Elder Law Planning
Preservation of Assets
We understand that obtaining the best medical care for your loved one is of the utmost importance. At the The Wolf Law Group, P.C. we strive to assist you with getting that care while ensuring that your family member’s hard earned wealth is preserved. The following are various strategies the The Wolf Law Group, P.C. has successfully implemented to achieve our clients’ goals:
Trust Planning
An irrevocable trust can be used as the vehicle to transfer wealth out of a person’s individual name to his or her intended beneficiaries, allowing that person to potentially become eligible for certain government benefits. The person setting up the trust known as the “grantor” can spell out all of the dispositive provisions of the trust, insuring that the assets pass to the intended beneficiaries according to his or her wishes. The grantor appoints a trustee who invests the trust assets on behalf of the beneficiaries and makes distributions to the beneficiaries pursuant to the terms of the trust agreement. The trusts for the beneficiaries are designed as “spend thrift” trusts and as a general rule are protected from (a) third party creditors, (b) spouses, in divorce situations, and (c) certain governmental agencies.
A Supplemental (or Special) Needs Trust (“SNT”) may be advisable in certain circumstances. A Third Party SNT is one that is established by a family member for the benefit of a person who is deemed to have a “severe and chronic or persistent developmental disability” and is eligible or may become eligible for government benefits. The SNT assets can be used for the benefit of the disabled person to enhance the quality of his or her life. If the SNT is properly drafted and administered, the trust assets attributable to the disabled beneficiary will not jeopardize or supplant the person’s benefits, but will simply supplement those benefits.
A Self Settled SNT is established by the disabled person under the age of 65 before applying for benefits. The disabled person funds the SNT with his or her own assets. The assets of the SNT can be used for the benefit of the disabled person during his or her lifetime and if drafted properly, will not prevent the disabled person from applying for and receiving benefits. However, the self settled SNT must provide that upon the death of the disabled person, the remaining trust assets, if any, must be used to reimburse the Department of Social Services for the amount that has been spent by the State on the disabled person’s care. If there is a surplus of trust funds, then the remaining trust assets can pass to the disabled person’s intended beneficiaries.
Medicaid Planning
In order to receive Medicaid benefits, the applicant must be medically and financially eligible. the The Wolf Law Group, P.C. works with their clients to analyze what services would be the most beneficial such as community or nursing home based Medicaid. Upon making that determination we help implement the necessary legal documentation and structure the potential applicant’s assets to help make the applicant financially eligible. In addition, on many cases, we have worked with other professionals such as care managers and social workers who can assist the applicant with obtaining the required medical assessments and preparing the Medicaid application.
Resilience Planning
For most people, their most valuable asset is their home. The The Wolf Law Group, P.C. specializes in providing our clients with various legal options for protecting the home when extensive care is needed. Some of these strategies include: (i) transfer of the home to certain exempt family members, (ii) retention and/or purchase of a life estate and (iii) transfer of the home to an irrevocable trust or other protective vehicle.
Spousal Protection
One of the greatest fears that families face when exploring the options of extensive medical care for a “sick spouse”, is the financial protection of the “well spouse”. We work with families to insure that the family assets are structured properly and that the necessary elections are made during the Medicaid application process so that the “well spouse” does not have to become impoverished in order for the “sick spouse” to get the care he or she needs. Once the “sick spouse” is approved for assistance, we then work with the “well spouse” to further plan his or her estate to provide that the remaining family assets pass to the intended beneficiaries and that he or she have the necessary advanced directives in place in the instance.
Guardianship Proceedings
When your loved one is no longer capable of taking care of his or her personal or financial needs and has no power of attorney or health care proxy in place, the The Wolf Law Group, P.C. can assist you in bringing an Article 81 Guardianship Proceeding which will allow you to take care of these needs. A guardianship proceeding entails the following:
The person who starts a guardianship proceeding begins the proceeding by filing a petition with the court, which outlines the reasons why the petitioner believes his or her loved one (the “alleged incapacitated person” or “AIP”) is incapacitated and incapable of taking care of his or her personal and financial needs.
Once the petition is submitted, the Court sets a hearing date and a Court Evaluator is selected by the judge as a neutral party to examine the capacity of your loved one. The Court Evaluator meets with your loved one, investigates the state of his or her health, his or her ability to take care of him or herself, and his or her finances. The evaluator then reports on these matters to the Court with a recommendation as to whether or not a guardian should be appointed for the AIP, and if so, the extent of that guardian’s powers. The Guardians powers must be designed to accomplish the least restrictive form of intervention and be limited to only the necessary powers to deal with the AIP’s level of incapacity.
At the hearing all parties have the right to present evidence such as testimony and documents to the court. Your loved one also has a right to a trial by jury if he or she wants to contest the appointment of a guardian. Following the hearing, the court may appoint a Guardian based upon a determination that the appointment is necessary to provide for the personal needs of your loved one and/or to manage his or her property and financial affairs.
The guardian may not assume his or her duties until the Court issues a Commission. Unless specifically waived by the Court, the County Clerk may not issue a Commission until the guardian files a monetary bond. The guardian has reporting and educational requirements which include the responsibility to file an initial report within ninety days of the issuance of the commission, annual reports, and intermediate and final reports.
Case Studies
Example #1: Stroke Victim & Medicaid Planning:
Guardianship Proceeding: A client came to us after his wife had suffered a stroke that left her comatose. He and his wife had no advanced directive and they owned all of their assets jointly. His wife needed immediate long term care in a nursing home. Because our client’s wife did not have a power of attorney, he was unable to transfer his wife’s assets in order to make her eligible for Medicaid and he feared that he would have to spend what little assets they had to personally pay for the cost of her care. Since his wife had never implemented a health care proxy, he worried that he might have difficulty making treatment decisions for her as well. The Wolf Law Group, P.C. brought an Article 81 Guardianship Proceeding petitioning the Court for our client to be appointed Guardian of his wife’s person and property. Our client was commissioned as Guardian and was able to protect the jointly held assets by transferring his wife’s interest in their home and accounts to his name individually, which are exempt transfers, making her Medicaid eligible. We are now working with our client on his own estate planning matters, including implementing a power of attorney and health care proxy naming his children as his agents.
Example #2 – Asset Protection And Emergency Medicaid Planning
Note and Gift Transaction: Client, a widowed woman without children, was no longer able to live on her own and required immediate nursing home care. She had resources of $300,000 made up of her co-op and a cash account. It was her wish to leave her assets to her siblings that lived abroad. In order to make her eligible for Medicaid we assisted in the sale of her co-op. We then implemented a promissory note and gift transaction whereby she gifted one-half of her resources to her siblings and loaned them the balance of the assets. By entering into this arrangement she reduced her assets to the allowable Medicaid resource amount and then applied for Medicaid. The actual amount of the loan was not considered a resource for application purposes, but rather an income stream to Client. The repayments to Client under the loan portion of this transaction gave her the wherewithal to pay the nursing home during the penalty period that was incurred because of the gift she made to her siblings. Once the penalty period expired Client was approved for nursing home Medicaid. This emergency planning done at the “eleventh hour” allowed Client to qualify for nursing home Medicaid and preserve approximately 45% of her assets for the objects of her bounty.
Example #3 – Preparing In Advance For Nursing Home Medicaid
Residence Planning: Client is widowed and unable to continue living alone in his residence since the cost of maintenance is too great and he needs constant supervision. His daughter/beneficiary and son-in-law are willing and able to have Client live with them after remodeling their home to accommodate him. Client is in the process of selling his residence. He will use the majority of the proceeds to pay for the building of his apartment at his daughter’s house and to purchase the right to occupy the new apartment in his daughter’s home, giving him the right to live there for a period of years. Both “transfers” to his daughter will not be considered gifts, but rather transfers for consideration and therefore will not subject Client to a penalty period for nursing home Medicaid application purposes should he need more advanced care in the near future.
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