PAELA’s 15th Annual Winter Conference took place on February 23-25, 2023. Handouts for PAELA Members can be found once you Login to the Members Only Section.  The 2024 Winter Meeting is scheduled for February 22-24 at the Omni Bedford Springs Resort in Bedford, PA.

Education & Advocacy for Those with Special Needs and the Elderly

Public Policy Position Papers

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Medicaid 

Medicaid, called Medical Assistance in Pennsylvania, is federal program administered by the states and designed to provide healthcare benefits for people who meet specific financial eligibility criteria. The Department of Human Services (DHS) oversees the Medicaid program which focuses on three main groups of people:  the elderly in need of skilled nursing facility care, the permanently disabled and the working poor.  DHS County Assistance Offices throughout Pennsylvania process applications for Medicaid benefits.  Consequently, applications are processed somewhat differently from one county to the next.  Moreover, Medicaid’s eligibility rules vary from state to state, although the basic requirements laid out in federal law apply to all the states.

Elder law attorneys focus primarily on Medicaid benefits for older adults needing skilled nursing home care.  In addition, some individuals living at home can also receive Medicaid benefits (sometimes referred to as “waiver benefits”).  Medicaid benefits are available for those found (1) to be nursing facility clinically eligible by their local Area Agency on Aging, (2) to be financially eligible by their local County Assistance Office and (3) not to have made disqualifying asset transfers during the five years prior to their application for Medicaid benefits.  In addition, there are income limits for those seeking waiver benefits to help pay for in-home care.

Individuals residing in personal care facilities cannot qualify for Medicaid long-term care benefits.  Additionally, individuals residing in skilled nursing facilities that do not participate in Medicaid will not qualify.

For married applicants, there are spousal asset protection rules that allow the spouse not needing skilled care to retain some assets and income and thereby maintain a basic level of financial security.  There is also an Estate Recovery Program that seeks to recoup money from the estates of deceased Medicaid recipients to cover the cost of Medicaid benefits they received during life.

Elder law attorneys help clients and their families navigate Medicaid’s complex, state specific rules in order to obtain benefits and best protect assets from being spent on the cost of long-term nursing home care.  They help those planning ahead before the need for care arises, and they assist those entering skilled nursing facilities in immediate need of Medicaid benefits. They also advise those who have applied for benefits and been denied improperly.

Estate Planning

Estate planning is the process of preparing for the passing of assets at death in the most helpful and least costly way possible.   It also involves planning for incapacity during lifetime.  The centerpiece of most estate plans is a well drafted will.  However, a will alone is almost never sufficient.  For example, proper planning includes well drafted financial and health care powers of attorney.  There may be other documents like trusts required to carry out the estate plan properly.  It is also important to consider beneficiary designations on assets like life insurance, retirement plans and annuities.

However, focusing only on documents when planning an estate is usually a mistake.  Beneficiaries are unique and structuring inheritances for them takes thought.  It is important to anticipate not only their current needs, but also needs that could develop in the future.

Estate planning requires help from people like executors, agents, guardians and trustees.  It is crucial to select people to fill these roles in your estate plan with great care.  That starts with understanding what executors, agents, guardians and trustees do.  Each position carries with it specific responsibilities and requires unique skills.  Only when you understand those responsibilities and skills can you select the people best able to carry out those roles in your estate plan.

Some estate plans focus on minimizing taxes like the federal estate tax or Pennsylvania inheritance tax.  Some may be centered on protecting assets for beneficiaries with disabilities, those facing future long-term care costs, or those too young to manage an inheritance responsibly.

Too often people,  and even some attorneys, focus exclusively on documents when doing estate planning.  They assume having a will, for example, makes for a good estate plan.  It does not.  Having a will is not nearly as important as what that will says.  Generic documents that do not reflect your individual circumstances and your unique goals often are a waste of money.  Worse still, they create a false sense of security.

If you want to plan your estate properly, a PAELA member near you can help you understand the issues you and your beneficiaries will face.  They will help you develop a plan to protect your family and provide the financial security you want them to have.  Although that may seem like a daunting task, your beneficiaries will appreciate the thought and effort you invested in protecting them and passing on a legacy to them that provides the greatest benefit possible.

Estate Recovery

When someone receives Medical Assistance benefits for long-term care, i.e. care in a skilled nursing facility, home and community-based services and hospital and prescription drug benefits, their estate can be required to repay the state for the value of those benefits.  This is known as estate recovery. The Pennsylvania Department of Human Services maintains an entire department dedicated to processing estate recovery claims. Those claims can be substantial.

You may be wondering how someone who qualified for Medical Assistance could have enough assets to satisfy an estate recovery claim.  Here’s a common situation (but certainly not the only situation) that gives rise to an estate recovery claim:  

When people apply for Medical Assistance, also known as Medicaid, they often can exclude their home’s value when determining their financial eligibility.  This means they can receive Medical Assistance benefits even though they own their own home. However, when they die, the state expects repayment for the benefits it provided, and it looks at the home (as well as other assets) as a source of funds for repayment.

In Pennsylvania, estate recovery claims can be lodged against a decedent’s probate estate, life insurance payable to the decedent’s estate and some deposit accounts paid to family members and funeral homes outside the normal probate process.  Estate recovery claims do not reach most jointly held assets, trust assets, most life insurance, retirement accounts and other non-probate assets. Additionally, estates worth less than $2,400 are exempt from estate recovery claims.

Whenever someone over the age of 55 dies in Pennsylvania, his or her estate is required to determine if the decedent received Medical Assistance benefits within five years of the date of death.  If so, the estate’s personal representative must request a statement of claim from the Pennsylvania Department of Human Services. If you are unsure whether the decedent received Medical Assistance, it is best to request a statement of claim just to be sure.

There are specific procedures that you must follow when requesting a statement of claim.  A PAELA member near you can assist you with this process. If there is an estate recovery claim made against the estate, it is treated like any of creditor claim, i.e. it is assigned a priority of payment status and must be paid with the estate’s available assets.  Here again, a PAELA member near you can help you understand the components of an estate recovery claim and prioritize each part of the claim properly. Failure to request a statement of claim, failing to make the request properly or failing to prioritize the claim among all other creditor claims properly can result in the estate’s personal representative being personally liable to repay some or all of the estate recovery claim.  Therefore, you should seek professional help to understand and resolve estate recovery claims properly.

 

Estate Administration

The death of a loved one brings with it a multitude of questions and legal concerns.  Elder law attorneys help executors and families understand the estate administration process.  They guide clients through the various tasks needed to finalize the details of someone’s life.

Estate administration involves four basic tasks:  (1) gathering and valuing a decedent’s assets, (2) resolving all creditor claims, (3) resolving outstanding tax obligations, and (4) distributing the remaining assets to beneficiaries.  Each of these basic tasks can involve a variety of legal issues.  Moreover, communication with beneficiaries, creditors and taxing authorities is critical at every point in the estate administration process.

When someone dies with a will, an executor is appointed to direct the estate’s administration. When someone dies without a will, Pennsylvania’s intestacy law determines who runs the estate and who is entitled to inherit the decedent’s assets.  The legal process by which the estate is opened and the rules that govern the estate’s administration is referred to as probate.

Importantly, probate is not a bad thing.  It is designed to bring order to what could otherwise be a very chaotic resolution of someone’s legal and financial affairs.  In some states probate involves significant interaction with the court.  However, in Pennsylvania, the court is rarely involved.  Consequently, probate costs in Pennsylvania are comparatively low.

Therefore, you should regard recommendations to avoid probate with skepticism.  Sometimes that may be good advice, but often it is not.  Regardless of whether someone’s estate goes through probate, creditors have a right to be paid and taxes likely will be due.  Without the structure probate provides, beneficiaries may find themselves having to deal with these issues themselves and at a substantial disadvantage because deadlines to deal with these issues often have passed.

Creditors have one year to submit claims against the estate.  Collecting money owed to the decedent can take a significant amount of time, especially when litigation is involved.  Most taxes that apply to estates are due between nine and 15 months after the decedent’s death.  Consequently, estate administration is not designed to go especially quickly.  That said, many estates make significant distributions to beneficiaries before the estate formally concludes its administration.

PAELA members can help you administer a loved one’s estate.  They will make sure everything is handled properly and in a timely manner.  If you are a beneficiary and are not sure if an estate is being administered properly, an elder law attorney can help you with that too.  There is no set timeframe to complete an estate. It is very fact specific.  However, the goal is always the same:  make sure everything that needs to be done is done properly and in a timely manner.

 

Special Needs Planning

For individuals receiving certain need-based government benefits such as Supplemental Security Income (SSI) and Medical Assistance (Medicaid), the arrival of money from inheritances or litigation awards jeopardizes the individual’s ongoing benefit eligibility.  Special needs planning helps maintain benefit eligibility while permitting people to enjoy the financial benefit of the new assets they receive.

Common tools for special needs planners include first-party special needs trusts (sometimes called “payback trusts” and “(d)(4)A trusts”) and pooled trusts (sometimes called “(d)(4)C trusts”).  These are trusts funded using assets that already belong to the person receiving benefits.  When smaller amounts of money are involved, planners often turn to pooled trusts operated by nonprofit organizations to hold an individual’s excess assets.  These trusts require careful drafting and have ongoing oversight by government agencies like the Pennsylvania Department of Human Resources and the Social Security Administration.

Family members and others looking to provide financial support to individuals receiving need-based benefits often set up third-party supplemental needs trusts to generate assistance without having the trust’s assets count when determining the benefit eligibility.

Some individuals receiving benefits can use ABLE (Achieving a Better Life Experience) accounts to shelter excess income and resources.  There are specific eligibility requirements and contribution limits for ABLE accounts that must be considered when determining if an ABLE account is an appropriate planning tool.

Special needs planners also use spenddown strategies like prepaying funeral expenses, buying or improving a residence or purchasing a vehicle as a way of converting excess countable resources into exempt resources that do not adversely impact benefit eligibility.

Special needs planning, especially the rules pertaining to first party special needs trusts, is very technical and fact-specific.  Thus, it is critical to work with lawyers well-versed in this type of planning.

 

Administrative Advocacy

There are a variety of laws and government programs that assist older adults.  They include benefit programs like Medicare, Medicaid, Social Security retirement, and state PACE and PACENET prescription drug benefits.  Similarly, older adults must deal with health insurance claims through traditional Medicare or Medicare Advantage plans.  They also have to deal with Medicare Part D prescription drug plans.  Sometimes they have to contend with negligent care in nursing homes and other types of care facilities.  Still others struggle to claim long-term care insurance benefits.  In short, seniors and their families face complex issues of benefit eligibility, contract interpretation and administrative law every day.

Elder law attorneys help clients understand a variety of government programs and advocate for them when those programs fail to provide all that they promise.  This can include helping to secure ongoing Medicare coverage for patients rehabilitating in nursing homes after a qualifying hospital stay.  When Medicaid benefits are denied or suspended, elder law attorneys understand the procedures required to challenge those determinations.  They can interpret contracts with insurance companies and care facilities and guide clients to understand their rights and claim all that to which they are entitled.

Elder law attorneys also assist fiduciaries like guardians, agents under power of attorney and executors understand all their responsibilities.  Whether appearing in court or advising people about how to carry out their responsibilities properly, elder law attorneys can advise and advocate for those charged with helping aging loved ones.

Sometimes families simply need some advice about how to advocate for themselves.  Other times they require an experienced advocate to bring claims on their behalf.  In both situations elder law attorneys are a critical resource for older adults and their families.  If you need advice or someone to advocate on your behalf, contact a PAELA member near you for help and guidance.

State Advocacy

Pennsylvania General Assembly Leadership for 2019-2020:

Overview of PAELA Legislative Agenda for the 2019-2020 Legislative Session:

Digital Assets. PAELA supports adoption of the Fiduciary Access to Digital Assets Act – SB320.  Our letter of support dated June 10, 2019, can be found below.  More information about the bill can be found HERE. 

Orphan’s Court Rule.  On February 25, 2019, PAELA submitted comments outlining significant poterntial problems with Proposed PA Orphan’s Court Rule 5.50.  The letter we submitted to the Orphan’s Court Procedural Rules Committee can be found below.  A copy of the Proposed Rule can be found HERE.

Guardianship Reform.  PAELA is interested in and closely monitoring guardianship reform efforts in PA. Our discussion paper on the issue can be found below:

OAPSA. PAELA submitted comments on the proposed rewrite of the Older Adult Protective Services Act that was introduced in the last legislative session.  Our comments can be found below.  This bill has been reintroduced in the 2019-2020 session as SB 819. 

POLST.  PAELA supports adoption of the PA Orders for Life Sustaining Treatment bill – SB142.  Our letter of support can be found below and a copy of the bill can be found HERE

Community Health Choices.  PA has transitioned to a managed care model for delivery of long term supports and services.  PAELA has been actively advocating for consumers rights and protections during this transition.  An area of significant concern is the ongoing problems with the Independent Enrollment Broker.  The Department of Human Services is in the process of developing an RFP for this role.  A copy of PAELA’s letter dated July 28, 2019, outlining our concerns, can be found below: