Who’s doing that Medicaid application?

An application for Medicaid to pay for nursing home care can be filed by the individual himself, his spouse, another relative by blood or marriage, a staff member of an agency of which the person is a client, the person’s physician, the person’s attorney, or a designated staff member at the nursing home. Of course, a court-appointed Guardian or Agent under Power of Attorney could also act on behalf of the applicant. Anyone other than the applicant him/herself is referred to as the “authorized agent.”  Whoever takes on that task should also accept the responsibility to monitor the file, collect the necessary verifications, take any necessary action to compel a third party to release records, file the application on time, and file appeals in a timely way. Potential legal hazards are lurking around every corner. There have been a series of cases recently involving authorized representatives which had disastrous results.

Sometimes the individual or family member appointed the nursing home or its affiliated application preparers to assemble and file the application, expecting to be relieved of any obligation to collect records. Sometimes it was the Agent under Power of Attorney or family member who started the application, but didn’t follow through due to difficulties collecting records and their own busy life. Sometimes the family member was led to believe that the County Board of Social Services would “assist with the application” by reaching out to get verifications that the family member couldn’t produce. In other cases, there were communications breakdowns between the affiliated authorized representative and the nursing home, or the representative and the family member. Either way, Medicaid eligibility is denied again and again for “failure to produce required verifications” or “failure to cooperate” with the application process. The individual is left holding the bag — with a huge debt and no source of ongoing payment — and the nursing home discovers that it has provided services without compensation.

Several recent cases illustrate the problem. The decisions are “not approved for publication,” which means they are not precedential and not binding on lower courts, but they do provide a window into what can go wrong in these situations.

In P.B. vs DMAHS and Atlantic County, a daughter of the applicant took on the obligation to file the application. The documentation was incomplete and after multiple communications to the daughter, the application was denied for failure to provide required documents.

In A.D. vs DMAHS and Cape May County, Future Care Consultants was the designated representative. The caseworker was sending his/her requests for more documentation to the nursing home, and the decision does not say anything about the communications between those two. However, the representative failed to investigate the questions at hand and therefore, did not provide the available verifications.

In V.S. vs DMAHS, (Passaic County), the Agent under Power of Attorney designated the nursing home as the Authorized Representative. The necessary documents weren’t all provided, and the application was denied. The nursing home neglected to appeal within the 20 day window, and filed the request for hearing 7 months later. DMAHS refused to grant a waiver of the 20-day appeal deadline, and this denial was upheld.

In W.S. vs DMAHS and Atlantic County Board of Social Services, the individual’s authorized representative  was the nursing home. It applied four times and each application was denied for failure to provide the necessary proofs. The Court held that the county agency had no affirmative duty to acquire the needed documents.

In J.H. vs. DMAHS and Ocean County Bd. of Social Services, the authorized representative was Future Care Associates. They failed to procure all of the necessary verifications, with the result that the application was denied.

An application for Medicaid in New Jersey requires copious financial records for every single asset owned by the individual or spouse during the 5 year look-back. Copies of cancelled checks, deposit slips, credit card statements, explanations for ATM withdrawals … everything is being scrutinized. Once the county board asks for more records, the turnaround time is pretty short.  The applicant probably doesn’t have those records lying around, and it can take months for the Authorized Representative to get the records. The Authorized Representative may not even know where to start looking, and may need help from immediate family members. It could become necessary to file a court petition to compel third parties to produce documentation.

What’s the solution? Advance preparation is vital. We encourage our clients to come in three to six months before the date they plan to apply, so there is time to gather up the necessary proofs. Also, if a family member or POA  is appointing somebody as the representative, s/he should make sure that it is crystal clear as to who is doing what, and that all necessary authorizations have been provided so that the  representative can do their job. The family member should certainly insist that the representative keep them informed of the status, including any threatened denials. And the contract with the representative should spell out the representative’s responsibilities.

Call us for advice about Medicaid eligibility, asset preservation and the application process .. 732-382-6070

 

 

 

 

Elective share and Medicaid can lay a trap for the unwary

In New Jersey, a surviving spouse has the right to claim his or her “elective share” of the deceased spouse’s estate if the deceased left him/her an inadequate inheritance. The calculations are made using the step-by-step process of a set of state statutes, N.J.S.A. 3B:8-1. If the individual receives Medicaid benefits and is widowed, failure to claim the “elective share” can result in a loss of benefits because it is treated by the Medicaid program as an uncompensated transfer of assets. If a person receives benefits when they are not actually eligible, they may be subject to a claim or lien for reimbursement. Federal and State law (N.J.S.A. 30:4D-7.8) requires states to place liens for reimbursement against the estates of deceased Medicaid beneficiaries. All of these issues came together in a recent Appellate Division decision called  In the Matter of the Estate of Arthur E. Brown, N.J. Super. App. Div. (Simonelli, J.A.D.) (32 pp.) A-1086-14T4.

  • The case involved a widower who had been disinherited by his wife. The marital assets had been transferred into her name, and he received nursing home care that was paid for by Medicaid. When she died, he didn’t file a claim for the elective share. He continued to receive Medicaid benefits. Upon his death, the State took the position that the value of the claim which he had failed to pursue was an asset of his estate, which was subject to the State’s lien for reimbursement. The Court held that the value of the claim was correctly included as an asset of his estate subject to lien.

The estate had also argued that the deceased wasn’t entitled to an elective share at all because he and his wife had been living separate and apart at the time of her death, and the couple ceased to cohabit as man and wife under circumstances that gave the wife a cause of action for divorce under N.J.S.A. 2A:34-2(d) or (f). The elective share statute lists this as one of the reasons that a person can be barred from seeking an elective share. Residing in a nursing home due to Alzheimer’s dementia might be sufficient grounds for the spouse to seek a divorce, but the Court wasn’t ready to go so far as to hold that the “living separate and apart” as used in the law was intended to encompass this sort of reason for the separation.

When Estate planning is being done for the community spouse of a person who needs nursing home care, the impact of the estate plan on the ill spouse’s Medicaid eligibility needs to be considered.  Failing to consider the interplay of the elective share and the Medicaid rules can result in unintended consequences. Not only can there be an adverse impact on eligibility, there can be complicated impacts later which result in surprising litigation which adversely affects the heirs of the estate.

Call us about Medicaid eligibility planning and elder care estate planning … 732-382-6070

Guardian needs a Court Order to move incapacitated person out of State

Once a Court has ruled that a person is “incapacitated” and has appointed a Guardian of his person and property, the Guardian has many responsibilities and also, there are  certain restrictions on what a Guardian may do. The details are spelled out in New Jersey’s laws and court rules. Also, each County may have certain specific procedures of its own. One of these limitations is that the Courts of New Jersey have jurisdiction over the person of the individual who is under a guardianship, and a guardian must seek court permission to move the “ward” out of state.

A guardianship may last for many years, and there are certainly circumstances in which it is in the person’s best interest to move out of state. One example would be, if the Guardian needs to relocate for a new job or family circumstance. If the Guardian already resides out of state, s/he may find that the ward is running out of funds and could receive equivalent local care at much less expenses. There might be a specialized program out of state that is ideal for the individual, with a plan for the individual to become a resident of that state.

The Guardian typically would need to file a Verified Complaint with the same Court that entered the Guardianship judgment, seeking authorization to transfer their ward out of state. Very likely, the Court will want to see an updated report of the income and assets; a proposed care plan; an opinion from a physician or other involved professional that the transfer is medically safe and will promote the ward’s best interests; information from the receiving site that confirms the availability of a placement. The Court may appoint an attorney or a guardian ad litem for the incapacitated person.  If the ward has family members who remain in New Jersey and who have an ongoing involvement with the ward, the Guardian may want to consider obtaining consents from those people as well. The Guardian needs to put together as strong a case as possible to increase the likelihood of a favorable ruling. Clearly, this process won’t happen overnight, and the matter could become contested.

The Guardian is accountable to the Court, as the Court has continuing jurisdiction over the person residing in New Jersey who is under guardianship. As in all things, careful planning can prevent a crisis. If a guardian needs to relocate, they should start the planning enough in advance to facilitate a smooth transition to the receiving state for the senior adult or other person under guardianship. Once there, new proceedings will be needed to establish the guardianship in the receiving state … there is a uniform Act [UAGPPJA], but  each state has its own procedures for that.

Call for advice and representation on guardianship matters … 732-382-6070

Yes, we can still honor our aging parents

I wrote this piece in 2003 as a letter to the editor of the NJ Jewish News, at the death of my friends’ father, who was a charming man I’d really enjoyed knowing in his last twenty years. Something reminded me of him recently, so I thought I’d republish it here.

“Last week, I attended the funeral of the father of my close friends. He was 86 years old and died of complications of Alzheimer’s’ Disease. Over the past 7 years, his memory had grown increasingly impaired, and he was a bit unsteady on his feet. Sometimes he’d lose track of his ideas while he was talking. There came a point where he couldn’t prepare his own meals, drive or navigate. He reluctantly agreed to move to an Assisted Living residence. Yet he never sunk into that lonely despair that so often ruins the lives of frail elders. Why?

Mr. B’s four children took turns helping him out every weekend. They arranged for him to travel. They visited him a lot. They brought him to religious services and gave him an honored place at their dinner tables. They weren’t embarrassed by his increasing frailty – they were understanding. They lent him a hand and helped him remember what he needed to know. They continued to include him in their many celebrations with friends and relatives, even though he would sometimes just drift around in a sort of pleasant fog and not make much conversation. Despite his physical illnesses, Mr. B. was happy when he was surrounded by people, especially the people whom he’d always enjoyed, both young and old.

Mr. B. was happy because people helped him continue to do the things that had always been important to him. He continued to attend services regularly at the congregation he’d attended for 50 years. The other people there made sure that he retained as much as possible of the meaningful role he’d played in their services for decades.

Holidays, of course, have their special family rituals. Mr. B. retained his dignity as head of the family because his children enabled him to perform those rituals which he had customarily performed at these ceremonies. He could still  remember how to recite the blessings, even though he could not remember how to find his room down the hall.

Despite his diminishing abilities, this lucky gentleman was never cut off from the social life of his community and family. Too often, though, frail elders do find themselves dishonored, isolated and rejected.

It is our personal duty to give our parents honor and respect. Their weaknesses in their frail twilight years certainly don’t absolve us of that responsibility. If anything, the responsibility is even greater once the person cannot fully take care of himself.

It surely can be a challenge to keep our frail elders involved in our lives. We need to make special arrangements, to allow extra time, and to be very patient. The results of such inclusion will be dramatic, though. Not only will we enable our parents to live out their lives with dignity, joy and peace, we will be teaching the next generation a crucial lesson about how to care for their loved ones. Perhaps this will bode well for the future of all who grow old in this country.”

Call for advice on senior care and elder care planning, and strategies for a good old age … 732-382-6070

Protecting your family’s inheritance from their creditors

Perhaps you’ve heard friends talking about a “legacy trust” or a “family trust ” or a “bloodline trust.”  These are all names for the same basic concept. You may be at a point in your life that you feel that you do not need to retain the ownership of all of your assets because you feel that you really “have enough.” You feel that you want to leave a family legacy that might even be there for the grandchildren. So you wonder what is the best way to do this.

An outright gift transfer of assets will certainly provide a nice benefit for your children. Some people bypass their children and make transfers that are expressly just for the grandchildren. You can fund their education, help the grandchild with that first new car or their first home.  Either way, when transferring assets to children with the hope that the assets will be preserved and will grow for future family needs, though, you might consider the idea of protecting the assets against hazardous circumstances that could arise. These same principles apply when you are designing your Last Will and Testament.

The beauty of a trust for the family is that the assets can be protected. If enough safeguards are build into the trust structure, trust assets can be protected against creditors (“spendthrift”), they don’t get intermingled with the child’s own assets, and they may remain “off the table” in case of divorce or lawsuits. Also, the assets can be excluded from the child’s own estate at death. The family trust preserves assets for the family’s future while protecting against these all-too-common hazards.

There are many variations of trusts, and no one trust will be exactly right for everyone. They need to be customized for the particular family’s needs. And trusts can be built into your Last Will and Testament as well. The main idea is that sometimes, your goals of family protection might be better served with a trust than with an outright transfer, and you can explore these issues with your attorney.

Call us about senior estate planning and family legacy protection planning … 732-382-6070.