Welcome to My Blog

Attorney Michael MillonigHi,

I’m Michael Millonig, and you’ve managed to find your way to my blog.

As an attorney who specializes in elder law, I know that there are a lot of elder care issues facing adults with elderly parents that don’t necessarily either require, or get covered by, a lawyer. There are also many changes in elder law, especially Ohio’s Medicaid program, that happen quickly which make it difficult for me to keep you up to date with my email newsletter or seminars. That’s why I’ve started this blog.

Over time, I have no doubt that the topics will evolve, and that we’ll meander a little bit. Occasionally, I’m sure there will be some difficult discussions; but I hope that equally there will be some light-hearted ones. And regardless of the nature or tone of the topics, I’m looking for input from you, my dear readers. So, if there’s something you have a question about, something you’d like to know more about, or simply something you’d like to share, please don’t hesitate to reach out and let me know.

In the meantime, I’m going to get rolling and start writing about things like caring for aging parents, role reversal, supporting siblings with elderly parents, Ohio’s Medicaid program, revocable living trusts, powers of attorney, retirement communities, home-care, elder care and any other topic I can think of that might be useful to you.

Hopefully you enjoy what you find here, learn some things, and join the conversation.

Once again, welcome to my blog.

Michael  J.  Millonig
Certified as an Elder Law Attorney
by the National Elder Law Foundation since 1998
OSBA Board Certified Estate Planning
Trust and Probate Specialist
937-438-3977

Any legal information communicated in this blog is a general statement of the law.  It is not intended as legal advice and should not be relied upon to answer any specific questions concerning your own circumstances or for purposes of legal planning. These communications are not intended to create an attorney-client relationship. Please contact my office for an appointment if you have any legal questions.

GOP Tax Plan Could Deal Blow to Seniors Paying for Long-Term Care

The tax plan put forward by the Republican-led House of Representatives would eliminate many current deductions, and getting rid of one of them in particular could deal a serious financial blow to seniors and individuals with disabilities. The plan proposes eliminating the medical expense deduction, a change that will especially affect those needing long-term care.

Currently, taxpayers can deduct certain medical expenses from their income taxes if the expenses add up to more than 10 percent of adjusted gross income. These expenses can include health insurance premiums, deductibles, nursing home fees, home health care costs and even assisted living fees, if a doctor certifies that the individual must live in the facility due to health care or cognitive needs.

While most taxpayers don't have health care expenditures exceeding 10 percent of their income, many seniors and others with disabilities do. According to the IRS, 8.8 million households — almost 6 percent of tax filers — claimed medical deductions in 2015. The AARP estimates that 74 percent of those who take the deduction are age 50 or over and half have incomes of $50,000 or less. 

“It tends to be mostly … older people who do not have long-term care insurance, and end up in a nursing home,” Richard Kaplan, a professor who specializes in tax policy and elder law at the University of Illinois College of Law, told CNBC. “For people who are receiving long-term care and are paying for it themselves, this is going to be a huge deal.”

For them, having the deduction can mean that they do not run out of funds and have to rely on Medicaid, or are at least able to postpone applying for Medicaid. Eliminating the medical expense deduction will likely mean that more people will spend down their assets more quickly, requiring them to apply for Medicaid. In addition, adult children who pay for their parents' care can sometimes use the deduction. For more information about how ending the medical deduction might affect you, click here.

In addition to eliminating the medical expense deduction, the tax bill cuts corporate tax rates. The bill’s proponents argue that the tax changes will unleash huge economic growth that will result in higher tax revenue. However, if the bill’s supporters are wrong and the growth in tax revenues is not as large as hoped, the reduction in tax revenues will likely cause sharp cuts in government spending or an increase in budget deficits, or both. A reduction in spending could affect seniors and individuals with disabilities through cuts to Medicaid, Medicare, Section 8, Meals on Wheels, and food stamps.

The tax proposal would benefit a small number of wealthy seniors by eliminating the estate tax. Under the proposal, the estate tax exemption will be increased from $5.45 million to $10 million for individuals dying in 2018 through 2023. After 2023, the estate tax will be eliminated completely. The Tax Policy Center estimates that only about 0.2 percent of estates pay any federal tax under current rules.

The House’s tax plan is not final, and the Senate plan preserves the medical expense deduction.  The two bills, if passed, must be reconciled.

For an AARP fact sheet on Medicare beneficiaries who spend at least 10 percent of their income on out-of-pocket medical expenses, click here.

HOME FUNERAL RIGHTS IN OHIO

Funerals can be very expensive. You can avoid the greatest expense by simply not having a service at a funeral home. However, there are other things that need to be done that require the services of a funeral home. The law makes it very difficult to avoid using a funeral home. The first problem will be to decide where to transport the body of the deceased. If you cannot immediately arrange for a burial, which requires you to have a death certificate and burial or cremation permit, the body needs to go somewhere. This is generally done by a funeral home which will have facilities to store the body temporarily. The family will be under some pressure to move the body since most locations (e.g., nursing facility, home or other community location) cannot just keep the body for any period of time. A hospital or nursing facility might have a refrigeration unit for storage. A funeral director is authorized by Ohio law to arrange for the issuance of the death certificate. It is very difficult to do both of these things by yourself.

The procedure below outlines how you can make all these arrangements yourself under Ohio law. See my webpage on funeral planning for other suggestions on how to save money on a funeral. Click here http://www.michaelmillonig.com/practice-areas/funerals-burial/

1. The funeral director or “other person in charge of final disposition” must register the death with Ohio County Bureau of Vital Statistics. The death certificate form is issued and must be signed by the attending physician or coroner. O.R.C. §3705.16. If a funeral home is not preparing the death certificate, then you need to contact the Ohio Dept. of Health, Vital Statistics, in Columbus to get the death certificate. You cannot contact the local County Dept.

2. Call the County Coroner to report the death if the person died as a result of a crime, casualty, suicide, child under age 2, developmentally disabled person, or death in any suspicious or unusual manner. O.R.C. §313.12. If no funeral home is involved and/or you are going to have a home funeral, it is probably best to call the Coroner or ask the hospital or nursing home to call the Coroner.

3. Call a funeral home for transport to a cemetery or crematory. If you do not want to use a funeral home, call an Ambulance Service which may be willing to transport the body to a cemetery or crematory. You will need to have the burial or cremation permit.

4. Obtain a burial or cremation permit from the County Bureau of Vital Statistics. O.R.C. §3705.17 & O.R.C. §4717.22. The death certificate must be issued first.

5. Make cemetery arrangements for burial or cremation.

6. Plan a memorial service at a community facility or family residence or a grave site/cemetery service. You do not need to use a funeral home. The right for a home funeral is preserved in Ohio law. O.R.C. §4717.12.

Consumer Reports: Who Will Care for You?

The October issue of Consumer Reports has its cover story entitled “Who Will Care for You?” The article focuses on elder care decisions at the assisted-living level. See https://www.consumerreports.org/cro/index.htm

It is generally an instructive and helpful article. I am going to add my own comments and information to go along with this article.

The first obvious answer to the question posed by the article is missed by Consumer Reports. Many people would answer this question by saying that a family member will take care of them. That is not necessarily the best option but is often the plan for many people. More importantly, it is an important issue to be addressed in this context. It is very difficult to care for a family member 24/7 year after year. This may work out for some period of time if the person’s needs are not that demanding. However, at some point in time it simply becomes too much and a person does need to move to a nursing facility. I never discourage any of my clients to at least not try to care for a family member at home but the practical realities and the difficulty of doing so need to be addressed.

The article very accurately points out that the dividing line between an assisted living facility and a skilled nursing facility is not clear. This is true as a matter of the legal definitions and in practice. The first step in determining what type of care a person needs is to obtain a level of care assessment. This is usually done by a social worker, nurse or other personnel from a nursing facility. Is not usually done by doctor although it certainly could be.

As the article points out, some persons are in an assisted living facility longer than they should be. Conversely, some persons are told to leave and go to a skilled nursing facility when they really are not ready for that level of care yet. In these situations is very important for the resident to have a family member or other person monitoring their care and making sure they are not involuntarily transferred out of the assisted-living facility.

The article refers to use of an aging life care expert. This is the new terminology for what used to be referred to as a geriatric care manager. This person is usually a social worker or nurse by training. They can provide invaluable advice and advocacy for families and residents of nursing facilities. Our office had a geriatric care manager for over eight years. Our experience was that not too many clients saw the need for this service. Many people naively assume that the nursing home will take care of their loved one and that you should not need any additional help. In an ideal world this would be true. However, nursing facilities just do not have sufficient staff to be on top of every possible need or request of every resident. A geriatric care manager can make up for this shortfall and also provide valuable advice and training for the family members in dealing with the nursing facility. Our clients we helped with their loved ones greatly appreciated our assistance and expertise. However, most people just didn’t seem to see the need for this service which is why I no longer offer it. You can find an aging life care expert in your area at https://www.aginglifecare.org/ I also refer my clients to a local aging care life expert. http://www.1specialcare.com/

The article also wisely points out the empty promise made by many marketing representatives that “We will take care of your mother for the rest of her life.” “We will never kick her out.” This is pure sales talk and is probably not supported by any of the legal clauses in the resident’s contract. The resident will be kicked out if they run out of money and don’t pay their bill. The resident will also be kicked out if their medical condition worsens such that the facility is not capable of taking care of them. The marketing person perhaps doesn’t fully understand this or chooses to ignore that reality. Promises are also often made that there is some type of fund that can be used for residents who run out of money. Do not believe this. What this really means is that if the person runs out of money they will be able to apply for Medicaid which will pay the nursing home bill.

The article also gives good advice by saying you should never agree to a mandatory arbitration clause. However, simply crossing off a clause on the standard form may not be sufficient. Most nursing facilities will not allow you to do so but is worth a try.

I think the underlying theme and general point of the article is that you should get professional advice and as much reliable information as possible before making these elder care choices.

Social Security Beneficiaries Will Receive a 2 Percent Increase in 2018

In 2018, Social Security recipients will get their largest cost of living increase in benefits since 2012, but the additional income will likely be largely eaten up by higher Medicare Part B premiums.

Cost of living increases are tied to the consumer price index, and an upturn in inflation rates and gas prices means recipients get a small boost in 2018, amounting to $27 a month for the typical retiree. The 2 percent increase is higher than last year’s .3 percent rise and the lack of any increase at all in 2016. The cost of living change also affects the maximum amount of earnings subject to the Social Security tax, which will grow from $127,200 to $128,700.

The increase in benefits will likely be consumed by higher Medicare premiums, however. Most elderly and disabled people have their Medicare Part B premiums deducted from their monthly Social Security checks. For these individuals, if Social Security benefits don't rise, Medicare premiums can't either. This “hold harmless” provision does not apply to about 30 percent of Medicare beneficiaries: those enrolled in Medicare but who are not yet receiving Social Security, new Medicare beneficiaries, seniors earning more than $85,000 a year, and “dual eligibles” who get both Medicare and Medicaid benefits. In the past few years, Medicare beneficiaries not subject to the hold harmless provision have been paying higher Medicare premiums while Medicare premiums for those in the hold harmless group remained more or less the same. Now that seniors will be getting an increase in Social Security payments, Medicare will likely hike premiums for the seniors in the hold harmless group. And that increase may eat up the entire raise, at least for some beneficiaries.

For 2018, the monthly federal Supplemental Security Income (SSI) payment standard will be $750 for an individual and $1,125 for a couple.

For more on the 2018 Social Security benefit levels, click here.

Hospital Observation Status & Medicare

All hospitals must now give Medicare recipients notice when they are in the hospital under observation status. The law was intended to prevent surprises after a Medicare beneficiary spends days in a hospital under “observation” and is then admitted to a nursing home. This is important because Medicare covers nursing home stays entirely for the first 20 days, but only if the patient was first admitted to a hospital as an inpatient for at least three days. Many beneficiaries are being transferred to nursing homes only to find that because they were hospital outpatients all along, they must pick up the tab for the subsequent nursing home stay — Medicare will pay none of it. Also, if you do not have Medicare Part B, you may end up having to pay the full hospital bill.

The use of observation status by hospitals is increasing and you need to be aware of this and fight it. The Center for Medicare Advocacy has great information and a toolkit to assist you with this. I strongly advise you review the information on their site devoted to this topic.  http://www.medicareadvocacy.org/medicare-hospital-outpatient-observation-status-toolkit/

Nursing Home Costs Rise Sharply in 2017

The median cost of a private nursing home room in the United States has increased to $97,455 a year, up 5.5 percent from 2016, according to Genworth 2017 Cost of Care survey, which the insurer conducts annually. Genworth reports that the median cost of a semi-private room in a nursing home is $85,775, up 4.44 percent from 2016. The rise in prices is much larger than the 1.24 percent and 2.27 percent gains, respectively, in 2016.

The price rise was slightly less for assisted living facilities, where the median rate rose 3.36 percent, to $3,750 a month. The national median rate for the services of a home health aide was $22 an hour, up from $20 in 2016, and the cost of adult day care, which provides support services in a protective setting during part of the day, rose from $68 to $70 a day.

Alaska continues to be the costliest state for nursing home care, with the median annual cost of a private nursing home room totaling $292,000. Oklahoma again was found to be the most affordable state, with a median annual cost of a private room of $63,510.

The 2017 survey was based on responses from more than 15,000 nursing homes, assisted living facilities, adult day health facilities and home care providers. The survey was conducted by phone during May and June of 2017.

As the survey indicates, nursing home care is growing ever more expensive. Contact your elder law attorney to learn how you can protect some or all of your family’s assets.

For more on Genworth’s 2017 Cost of Care Survey, including costs for your state, see the following link: https://www.genworth.com/about-us/industry-expertise/cost-of-care.html

Graham-Cassidy bill and Ohio Medicaid

The most recent version of the Republican bill to repeal Obamacare again proposes a block grant model for the State Medicaid programs. The federal funds given to the State Medicaid programs would be based on a per capita amount (i.e. per person). This would be an absolute limit that could not be exceeded. The method for determining this amount is somewhat complicated and I will not attempt to go over that here. However, as I have stated before, the effect on the Ohio Medicaid program would generally be to limit eligibility. An absolute funding ceiling puts pressure on the Ohio Department of Medicaid to find some way to restrict eligibility. Based on my experience, I am sure they will find a way.

One positive change in the Graham-Cassidy bill is that new exceptions are added for the new prohibition of not allowing three months prior retroactivity for Medicaid applications. Presently, an applicant may qualify for eligibility for the three months prior to the month of filing of the application. However, the applicant must have met all eligibility criteria for those prior three months. So they are not getting additional eligibility or anything that they are not entitled to. This just gives applicants some extra time to get the forms filled out and filed. Now they will have to rush to get the application filed or miss out on a month or more of eligibility even though they would have met the eligibility criteria. The new exceptions allow the three month retroactivity for: a) applicants age 65 or older; b) applicants who are blind or disabled. All others will need to rush to get their applications filed by the end of the month.

Elder Care Choices

The October issue of Consumer Reports has its cover story entitled “Who Will Care for You?” The article focuses on elder care decisions at the assisted-living level. See https://www.consumerreports.org/cro/index.htm

It is generally an instructive and helpful article. I am going to add my own comments and information to go along with this article.

The first obvious answer to the question posed by the article is missed by Consumer Reports. Many people would answer this question by saying that a family member will take care of them. That is not necessarily the best option but is often the plan for many people. More importantly, it is an important issue to be addressed in this context. It is very difficult to care for a family member 24/7 year after year. This may work out for some period of time if the person’s needs are not that demanding. However, at some point in time it simply becomes too much and a person does need to move to a nursing facility. I never discourage any of my clients to at least not try to care for a family member at home but the practical realities and the difficulty of doing so need to be addressed.

The article very accurately points out that the dividing line between an assisted living facility and a skilled nursing facility is not clear. This is true as a matter of the legal definitions and in practice. The first step in determining what type of care a person needs is to obtain a level of care assessment. This is usually done by a social worker, nurse or other personnel from a nursing facility. Is not usually done by doctor although it certainly could be.

As the article points out, some persons are in an assisted living facility longer than they should be. Conversely, some persons are told to leave and go to a skilled nursing facility when they really are not ready for that level of care yet. In these situations is very important for the resident to have a family member or other person monitoring their care and making sure they are not involuntarily transferred out of the assisted-living facility.

The article refers to use of an aging life care expert. This is the new terminology for what used to be referred to as a geriatric care manager. This person is usually a social worker or nurse by training. They can provide invaluable advice and advocacy for families and residents of nursing facilities. Our office had a geriatric care manager for over eight years. Our experience was that not too many clients saw the need for this service. Many people naively assume that the nursing home will take care of their loved one and that you should not need any additional help. In an ideal world this would be true. However, nursing facilities just do not have sufficient staff to be on top of every possible need or request of every resident. A geriatric care manager can make up for this shortfall and also provide valuable advice and training for the family members in dealing with the nursing facility. Our clients we helped with their loved ones greatly appreciated our assistance and expertise. However, most people just didn’t seem to see the need for this service which is why I no longer offer it. You can find an aging life care expert in your area at https://www.aginglifecare.org/ I also refer my clients to a local aging care life expert. http://www.1specialcare.com/

The article also wisely points out the empty promise made by many marketing representatives that “We will take care of your mother for the rest of her life.” “We will never kick her out.” This is pure sales talk and is probably not supported by any of the legal clauses in the resident’s contract. The resident will be kicked out if they run out of money and don’t pay their bill. The resident will also be kicked out if their medical condition worsens such that the facility is not capable of taking care of them. The marketing person perhaps doesn’t fully understand this or chooses to ignore that reality. Promises are also often made that there is some type of fund that can be used for residents who run out of money. Do not believe this. What this really means is that if the person runs out of money they will be able to apply for Medicaid which will pay the nursing home bill.

The article also gives good advice by saying you should never agree to a mandatory arbitration clause. However, simply crossing off a clause on the standard form may not be sufficient. Most nursing facilities will not allow you to do so but is worth a try.

I think the underlying theme and general point of the article is that you should get professional advice and as much reliable information as possible before making these elder care choices.

 

Avoiding Probate without using a Trust; Joint, POD & TOD Accounts

An estate plan can be set up to avoid probate without use of a Revocable Living Trust. For persons with a small estate consisting of only a few assets, a trust is often not economical.

You can plan your estate by using joint and survivorship (JTWRS), POD (pay on death) and TOD (transfer on death) accounts which pass to the named survivor or beneficiary outside of probate. However, there are some drawbacks to this type of estate plan. The more accounts and assets you have, the more difficult it is to plan your whole estate in this way. If you change your intentions, you will have to rearrange all your accounts. This may involve trips to the bank, filling-out forms, correspondence with financial institutions and much other paperwork. Unequal changes in value can leave some heirs getting more than others, contrary to your intentions. For example, if you give Microsoft stock to one child and Ford stock to another, the stock values may change dramatically before you pass away leaving one child with a larger inheritance. Also, there have been many cases where a son or daughter has withdrawn funds in a joint account while their parent was still living. If the other person on the JTWRS account owes money to someone or is sued for a debt, this creditor can attach your funds in the joint account. These joint and POD accounts only avoid probate and do not avoid estate tax. If an estate plan utilizing joint and survivorship accounts is the chosen plan, then this planning should be done with the advice and assistance of legal counsel to assure that all accounts are properly set up to avoid Probate. My experience has been that very few people who try to set up their estate to avoid probate in this manner do so successfully. They almost always forget to set up some accounts correctly and, after they pass away, the family needs to open probate for just one or two accounts.

A Revocable Living Trust plan offers the following advantages over use of JTWRS and POD accounts: a) all assets are held under one “umbrella” which simplifies management of the assets; b) if a change in the estate distribution is desired, the grantor only needs to amend the Trust instead of re-arranging some or all of the asset beneficiary designations; c) no risk of changes in account values or balances altering the desired equal (or other proportionate) distribution to the intended heirs; d) the Trust can include a “spendthrift clause” which will protect the estate share of any beneficiary who is sued, gets divorced, files bankruptcy or has any creditor claims against their share of the Trust. A Revocable Living Trust is usually the better estate planning technique for avoiding probate for most people.