News Segment Interview with Don L. Rosenberg
QUESTION 1. If there is one message that you could tell the public today, what would that be?
ANSWER. It is that I’m amazed that no one has ever informed the public that they do not have to lose all of their assets if they or a loved one is in a nursing home or entry into a nursing home is imminent. I’m amazed that no one has any idea that you can seek governmental benefits and still preserve their assets for themselves, their spouse’s and their children. That there is a terrible gap between what is the law and what people believe the law to be. Misunderstanding runs rampant in this area. Most people do not take the time to consult a specialist in this area, they listen to their friends that all hope is lost. People can pay for their care by planning. They can either be rich and spend their money; be poor and go on Medicaid; be insured and look at long-term / stay at home insurance; or plan and put their house in order. While this area of the law is not glamorous and highly publicized and therefore a lot of attorneys do not practice in this area, it is a very important area of the law because with appropriate planning we can save hundreds of thousands of dollars for our clients. People work a lifetime to accumulate assets and when a husband and a wife have to confront a nursing home, they are looking at $55,000.00 a year for the care of one spouse and the cost of living for the other spouse which in effect will cost about a quarter of a million dollars in three years. It all boils down to people working with an expert such as myself and receiving quality information to make an intelligent choice as opposed to taking their chances. And of course when you leave things to chance and circumstance it just breeds disaster.
QUESTION 2. What is the difference between an Elder Law Attorney such as yourself and an attorney who holds himself out as an Estate Planner?
ANSWER. In addition to having the same expertise of an Estate Planner, when I meet with my clients and their families, I always help them plan not only for what happens to the assets after we are gone, but for the questions: What if I become disabled? Who will make my medical care decisions when I am no longer able to do so? Who will make my end of life decisions? And if my disability is so severe, how I can achieve the greatest quality of care at the least cost to me and my family? Most of my clients come in with the preconceived belief that because they are getting old or will be old someday, they will have to go into a nursing home and must give their assets away to their children now to protect them. First, there is no guarantee that nursing home care is the only option. Second, to give your assets away substantially limits the choice and quality of care when you need it. You’ve heard of the saying, “no money no room at the inn”. I can show to everyone who has the current capacity to plan a method where they can ensure that they will receive the greatest quality of care at the least cost to themselves and their family. All it requires is the proper documentation.
Let’s get one thing straight. You cannot save it all except only in rare circumstances. You have to spend a portion of your assets to receive quality of care. The amount that you may have to spend should be no more than half your assets or as little as 20 or 30%.
The bottom line is people can enjoy their assets and their lives and if the time comes when they need custodial care, they will be prepared for that day. They will have planning that will permit them to protect the majority of their assets and have established other documents allowing their loved ones to take care of them and make decisions when they are no longer able to do so.
QUESTION 3. What is the most important specific document that you can advise a client to establish when putting their house in order?
ANSWER. That is really simple. It is a Durable Power of Attorney. This would be a Durable Power of Attorney for Health Care as well as for Financial matters. This means that if you were no longer able to provide for your own medical care decisions or financial decisions, you would have somebody that would have the authority to actually be you. It would give them the arsenal to be prepared that if any circumstances came down the road, that a loved one that they trust will make those decisions for them as opposed to a Probate Court appointing someone they would not have chosen had they had the opportunity to do so. In most cases, Probate is optional and people can make the choice to avoid it. The most common mistake I see is that those that have had the forethought to establish a Durable Power of Attorney, it is done incorrectly and eliminates the ability to plan for long-term care. This is true in about 99% of the time.
QUESTION 4. Can you briefly explain how one goes about protecting their assets from the nursing home?
ANSWER. It should be understood that this area of the law is constantly changing and complex. There is no one particular method for everyone to protect their assets. It depends on what their current assets are. We have to examine the issues of capital gains tax, income tax, we look at gifting, we look at annuities, we can look at rental property. Gifting is a common strategy. Most people believe that you cannot make a gift within a three year period and apply for long-term care Medicaid benefits. This is absolutely not true. What the law does say that if you give a gift within a three year period, Medicaid will need to know about that gift and will determine a penalty which is caused by the value of that gift which may be one month, two months, ten months, or the total three years. It depends on the amount of the gift made, when the gift was made, and when you are applying for Medicaid. Further, that if you make a gift and there is no reason to believe that you were sick and had to go into a nursing home, then it may not be considered a gift or impermissible at all.
QUESTION 5. Is there anything else you would like to say?
ANSWER. Yes. And that would be life is not a dress rehearsal. We all know no one is promised tomorrow. I see all the time where my clients will put their head in the sand and think their problems will go away. My advice to everyone out there would be to plan now, put your house in order, give yourself peace of mind so you don’t have to worry about these issues when the time comes. This is no different than driving on a bald tire. You know its going to blow, you know its going to be a problem, yet we procrastinate before we get it fixed, or repaired or replaced. Procrastination is the greatest threat to our future and security and our loved ones.