Michigan Elder Law & Estate Planning
Help for Michigan Seniors on Estate Planning, Disability Planning, Medicaid and Nursing Homes
From the monthly archives:
QUESTION: I have heard that you are allowed to keep some things and qualify for long-term care Medicaid. What are you allowed to keep?
ANSWER: It is true that some property may be exempt for purposes of Medicaid qualification. And indeed, converting non-exempt assets to exempt assets is one valuable method of spend down. The following items are generally exempt: [click to continue…]
{ 0 comments }
QUESTION: I am concerned about my parents. My dad just entered the nursing home. His care costs more $6,000.00 per month and my mother is almost out of savings. Does she have to sell the house (which is worth about $250,000.00) to pay for my dad’s care? And what about estate recovery? What is that?
ANSWER: Your mother does not have to sell the house and for now, it is safe as long as you follow the proper procedures to qualify for Medicaid. But there are still several concerns here.
First, most people needing nursing home care will end up receiving Medicaid assistance at some point. Many people make the mistake of thinking that they should just pay the nursing home each month without realizing that there are often estate planning options that can prevent the need for a full spend down. Seeing an elder law attorney during a nursing home spend down is a lot like seeing an accountant at tax time: there are a lot of deductions and exclusions that you would not otherwise know about that can cut your tax bill. An elder law attorney can help you minimize your nursing home bill in the same way. [click to continue…]
{ 0 comments }
The Michigan Department of Human Services has enacted several changes to the Medicaid eligibility rules recently that impact qualification for long-term care Medicaid.
Perhaps the most important change relates to divested assets (gifts) and the calculation of penalty periods. Generally speaking, the gifting of assets results in a period of ineligibility for Medicaid long-term care. Under previous policy, returning some of the gifted assets would result in a partial cancellation of the penalty period. For example, if a long-term care Medicaid applicant had given away $61,910.00, she would ineligible for Medicaid for 10 months ($61,910.00/$6,191.00=10 months). But if that same person returned $30,955.00 ($6,191.00 x 5), the penalty would be reduced to 5 months. This former policy was known as a “partial cure” of a penalty. [click to continue…]
{ 0 comments }
Who says that blogging and nursing homes don’t go together?
There is a pair of stories in the news this week that contrasts different seniors’ comfort levels with the internet. The first is highlighted over at the Greatest American Lawyer, where Enrico Schaeffer posts on the death of the world’s oldest blogger:
“An Australian woman often described as the world’s oldest blogger has died at the age of 108 after posting a final message about her ailing health but how she sang “a happy song, as I do every day.”
What a treasure Olive Riley, author of The Life of Riley (be patient—the bandwidth of that blog is being put to the test) has created for her family and indeed the world. Olive Riley, survivor of two world wars and mother of three children, had a spirit to inspire us all and at least some of that spirit has been captured in her online posts. Olive Riley is remarkable for her ability to learn blogging at the age of 106 or so, but her affinity for the internet is hardly unusual among seniors, who now commonly use the internet for things like email, research, and driving directions. [click to continue…]
{ 0 comments }
I recently received a letter offering a “Certified Copy” of the deed to my home. The offer explains that the Federal Citizen Information Center recommends that every home owner have a certified deed and that the National Deed Service could provide a deed for just $59.95. There actually is an article at the Federal Citizen Information Center recommending that everyone have a copy of the deed to their home, which can be found here. And indeed, for estate planning, medicaid planning, or asset protection planning, it is a good idea to have a copy of the recorded deed to your home on hand. As the Federal Citizen Information Center article notes:
When was the last time you couldn’t find an important paper you knew you had carefully put away? How do people decide where to store and keep such records? And how do they know what to keep, what to throw away, and when? Do you have an easy to figure out system you or a loved one can refer to in case of an emergency?
If you take a look at the Medicaid Checklist, you will see that gathering important information can be a big job. [click to continue…]
{ 0 comments }
I recently had a conversation with an elderly woman who lamented that her living circumstances did not allow her to have a pet. Isolation and loneliness can be a very real problem for many seniors who are often without family nearby or even pets for companionship.
One partial solution to this problem is offered by groups like Therapy Dogs International. Therapy dogs are certified according to rigorous standards to have the proper temperament for visiting the elderly and disabled in senior housing, assisted living, hospitals and nursing homes. The unconditional love of a dog has an undeniable therapeutic effect on many people. A UCLA medical study “showed that trained Assistance Therapy dogs, visiting severely ill cardiac patients in intensive care, lowered their stress and anxiety and their heart and lung pressure significantly.” [click to continue…]
{ 0 comments }
Recent litigation over the estate of Martin Luther King, Jr. provides an illustration of problems that can develop in the administration of a trust or estate and an opportunity to discuss ways to avoid disputes in
estate and trust administration. In the case of the King family, Dexter King is president of the Estate of Martin Luther King, Jr. Corporation. This company controls the use of the image and property of the late Martin Luther King, Jr. Bernice King and Martin Luther King III have sued Dexter King, alleging that he obtained control of assets that were the property of the estate of Corretta Scott King. The lawsuit further alleges that Dexter has mishandled the property of the Estate of Martin Luther King, Jr. Corporation and that Dexter has refused to provide information to beneficiaries and shareholders regarding his activities. This litigation highlights several issues to consider in estate planning and administration.
First of all, it is not uncommon for there to be confusion over what exactly is estate property. What happens, for example, if Fred provides a $5,000.00 gift in his will to Joe and he also names Joe as a beneficiary on a savings account worth about $5,000.00? Should the savings account satisfy the gift in the will, or does Joe get an additional $5,000.00 from the estate? In the litigation over the King estates, there seems to have been confusion over what was part of Coretta Scott King’s estate (the probate assets) and what belonged to the Martin Luther King, Jr. Corporation (a non-probate asset). Any estate can be set up to avoid this kind of confusion and avoid misunderstandings between family members down the line by consolidating the estate to a trust.
A second issue presented in the King litigation involves the handling of personal property. Most wills give the personal representative direction to sell personal property and use the proceeds to pay estate obligations and make distributions to heirs. But in many cases, family members may disagree with the sale of personal property–either because the item has more sentimental value or, as in the case of Martin Luther King, Jr.’s estate, the property is very valuable and the sale price is subject to second-guessing. The reports have insinuated that Dexter King’s decision to sell substantial property of the corporation for $30 million may not have been supported by his siblings. There is also the possibility that the sale was below fair market value. Indeed, rather than sell at a public auction with Sotheby’s, and potentially obtain a better price, the corporation’s property was sold privately at the eleventh hour. Disposition of assets by public auction is clearly a safer route for fiduciaries. Beneficiaries who believe the property more valuable than the asking price have the opportunity to purchase the property themselves and obtain that better price. [click to continue…]
{ 0 comments }
Any adult caregiver who has control over a parent’s assets (such as by power of attorney, as a trustee, or through joint bank accounts) can be in a very dangerous position for several reasons.
First, adult caregivers who receive compensation are vulnerable to charges of undue influence, constructive trust and other damaging allegations. How do these arrangements become such a problem? Consider that in many families, it is common for one child to bear a disproportionate share of the caregiving duties. Second, realize that such a caregiver is generally closer geographically and sometimes emotionally to Mom and Dad. The opportunity for jealousy to develop is obvious as well as the opportunity for wrongdoing. And regardless of what actually happened, it is easy for there to be an appearance of wrongdoing. Finally, bear in mind that caregiving is extremely time-consuming, stressful and expensive for the caregiver. Just as a stay-at-home mother is worth well over $100,000.00 per year in terms of replacement cost, a caregiver often makes an economic sacrifice to take care of Mom and Dad rather than work at a job. When you consider all of these factors together, it is easy to see how there is an emotional thunderstorm forming around the care of many seniors. Money is a significant factor, but it is often less significant than the stress on, and the quality of, relationships among family members. [click to continue…]
{ 0 comments }
Perhaps the most important lesson an estate planning attorney can convey to a client is that your end-of-life decisions will be made for you-and possibly expose your estate to significant and unnecessary expense-unless you create legally enforceable estate plan documents. Without a clear expression of your wishes, some of your most important decisions may be made by a family member, a stranger, or a probate judge who may have no idea what your real wishes were. This can lead to increased costs, family disagreements, and other forms of waste. Several types of legal documents can help you and your family avoid these problems:
{ 0 comments }
