The following tips from Dr. Robert Luchi, a Professor of Medicine-Geriatrics, and from About.com can help seniors beat the heat:

* If you don’t have air conditioning head to to the shopping mall, senior center, library, movie theater, or place of worship, and plan to spend some time there in the cool air.

* Cool baths or showers can provide relief. Ice bags and wet towels are also helpful.

* Beware of dehydration. Drink water before outdoor activities and drink water at regular intervals during the day, even if you are not thirsty. Avoid beverages with caffeine or alcoholic beverages because such drinks can lead to dehydration.

* Curtail physical activity during extremely hot weather. Activity adds to heart strain. If you must do something outside, take frequent rest breaks, preferably in the shade. Try to schedule outdoor activities for cooler times of the day–before 10 a.m. and after 6 p.m.

* Avoid heavy meals. Limit salt use.

* Wearing loose fitting, lightweight clothing will allow for good air circulation around your body.

* Use a hat or umbrella to protect your head and neck from sun exposure and be sure to use sunscreen with an SPF of 15 or greater anytime you go outside.

* Take the heat seriously. Dizziness, rapid heartbeat, diarrhea, nausea, headache, chest pain, mental changes or breathing problems are warning signs that you should seek immediate medical attention.

* If you have a chronic medical problem, talk with your doctor about additional precautions you should take to prevent heat related illness. Some conditions and medications may place you at higher risk.

* If you show any signs of heat related illness try to get to a cooler place as soon as possible, sip some cool fluids and sponge yourself off with with lukewarm tap water.

The Gatesman Law Office wishes you a safe and healthy summertime.

However, a lien may not be imposed if a spouse is living in the house, and estate recovery is allowed only after such spouse has died. For a single person in the nursing home, if the state has put a lien on the house, the law states that the “lien shall dissolve upon that individual’s discharge from the medical institution and return home.”

In some instances, family members choose to take a loved one home when that person has reached the end of life to be cared for by hospice providers in the home setting. In that instance, if a Medicaid lien was placed on the house, the law provides that such lien may not be enforced.

In light of such circumstance, a financially savvy family member who holds an appropriate power of attorney can take steps to protect the house from estate recovery by using a life estate deed.

Such planning would have the following result. First, the Medicaid lien will be ineffectual under the law. Second, the life estate deed will allow the property to pass to family members outside of probate. Property that passes outside of probate is not subject to estate recovery.

In this way, the state would be unable to obtain the house notwithstanding that it had placed a lien on the property.

Ensuring that the power of attorney has appropriate provisions to allow for this type of planning is one of the things this office does when working with a client.

Does your power of attorney fit the bill?

Such losses can be significant. For working age individuals, an automobile accident could result in you losing the ability to work. If that is the case, you will be dependent on an insurance recovery to provide you with the value of the wages you would lose by not being able to work and earn a living for the rest of your life.

Consequently, it is important that you review your automobile insurance bodily injury coverage. I generally recommend that working age people, and especially high earning workers, have at least $1,000,000 in coverage. And importantly, I advise that such high coverage limits apply for your uninsured motorists insurance. That way, if you are hit by an uninsured or underinsured driver, you could look to your own insurance company to make sure you are not impoverished if the accident results in an inability to work.

Also, if you are responsible for injury to a high earning individual and your insurance coverage is not sufficient to compensate that person for her lost wages, then your other assets may be at risk to pay for the injured party’s losses.

Often, one can obtain an increase in liability coverage with no premium increase if you also raise the deductible on your auto collision or comprehensive insurance coverage. Indeed, some advisers suggest that a higher deductible is desirable because, if you make a lot of small claims against your policy, the benefit of the claim will be minimal, but the resulting premium increase could be significant. With a higher deductible, $1,000 for example, you will assume the responsibility to pay for such loss, but you would get the benefit of reducing your premium. Such premium reduction may allow you to obtain higher liability coverage with no increase in overall premium.

Some insurers like GEICO advertise that they can save you money because they have less costly premiums than other insurers. However, GEICO generally will not write a policy with $1,000,000 liability coverage. Therefore, one must consider whether a cut-rate insurer is a good deal if it cannot provide you with the coverage you desire.

Also, while many people have umbrella insurance coverage, such coverage may not apply to uninsured motorist liability. If that is the case with your insurer, then you cannot rely on your umbrella insurance to cover a shortfall in liability coverage if you are hit and injured by an uninsured or underinsured driver.

It is prudent financial planning to review your automobile insurance policy to ensure that your coverage is adequate for your circumstances.

That rule, however has been changed by the Maryland legislature, such change to be effective October 1, 2010. The new legislation changes the Annotated Code of Maryland, Estates and Trusts Section 13–214(c)(3).

After October 1, 2010, the relevant statutory provision will read as follows:

When a minor or disabled person dies, the guardian shall deliver to the appropriate probate court for safekeeping any will of the deceased person in his possession, pay from the [guardianship] estate all commissions, fees, and expenses shown on the court-approved final guardianship account, inform the personal representative or a beneficiary named in [the will] that he has done so, and retain the balance of the estate for delivery to an appointed personal representative of the decedent or other person entitled to it.

In the meantime, the strictures of Battley v. Banks shall apply.

Prior to entering the nursing home, the client, as agent under mother’s power of attorney, assisted his mother by paying in-home care givers using mother’s funds. Such payments totaled $200,000 over a several year period. While doing so enabled mother to continue to reside at home giving her a better quality of life, at the insistence of the caregivers, such payments were made “under the table”. In other words, no employment taxes were paid for these care costs, and the payments were not reported to the IRS.

Client applied for Medicaid, which was denied because the caseworker improperly treated the $200,000 payments as gifts causing Medicaid ineligibility. In fact, such payments were payments for services. The client, on his mother’s behalf, contested the denial and the matter was set for a hearing before an administrative law judge.

Now the client is fearful that providing a sworn statement as to the reason for the payments will expose the client or his mother to potential civil or criminal liability relating to their failure to report the care giver payments to the IRS.

So, instead of running that risk, the client will withdraw his challenge to the denial of Medicaid benefits. That is unfortunate because the payments to the care givers clearly were not gifts.

This cautionary tale is but one example of the complex matters frequently addressed by elder law attorneys as they seek to guide their clients through the maze of public benefits law.

Annuity Replaces Lost Income
Enabling the spouse to keep more assets is particularly important when one considers the Medicaid rule that requires that most of the income earned by the spouse in the nursing home must be paid to the nursing home as a contribution to the cost of care. Hence, whatever additional assets the couple can retain by using an annuity will serve to offset the lost income, income the couple most likely depended on to maintain the day-to-day household expenses.

Specialized Annuity
The strategy discussed in last month’s article involves the use of a specialized annuity. I have addressed the characteristics of such annuity in my article discussing the 2006 Medicaid rule changes. You can read that article by clicking -HERE-.

These Articles are Not Legal Advice
As with any article on this website, you should not consider the ideas presented here as constituting legal advice to you in particular, or advice that addresses your particular situation. For more information, click the Is This Legal Advice? tab at the top of this page.

Why Did the Nursing Home File a Medicaid Application?
I found it odd that the nursing home would file a Medicaid application when it knew full well that Medicaid would not be granted unless something was done with the cash in the bank. Then it dawned on me: is it possible the nursing home filed such application to further its own interests?

The Medicaid Application Will Be Denied.
In this case, the Medicaid rules allow the couple to keep only $100,000 in the bank. Because they had $200,000, Medicaid would not begin to pay for husband’s nursing home care until the couple had spent the other $100,000, and the Medicaid application filed by the nursing home would be denied because the couple has too much money. With such denial would come a notice stating that the couple had to spend $100,000 and then reapply for Medicaid before the State could begin to pay for the nursing home costs.

Was the Nursing Home Pursuing It’s Own Interests?
I wondered, after hearing that the nursing home filed the Medicaid application, if the nursing home’s purpose was to get such a Medicaid denial notice in order to show such notice to the wife and tell her she needed to continue paying the nursing home until she spent $100,000 on nursing home costs.

A More Beneficial Alternative.
The other alternative that I had discussed with the wife was that she could use that excess $100,000 to purchase an annuity to provide her with additional income, thereby allowing her husband to qualify for Medicaid immediately.

Two Possible Courses of Action.
In other words, there are two courses of action available to the couple. One alternative is to pay to the nursing home $100,000 of the $200,000 in the bank and then apply for Medicaid. At that point, there is only $100,000 to cover the retirement needs of the wife living at home (husband’s needs will be covered because Medicaid will pay the nursing home costs.)

The other alternative is for the wife to use $100,000 to purchase an annuity that will return the full amount to her over a three to five year period. Those funds, together with the $100,000 remaining in the bank accounts, $200,000 in total, would be available to cover the retirement needs of the wife living at home. As in the first alternative, husband’s needs will be covered because Medicaid will pay the nursing home costs.

Which Would You Prefer?
Most people would prefer to keep $200,000 for their retirement years as opposed to keeping only $100,000. Because the Medicaid rules allow one to do so, why wouldn’t the nursing home, which offered to “help” the couple get Medicaid benefits, assist the wife to keep the full amount? Unfortunately, because Medicaid reimburses nursing homes at a slightly lower rate than a private pay resident, nursing homes prefer to have families pay privately for as long as possible and not take advantage of cost saving strategies like the one discussed above in which the wife got to keep $200,000 instead of $100,000.

However, it is a lot easier to live comfortably in retirement when you have $200,000 in savings than when you have only $100,000.

So, whenever a nursing home suggests that it will assist in applying for Medicaid benefits, one has to wonder: is this a case of the fox guarding the hen house?

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Some time later, Mother needs long term care in a nursing home.  Unfortunately, she has only $1,000 in the bank and has been subsisting month to month on her income.  So you help your mother to apply for  Medicaid benefits to cover her nursing home costs.

The Medicaid caseworker accepts your application and does nothing for several months.  The nursing home, knowing that you have applied for Medicaid, requires that your mother only pay her income to the nursing home per month, which she must do in order to get Medicaid.  However, such payment is substantially less than the $8,500 per month the nursing would cost without Medicaid.

Five months after filing the Medicaid application, which is a typical application processing period, the caseworker informs you that mother’s contributions to the household expenses and the telephone bill will be treated as gifts to you, causing your mother to be ineligible for Medicaid.  In response, the nursing home sends you a bill for $40,000 for five months of care and will start billing $8,500 per month for future months.

“That’s outrageous,”  you exclaim, “my mother simply paid for the cost of heating and cooling her living space and for her private telephone line!  Those were not gifts to me!”

Outrageous as that may seem, it is true that the Medicaid rules penalize that type of cost sharing unless it is supported by a contract between you and your mother.

For this reason, any time a senior family member is contemplating entering into a financial transaction or co-living arrangement with another family member, it is wise to seek competent legal counsel.   Indeed, seemingly commonsense actions could have far reaching adverse consequences if nursing home care ever becomes a necessity.

The Gatesman Law Office stands ready to assist your family in doing appropriate planning to ensure that such surprises do not occur in your life or the lives of your parents.

Recently, the Gatesman Law Office had been assisting a family in revising the distribution pattern under their estate plan. Husband and wife each had a revocable trust, which trusts held property in further trust for one of their children after both husband and wife died. The share for their other child was to be given to him outright, free of trust.

However, as time passed, the conditions that prompted the desire to hold property in trust for the couple’s now adult child no longer existed and they were in the process of revising their revocable trusts to eliminate the trust for such adult child.

Then, suddenly and unexpectedly, husband died. As a consequence, husband could no longer amend his revocable trust. While wife, who survived her husband, was now the trustee and beneficiary of husband’s trust, she did not have the power to amend the trust to change how trust assets would be distributed after her death.

Nevertheless, because legal counsel had been working with this family for years and knew the estate planning objectives of both husband and wife, and because husband had been in the process of revising his trust when he died, legal counsel devised a plan to validate that old saw, “there is more than one way to skin a cat.”

The plan worked like this. In addition to amending the distribution of his trust, husband was in the process of changing the designated successor trustees so that his children would serve as such successors. So, legal counsel prepared a contract between wife, acting as Trustee of husband’s trust, and the two children, whereby the two children would agree to serve as successor trustees under the trust should wife cease to serve, in exchange for which, the trust would distribute the property to the children at wife’s death in the manner that husband desired.

Because this was a valid contract, and there was a quid pro quo between the parties, the wife and her children were able to effectively change the distribution pattern in husband’s trust to meet husband’s objectives, even after husband had died. Such method of revising the trust, although unorthodox, is legal and effective.

In this and other ways, the Gatesman Law Office stands ready to provide you with creative solutions to any unusual or unique legal problems you may be facing.