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Do you have the Right Durable Power of Attorney?

Do You Have the Right Durable Power of Attorney?

What is a Power of Attorney? Sometimes it’s called a Financial Power of Attorney. It’s a document that gives authority to your named Agent to act for you in various situations.  That may be paying your bills, accessing your bank accounts, closing your accounts, or even selling your residence. Well planned power of attorney documents give considerable authority to your appointed Agent, so you need to make sure that you have named a trusted person to act as your Agent.

Have you named a successor Agent? Maybe you have named your spouse or your oldest child as your Agent, but what if that person can’t act for you. Have you named an alternate person? Is your power of attorney a “durable” power of attorney? If it is durable, this means that your Agent can act for you even if you are incapacitated. Generally, you want the document to be durable, and you want to appoint an alternate Agent so that you are better protected.

Is your power of attorney “springing,” “conditional,” or “immediate”? Both springing and conditional powers of attorney have been outlawed in some states due to the problems that they can create, but I often see them being used by attorneys who are not familiar with those issues. If a person is being scammed or making bad decisions, and they have a springing power of attorney that requires one or two doctors to state that the person cannot handle their own affairs, the big question is whether doctors will be willing to sign such statements, or whether the person can avoid going to the doctor so that there is no diagnosis of dementia, or whether the person can fool the doctor during a five minute visit so that the doctor thinks the person is still okay to handle their own affairs.

Is your power of attorney elder law friendly? An example of the importance of this is whether your Agent can get you onto government benefits such as Medi-Cal if you need assistance at home or you want Medi-Cal to pay for your nursing home costs. It’s not just a matter of the application for the benefit, but the power of attorney must also allowing transfers and reclassification of assets for eligibility for those benefits and for protection against the state placing a lien on those assets. These are critical issues for many elders, and the lack of a power of attorney, or having the wrong power of attorney, can prohibit your family from taking the necessary actions to protect you and your loved ones.

I have seen many individuals and families face financial hardship because a proper power of attorney was not in place. Getting a good power of attorney is not difficult. Not having the right one in place when you need it can be devastating.

Every adult should have the right kind of power of attorney in place and have the best Agent and successor Agent available to take action to help them. It’s one of the most important documents that a person can have. If you don’t have a durable power of attorney in place, get one. If you have one, make sure that it is detailed enough to allow your Agent to take the necessary actions that may be needed to protect you, to care for you, and to protect your assets.

 

 

Improper Nursing Home Charges

A recent article in the New York Times stated, “We have a big problem paying for long-term care in this country, although most people don’t wake up to the challenge until it affects their family directly.”

Many families overpay simply because they don’t know the rules and aren’t aware of their rights. Don’t let that happen in your family. Make sure that you learn the basics before you need to get care for someone, and make sure that your legal documents will allow the individuals you trust to make the right decisions for you.

There’s a lot of confusion on when Medicare will pay for a skilled nursing facility. A Federal court case in early 2013 clarified that the nationwide standard applying Medicare benefits for long-term care in skilled nursing facilities was incorrect. The old rule-of-thumb standard was the “Improvement Standard” that resulted in many seniors being inappropriately denied Medicare coverage for something that should have been covered by Medicare. Now, more than five years after that court decision, many nursing homes are still misapplying the standard and denying Medicare benefits to residents.

Despite the court decisions, we still regularly see nursing homes acting in violation of the law with overbilling and improper evictions. Why? The nursing homes can increase their profits by violating the law, and most families never know that they’ve been scammed into making unnecessary payments. The insurance companies go along with this too because it saves them billions of dollars annually when they don’t have to pay the residents’ portion of the nursing home bill that Medicare doesn’t cover.

Most nursing homes follow the law, or can be nudged to follow the law, but some nursing homes act aggressively with false billing and improper evictions.

I was recently preparing to sign documents at a nursing home in the late afternoon, and then the family called to advise me that my client had died that morning. When the family came to see me a week later, I found out that they had been charged a little over $10,000 at the beginning of the month. I couldn’t understand why the family had been charged when the elder was still covered by Medicare. I thought it was wrong, and I advised them to go back and seek a refund.

A few weeks later the family was happy to advise me that the nursing home had immediately given them back a little over $6,000. Wow! … That’s great, but what about the remaining $4,000? Why wasn’t that returned?

I told the family to send the nursing home a signed letter and ask for a written reply from the nursing home explaining exactly why the nursing home was keeping the $4,000 amount and not returning the entire amount to the family of the deceased person.

After three letters from the family and still no response, the family phoned the nursing home and was told that they could come in and discuss the issue. The nursing home cleverly never put anything in writing. They simply explained that it was a billing error. They said that the deceased woman should have been kept on Medicare, but it was now too late.

That’s wrong in many ways. The nursing home could have returned the improperly charged amount to the family, and the nursing home could have corrected their error with Medicare. The more likely scenario, however, is that Medicare paid the nursing home and the nursing home also kept the family’s money. That’s double dipping. It’s called fraud.

Learn how things work. Don’t allow the nursing home to charge for something the elder is already entitled to under Medicare benefits.

 

Good News Bad News

Good News / Bad News

 

Covid has been bad news with illness and death for millions, the loss of loved ones and caregivers for millions, and economic turmoil for millions more.

When the pandemic first took off, the hospitals needed thousands of respirators. The good news was that the government had thousands in storage. The bad news was that the vast majority of those didn’t work. Good news and bad news.

Despite the losses from the outbreak, the good news has been the success of the vaccines we have available in the US. In other countries, the success has varied.

The good news in the Seychelles, Bahrain, Chile, and Mongolia was that they got out of the gate very fast with high vaccination rates in their populations. The bad news was that all four of those countries used Chinese vaccines which apparently weren’t very effective, and soon all four of those countries ranked in the top 10 countries of the worst outbreaks worldwide. Yes, good news and bad news.

What about your estate plan? If you have one, that’s good news. If it won’t work when you need it, that’s bad news. Will it work? People counted on those Chinese vaccines to work, but it appears that they weren’t effective.

Does your estate plan reflect your current wishes? Are the right people in charge to look after your interests? Will the results be good news or bad news?

We often see trusts that don’t reflect the person’s current wishes because they just haven’t gotten around to making the updates. But in some cases, the trust was wrong from the beginning. It simply wasn’t a good trust.

In a recent case with a husband and wife, the trust says that if either is incapacitated, they agree to resign from being Trustee. The next paragraph gives a committee of people who will decide whether the person is incapacitated, and if two of the three say the person is incapacitated, then the person agrees to resign. (Committee of three is pastor and two medical doctors.) The problem with the trust is that there is no third step for removal of the Trustee if he or she refuses to resign, and now the couple has waited too long and the husband’s dementia has progressed to the point where he no longer has the mental capacity to resign. I cannot allow him to sign any documents at all. He can say his name, but he doesn’t know that he’s married to his wife, and when asked for his town, city, street, or number of children, he can only repeat his name. — He can no longer sign any legal documents.

The wife has exhausted their liquid assets in paying for their stay at an assisted living facility, and now she’s facing the prospect of selling their residence and paying a huge amount of capital gains tax. Due to many different circumstances, and waiting too long to act, she’s now facing a dilemma and has a poorly written trust.

Where do you stand on this issue for yourself? Do you have a good trust? Does it reflect your current wishes of who you want in charge and how you want any remaining assets distributed after your death?

If you don’t have a trust, go see a qualified attorney who practices elder law and estate planning. If you have a trust, make sure it reflects your current wishes and will work when you need it to work.

Protect yourselves. Protect your families.