Archive for the ‘Aging Parents’ Category

The Best Kept Secret:
Improved Pension Benefits for Veterans and Surviving Spouses
Most families have no idea that if an individual is a veteran, he or she is entitled to additional income. As individuals age, the rising long term costs make it very difficult to maintain financial security, especially in these rocky financial times. This article explores the often unclaimed income waiting for veterans. For most veterans, the idea of collecting a pension benefit from the military does not seem like a real possibility unless the veteran suffered a service connected disability. However, there is a veteran’s pension benefit program available to all veterans, and their families, which is available to pay for unreimbursed home health and medical expenses and the
unreimbursed cost of assisted living. This program is called the “Aid and Attendance Program” (“AA”).
Eligibility for the AA Program. In order to be eligible for the AA Program, a veteran must have served 90 days on active duty with at least one day during wartime, and must have been discharged under conditions other than dishonorable. Additionally, the veteran must be “permanently and totally disabled” because of a non-service connected condition.

Periods of Wartime Service:
WWI: April 6, 1917 to November 11, 1918
WWII: December 7, 1941 to December 31, 1946
Korean Conflict: June 27, 1950 to January 31, 1955
Vietnam Era: August 5, 1964 (February 28, 1961, for veterans who served “in country” before August 4, 1964) to May 7, 1975
Gulf War: August 2, 1990 – TBA
Permanently and Totally Disabled. “Permanently and totally disabled” means that a veteran must require “care or assistance on a regular basis,” which protects him or her from dangers of a daily living environment. The term can be established by showing one, or more, of the following conditions:
The veteran is blind or has a visual impairment;
The veteran is a patient in a nursing home or hospice facility because of mental or physical incapacity;
The veteran is unable to dress or undress or keep himself or herself clean and presentable;
The veteran needs adjustments to any special prosthetic, orthopedic appliance, or is not able to attend to the prosthetic,
or appliance;
The veteran has a physical or mental incapacity (dementia) that requires assistance on a regular basis to protect the veteran from the hazards of his or her environment.
Furthermore, it is generally presumed that a veteran who is residing in an assisted living facility does meet one, or more, of the aforementioned conditions. However, a letter from the veteran’s personal physician substantiating the veteran’s disability will greatly enhance the benefits process.

Current AA Monthly Pension Benefits

The current approximate maximum monthly AA pension benefits are as follows:
Veteran & Spouse: $1,800.00
Veteran: $1,500.00
Surviving Spouse: $950.00

Unreimbursed Medical Expenses. Unreimbursed medical expenses are generally defined to include the costs associated to health and Medicare insurance premiums, prescriptions drugs, dental and vision care, and expenses related to an assisted living facility, and in-home care aid, and/or adult day care.
Net Worth Valuation. Finally, assuming a veteran, and/or his or her spouse, has tentatively qualified for the AA monthly pension benefit, the final test to fulfill the qualification process related to the net worth of the applicant. With the exception of the applicant’s home, an automobile, traditional household furnishings and personal property, which are treated as non-countable, attorneys who advise clients on veterans benefits are allowing the applicants to maintain
no more than one of the following cash asset levels without jeopardizing his or her opportunity to collect the maximum monthly AA pension benefit:
Couple: $80,000.00
Individual: $50,000.00
However, in practice, if a person’s assets are a home plus $40,000.00 in other assets, there are usually no issues. The home is not counted. In other words, the VA will rarely deny a claim if the net worth is below this number.
AA Pre-Planning. Lastly, with the Veterans Administration only looking at the applicant’s net worth at the time of the actual AA application, and with there being no penalty period for the transfer of assets prior to the time of the application, it is fair to conclude that with proper planning, just about any veteran, and/or his or her spouse, can qualify for a monthly AA pension benefit.
Medicaid Benefits. With the Medicaid program having stricter rules and regulations regarding asset transfers than the Veterans AA Program, it is very important that clients engage a qualified elder law attorney when developing a Long Term Care Plan. For instance, transferring assets to qualify for AA Benefits could result in a five year ineligibility for Medicaid benefits.

Please contact Danielle Mayoras for additional information or questions at dmayoras@brmmlaw.com or 1-877-PLAN-758.

You can also visit:

www.TheCenterForElderLaw.com, www.TheCenterForSpecialNeedsPlanning.com,
www.TheCenterforProbateLitigation.com and subscribe to our bi-monthly e-letter, The Insight:
News, Stories, and Thoughts on Elder, Special Needs, and Probate Law.

Reprinted from Alzheimer’s Disease & Related Dementias: a Guidebook for Care, Comfort, Legal
and Financial Security.

In this economy it is more important than ever for families to have their estate planning needs in order. As this article illustrates, families who don’t are subject to both emotional heartache and monetary loss. These family feuds erupt frequently and happen more than people think.

What Happens When The Family Can’t Get Along?
Dealing with a loved one with Alzheimer’s or dementia is difficult enough, but the problem becomes even more troublesome when the condition acts as a spark to ignite family conflict. Sibling rivalries, second marriages, denied incompetence, and simple greed are but some of the situations that add fuel to the fire and foster dramatic family feuds.
Often the fire grows so great that families become torn in half, spending months – or even years – battling in probate court. Sadly, many families are never able to repair the damage, emotionally or financially.
No one wants to end up in probate court fighting in a public family squabble. What can be done to avoid it?
Sometimes nothing. If someone else is determined to steal from, cheat, or improperly care for someone suffering from Alzheimer’s or dementia, you may have no choice but to go to court. Other times, probate court battles can be prevented, or at least minimized. How? Two ways: know when to call an experienced probate litigation attorney and know your legal rights.

The first one is easy. Anytime you suspect that someone is not acting properly towards an elderly loved one in a way that will either jeopardize that persons’ care or well-being, or may result in a loss of assets, then you should call an attorney who regularly represents clients in contested probate matters. Many such attorneys offer a low-cost or even free consultation. For example, the experienced attorneys at The Center for Probate Litigation will provide a free consultation to discuss your specific situation and let you know whether action is required. Too many families regret waiting and doing nothing – when in doubt, call an expert.

The second way to protect your family and often avoid court is to become educated about your legal rights. The following is an overview of the basic concepts that families of a loved one with Alzheimer’s or dementia may face when a family dispute or conflict threatens to surface.
Challenging a Power of Attorney or Patient Advocate Designation Many people believe that once someone signs a power of attorney, for either health care or financial decisions, or a patient advocate designation, then all control has been surrendered to the person designated to make decisions (called the attorney-in-fact or agent) and the rest of the family has no choice but to step aside. In reality, the appointment of an attorney-in-fact or agent is often just the beginning.
A power of attorney or patient advocate designation is only valid if it was executed in compliance with Michigan law, and the person was legally competent at the time of execution. If a power of attorney or patient advocate was signed by someone who was not competent, then the document can be voided.
Even when dealing with a valid power of attorney or patient advocate designation, the attorney-in-fact has a legal responsibility to act in the best interest of the principal. For health care decisions, this means deciding where to live and whom to provide care, based on what is best for the person in need of care, not what is most convenient for the agents. Often the person appointed to make these decisions want to make these decisions based on what will maximize their inheritance or what is easiest for them. This does not fulfill their responsibility.
For financial decisions, this requires the attorney-in-fact to invest prudently and refrain from self-dealing. Often, a person with Alzheimer’s or dementia requires much more conservative investments than he or she had previously chosen earlier in life. This may require a sale of annuities or securities, and insuring the portfolio is diversified, liquid and protected from extreme market fluctuations.
When the loved one has significant assets, following the advice of a credentialed, knowledgeable and ethical financial planner is essential. But Agents must use common sense too – just because a licensed stock broker or annuity salesmen recommends an investment does not make it suitable for a senior citizen with Alzheimer’s or dementia.

Guardianship & Conservatorship Disputes
What do you do when you discover an invalid power of attorney or patient advocate designation, or that the attorney-infact is not acting in the best interests of your loved one with Alzheimer’s or dementia? The only way to make sure that control is taken away from an agent who is not acting appropriately is to initiate guardianship and/or conservatorship proceedings.
Both proceedings are handled in probate court and involve someone asking for a decision maker to be appointed. Guardians make medical, placement and other life decisions, while Conservators make financial decisions. One person can serve in both functions, but courts can appoint different people as well.
Who gets appointed in these roles?
Most often, it is a family member or another loved one of the individual in need of protection, or ward. And, the ward’s choice does matter! This is especially true for someone with early stages
Alzheimer’s or dementia who still retains some decision-making ability, but requires some assistance. Even an incompetent person’s choice will carry great weight if it was expressed through a power of attorney or patient advocate signed while the person was still competent.
Judges who make this decision often have a difficult time when the family disputes who should act in that role. Sibling rivalries and second marriages present significant challenges. Because probate judges have a great deal of discretion in making decisions, family members vying for appointment must do everything they can to convince the judge that they are the most suitable, and that their opponent is not. This process is not fun for anyone who participates, but sometimes is necessary.
Once the guardian and/or conservator is appointed, those who serve have similar fiduciary obligations as an Attorneyin-Fact. The big difference is that they are monitored by the probate court, and file detailed reports on an annual basis, so that the probate court can make sure that the ward is properly protected. Probate courts often also require bonds to be posted when the protected person has significant assets.
Certainly, no one should choose to initiate a guardianship or conservatorships proceeding unless they have no other good choice. But when diplomacy has failed, or when a loved one’s Alzheimer’s or dementia causes them to be too stubborn to admit that they need help making decisions, it is the only safe choice. With an experienced attorney guiding the family, protective proceedings through probate court helps many people sleep at night knowing their loved one is safe.

Theft and Loss of Assets
Court disputes are not always done to safeguard a person’s well-being. Often they are necessary to help a loved one from losing assets, either through mismanagement caused by their dementia or Alzheimer’s, or theft or exploitation from an unsavory family member or annuity salesman. Knowing when to intervene or not is not always easy.
Many seniors suffering from Alzheimer’s or dementia do not want to admit that they need help with their financial decisions. Often, their children do not want to insult them by asking too many questions. But when you have a loved one diagnosed with dementia or Alzheimer’s, you owe it to them to probe. Make sure their investments are secure and appropriate, and their assets are protected.
In doing so, pay attention to warning signs of exploitation. The National Center on Elder Abuse lists many warning signs of exploitation, including sudden changes in banking practice, unexplained withdrawal of large sums of money, the addition of names on a bank signature card, unauthorized withdrawal of the elder’s funds using an ATM card, abrupt changes in a will or other financial document; substandard care being provided or bills unpaid despite the availability of adequate financial resources, forged signatures, and unexplained transfers of assets, among others.
If you discover any of these warning signs, talk to an elder law attorney with knowledge in financial matters immediately. Often, children or other trusted family members are the ones exploiting or even stealing money from someone suffering from Alzheimer’s or dementia. In other cases, there are greedy financial planners who target vulnerable adults with high-commission, inappropriate investments. Financial exploitation is not always easy to spot.
Being on guard and proactive is the best defense.

Challenging Changes to a Joint Asset, Will or Trust
What do you do when you discover financial exploitation in a way that is not as overt as theft? What do you do when your father with Alzheimer’s or dementia has added his second wife’s name to a bank account that was always meant for the family, or your mother changed her will or trust to omit you in favor of your brother or sister?
All of these can be successfully challenged in court under the right circumstances, with the help of an experienced probate litigation attorney, but only if the help is sought before it is too late. Sometimes, it is not too late even after the exploited senior passes away. Will and trust changes, joint assets — including bank accounts and real estate, and even outright gifts can be set aside and undone on the basis of incompetence, undue influence, fraud and other reasons.
Incompetence – The test for competency varies depending on the document challenged, but for every situation, the crucial factor is whether the individual reasonably understood the nature of the document or transaction when it was signed. For someone in the early stages of Alzheimer’s or dementia, this is not a bright line test with an easy answer.
Undue Influence – When a person is compelled to make a decision that he or she would not have made, the decision is often the product of undue influence, which is a basis to set it aside. In fact, the law presumes undue influence has occurred when the beneficiary was acting as the power-of-attorney, or otherwise occupied a position of confidence and trust, before the decision or document was made.
Fraud – Even when competent, vulnerable adults with Alzheimer’s or dementia can be tricked into transferring assets, or changing bank accounts or estate planning documents, based on material statements of fact that are false. When someone relies on a material and false representation, the transaction or document can be set aside as invalid.
Accounts of Convenience – For joint bank accounts in particular, and sometimes other joint assets (sometimes even real estate), a loved one with Alzheimer’s or dementia may add the name of a child or other trusted relative as a convenience to help will bill paying, financial management or as a “poor man’s will” to save costs. If the person did not intend the joint owner to keep the asset on death, but instead only added the joint name as a convenience, then courts can and do order the asset to be turned over to the estate and shared with the other beneficiaries.
The decision whether or not to contest the joint nature of an asset, or a new estate planning document, is not always an easy one, and certainly should not be made lightly. Court battles seeking to set aside documents or transactions can be costly and time-consuming. But sometimes, honoring the true wishes of a loved one with Alzheimer’s or dementia is worth the fight.

Please contact Andrew W. Mayoras for additional information or questions at
awmayoras@brmmlaw.com or 1-877-PLAN-758.

You can also visit:
www.TheCenterForElderLaw.com, www.TheCenterForSpecialNeedsPlanning.com,
www.TheCenterforProbateLitigation.com and subscribe to our bi-monthly e-letter, The Insight:
News, Stories, and Thoughts on Elder, Special Needs, and Probate Law.

For more stories on probate and celebrity cases, visit: www.probatelawyerblog.com.

Reprinted from Alzheimer’s Disease & Related Dementias: a Guidebook for Care, Comfort, Legal

and Financial Security.

Introduction to
Elder Law for Caregivers

Caregiving for someone with Alzheimer’s or a related dementia is one of the most difficult jobs in the world. In addition to making sure that your loved one is safe and their daily needs are met, you are also faced with the fact that there are many financial and legal issues that must be addressed. As if that was not enough, you also are trying provide the best quality of care at the least cost to the family. Caregiving is expensive and stressful, especially in these uncertain financial times. Hopefully, this article can provide you the financial and legal answers you need to do a better job.
Elder law is not just for senior citizens who are no longer independent or who are about to enter a nursing home. Elder law is for anyone who is middle aged and beyond — and sometimes even younger.
There are now more than 5 million people in the United States living with Alzheimer’s. This is a 10% increase from 5 years ago, and clearly supports the long forecasted dementia epidemic. One in eight persons age 65 and over have Alzheimer’s disease and nearly half of all persons over the age of 85 have Alzheimer’s. Every 72 seconds someone develops Alzheimer’s disease; by mid-century someone will develop Alzheimer’s every 33 seconds.
You are not alone. There are over 50 million caregivers in this county. Studies show that 12 million people in this country need long term care. Twenty-one percent of American adults provide free caregiving for loved ones. Fiftynine percent of these caregivers either work outside the home, or have worked outside the home, while providing care.
It has been estimated that the value of free services given by caregivers is in excess of $310 billion a year.
Additionally, as a result of caregivers, businesses are also effected by the caregiving epidemic. Specifically, over 60% of caregivers work and dedicate on average 18 hours per week to provide care. Family caregivers account for 73% of early departures and late arrivals in the workplace. Caregiving by an employee costs the average employer $2,100 per employee or for all employers as much as $33 billion annually. These services are provided by family members without regard to cost because of the love and respect they have for their loved ones.
These statistics only represent the economic cost of caregiving. It does not even address the emotional and physical toll on caregivers. The fact is that 70% of all caregivers over the age of 70 die first. People generally do not think about the health of the caregiver or plan for the unthinkable – - the caregiver having health problems or passing away before their loved one with dementia. It is for this reason that we approach each situation from the worst case scenario. We plan for the worst and hope for the best, that way our clients are always protected.
We know that age is the biggest risk factor for Alzheimer’s and dementia related diseases, however, these diseases do not discriminate. We have helped clients who have loved ones suffering from Alzheimer’s and dementia related diseases, some as young as their late 30’s. The time to look down the road and make major decisions regarding your health, well-being and finances is now.
It is important to understand the difference between an elder law attorney and an estate planning attorney. While estate planning attorneys are concerned with what happens to your estate upon your death, elder law attorneys ensure that your affairs can be managed in the event of your disability as well as once you pass away. Specifically, an experienced elder law attorney addresses the following tough questions like:
Who will make my medical decisions when I am no longer able to make them?
If I am unable to care for myself, how can I achieve the greatest quality of care without bankrupting myself or my family?
Who will be able to talk to my doctors and the hospital when I require guidance even though I am able to make my own medical decisions?
Who will make my end of life decisions?
What happens if I get sick and cannot stay in my home anymore?
How am I going to pay for it?
For caregivers of loved ones with Alzheimer’s and related dementia, information regarding Medicaid and estate planning is a necessity. It is our hope that this guidebook will answer many common legal questions and that it will eliminate the belief that it is never too late to plan.
In these uncertain financial times, the proper long term care planning is more important than ever. Families who seek the proper professional advice will be able to protect significant portions of their assets, possibly all of their assets, in spite of these rocky financial times. However, families who fail to do the proper planning, will rapidly deplete their assets with the rising nursing home costs.

Medicaid Basics
We wanted to use this opportunity to explain Medicaid basics and to correct some of the most frequently misunderstood concepts of Medicaid. Please keep in mind, however, that the Medicaid laws are constantly changing. A brief summary of the most recent changes are discussed in the next Chapter. The discussion below is based on the current Medicaid laws as of January 2008. Prior to implementing any of the strategies discussed below, it is imperative that you contact an experienced elder law attorney. There are many common questions we are asked, such as:
What is the difference between a countable asset and a non-countable asset?
A countable asset means that Medicaid looks at it and it effects your Medicaid eligibility whereas a non-countable asset does not effect your Medicaid eligibility.
If I am single and trying to qualify for Medicaid, what assets can I keep?
A single individual can keep:
• $2,000.00 cash;
• a home if it is not owned by a living trust;
• all personal property and jewelry;
• one vehicle;
• life insurance with a combined face value up to $1,500.00;
• an irrevocable funeral contract up to a maximum of $11,072.00;
• burial space plan;
• OBRA ‘93 Payback Trust, Pooled Income Trust; and
• in certain circumstances immediate annuities.
If my spouse goes into a nursing home, what assets can I keep?
For 2008, if your spouse goes into a nursing home,
then you may keep one-half of the countable assets, up to a maximum of $104,400.00 and no less than $20,880.00.
These numbers are adjusted annually. Medicaid will make this assessment based upon the value of your assets on the “snapshot date,” which is the first day that your spouse goes into the hospital or nursing home and receives continuous care for 30 days or more or commonly know as the date the last night your spouse slept at home.
Are there any other special planning tools for married couples?
There is very specialized technique called a “Trust for the Sole Benefit of the Community Spouse” that can be used in some circumstances to protect a significant portion of a married couple’s assets. This is an irrevocable trust with many requirements.
If my spouse goes into a nursing home, can I receive his or her Social Security and pension benefits?
It is possible. Sometimes, Medicaid will allow “shelter and utility allowances,” which means that it will divert a portion or all of your spouse’s income to you to help you pay your bills. For 2008, the maximum amount that you can receive as a
shelter allowance is $2,610.00 per month. In some circumstance where this is not enough, a probate court can increase the income allowance.
Does my mother have to wait five years to qualify for Medicaid?
No. The five year period is not a waiting period, but only an examination period. Therefore, if your mother enters a nursing home on November 1st and spends down her assets by January 1st, she may be eligible for Medicaid on January 1st.
Will Medicaid be able to recover the cost of care (Estate Recovery) from the home?
Yes, if you do not plan properly. Michigan recently enacted a probate Estate Recovery, which allows the State to file a claim against any assets that pass through the probate process. However, the residence and any other assets that pass to beneficiaries outside of probate court are not subject to Estate Recovery. Elder law attorneys accomplish this goal of protecting the home, through the preparation of a special deed. This deed allows your loved one to maintain ownership of the home
while living, and avoids probate court and Estate Recovery upon death, while remaining an exempt asset from Medicaid.
My mother applied for Medicaid and even though she had less than $2,000.00 in the bank, she was denied. The Medicaid office informed us that it was because her house was in a trust. Is it true that her house has to be sold before she can qualify for Medicaid?
Her house does not necessarily have to be sold. Your mother could execute a  quit claim deed transferring the home out of her trust. Many people do not realize that when a home is owned by a trust, it is a countable asset. When a home is not owned by a trust, it is a non-countable asset for Medicaid purposes. However, it will then go through the probate court process and be subject to Estate Recovery, unless one plans properly as explained in the question above. It is important to be certain that any attorney you work with is familiar with the Medicaid laws. Additionally, not to complicate matters more, there are circumstances when titling a house in a trust can be very advantageous.
Is it true that if I gift money to my children before applying for Medicaid, it will disqualify me from receiving Medicaid?
Not necessarily; it depends on when the gift was made and how it was done. Even though the laws
regarding gifting and Medicaid have change, it is important to understand that you can make gifts and still qualify for
Medicaid if the gifting is done properly. Gifting should only be done with the advice of an elder law attorney. See the next chapter titled “Recent Changes in Medicaid Laws.”
If my father added my name to his assets and now he needs to qualify for Medicaid, does that mean that I can keep half of the assets? The answer is: it depends. This is a very complicated area of Medicaid planning. It depends on whether the asset is available to your father without another’s consent and when your name was added to it. If your father added your name to his assets and he still has access to them, then the assets remain his irrespective of when he added your name. For instance, joint bank accounts are available to all owners and are countable. On the other hand, if
your father added your name to the cottage over five years ago, the asset may not be available for Medicaid purposes.

Recent Changes in Medicaid Laws (full of traps and pitfalls for the uninformed)
Every so often, Congress changes the rules of Medicaid eligibility for nursing home coverage. In recent years the rules have been relatively stable, with no changes in federal law since 1993. However, on February 8, 2006, the Deficit Reduction Act of 2005 (“DRA”) was enacted and it substantially changed Medicaid laws.
In our collective experience of 37 years of practicing elder law, we have never seen such drastic changes when it comes to providing benefits to the elderly, disabled, and poor. Michigan enacted the DRA on July 1, 2007, effective retroactively to February 8, 2006. In addition to the drastic changes imposed by DRA, Michigan has implemented additional significant changes in April 2007, September 2007, October 2007 and in January 2008. This Chapter is intended to provide a brief summary and is not meant as a comprehensive summary of the changes.
Here is a brief summary of some of these new laws:
Increased Look-back Period.
All transfers under the new law, whether to individuals or to trusts, will be subject to a
five year look-back period rather than the previous look-back period (three years for individuals and five years for trusts). This has made the Medicaid application process more difficult and could result in more applicants being denied for lack of documentation, given that they will need to produce five years, instead of three years, worth of records. This will be particularly true for families that have a loved one with Alzheimer’s and related dementia as their record keeping skills are likely to have been poor. Keep in mind, if you work with an experienced elder law attorney, there may be ways to reduce the documentation burden of the five year look-back period.
Altered Penalty Start Date.
For asset transfers that are less than fair market value, the penalty period now begins on the
date that the individual would otherwise have been eligible for long term care services (Medicaid as well as the home based community waiver) but for the asset transfers, rather than the previous penalty period start date of the asset transfer itself. Simply put, Medicaid will penalize from the date of the Medicaid application instead of the date of the gift. Further, all transfers during the look-back period will be added together to determine the total transfer penalty.
With respect to asset transfers that occurred prior to February 8, 2006 the old penalty start date, the date of the gift, still applies.
Charitable and political contributions as well as innocent gifts to family members under the tax laws are some of the types of transfers that could result in a Medicaid ineligibility period.
For example, a semi-healthy grandmother gives her granddaughter $20,000 to assist with her college education. Three years later, the grandmother, as a result of Alzheimer’s disease or dementia, requires nursing home care. Over the next eighteen months, she spends her life savings on her own care. Forty-eight months after her gift to her granddaughter, the grandmother has depleted her assets and applies for Medicaid. She will be penalized for about four months before
she receives Medicaid benefits, even though she has no money remaining to pay for her care. How her care will be paid for during that four month period of ineligibility is anyone’s guess.
Hardship Waivers. To mitigate the effect of these new rules, Congress has mandated that each state institute a process for seeking a hardship waiver for those instances when the application of the transfer penalty would result in a deprivation of medical care that would endanger the applicant’s health or life, or for “food, clothing, shelter, or other necessities of life.” Michigan currently considers hardship when a delay in treatment may result in the person’s death or permanent impairment of the person’s health. The current standard is much stricter than that imposed upon by the new. Unfortunately, we do not anticipate that Michigan will change their hardship exception anytime soon.
Home Equity.
Medicaid previously disregarded the value of a primary residence regardless of its value in counting
assets. Under the DRA, individuals with more than $500,000 in home equity are now ineligible for Medicaid nursing home benefits. Keep in mind that under pre and post-DRA laws, any home owned by a revocable living trust is considered a countable asset and must be removed from the trust before the applicant can qualify for Medicaid. The cap on equity does not apply if there is a spouse or child under 21 or a blind or disabled child residing in the home.
These exceptions apply regardless of the equity value of the home.
Treatment of Annuities.
The DRA has set forth changes concerning annuities which are very complex and as of this date, it is unclear how they will be interpreted. The gist of these changes is to provide a requirement that the State of Michigan be named as a beneficiary to the extent medical services have been paid by Medicaid as well as instituting reporting requirements for the annuity companies. Previously, certain annuities were treated as exempt assets and did not require that the State of Michigan be named as the beneficiary. In the event that the Medicaid applicant has a spouse, however, Medicaid will only have to be named as a remainder beneficiary.
Long Term Care Insurance Partnership.
Under the DRA, Medicaid disregards any assets or resources in an amount equal to the insurance benefit payments that are made to or on behalf of an individual who is a beneficiary under a long term care insurance policy. This will most likely be implemented in Michigan sometime in the 2008 calendar year.

Danielle Mayoras • dmayoras@brmmlaw.com •1-877-PLAN-758 •
www.TheCenterForElderLaw.com

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