish things with my kiddos; and spend some time in my kitchen baking a few of my favorite desserts such as cobblers, cheesecakes and everything pumpkin-flavored! Needless to say, cheat days in my diet are most common during the fall. During this time of year, the comfort food is so rewarding. Believe it or not, it’s the perfect, yet easy way to entice the entire family over for dinner, not just on Thanksgiving Day. Sharing these moments with family and indulging in comfort food and desserts allows you to reminisce on the most enjoyable periods of your life. As they say, some of the greatest pleasures in life are simple, and what could be as simple as cooking a delectable meal and spending time with those you love most. I truly hope your Autumn is a memorable and happy time. Happy Fall, Y’all! 

Check out a few of my favorite fall recipes below!

Wednesday, October 9, 2019

It’s Never Too Early for Life Care Planning

Catherine E. Sears, Esq.

I regularly meet with clients who would be perfect candidates for TPC’s Life Care Planning program but just aren’t willing to accept it yet. For those who don’t know, Life Care Planning is a holistic approach to the concerns of aging that has the law firm at the center of your aging process. So often, families who are helping a loved one through the aging process make the same common mistakes.

Perhaps the estate planning documents are not in place, or, even if they are in place, the fiduciaries in the documents do not properly understand their role. Maybe long-term care planning or asset protection planning starts too late, many years after a diagnosis occurs. There might be misunderstandings regarding what the senior’s rights are when a hospital is getting ready to discharge him after a medical event, or a long-term care facility is getting ready to admit the senior as a resident. This might cause the senior’s care to be compromised, or for the senior to be moved from one location to another far more than is necessary, which can be very detrimental to the senior’s health. Or, perhaps the senior is experiencing isolation (and, therefore, more rapid cognitive decline) because she is trying to “age in place” in her own home, but has lost the ability to drive. Maybe loved ones are becoming burned out or are compromising their own health and wellbeing by trying to provide in-home care for the senior.

With a Life Care Plan, the law firm can help. Our Elder Care Coordinator, who has a background in geriatric social work, will visit with the senior and her family regularly to get to know the senior’s unique goals and wishes for her aging process and make sure that these goals are not compromised despite whatever changes might happen in the senior’s life. Additionally, the law firm provides the services necessary to ensure that all legal options are explored which could maximize the senior’s quality of life.

Additionally, with a Life Care Plan, the law firm can serve as the senior’s decision-maker for legal, financial, and medical affairs, which provides great peace of mind if the senior never had children, or is estranged from his children, or doesn’t believe that his children would make good decisions for him. Alternatively, if the senior does have family he would trust to make these decisions for him but the family members live far away or do not have sufficient time to devote to attending medical appointments or making regular visits, the Elder Care Coordinator can make these visits and report back to the family member to allow her to make an informed decision.

When I tell clients about Life Care Planning, they are usually excited about the program and feel it would be a good fit for them. However, they often tell me that they don’t need Life Care Planning yet because they are still able to take care of themselves and make their own decisions. However, this doesn’t mean that Life Care Planning is irrelevant to them; it actually means that it is the perfect time to begin Life Care Planning.

To utilize the program best, you should clearly still be able to make your own decisions. An important benefit of the program is that you have already created a plan, while you are healthy, to govern what decisions will be made while your health declines. If you wait until your health or your cognition begins to decline before starting Life Care Planning, there are still ways we can help, but you are limiting our ability to help. By allowing us to get involved once decline has already begun, you may already have compromised some of your standard of living or may already have fallen into some avoidable pitfalls. Just as you purchase a life insurance policy long before you think you will die, or you might purchase long-term care insurance many years before you anticipate needing long-term care, you can best utilize Life Care Planning by signing up before you need any help.

So, even if you don’t think you need Life Care Planning yet, consider scheduling a free Life Care Planning consultation with me and with our Elder Care Coordinator so you can learn more about the program and all the benefits it can provide you. Additionally, contact our office to RSVP for a special seminar about Life Care Planning on November 14th at the Holiday Inn & Suites Historic Gateway on Bypass Road. We look forward to seeing you soon!

Friday, September 13, 2019

Caregiver Agreements

Catherine E. Sears, Esq.

Just as you have the opportunity to choose your own mechanic or your own attorney, a Medicaid applicant has the opportunity to choose who to hire to provide caregiving services. Of course, the applicant may choose to hire a professional in-home caregiving company; however, if certain criteria are met, the applicant may, alternatively, hire a trustworthy family member to serve as a caregiver. The applicant and the family member might understand between themselves that the family member would ordinarily provide such caregiving services out of the goodness of her heart for no cost, and that being part of a family means helping your loved ones without expecting anything in return.
However, by paying a family member to serve as a caregiver, the Medicaid applicant can still spend-down his resources in order to qualify for Medicaid, and, instead of having that money go to a professional company, can keep the money in the family. Additionally, even though this money will now legally belong to the family member and not to the Medicaid applicant, there can be an acknowledgement within the family that these funds are still the applicant’s money because the family member would have been willing to provide assistance free of charge.
Once a senior actually receives long-term Medicaid, all of her income, with the exception of the $40.00 “personal needs allowance,” will go towards paying the cost of her health insurance premiums and the patient-pay responsibility at the long-term care facility. Therefore, any other expenses which go beyond the scope of the cost of the long-term care facility (including new glasses or hearing aids, new clothes if the senior’s clothing size fluctuates due to her medical condition, tasty snacks to supplement the food provided by the long-term care facility, etc.) must be paid from the personal needs allowance or out of the goodness of family members’ hearts. These expenses can add up, and having family members pay for these “supplemental needs” out of their own pockets can have a significant impact on family members’ own finances. However, if a family member had previously been paid for serving as the senior’s caregiver, then that family member can use that “extra” money to pay for these supplemental expenses instead of using her personal assets. Then, if there is any money left over after the senior dies, the remaining funds can be distributed to the senior’s family members to pass some assets on to the next generation.
There are some practical factors to consider in determining whether a caregiver agreement between a parent and a child is an appropriate strategy for your client. First, the caregiver child must be trustworthy to maximize the likelihood that he will, in fact, use these funds for his parent’s supplemental needs. It is wise for the caregiver child to create a separate bank account and deposit the funds into that account instead of commingling the assets into an existing joint account with a spouse. It is also wise for the caregiver child to update his own estate planning documents to say what will happen to the assets in case the caregiver child predeceases his parent. Additionally, because the money from serving as a caregiver will be considered earned income for the caregiver child, he will need to report and pay income taxes on the income. Since the money will legally belong to the caregiver child, there will be gifting ramifications for any money he returns to the parent during the parent’s lifetime and any money he gives to his siblings or other beneficiaries after his parent’s death. Depending on the amount gifted to a particular individual within a calendar year, he may need to file a gift tax return, and any amount gifted could create a penalty period if the caregiver child himself needs long-term care Medicaid within five (5) years of making the gift. If the caregiver child is also serving as Agent under the parent’s durable power of attorney or as Trustee of the parent’s revocable living trust, then it is also important to make sure that the power of attorney and/or trust document give the caregiver child the power to engage in self-dealing.
There are also a number of factors that need to be met to ensure that a caregiver agreement between a parent and a child will be treated as compensation for services and not as an uncompensated transfer which will create a penalty period. The rules that govern these requirements are extremely detailed, so it is important to have an experienced elder law attorney draft a precise, custom-tailored contract for your family to avoid accidentally failing to meet one of Medicaid’s many criteria.
If a family member is providing caregiving services to a Medicaid applicant, this can be an extremely effective way of transferring assets to such family member without creating a penalty to the applicant. However, for this strategy to work correctly and not penalize the Medicaid applicant, it is imperative that all parties treat the arrangement as the formal, legal matter it is and not as an informal arrangement simply because it involves family members.