Good Advice You Will Ignore
Nursing Homes Are Suing Friends & Neighbors. Do Not Be A Victim.
How Can You Be Held Responsible For Someone Else’s Bills?
1. Friend or Relation Needs Long-Term Care. You are here to help. To get your relative, friend or neighbor into a long-term care facility. Just helping out. Being nice.
2. Reality Check. Sometimes there is no alternative to residential care.
3. Who Pays? Nursing homes are unbelievably expensive. $400, $500, $600. Per day.
4. Medicaid Pays? Even broke people must apply for Medicaid. Medicaid rules are torture to understand and worse to follow.
5. When Medicaid Does Not Pay. Many folks lose months of Medicaid eligibility when applying. Tens of thousands of dollars that Medicaid will never pay.
6. Can’t Get Blood Out of a Turnip. The resident is broke. But you are not.
7. Follow the money. Why does the nursing home pursue you? “Because that’s where the money is.”
8. Even National Public Radio has noticed! Nursing homes are stepping up collection efforts.
9. What To Do? Federal law already prohibits the worst tactics.
10. Do Not Be A Victim! Help Your Loved Ones… And Protect Yourself. Your loved ones need you. Will you be victimized? Not necessarily.
3 Federal Laws
Three federal laws protect seniors, their friends, and families.
Nursing Home Reform Act
They cannot make you “assume personal responsibility for any cost of the resident’s care.” Personal guarantee requirements are illegal. But they will try anyway.
Fair Debt Collection Practices Act Fair Credit Reporting Act
They cannot sue you. They cannot ruin your credit rating. Well, at least they are not supposed to.
When they violate the Nursing Home Reform Act, they also violate the Fair Debt Collection Practices Act. When they report to the credit agencies, they also violate the Fair Credit Reporting Act too. Trifecta!
Can They Do That? Nope! Can They Get Away With It?
Only If You Let Them!
Q: If these bad practices are so illegal, how do they get away with it?
A: Because you let them.
Q: How can you protect yourself?
A: Glad you asked. Read on…
Sign The Papers!
No, I Will Not Sign The Papers!
Be Prepared! They want you to sign the contract. You do not want to sign the contract. They cannot make you sign the contract. Be ready. Prepare yourself. Do not be surprised. Signing the contract will be presented as reasonable. “But everybody signs!” You are not everybody.
1. Take a Tip from Nancy Reagan and Mr. T: “Just Say No!”
You drive your friend or family member to the nursing home. The admissions clerk has a whole file of papers. For you. To sign. They are willing you to sign. They are wanting you to sign. They are waiting for you to sign. Refuse. Take a lesson from the mule. Sit down. Do not budge. The answer is “No.”
“But somebody must sign!” they say. Fine. Let the soon-to-be resident sign the contract. Remember that under the Nursing Home Reform Act, only the resident can be required to assume personal liability for their care.
“But your loved one/friend/relative is not mentally competent.” they say. How do they know? Only the probate court can decide whether someone is “legally incapacitated.” If the soon-to-be resident is an adult, they are presumed competent. And able to sign.
“But that signature is just a scrawl!” they say. Just remind them that any ink on the page is good enough. A happy face works. Scribbles are just fine. Doubt it? Can you decipher your doctor’s signature? Or your lawyer’s? What does that prescription mean? Do not let them buffalo you. Clients frequently comment that my own signature is remarkably clear. You can actually read it! Credit goes to Sister Mary Rachel in the second grade who taught penmanship. But to be legally valid, any squiggle will do.
What if the soon-to-be resident is incapable of even a modest squiggle?
2. Remember: Important to Them Does Not Mean Important to You.
Your loved one has an episode. 9-1-1. Off to the hospital. Then to rehabilitation at the nursing facility. Your loved one, friend or neighbor is already at the facility. While visiting, they want you to sign “for our records.” Why would you sign? The care is already in place. Urgency on their part does not create urgency on your part.
“If you don’t sign, we will be forced to kick them out!” they say. Remind them that there are only five (5) specific reasons to evict a resident:
1. Does not need the level of care;
2. Does not pay;
3. Endangers health or safety of other residents;
4. Home cannot provide for the resident’s needs;
5. Closure of the nursing home.
Notice that these reasons do not include: Because a family member or friend refused to sign the contract. Let them huff and puff. They cannot discharge without a 30-day notice and discharge care plan. No worries.
Sign The Papers!
Yes, I Will Sign The Papers!
You are tired. Feeling guilty. Harassed. You forgot the good advice you read above. They wore you down. You give in and agree to sign the contract. Pressure!
But first! Read the damn thing… Let your elder law counsel read it for you. Here’s what to watch out for:
1. Liability Language. Remember that the Nursing Home Reform Act protects you from responsibility for your loved one’s bills. But not if you voluntarily agree. So do not voluntarily agree. If you see the words: guarantee, guarantor, surety, hold harmless, financial responsibility, joint and several liability, or similar words. These are red flags, screaming sirens. Draw a line through any language you do not understand. And if you wind up with pages of words with lines through them, good for you. Blatant violations of the Nursing Home Reform Act like this are pretty unusual.
2. Responsible Party. Frequently, designating you as the “responsible party” or “financially responsible party” simply means you agreed to act as attorney in fact under a power of attorney. And that’s OK. Just be sure that whenever you sign anything, add “, POA” to your signature. And beware of attempts to sneak personal liability language past you…
3. Accurate, Timely Medicaid Application. Do not promise to file the Medicaid application. Especially, do not promise to file a Medicaid application accurately, or completely, or in a timely manner. If you screw up the application, then you are on the hook. Medicaid applications are like tax audits. You must have records. Lots of records. Up to five (5) years of records. And it is torture! That’s why we have Elder Law attorneys to figure this stuff out. Many, many Medicaid applications are denied. For all sorts of reasons. Now you are responsible for the bills. And the most expensive Medicaid applications are those that are done “for free” by the nursing home.
4. Using Resident’s Assets to Pay for Care. Seems reasonable, doesn’t it? But what if you cannot get access to the resident’s money or property? How can you comply? Did you just agree to go to probate court for guardianship and conservatorship? Maybe. What if the power of attorney you have from the resident is incomplete? Not all powers of attorney are created equal. Some are good. Others are awful. And then there are the complications relating to the assets themselves. Does your friend share joint tenancy of the family farm or cottage? What if you cannot sell the property? What if the market is bad?
What if everything looks fine, but the bank simply refuses to accept the Power of Attorney? Line through this sort of thing… you’ll be glad you did!
You can get long-term care benefits without going broke. Medicaid wants you broke. But you do not have to accept what Medicaid wants. You can protect what you have earned. Here’s how:
How Medicaid Works
What If You Give Away Your Stuff?
What if you give away your stuff and then apply for Medicaid benefits? Medicaid will say, “We will not help you. You had stuff and gave it away. And so we will not pay.” This is called the “Penalty Period.” Medicaid will excuse itself for a period of time. The more you gave away, the longer Medicaid will not pay. Right now, for every $10,000 you give away, Medicaid will not pay for a month. Give away $120,000, Medicaid will not pay for an entire year! But then Medicaid will pay.
In the meantime, while Medicaid is not paying, the nursing home is suing you. And your kids. And your friends, And your first-grade teacher. And anyone else you gave stuff to. You thought you could keep the house? Ha-ha. You thought you could keep an automobile. Yuk-yuk. Whoops!
Funny thing, though. What if you gave away your stuff more than five (5) years ago? What if sixty-one (61) months ago you gave all that stuff away? Then you applied for Medicaid? Things are different. Now Medicaid does not care that you ever had that stuff at all. Does not matter.
So perhaps you should give all your stuff away. Right now. To the kids. Your neighbors. Your first-grade teacher. Then wait for five (5) years. And if you ever need long-term care after that, no problem! Medicaid does not care that you had that stuff and gave it away. Great Plan!
By now, the sharpest knives in the drawer have spotted the problem with this brilliant approach, right? If you give your stuff away, then you have no stuff. And you like your stuff. What to do?
What If You Give Away Your Stuff Without Giving Away Your Stuff?
How can you give away your stuff without giving away your stuff? By using a particular kind of trust, that’s how. For Medicaid purposes, you gave your stuff away. For federal tax purposes, state tax purposes, common sense purposes, you did not give your stuff away.
The IRS doesn’t think you did anything when you put your assets in this type of trust. Medicaid says you “divested” those assets. Medicaid says you gave those assets away. Medicaid starts the Five-Year Clock. Five (5) years after putting those assets into that trust, Medicaid will not count those assets as yours. And you will qualify for the Medicaid benefits you have paid for. Without sacrificing your lifesavings, cottage, other stuff.
Why Should You Want To Qualify For Medicaid Benefits And Keep Your Stuff?
Why? Do you like paying for the same thing twice? Are you opposed to getting any return on your tax dollars? Does the government know what to do with your money better than you do? Would it be dreadful to receive the government benefits you’ve paid for? And to have additional life savings to purchase additional goods and services? Is it awful to get the same deal from the government that irresponsible folks get? Would you prefer to be flat, busted broke and forced to go to a nursing home than to supplement at-home Medicaid with life savings to remain at home? Are your kids and grandchildren so undeserving and ungrateful that you’d rather give your money to the government?
This Is Too Good To Be True! Tricksy Stuff Like This Never Works For Regular Folks!
Plus, It Must Be Wrong Or Immoral Or Something Else That’s Bad Or My Planners Would Have Told Me All About It! And What If I Move Out Of State? And Give Me A Minute And I’ll Think Of Something Else…
On February 8, 2006, Congress overhauled the Medicaid system. Congress replaced 50 states going in 50 different directions with some general principles that apply to everybody. Seventeen years ago, I was shocked when this happened. The Medicaid landscape was rewritten, much to the distress of our long-term care clients. Tools and techniques that had been proven reliable were wiped out. But there was a silver lining to this dark cloud of Medicaid reform.
No longer did it make sense to wait-and-see. The environment was different. Now we had some assurance that a Michigan plan could work in Florida. Or Texas. Or South Carolina. But not California, nothing works in California.
Not only did we have a legal structure that worked from coast to coast, but we could also rely on that structure to be stable. And so, it has proved. Over the last 17 years, thousands of these LifePlanning™ trusts have been implemented by regular folks. And they have worked. Every time. Saving millions of dollars. For regular folks. To maintain dignity. To preserve families. To keep the promise that hard work, saving, planning, and doing the right things will have good consequences for you, your spouse, your family.
For every Medicaid application involving these trusts, we submit a full copy of the trust and all the supporting documents. Total disclosure. Candid honesty. Written evidence. Full documentation. This stuff works because we scrupulously, thoroughly, exhaustively comply with every law, rule, precept, and policy.
Going broke is a choice. Your choice. It is not chance, bad luck, or misfortune.
Why Don’t You Deserve A Little Payback For All The Taxes You Paid In?
Why Do You Want To Spend Your Last Nickel On Long-Term Care?
Why Shouldn’t The Government Spend Your Money For You?
Traditional estate planning is concerned with avoiding probate, saving taxes, and dumping your leftover stuff on your beneficiaries. After you die. Nobody cares what happens to you while you are alive. How does that help anyone? Stupid.
Traditional estate planning fails because the overwhelming majority of us will need long-term skilled care. 70% of us. For an average of 3 years. And we will go broke paying for it.
Is it surprising that thousands of recreation properties: cottages, cabins, hunting land, are lost to pay for long-term care? Why is your estate planner hurting you and your family? It is evil intent? Or stupidity?
LifePlanning™ defeats Nursing Home Poverty. Keep your stuff. Get the care you have already paid for. Good for you. Good for your family. Good example for society,
When my mother suffered from the dementia which led to her death, over 10 years ago, their estate plan preserved their lifesavings. Mom’s months in the nursing home did not mean Dad’s impoverishment. Dad spent the last years with security and peace of mind.
Is Now A Bad Time For A Real Solution?
Perhaps you think you already have an answer to this problem. Maybe you do not see this as a problem at all. It is possible that you do not believe in the passage of time or its effects on you.
Peace of mind and financial security are waiting for everyone who practices LifePlanning™. You know that peace only begins with financial security. Are legal documents the most important? Is avoiding probate the best you can do for yourself or your loved ones? Is family about inheritance? Or are these things only significant to support the foundation of your family?
Do you think finding the best care is easy? Do you want to get lost in the overwhelming flood of claims and promises? Or would you like straight answers?
Well, here you are. Now you know. No excuses. Get information, insight, inspiration. It is your turn. Ignore the message? Invite poverty? Or get the freely offered information. To make wise decisions. For you. For your loved ones.
The LifePlan™ Workshop has been the first step on the path to security and peace for thousands of families. Why not your family?
