Do you already have a Trust? Is it a Living Trust or Revocable Living Trust or a Family Trust?

If you already have a Trust, you then need to answer the following questions:

How old is it?

Do you have signed copies?

Is it up to date?

Does it consider the current tax laws?

There was a major tax law change at the beginning of 2012, and many people with older Trusts aren’t aware that their Trust may not be appropriate for their current family situation. You need to have a professional Estate Planning Attorney read your Trust together with you and explain how it will work when you’re incapacitated or die, and how the tax law changes may make your current Trust obsolete.

You need to think about who will be making the decisions for you if you’re incapacitated, and who will make the decisions for your estate after you die. Have you named the right people? Are they likely to outlive you? Have you named alternates in case those people can’t act for you? I frequently have people coming to me with complaints about an older Trustee who is making poor decisions and won’t resign. What does your family do then? Go to court? Needlessly spend thousands of dollars on a legal dispute?

Did you lend $50,000 or $100,000 to one child who has never paid it back? Does your Trust document consider this to make sure that your wishes are known? When the son of one my clients found out what his father’s Trust said, he shredded all of the documents so that he wouldn’t have to pay back the debt and he would receive much more than his brothers and sisters. Since we keep copies of our clients’ documents, we just provided a copy set to the family and the son wasn’t allowed to “double dip” from his parents’ wealth.

If you have a Trust, make sure you know what it says, and make sure that it’s the right Trust for you.

 

 

 

Most of the nursing homes in Santa Clara County currently charge residents $11,000 to $12,000 per month. Are you prepared for that cost? How long will you or your loved one be there? Two months? Ten months? One year? Five years?

The longest stay I’m aware of is over 20 years. That’s a huge expense.

How will you pay? Private pay? Long term care insurance? Medi-Cal?

What most people do not know, is that there are elder law attorneys who specialize in Medi-Cal planning to protect the family assets. Those of us who practice in this area work to make the clients eligible for Medi-Cal benefits and protect the family assets so that they can be used for the benefit of the other spouse and then eventually pass to the heirs of the ill person.

Yes, it’s true that Medi-Cal will cover your long term care costs in a skilled nursing facility even if you own your house, but if you own the house at the time you die, the State of California will seek repayment of your benefits by placing a lien on your house. The residence is still protected after the Medi-Cal resident’s death if the surviving spouse is living there, but the State of California has been sending out “voluntary liens” to the surviving spouse. If he or she is confused after the death of their spouse, and they happen to sign the lien without a full understanding of the result, the house will be encumbered with a lien from the state.

If you have a family member or close friend in a nursing home, or you think that a nursing home may be in their future, get some expert legal advice for proper planning. In one case I handled, the entire value of the house would have gone to the state, and now it will pass to the two children of the nursing home resident.

Know your rights and seek proper legal expertise to help guide you in establishing the right estate plan for your family. Your family will be grateful you did.

 

 

 

 

 

Over the last 10 to 15 years, there seems to have been a real burst of products to swallow and games to play to try and strengthen our memory skills. Do they work? The Institute of Medicine has cautioned consumers to watch out for phony products or poorly tested products that claim to “prevent, slow, or reverse the effects of cognitive aging.”

What about exercise? Brain exercise is one thing, but what about overall body exercise? Several studies have shown that the more you exercise, the more you reduce the risk of developing dementia. Some studies suggest that high levels of exercise might reduce the risk of Alzheimer’s by 30 to 40%. That’s significant.

Games, friendly conversations, food choices, and purposeful living all seem to help age-proof your brain, but physical exercise leads them all as far as effectiveness. And for many people, starting a mild exercise routine isn’t all that difficult. A simple daily walk can make a big difference. Check with your doctor and try getting more exercise.

Have you ever known an elder person who had a serious mental decline shortly after an injury that limited their mobility? I’ve seen this several times. In some cases there is no sign of dementia before the injury, and in other cases there is mild dementia, but the individual is coping well. Then, following the loss of mobility, there is a significant loss of mental ability.

I deal with dementia issues weekly whether it be for a client, the client’s spouse, or the client’s parent. It’s a complicated subject.

Aging well involves taking care of yourself. What about your legal documents? Do you have the right documents in place to allow others to care for you if the need arises? Make sure that you have an estate plan, and make sure that it’s up to date.

I recently got a call from a daughter telling me her father just had a major stroke. Why didn’t they get his documents in place before the stroke? Well, even though he’s in his 80s and had already experienced two minor strokes, they “just figured that he’d probably be okay.” Really? For how long? Forever?

A stroke is generally considered to be a “sudden disabling attack” or loss of consciousness caused by an interruption in the flow of blood to the brain. It’s a sudden event. A stroke is a medical emergency. It’s essentially a “brain attack.” Estate planning needs to be done before the stroke. There might not be a chance to do it after the stroke.

About 75% of all strokes occur in people over the age of 65, but a stroke can happen at any age. I know a local man who recently died about two weeks after having a stroke, and he was only in his late 40s. It happens.

The chances of having a stroke can be greatly reduced by healthy living. The CDC (Centers for Disease Control and Prevention) gives stroke prevention guidelines for diet, weight, and physical activity, and you should read them and take them to heart. The guidelines for reducing the chances of a stroke are similar to other guidelines for better health. You should know them and keep them in mind.

A man came to meet with me recently to discuss the estate plan that was prepared for him and his wife a few years back. His wife is now in the memory care unit at an assisted living facility and she is doing well there despite being in the early stages of Alzheimer’s disease. The gentleman provides a lot of the companionship and care for his wife, and he also manages all of the family finances. He recently reviewed his old estate plan and was fairly certain that it wasn’t right for them, but he figured that he could manage things okay the way they were ­­— until he had a minor stroke himself! He’s lucky that it wasn’t a major stroke, but it woke him up to the fact that if something happens to him and he can’t manage their affairs and help take care of his wife, they will both suffer tremendously, and so will their children and grandchildren.

Lao Tzu, the ancient Chinese philosopher, said it simply: “Anticipate the difficult by managing the easy.” I apply this idea to estate planning because getting a proper estate plan put into place now to protect yourself, your spouse, and your heirs is easy. Doing anything after a stroke can be difficult or impossible, and trying to navigate through the legal system without the proper legal authority can be daunting or impossible. The lack of proper decisions today can mean that certain options are closed to you and your family in the future. Get it done. Make a plan to protect yourself and your family. Make sure that you have the right estate planning documents in place for when they might be needed.

You can take steps to help prevent a stroke, but you can’t time when a debilitating stroke might occur. Work on improving your health to prevent a stroke, and get the proper estate planning documents in place while you’re still able to do so.

What’s your number? What about your mother? What about your father?

Here, I’m asking how much you’re willing to be scammed out of, or willing to have an elder parent scammed out of, before you take some protective action? Do you have the legal documentation in place for someone else to take over?

Here are a few recent stories reported by elder law attorneys:

1. The scammers told the woman that they were officers investigating her bank for misappropriating her funds, and they needed her assistance to execute a sting operation. They told her that she would have all of her funds returned to her after the sting was completed. After transferring nearly all of her liquid assets, she sold most of her stocks and transferred that money too. She lost over $1,000,000 and now owes the IRS over $200,000 for capital gains tax on the sale of the stock.

2. An elderly client’s spouse has fallen prey to the Jamaican lottery scam and refuses to disengage. The one is convinced that it’s real, and keeps going around the other to send more and more money to the scammers in Jamaica.

3. A client’s parents lost $350,000 to a scam about the Canadian lottery, another $450,000 to the overseas family of a former caregiver, and another $200,000 as an “investment” to a neighbor with a failing business.

So, I ask again — How much money are you willing to lose before someone steps in to stop the fraud? Have you had open discussions on this with family or friends? It isn’t always easy, but those discussions, accompanied by the right legal documents, can help to prevent someone from getting scammed out of thousands of dollars.

Elder financial abuse is on the rise.

Make sure that there’s a system in place for a trusted person to be checking on the accounts of elders on a regular basis. Yes, that means the elder gives up a bit of their privacy and freedom, but in many cases it’s well worth it.

Most people don’t have an estate plan in place — period. That type of procrastination can cause a LOT of problems for the individual and their family. Costs. Delays. Unintended distributions. Other unintended results.

And for those who do have a plan in place, take a look to see if your documents are valid. It isn’t just a matter of who gets your assets upon death. It’s also a matter of who will take care of you if you need care, how your assets will be used for your care, and whether we can take special steps to preserve assets to go to your spouse and family following your death.

If you already have a plan in place, you are to be congratulated for doing so. Now you have to make sure that your plan will still work for you. Will your documents provide the intended result?

Families regularly rely upon legal documents for years only to find out later that the documents weren’t signed properly, that the documents don’t comply with the needs of an elderly or mentally incapacitated person, or that the documents were written under a prior estate tax law that has changed so much that the documents should have been changed as well. Don’t let this happen to you or your family.

It’s not uncommon for people in their 60s, 70s, or 80s to have lost one of their children, and maybe even a spouse. What about the share of your assets that was to go to that child? Do your documents clearly state your wishes as to whether it should go to the deceased child’s spouse, their children, or their siblings? I’ve had many clients who are shocked to learn what the result would be from their current documents.

Remember, it isn’t just about who gets your assets when you’re gone. It’s also about who will make decisions for you while you’re alive, how your assets will be used for your benefit while you’re living, and then how your assets will pass after your death. Do yourself and your family a huge favor by making sure that you have the right legal documents in place now, and that they accurately represent your wishes. Don’t wait!

I recently read an article written by a nationally renowned estate planning attorney who said, “If the elder law attorney can advise clients early enough, . . . they can alleviate later problems.” Yes, that’s true, and we often see the problems of people who don’t get it done right.

A local woman came to me recently because her long-term friend had died six weeks earlier. He had gifted her 50% of his home four or five years ago, and the other 50% of the home was held in his trust to be distributed to her following the man’s death. The problem was that the attorney who prepared the trust wasn’t familiar with elder law rules and Medi-Cal, so now the State of California will seek repayment of his Medi-Cal bill. He had been in the nursing home for about five years prior to his death, so his debt back to Medi-Cal will be around $500,000 to $600,000. The woman who was to get the home will now have to pay the debt to the state if she wants to keep the home for herself. Neither the woman, nor the friend who died, were ever advised that there could be a problem with her getting the rest of the home upon the man’s death. Sad result.

Estate planning and elder law planning are not the same thing. You need to have an estate plan that is prepared with an eye towards elder law needs so that you are protected in the event that certain circumstances arise. It’s like buying your granddaughter a car that has seatbelts and multiple airbags. You hope that the lifesaving features are never needed to save her life in an accident, but you also hope that they’re always working and she’ll be protected in the event of an emergency. That’s why we use those things.

If you drive year after year and never have an accident, then you didn’t need to be wearing your seatbelt all that time. But we wear seatbelts whenever we’re in a car simply because it provides that needed protection “just in case,” and we never know when that just in case event may occur. Do you know of anyone younger than you who had a stroke or suddenly died? It happens, and many people aren’t prepared for it.

Do you have proper estate planning documents in place? Will they work when you need them to work?

A very experienced financial planner called me recently with a serious problem. He had confirmed a few years ago that his client had an estate plan, but the client, now age 82, recently suffered a serious stroke and the documents wouldn’t work as the elder had planned. Stanford Hospital was refusing to release the man to return to his assisted living facility because the elder’s documents were not in order and the elder wasn’t able to make decisions for himself. The elder was being kept at Stanford Hospital and paying the bill there while he was also paying the bill at his assisted living facility. The lack of proper documents left him trapped, and three other attorneys that the financial planner consulted were unable to help the elder.

Don’t leave your future to chance and hope. Take care of yourself and your loved ones. Make sure that you have a quality estate plan in place, and make sure that you understand it.

 

Medicare health insurance covers about 54 million people. About 11 million of those people will end up with a hospital stay each year. Some of those will be there for just a day or two, and some will be there for much longer.

What if you or your loved one is being discharged and you think it’s too early for the discharge? What if you think another day or two, or even more, would make a big difference in the person’s health, stability, and recovery?

As one expert said, “There’s enormous pressure on discharge teams to get patients out.”

We know that hospitals are notorious for discharging patients early, but what can a patient or their family do when the hospital is forcing a discharge? They can’t force you to stay, but can they force you to leave?

Medicare has a special process to protect Medicare patients from early discharge, but you have to act fast. The process is actually called a “fast appeal.” Filing the appeal is easy, but you have to know the rules, and the timing is critical.

A hospital stay produces a lot of paperwork, but you need to pay attention. Within two days of your hospital admission, and certainly prior to discharge, you should get a notice called “An Important Message from Medicare about Your Rights.” This is sometimes called the Important Message or IM. If you don’t get this notice, ask for it. When you get it, hang onto it. The notice will give you the name and phone number for the BFCC-QIO. Ha! That’s the Beneficiary and Family Centered Care Quality Improvement Organization. Long and awkward name.

That office, sometimes called the Medicare Quality Improvement Organization (QIO), is the entity charged with handling fast appeals and complaints about the quality of care. If the patient is on Medicare, this office is there to help. But, you have to call them to get them involved.

If you think that the Medicare-covered hospital services are ending too soon, you have the right to a fast appeal, but you need to call and request the fast appeal of a pending discharge (1) ideally before midnight on the day before you are to be discharged, or (2) certainly no later than the day you’re scheduled to be discharged. This must be done before you leave the hospital. Once you speak with someone at the QIO, or leave a message at the QIO, your appeal has begun.

If you ask for the fast appeal, you can stay in the hospital while you wait for the QIO’s decision from an independent physician, and even if the QIO agrees that you are ready to be discharged, you won’t be responsible for paying the hospital charges (except for applicable coinsurance and deductibles) incurred through noon of the day after the QIO gives you its decision.

The appeal time buys some time for the patient, but only Medicare patients who have been admitted to the hospital qualify for this type of appeal. If the patient was only under “observation status,” this presents other issues and there is a separate appeals process, so make sure that it’s clear whether the patient has been officially admitted to the hospital. Some hospitals have been known to hold a patient for several days on observation status, and since the patient was never admitted, that creates other problems – especially if the patient and family were mistaken regarding the patient’s status.

Be informed. Know your rights. Protect yourselves and your loved ones.

 

 

I should start off by saying clearly that I am neither a doctor nor a trained medical professional. I’m an estate planning and elder law attorney with a background in science and an interest in reading about dementia. That being said, I also learn daily from my elder clients regarding their own lives, the signs of mental decline as they experience it, and their personal observations about the status of their spouse or other loved ones.

As sad as it may be, it’s all too often that people have not done the proper legal planning in advance of the dementia reaching a level where the individual can no longer sign any legal documents expressing their wishes. The issues then come to the surface. Who do they want to handle their affairs? How do they want their assets handled while they’re still living? How do they want their assets distributed after their death?

How is it that so many families find themselves in the position of having an elder with dementia, and not having the right plan put in place? I often hear that the elder was “coping” okay, and nobody wanted to have the difficult conversation that “maybe it’s time we do something.” Many times, a person will notice signs of early dementia in themselves or their spouse or parent, and then take action. At other times, people hide from the reality and hope it will go away.

I have had many cases where one spouse, or an adult child, comes to me and says that their spouse or parent was “doing okay” so nobody was too worried, and then they suddenly took a rapid and dramatic decline into severe dementia. It happens.

None of us know how dementia will affect a given individual, or what the timeline will be between noticing the first signs and reaching a point where the person refuses to sign any documents or simply does not have the mental capacity to sign. Don’t let this happen to you or a close friend or loved one. Be proactive and do some advance planning to protect the individual and the family.

 

 

People frequently bring me their existing Wills, Trusts, and Durable Power of Attorney documents for me to review and make sure that the documents will serve the intended purpose when the person needs to rely upon those documents. But, in many cases, the documents simply won’t meet the needs or desires of the person who signed them.

A local man died recently and two of his children came to see me with his Will that said the house went to the two of them, and nothing to the third child because, “Dad knew she was evil.” Really? I questioned whether the court would accept the Will that they showed me because it didn’t meet the California requirements for a valid Will. The Will had only one squiggled signature of a witness without the person’s printed name or address. There’s no way to validate who that witness was, but the two of them kept repeating that it didn’t matter because the Will was notarized. Well, in California we don’t notarize Wills. Valid Wills in California require the signatures of two witnesses that can be validated. Will the court ever accept that Will? Not likely. How many thousands of dollars will the three adult children spend fighting over it in court?

In another recent case, I had a brother and sister come to me shortly after their mother’s death, and they presented me with her Trust and four amendments to the Trust. Their mother had just died a week earlier at 99 years old, and they wanted to move ahead with the administration of the Trust. They seemed very knowledgeable about the contents of the Trust and informed me that, “Mom’s biological children get 60%, and her step-kids get 40%.” Really? That’s what it said in the second and third amendments, but the fourth amendment dropped that special language and also omitted a gift of $50,000 to the mother’s closest friend. The son and daughter were stunned. The daughter had been present when Mom signed the fourth amendment with her attorney the year before, but apparently the attorney forgot to carry through on Mom’s longstanding wish, and nobody took the time to read the one short paragraph that dropped Mom’s wishes that had been consistent for 10 or 15 years prior to signing the fourth amendment.

The end result of the attorney’s error on Mom’s fourth amendment was that her son and daughter would now each get $260,000 less than Mom had long intended. Although the key paragraph was only three or four sentences long, and it was intended that the wording be the same as on the prior two amendments, nobody took the time to read that paragraph and understand the meaning. Expensive mistake.

Another common problem that I see is when a surviving spouse comes to see me 5 or 10 years after the first spouse died, and they’re shocked to find out that they don’t have full control over all of the couple’s assets. They signed the documents years ago and never fully understood the documents they had signed.

Don’t let this happen in your family. First, make sure that you have the proper legal documents in place, and that each document is valid. Second, make sure that you understand what your documents say, and that the documents accurately reflect your wishes. Don’t leave it until it’s too late. Get your legal documents in order now.