Elder Law Basics Presented By: Attorney Bob Mannor & Attorney Jennifer Ackroyd-Fabris Attorneys Bob Mannor & Jennifer Ackroyd-Fabris Bob was a speaker at the 1 st Annual Elder Law Institute and this year is a featured speaker at the 2 nd Annual Elder Law Institute which is a continuing legal education program for lawyers put on by an alliance of all of the Michigan Law Schools. Bob & Jennifer are Accredited Attorneys by the Veteran Administration Office of General Counsel Bob is the current President of National Academy of Elder Law Attorneys Michigan Chapter and on the Board of Directors for the Elder Law and Disability Rights Section of the State Bar of Michigan Bob is one of only 18 Attorneys in Michigan who are Nationally Board Certified as an Elder Law Attorney by the National Elder Law Foundation Both Bob & Jennifer teach Continuing Education classes for Attorneys, Social Workers and Nursing Home Administrators Both Bob & Jennifer were recently published in the Michigan Bar Journal with an article on Holistic Planning for Long Term Care Basics of Elder Law What is Elder Law? Over-used term? Canany attorney do Elder Law? Should any attorney do Elder Law? What is the difference between Elder Law and Life Care Planning Law Firms? 1
Get to know Mable Husband died recently Diagnosed with Alzheimer s Disease Children are all out of state Wants to stay in her own home as long as possible Limited assets and income Veterans Benefits What does VA have to do with Elder Law Planning for Income & Asset Eligibility Accreditation Getting through the system 2
VA Health Care System Veterans Administration Home Care 2-42 hours per week Community Adult Day Health Care Veterans Administration Nursing Homes Contracted Private Nursing Homes* (*See materials for list of contracted facilities) VA Health Care System Community Nursing Homes with VA Contracts Community Nursing Homes are able to accommodate respite placements. Eligibility: 70-100% Service Connected 60% Service Connected and unemployable 60% Service Connected and permanently and totally disabled Needing nursing home care for Service Connected disability, % not specified. VA Compensation Service Connected Benefits Presumptive Conditions* Vietnam Vets If a Veteran was previously denied, now is the time to re-apply (recommend using an attorney if previously denied benefits) (*See materials for list of Presumptive Conditions) 3
A&A: A right for our profoundly deserving Veterans Aid and Attendance (A&A) provides benefits for veterans and/or surviving spouses. It is designed specifically to help those who served our country s military in its greatest time of need. What is A&A? Veterans Aid & Attendance Pension Benefit Can help a veteran or their surviving spouse pay for care in: Independent Living Communities Assisted Living Communities Nursing Homes In-Home Care 2016 Monthly Benefit Rates Veteran with Dependent/Spouse: $2,120 Single Veteran: $1,788 Surviving Spouse: $1,149 Veteran healthy Spouse needs care: $1,404 4
Eligibility Requirements 90 days of active duty (1 day during wartime) Received a discharge other than dishonorable Over age 65 Periods of Wartime WWI: Apr 6, 1917 to Nov 11, 1918 WWII: Dec 7, 1941 to Dec 31, 1946 Korean Conflict: June 27, 1950 to Jan 31, 1955 Vietnam Era: Aug 5, 1964 to May 7, 1975 (Feb 28, 1961 for veterans who served in country before Aug 4, 1964) Gulf War: Aug 2, 1990 - TBA Qualification The VA eligibility measures: Medical Need Doctor s orders Income & Medical Expenses Medical expenses must exceed income Assets 5
Example Leroy is a 92 year old World War II Veteran Wife died 8 years ago and has lived alone ever since. He has fallen several times recently Income is $1,700 from Social Security and $1,400 from GM pension Owns a house in Flint and a bank account Considering Independent Living for $3,500/month and paying a home health company $1,000/month for shower assist, medicine maintenance and help with dressing each morning Could qualify for an extra $1,788 per month from VA to help pay expenses SPECIAL RULES FOR INDEPENDENT LIVING Must be independently paying for 2 ADL s Only applies to Independent Living Not Assisted Living Functional mobility, often referred to as transferring (moving from one place to another while performing activities) Bathing and showering (washing the body) Dressing Self-feeding (not including cooking or chewing and swallowing) Personal hygiene and grooming (including brushing/combing/styling hair) Toilet hygiene (getting to the toilet, cleaning oneself, and getting back up) SPECIAL RULES FOR INDEPENDENT LIVING Must be independently paying for 2 ADL s Only applies to Independent Living Not Assisted Living Note: Medicine Maintenance is NOT an Activity of Daily Living (ADL). It is considered an Instrumental ADL Does not count for making Independent Living rent an Unreimbursed Medical Expense for VA Purposes It DOES still count as an Unreimbursed Medical Expense by itself 6
MEDICARE Follow The Medicare Money How Medicare Providers Are Paid & What It Means for Advocacy Christopher W. Smith Chalgian & Tripp Law, Southfield smith@mielderlaw.com Declining Beneficiary Protections 98.8% 7
Fee For Service + + = Total Bill Photos: Front desk by kzenon at 123rf; Valet by Diana Johanna Velasquez at 123rf; Room service by Russ Witherington at 123rf. PROSPECTIVE PAYMENT Photo: Buffet by Emily Manevska at 123rf. Skyrocketing Medicare Advantage Enrollment in 35% 30% 25% 20% 15% 10% 5% 0% 5% Michigan $5.8 BILLIO N 1% 16% 32% 2000 2005 2010 2015 Photo: Road sign by Keith Bell at 123rf. 8
Medicare Advantage: Advocacy Takeaways Two parties need to profit within capitated rates: Insurer & Provider Medicare Advantage: Advocacy Takeaways Beware of the Fine Print Incentive to Enroll Healthy Individuals Skilled Nursing Coverage Use Quality Ratings RECOVERY AUDIT CONTRACTORS % of Medicare Payments % of RAC Recovery Other Providers Other Providers Hospitals 37.3% Hospitals 84.2% 9
RACs AND OBSERVATION STATUS Average 2-Day Hospital Stay (2013) Part A = $5,142 Part B = $1,741 (Observation) ALJ Appeal Waits 2009 = 94.9 Days 2015 = 547.1 Days Hospitals: Advocacy Takeaways 1. Hospitals are paid per diagnosis. NOT PER DIEM. Hospitals: Advocacy Takeaways 2. Make sure discharge is patient centered not hospital centered. 10
Hospitals: Advocacy Takeaways 3. Hospitals are really under tremendous cost pressures. Examples: Medicare Advantage Plans Readmission Penalties Recovery Audit Contractors Skilled Nursing Key Terms: Skilled Nursing Data collected in Minimum Data Set, which is part of the Resident Assessment Instrument. Grouped by Resource Utilitization Groups (RUG) 66 Groups Under RUG-IV RUG Score Determines Per Day Reimbursement 11
RUG Score 8 Classifications Rehabilitation Plus Extensive Services* Rehabilitation Extensive Services (*e.g., Ventilator) Special Care High (e.g., coma, severe COPD, septicemia) Special Care Low (e.g., feeding tube, skin ulcers and infections) Clinically Complex (e.g., pneumonia, IV medications, surgical wounds) Behavioral Symptoms and Cognitive Problems Reduced Physical Function RUG Score Then Classified in One of 62 Groups Examples of Factors Impacting RUG score: Therapy Hours ADLs (eating, toileting, transerring, and bed mobility) Depressive Indicators Skilled Nursing: Advocacy Takeaways Use Minimum Data Set as an advocacy tool. 12
Medicare Pays for up to 100 days in a Skilled Nursing Facility Days 1-20: $0 patient responsibility Days 21-100: $161 patient or co-insurance responsibility Practice Tip Patient is in a Skilled Nursing Facility longer than 20 days and has a high co-pay Switch to Medigap Open Enrollment: Oct. 15 Dec. 7 th. Medicare Advantage Disenrollment: Jan. 1 Feb. 14 SPECIAL ENROLLMENT PERIOD Moved into, currently live in, or for 2 months after moving out of an institution (such as a skilled nursing facility or long term care hospital Legacy Medigap Hospice: Advocacy Takeaways 1. Hospice discharges are becoming more common. 2. Medicare Advantage patients return to Original Medicare when on hospice. 3. Hospice provider must have a contract with the skilled nursing facility. 4. Hospice covers palliative medications. Other Medicare Parts cover medication unrelated to terminal illness. 13
Medicare 100 days renews after a period of 60 continuous days with no skilled care If the break in skilled care is 1-30 days, patient does not need a new qualifying hospital stay to continue with their unused 100 days If the break in skilled care is 30-60 patient needs a new qualifying hospital stay to continue with their unused 100 days If the break in skilled care is 60 days or more, patient needs a new qualifying hospital stay AND their 100 days renews Long Term Care Medicaid Covers long term skilled care in a nursing facility including room and board. Can cover the Medicare co-pay if co-insurance does not. Is retroactive to the first day of the month in which the application was submitted. Must medically qualify Medically Eligible Door 1 Activities of Daily Living Bed Mobility, Transfers, Toilet Use, Eating, Door 2 Cognitive Performance Short Term Memory, Cognitive skills for daily decision-making, making self understood Door 3 - Physician Involvement Physician Visits & Physician Orders Door 4 Treatments & Conditions Door 5 Skilled Rehabilitation Therapies At least 45 min Door 6 Behavior Wandering, verbally abusive, physically abusive, socially inappropriate/disruptive, Resists care Door 7 Service Dependency See Materials 14
Long Term Care Medicaid Income Limit: Monthly income cannot be more than the cost of care at the nursing facility Asset Limit: Single Person: $2,000 Married Person: Up to $119,220* Exempt Assets: 1 Home (subject to estate recovery), 1 Vehicle, 1 Prepaid Funeral, Life Insurance Policy (if face value is below $1,500) Gifting Innocent Transfers Forgiving a Debt Bad Advice Selling something for less than what it is worth A relative withdrawing money from a joint account Adding child s name to account or house 15
Penalty Periods 2016 Divestment Divisor = $8,282 For every $ 8,282 gifted (within the last 5 years), Medicaid will not pay for 1 month of Long Term Care MI Choice Waiver Can help pay for care: In the home In an Independent Living Some Assisted Livings MI Choice Waiver Medical Eligibility Must Meet Michigan Medicaid Level of Care Determination Financial Eligibility Same as Long Term Care Nursing Home Medicaid Income Limit of: $2,199 16
MI Choice Waiver Waitlist Priority Categories: 1. Children s Special Health Care Services Age Expirations 2. Nursing Facility Transition Participants 3. Current Adult Protective Services (APS) and Diversion Applicants 4. Chronological Order by Service Request Date MI Choice Waiver Key Points 30 days to become financially eligible for Medicaid Initial Asset Assessment for Married Couples See Materials Imminent Risk Assessment Nursing Facility Transition Long Term Care Pitfalls, Red Flags & Waterfalls 17
Medicaid Myth Busters Question #1 Should I tell a resident to give assets away to protect them from the nursing home spend down? Answer: NO! If you need nursing home care within 60 months of giving away the money, you will be penalized. Question #2 Medicaid Myth Busters When someone is on Medicaid in a skilled nursing facility on Medicaid, the house is protected. Answer: False The house can be an exempt asset while patient is on Medicaid, but it may be subject to estate recovery if no sufficient legal planning. (Plus they are left with no money to pay taxes and insurance). Medicaid Myth Busters Question #3 Everyone should use a Ladybird Deed to protect the house from Medicaid spend-down. Answer: False Ladybird Deeds are much more complicated than they seem. They are often a bad decision. The family should consult a qualified elder law attorney. Specifically, they should not get a Ladybird Deed from an attorney that does not regularly file successful Medicaid applications. 18
Medicaid Myth Busters Question #4 If I am already in a nursing home, it is too late to preserve any assets. Answer: B No, It is never too late (or too early) to plan! You may be able to protect some of your remaining assets no matter how long you have been in a nursing home or paying for long-term care elsewhere. Medicaid Myth Busters Question #5 The community spouse s assets are not considered in Medicaid eligibility. Answer: False, they are countable. BUT The community spouse s assets are countable at the original application, but are not countable upon yearly redetermination Medicaid Myth Busters Question # 6 For a married couple, when the community spouse dies, the spouse on Medicaid will remain eligible. Answer: B False, Medicaid can end depending on the assets Proper planning at initial application can avoid getting a denial upon the spouses death. 19
Why Plan Ahead If there is a chronic disease diagnosis Dementia or Alzheimer's Parkinson s COPD It is Likely Clients will need long term care at some Point To pay for 1 year of home care (40 hours weekly, $22/hour) = $45,760 To pay for 1 year in assisted living ($4,000 per month) = $48,000 To pay for 1 year of memory care assisted living ($6,000) = $72,000 To pay for 2 years in a nursing home (at $8,282 per month) = $198,768 Total Care for 5 years of care = $364,528 Sam & Lucy Sam was a Veteran Sam has trouble walking Lucy has Alzheimer s Lucy was admitted to a skilled nursing facility last week for long term care Together they have a modest home, car and have $100,000 saved Sam & Lucy Without Planning: The social worker tells them to apply for Medicaid. They do and get denied, the letter says they need to spend down $50,000 After 6 months in the nursing home, Sam has spent $54,000 The social worker tells him to apply again Sam does, he gets approved but there is a divestment penalty because: In the 6 months she has been there, he was told he could no longer drive, so he gave the car to his granddaughter. He pays for 2 more months of her care, then Medicaid starts. He found old paper work for a life insurance policy that Lucy had in her name with a cash value of $2,000. He doesn t have Power of Attorney so the insurance company will not allow him to cash it in. 20
Sam & Lucy But Wait, there is more: After 11 months of Medicaid coverage, Sam gets the redetermination in the mail. He fills it out and sends it in. 3 months later he gets a denial because: He reported $28,000 in their joint bank account The nursing home sends Sam a bill for $27,000. Sam pays the bill and now only has $1,000 to live on. Medicaid is still denied, by the time he got the notice, he has another $9,000 bill from the nursing home because Medicaid is still not approved Sam & Lucy Sam has neglected getting care for himself because he cannot afford it. Another month passes, Sam dies Medicaid is still not approved, now Lucy has an $18,000 bill at the nursing home. The social worker submits a Medicaid application for her, she is denied again because of the life insurance policy Outstanding balance continues to grow DO NOT FILE UNLESS YOU KNOW YOU ARE GOING TO GET APPROVED! Once approved make sure to stay approved! 21
Sam & Lucy With Planning: Sam contacted an Elder Law Attorney when he was told Lucy would need long term care Lucy was still competent enough to sign a Power of Attorney (or the attorney sought a Protective Order from Probate Court) The attorney had Lucy sign a Power of Attorney and has listed Lucy s niece as a back-up Attorney does Medicaid plan to protect the $100,000 + the value of the life insurance + the house Medicaid application is approved the 1 st time Nursing Home gets paid Sam has enough money to pay for his care and to pay for rides to the nursing home to visit his wife Community Spouse Medicaid Community Spouse Income Allowance Court Approval Trusts for spouse no longer viable but other techniques can produce the same results Roadblock: Misunderstood Money Patient says I have no money to pay for care Assets & Income Saved money for the elder's benefit: an elder centered approach 22
Roadblock: Where is the $ going? Bad Life Insurance Policies Bad Annuities Supporting grown children Kids say they need parent s money to live on too bad this is NOT ok. There may be other programs to help the kids if they are disabled or indigent but they cannot rely on parent s money. Elder Abuse Roadblock: Unintentional Fraud Lack of reporting assets is considered Medicaid fraud. Not realizing something is a reportable asset and leaving it off the application is considered Medicaid fraud. If you help them file Medicaid or refer to a Non-attorney and assets are not reported properly who do you think the Inspector General is going to be calling? Roadblock: Capacity When can a person make their own decisions? Power of Attorney? When Can Someone Sign a POA? Guardianship or Conservatorship Doctor is not the determinant for Legal Capacity 23
Roadblock: Respecting Parents Wants but Disregarding their Needs I can drive fine and I only go a short distance anyway I want to die in my home or I Don t want strangers in my house I Don t Need Help I Said In Sickness and In Health Roadblock: Lack of Consistency Yo-Yo Effect Home Hospital Home Hospital - Rehab Home Hospital REPEAT The Magic Pill In Long Term Care there are no one time fixes. 24
MannorLawGroup.com Grand Blanc 8226 S. Saginaw St. Suite A, Grand Blanc, MI 48439 Rochester Hills 455 S. Livernois, Suite B22, Rochester Hills, MI 48307 phone 810-694-9000 Info@mannorlaw.com fax 810-963-0195 25