by Bill Miller | Jun 2, 2018 | Medicaid
One government program is by far the largest payer of nursing home costs in the U. S. – Medicaid. Although the funds come from the federal government, the states administer Medicaid. For example, Alabama Medicaid processes applications and distributes benefits for eligible Alabama residents. Although Medicaid covers many medical services, however, there are some services not covered by Medicaid. Before expecting Medicaid to defray your medical costs, it’s important to know what is not covered.
Services Not Covered by Medicaid:
- Routine or annual physical checkups
- Over-the-counter drugs or health supplements
- Custodial care and assistance with activities of daily living (ADLs)
- Charges for missed appointments
- Dental care
- Cosmetic surgery
- Medical services provided outside of the United States
- TV rentals and VCRs in hospital rooms, as well as meal trays and cots for guests
- Respiratory therapy, speech therapy, and occupational therapy
- Services provided to people in prison or jail
Example: Jessie qualified for Medicaid and thought all her medical needs would be covered. However, her claims for her yearly physical and her over-the-counter allergy pills were denied. She also missed several doctor’s appointments. She was charged because she did not cancel in advance. Jessie had to pay for the missed appointments. She learned the hard way about services not covered by Medicaid.
Medicaid may pay for optional medical services like:
- Eye examinations, glasses, contact lenses
- Hearing exams and aids
- Preventive screenings
- Physical therapy
- Nonemergency transportation to and from medical appointments and treatments
- Some non prescription drugs and nonprescription drugs not covered by Medicare
- Chiropractic care
Fred needed physical therapy and chiropractic care to build his strength and help him get around a little easier. Medicaid typically does not pay for these services. However, Fred should talk to a Medicaid caseworker because some assistance may be available.
In addition, Medicaid does not pay for services provided by any health care provider who does not participate in Medicaid. Make sure your doctor accepts Medicaid patients before making an appointment.
Medicaid must consider Medical treatment and supplies medically necessary. For example, Randall feels he needs to move to a nursing home, but his doctor does not. Medicaid will probably deny Randall’s request unless his request is supported by documentation showing nursing care is medically necessary.
To receive Medicaid, you must be eligible.
The Medicaid application process is long, complex, and frustrating. In addition to the application, individuals must present many documents supporting their request for benefits. Applicants who are denied coverage can appeal the denial.
Act Now.
People should plan for long-term care and Medicaid eligibility well before incapacity strikes. In doing so, you should also know about services not covered by Medicaid.
The attorneys at Miller Estate and Elder Law help their clients prepare estate plans that address future potential incapacity issues. For a free consultation, contact us at 256-251-2137 or use our convenient Contact Form. Although we’re located in Anniston, we also help clients in the Birmingham, Gadsden, Hoover, Talladega, Vestavia Hills, and surrounding areas.
by Bill Miller | Jun 1, 2018 | Medicaid Planning, Medicaid Qualification
The Willingham Family needs to apply for Medicaid to pay for their grandmother Joanne’s nursing home care.Before doing so, it is important to look at all of her financial transactions during the Medicaid look back period. In the past four years, she has given them monetary gifts, sold her car to her granddaughter for less than market value, and transferred the family home to her oldest son, Byron. Now, however, Joanne needs 24/7 residential nursing home care. She has no option but to apply for Medicaid. She and her family have no idea how Medicaid will view the financial transactions she made during the Medicaid look back period.
A Little About the Medicaid Look Back Period
Medicaid is funded by the federal government but administered by each state. Alabama Medicaid, then, distributes benefit money to Alabama residents. Medicaid programs provide benefits through a variety of programs. We primarily will be looking at Medicaid for elderly or disabled people and residents of nursing homes.
To receive benefits, people must complete applications. They must also meet financial and resource limits. In addition, applicants must provide substantial documentation, including financial records, for the 60 month period before the application date – the Look Back Period.
Medicaid caseworkers thoroughly review an applicant’s financial history during the application process. They are particularly interested in gifts and transfers for less than market value that occurred during the Medicaid Look Back Period which is the 60 months prior to filing the application. What they discover during their review could trigger a penalty period where the applicant cannot receive benefits.
Why Does Medicaid Care About Transfers Made Before You Applied?
Assets transferred during the Look Back Period could have been used to pay for the applicant’s care.
Not All Transactions Were Created Equal.
Some financial transactions are deemed okay by the Medicaid system. Some are not.
These deals may cause problems for the applicant:
Gifts. Taxpayers are allowed to gift money within certain guidelines without facing tax penalties. However, Medicaid typically does not consider gifts exempt.
Irrevocable Trusts. In some cases, assets transferred to irrevocable trusts during the look back period trigger a penalty.
No Documents. Some transactions will be considered in violation of the Look Back Period because of inadequate documentation. The applicant may have to prove that the sale price of a house, for example, falls in line with the market value of the house.
These deals may be allowed:
- Spouses. Transfer to a spouse in most circumstances.
- Disabled Children. Transfers to a blind or disabled child under the age of 21 are usually allowed.
- Deals with Siblings. If an applicant co-owns a home with a sibling if the sibling lived with the applicant for at least one year before applicant applies.
- Adult Children Caregivers. Applicants can give their home to an adult child who is their primary caregiver.
- Payments to creditors are usually allowed. In fact, one way to turn liquid assets into exempt assets is to pay off your mortgage or home equity loan.
Advance Medicaid Planning Can Help.
Planning for Medicaid eligibility can be tricky. Speak with an Alabama attorney and make Medicaid planning part of your estate plan. To learn more, click the link to get a copy of our Alabama Guide to Medicaid Qualification. Doing so could save you thousands of dollars.
For a free consultation with an experienced Alabama attorney, contact us at 256-251-2137 or use our convenient Contact Form. We have offices in Anniston and Birmingham and serve clients in Gadsden, Hoover, Talladega, Vestavia Hills, and surrounding areas.
by Bill Miller | May 28, 2018 | Business, Estate Planning
When someone starts a business, the last thing they want to think about is death. A close second? Incapacity. However, planning for these events is critical to a company’s success. If you are a business owner, you need to include your business interest in your estate plan.
What is “business succession?”
It’s a way of ensuring that a business will continue operating if the owner (or one of the owners) dies or becomes unable to participate for some reason. It also may protect a company when an owner retires or is in the midst of divorce negotiations.
How can I include a business in my estate plan?
First, if you have partners, you can put a buy-sell agreement in place. This document spells out how the business will be handled if you can no longer participate in the company. For example, your buy-sell may provide for an owner’s interest to be bought out by the other partner or by the company itself. Having a good buy-sell in place is no good, however, if there’s no capital to pay for the buy-out. Business owners may use insurance policies, sinking funds, payment plans, or personal funds to purchase another owner’s interest.
Your estate plans must be synchronized with your business succession interests. Does your durable power of attorney address your business interests? Your power of attorney can be broad or limited. Does your agent have the power to make decisions about your business? More importantly, does your agent have the ability to make those decisions?
Does your Will leave your business interests to family members who have little interest in the business? Your loved ones may not be the best people to continue operating the company.
What can happen if I don’t have a business succession plan?
Without the right planning, a business could be in real trouble.
Let’s look at Dan and Bob’s Construction Company. Dan and Bob started their company from nothing. After 30 years, business was thriving and expanding every year. Then Bob suffered a major stroke, something the average 50-year old doesn’t expect to happen. Although Dan and Bob were astute businessmen when it came to building houses, they had failed to put together a business succession plan.
The company was thrown into confusion because Dan did not have the authority to make financial decisions by himself. One of Bob’s sons tried to take his place in the business but had no interests in business of any kind. Bob had not executed a durable power of attorney that would allow anyone to make financial decisions for him, so his wife had to petition for a guardianship/conservatorship. The company suffered cost overruns and angry clients because they fell behind in honoring their contracts.
A buy-sell agreement would have allowed the company to smoothly transition. Bob’s partnership interest could have been bought out by Dan or by the company itself.
Don’t Have an Estate Plan Yet?
The attorneys at Miller Estate and Elder Law help their clients develop estate plans that cover all their assets, including business interests.
For a free consultation with an experienced Alabama attorney, contact us at 256-251-2137 or use our convenient Contact Form. We have offices in Anniston and Birmingham and serve clients in Gadsden, Hoover, Talladega, Vestavia Hills, and surrounding areas.
by Bill Miller | May 21, 2018 | Asset Protection, Medicaid
The American dream is to work hard, build your life savings and purchase a home. But what happens when that dream is threatened? What if you want your family members to benefit from your hard work? There are ways to protect your savings from the ravages of long-term care, future creditors and civil judgments.
Protect Your Savings from Medicaid Recovery
In some cases, Medicaid programs must at least attempt to recover money paid to Medicaid recipients. Typically, Medicaid will file a claim against the deceased recipient’s estate. However, there are ways to protect your savings from Medicaid recovery:
- Alabama’s Partnership for Long-Term Care helps people buy long-term care insurance that will cover costs that otherwise might be paid by Medicaid. Although not everyone who applies will qualify, it’s certainly worth looking into.
- Irrevocable trusts are a great way to protect your savings from Medicaid recovery because the assets transferred to the trust are no longer considered your property. Medicaid’s 60-month look back period still applies, however.
Other alternatives to Medicaid:
- You can ask family and friends to agree to care for you in exchange for some type of compensation.
- You may also consider transferring assets to spouses or family members. However, this method could adversely affect your eligibility for public benefits. Another potential problem is taxes. Additionally, once you transfer your assets to someone else, you lose all control over those assets. Those assets are also subject to the creditors and predators of the person you gave them to including divorce, tax liens, bankruptcy filings and lawsuits.
Protection from Creditors and Predators
Some people need to protect their life savings from unscrupulous creditors or dishonest persons. Sadly, sometimes family members take advantage of elderly or disabled individuals by cleaning out their bank accounts with no remorse.
You can establish an asset protection trusts then fund it with your assets. In some cases, you may still receive benefits from the trust though it is protected.
Another option is to give money to family members or friends. However, you lose control of the assets, your beneficiary’s share may be taken by their creditors, and such transfers may hurt your Medicaid eligibility.
There’s one important thing to remember: you have to make sure you don’t violate fraudulent transfer laws when setting up an asset protection trust. If creditors are already filing claims against you, it may be too late to establish and fund an asset protection trust.
It’s best to consult an attorney before taking any steps toward asset protection.
Take Steps to Protect Your Hard-Earned Money.
Are you concerned about protecting your assets? Start planning now. Schedule an appointment with one of the qualified elder law attorneys at Miller Estate and Elder Law Our phone number 256-251-2137. Or you may choose to use our Contact Form to get started on your path to peace of mind.
The following might be helpful, too:
Protecting Your Estate from Medicaid Recovery
How Do I Protect My Assets from Nursing Home Costs?
by Bill Miller | May 17, 2018 | Estate Planning, Probate
Probate or avoid probate – one of the main issues you must decide when creating your estate plan. For many people, probate is not the best solution for settling an estate. Probate proceedings can be long, expensive, and frustrating for the heirs and the executor. Fortunately, there are perfectly legal ways to avoid probate.
Probate Explained
After someone dies, their property – their stuff – has to go somewhere. So, if the person who died left a valid Will, someone submits the Will to the court to be probated. An executor appointed by the court begins the sometimes tedious process of gathering the decedent’s assets and claims against the estate. The executor pays claims and distributes property is to heirs. Additionally, the executor closes the probate estate when everything is done.
When there is no Will, the property is still distributed. However, the law determines who gets what, not the decedent.
It is usually best for the heirs when the decedent’s property does not pass to them through probate. We’re going to look at three ways to make this happen.
Joint Tenancy to Avoid Probate
With this type of property ownership, two or more people own the property. Each owner has an undivided, equal interest in the property. In joint tenancy, a deceased owner’s interest does not pass to the other joint tenants.
Sometimes people own property with a joint tenancy with right of survivorship. This means that if one owner dies, the other owner gains possession of their ownership interest. In Alabama, this joint tenancy with the right of survivorship does not occur automatically. Instead, legal document must clearly state the right of survivorship.
Property that passes through right of survivorship usually does not become part of the probate estate. Without the right of survivorship, it does.
Beneficiary Designations to Avoid Probate
With most financial accounts and certain other assets, the owner may designate who will receive the asset upon the owner’s death. You’ve probably seen beneficiary designations on retirement accounts, bank accounts, and insurance policies.
One thing to remember is that beneficiary designations trump the Will. Usually, property passed through beneficiary designations will not pass through probate. Instead, it is transferred quickly to the beneficiaries named by the deceased owner.
Although the speedy transfer is great, discuss these designations with your estate planning attorney. Unless your estate plan and the designations are in sync, your heirs could receive more or less than you intended. For example, if your Will states that your three children will inherit equal shares of your estate, but you name your oldest child as beneficiary on your insurance policy, the oldest child will likely receive more than the other two children.
Revocable Living Trusts to Avoid Probate
Trusts are useful estate planning tools. There are various trusts for various purposes, including the revocable living trust.
Revocable means the settlor, the person who established the trust, can change the trust fairly easily. After signing the trust document, the settlor transfers assets to the trust. People often use this type of trust to avoid probate, reduce estate taxes, or manage assets. In general, trusts avoid probate because the trust assets never become part of the settlor’s estate.
A Little Planning Is What’s Needed.
For most people, it’s not that difficult to avoid probate. It just takes some astute estate planning with the assistance of an attorney who knows Alabama law.
The attorneys at Miller Estate and Elder Law have the experience you need to get the estate plan you deserve. Contact Miller Estate and Elder Law at 256-251-2137 to schedule an appointment or fill out our convenient Contact Form. We help clients in Anniston, Talladega, Birmingham, Gadsden and surrounding communities.
To learn more:
Pros and Cons of TODs and PODs
