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Olivia K. Smith on Families & Seniors

Appeal Rights for Medicare Recipients

January 30, 2023Filed Under: Elder Law, Long Term Care

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An appeals court recently ruled that some Medicare beneficiaries may now appeal decisions regarding their patient status.

The Underlying Issue

When Medicare patients go to a hospital, they often enter through the emergency department. The physician who attends to them must decide whether to admit them into the hospital as an inpatient, discharge them, or keep them in the hospital under observation status. A patient under observation services receives care virtually identical to inpatient care but is classified as an outpatient to qualify for traditional Medicare coverage.

If the patient receiving observation services must go to a nursing home to continue their recovery, traditional Medicare won’t cover the nursing home care because they were not classified as an inpatient for at least three consecutive days when they were in the hospital. This can have a serious financial effect on the patient since they must pay for the services on their own. What made the situation worse is that the Centers for Medicare & Medicaid Services would not allow patients to appeal the decision.

Observation Status

A patient in observation status is in limbo since a physician has determined that they are too sick to go home but not sick enough to be admitted into the hospital as an inpatient. They receive basically the same level of care as a patient who is classified as an inpatient, including mental and physical assessments, diagnostic tests, short-term treatments, medications, and feedings.

In 2015, then-President Barack Obama signed the Notice of Observation Treatment and Implication for Care Eligibility Act, a.k.a. Notice Act. The Notice Act requires hospitals to notify patients if they have been receiving hospital services under observation status for more than 24 hours. Patients must be given both written and oral notifications if their observation status exceeds 36 hours.

The written notice must explain why the patient is not classified as an inpatient. It must explain how their observation status may affect the cost of their hospital care and their eligibility for skilled nursing facility care coverage. The written notice must be signed by the patient or someone acting on the patient’s behalf. If they refuse to sign the notice, then a staff member of the hospital must sign it.

Alexander v. Azar

A recent federal court decision in the Alexander v. Azar case sided with Medicare beneficiaries who had been admitted to hospitals as inpatients but then changed to observation status. If you were a patient in a hospital and switched from inpatient status to observation status, you may have the right to appeal Medicare’s decision. To appeal your observation status decision, you must have been:

  • Hospitalized since January 1, 2009
  • A Medicare beneficiary with traditional Medicare (not Medicare Advantage) during your hospitalization
  • Admitted to the hospital as an inpatient before your status was changed to observation status
  • Notified of Medicare Outpatient Observation status from the hospital or have a Medicare Summary Notice stating that you will, or did, receive observation services that are not covered by Medicare part A
  • Qualified for either both Medicare Part A and Part B or only Medicare Part A
  • Hospitalized for at least three consecutive days but fewer than three days as an inpatient
  • Admitted to a skilled nursing facility within 30 days of discharge from the hospital.

Stay up to date as this situation develops by checking in with the Center for Medicare Advocacy.

Help with Medicare and Medicaid

Navigating the complicated Medicare and Medicaid systems can be difficult and time-consuming. It is all too easy to make mistakes that will cause coverage to be denied. An experienced elder law attorney can guide you through the process to get the benefits you need.

This article offers a summary of aspects of estate planning, elder law, and Medicaid and Medicare coverage. It is not legal advice and does not create an attorney-client relationship. For legal advice, you should contact our Cincinnati office by calling us at 513-771-2444 and schedule a consultation.

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A Guide to Being Appointed as a Guardian of Property

January 23, 2023Filed Under: Elder Law

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Martin, your grandfather, cannot make decisions on his own anymore. A court appoints you to be Martin’s guardian of property, to help Martin manage his money. You become Martin’s “fiduciary.” The law now requires you to act to a high standard of good faith and honesty.

There’s a lot of work involved with a guardianship, and the high standard could be daunting. To assist you, the Consumer Financial Protection Board (CFPB) has issued a guide: “Managing Someone Else’s Money: Help for Court-Appointed Guardians of Property and Conservators.” Download your free copy.

The guide details property-guardianship duties. These include keeping careful records, taking care to keep Martin’s money separate from yours, and making sure to spend Martin’s money for Martin’s benefit, only. The court order signed by the judge may provide a list of your duties, or, if not, you can follow the list provided in the CFPB guide. You may be paying Martin’s bills and taxes, overseeing bank accounts, making investments, obtaining insurance, and any other duties contained in the court order appointing you.

The guide recommends that as a first step, you must carefully read the court order. Speak to a lawyer about it if you can, and of course especially if the law in your state requires you to. The guide warns that you may be required to buy a bond, but, if you do not have good credit, you may not be able to get it. If so, the guide directs, inform the judge of this point before you are appointed.

The guide further details the guardian’s duties. These include creating an inventory of Martin’s property, keeping Martin’s goods and home safe, creating a budget for spending on Martin’s behalf and how to document that spending, how to sign checks on Martin’s behalf, and how to create an accounting to submit to the court as often as the court requires.

Also included is valuable advice to consult Martin as much as his condition permits; to resist pressure from others who may not have Martin’s best interests at heart; and, if in doubt, to consult the judge first before acting. You may also be required to consult and work together with other people whom Martin has designated for health care and other personal matters.

A guardian appointment is a big responsibility, as you must care for the person conscientiously and attentively. Be reassured, though, that help in discharging your duties is available to you from the court and from the CFPB guide.

If we can help you or a loved one understand when a guardianship may be necessary, please don’t hesitate to reach out. Please contact our Cincinnati office by calling us at 513-771-2444 and schedule a consultation.

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How to Take Care of Your Elderly Parents

January 16, 2023Filed Under: Elder Law, Long Term Care

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There is nothing you can do about aging, and it affects everyone in your family. It can be challenging for adult children to imagine their parents as seniors and to understand and respond to the reality that each parent will age differently. Even if you are in the fortunate circumstance where your aging parents can go it alone for a long time there will come a day when assistance or long-term care will be needed. There are things to consider as you help your parents live their best possible aging scenario. Managing their welfare takes time, research, and planning.

Your parents and their abilities to remain independent are most easily defined by activities of daily living and instrumental activities of daily living (ADLs and IADLs). Activities of daily living address daily functional mobility like getting in and out of bed or a chair, self-feeding, bathing and personal hygiene, the ability to use the toilet, and the ability to get dressed. These are essential daily living requirements that promote dignity and physical as well as emotional well-being for your elderly parents. If your parents are having difficulty managing these ADLs, it is an appropriate time to find help for them whether it is you or another qualified caregiver.

IADLs include all ADL activities and more. The additions are grocery shopping and cooking, medication management, laundry, and other housework, bill paying and finance management, using a telephone, and driving or using public transportation. Recognizing your parent’s limitations in any of these categories is a sign that you need to develop a care plan that provides appropriate assistance. The degree of change or sometimes multiple changes is an indication that staying at home may no longer be appropriate and safe for your parent. If you require assistance in determining suitable care needs, you can set up a comprehensive geriatric assessment by a medical professional. Take an honest look at the stage of life your parent is experiencing and then find the support and help they require.

Your aging parents’ geographical location is critical to consider as a family. Families are fortunate when one adult child lives nearby and can ensure their parent’s well-being. Video chat either online or through a phone application is one way to daily check on a parent. A friend may live close by and can do wellness checks and provide information about behavioral or health changes. If none of these options are viable, it may be time to discuss the idea of your parent(s) downsizing into another more supportive location and living arrangement.

Having this discussion is best before a parent’s adverse health event. Making residential changes without a previous plan in place can negatively impact the parent, especially when experiencing a health care crisis. When aging at home cannot be appropriately managed, it is time to consider the alternatives. These alternatives may include independent living communities, assisted living communities, nursing homes, or living with a trustworthy and capable relative or family member.

All of these assessments and changes in your parents’ lives impact their financial outlook. Making necessary residential changes can often be very costly, and your parent may need additional financial support from government or community programs to offset the difference in expenses. It is critical to take advantage of all possible financial help. As an adult child, you may have to begin managing your finances and retirement funds more actively. There are various federal, state, and non-profit groups that provide free tax assistance for seniors.

Some of the better organizations to help you navigate what is available are online and include Benefits.gov, Area Agency on Aging, and Benefitscheckup.org. These groups can help you assess the best strategies for housing, healthcare, financial assistance, legal aid, transportation, in-home services, prescription drugs, energy and utility support, and nutrition. BenefitsCheckUp is part of the National Council on Aging and is considered the nation’s most comprehensive online service for seniors with limited income and resources. The information available canvases all 50 states and the District of Columbia.

Caring for your aging parents should not be the job of one family member. The commitment should not be a burden, and responsibilities should be shared. Look for caregiver support organizations and forums as well as involving all family members. Everyone should do their part. The goal is to find the best blend of options and resources to allow your parents to age happily and well. Your parents’ health changes require that programs and opportunities change too. Caring for your aging parent is a dynamic process that must be retooled as their needs change.

We help families who are trying to navigate the maze of long-term care either for themselves or for an aging parent. We hope you found this article helpful. If you have questions or would like to discuss your personal situation, please don’t hesitate to contact us at 513-771-2444.

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Special Needs Trusts and ABLE Accounts: A Comparison

January 9, 2023Filed Under: Estate Planning, Special Needs

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People with disabilities can save money tax-free through special needs trusts (SNT) and Achieving a Better Life Experience accounts (ABLE). Both options provide a mechanism for saving money and protecting resources that ensures the person with a disability (PWD) continues their eligibility for public benefits programs. Accumulating resources for the benefit of a PWD without jeopardizing key government benefits like Supplemental Security Income (SSI) and Medicaid can reduce monetary pressures and greatly enhance the lives of those with disabilities.

Deciding if a Special Needs Trust or ABLE Account is Best

There are significant differences between the saving rules of an ABLE account and SNT (also known as a supplemental needs trust), as well as different rules regarding the use of the savings. There are also different annual limits on the amount you can save. Your circumstances can directly impact each saving strategy type, and understanding how to set up and manage the best option for you is crucial. A special needs attorney or disability attorney can explain whether one or the other or both account types can work for your situation.

ABLE accounts tend to be easier to create and manage, yet they have some disadvantages. One of which is the limit on the contribution you can make annually. A special needs trust has no contribution limits but can be expensive to create and typically more complex to manage. The advantage of having both is an ABLE account can cover everyday expenses while an SNT can cover those larger purchases not covered by public benefits.

Third-Party Special or Supplemental Needs Trust (SNT)

For persons with disabilities, most assistance programs have asset and income restrictions. If a PWD has too much money in their savings or earns too much money, they will lose eligibility for these benefits. Using an SNT allows a workaround for these restrictions. The money put into the trust won’t count toward the eligibility qualification for public assistance. It is permissible for family and friends to contribute financially to the beneficiary’s SNT. However, if the PWD can financially contribute to a trust for themselves, the special needs lawyer will create a First-Party SNT (Self-Settled SNT).

A special needs trust is a legal arrangement and a fiduciary relationship with a person or entity acting on behalf of another to manage these assets. Establishing an SNT can benefit both parties beyond the protection of income-restricted benefits programs. The creator of the trust, called the grantor, has some reassurance that trust proceeds will go to the expenses as stipulated. Creditors and legal judgments can’t seize the trust assets as an SNT is irrevocable.

However, the money in an SNT can only fund a limited range of expenses. A special needs lawyer or disability attorney can make clear that the expenditures from the SNT won’t conflict with government eligibility regulations for benefits programs. These funds may not cover basic living expenses but can pay for the following:

  • Medical equipment and medication that Medicare does not cover
  • Insurance premiums (health, dental, life, etc.)
  • Therapy or rehabilitation services
  • Caretaker or personal assistance payments
  • Legal or guardianship expenses
  • Education (school) and job training
  • Home renovations that improve safety and accessibility
  • Case management or private counseling
  • Recreation or entertainment tickets
  • Home appliances, electronic equipment, and furniture
  • Clothing
  • School or camp tuition
  • Telephone service and internet access
  • Transportation, including a vehicle, ride share, or bus/rail pass
  • Travel/vacation (including the cost of a companion)
  • Funeral and burial expenses

The list excludes food such as groceries or restaurant meals, rent or mortgage payments, property taxes, homeowners insurance dues, homeowners insurance, and utilities like gas, electricity, and water.

Achieving a Better Life Experience account (ABLE)

This account type still provides a tax advantage for a PWD but is only available to persons with significant disabilities appearing before age 26. It is permissible for friends, family members, and the beneficiary to contribute to the account. The money accrued in an ABLE account won’t affect a person’s eligibility for public benefits programs.

While the ABLE account contributions are not tax-deductible, the funds that grow within the account are tax-free, as are their distributions. An ABLE account is a newer financial product in comparison to an SNT. The goal of its creation in 2014 was to give more people with disabilities access to more benefits that, up until then, were only available to those with a special needs trust. Additionally, the monies in ABLE accounts can pay for a wider range of costs than an SNT. These expenses are known as Qualified Disability Expenses (QDEs). Funds in an ABLE account can cover expenses, including:

  • Housing
  • Transportation
  • Education
  • Employment training and support
  • Assistive technology and its related services
  • Personal support services
  • Prevention and wellness
  • Health
  • Legal fees
  • Financial management and administrative services
  • Basic living expenses
  • Expenses for ABLE account monitoring and oversight
  • Funeral and burial expenses

There are three key differences between SNTs and ABLE accounts: eligibility, allowable expenses in each account type, and limits on the money you can save.

Eligibility

ABLE accounts are only available to persons with a disability onset before age 26 as determined by the Social Security Administration’s criteria. There are no age limits in creating a third-party SNT, but funding can’t include the beneficiary. A first-party SNT is self-funded by the person with a disability but must be created before the PWD reaches age 65.

Allowable Expenses

An SNT’s design is to pay for extra things that make life more comfortable, like vacations, pets, home furnishings, entertainment, etc. An SNT paying for basic living costs may reduce a person’s public benefits. ABLE account allowable expenses have a broader range. Anything that helps a PWD improve their independence, health, or quality of life is acceptable. QDEs can include basic living costs such as education, food, employment, technology, and more.

Account Limits

ABLE accounts have amount and contribution limits. Contribution amounts are finite for each year and are under federal tax code governance. Additionally, ABLE accounts have a maximum limit set by the states that manage them. Many states have a maximum limit set above $300,000, with only the first $100,000 exempt from impacting eligibility for Supplemental Security Income. A special needs trust has no such limits; however, they can be more expensive to create.

Every family has different needs and circumstances when assessing whether an SNT or ABLE account (or both) is the better option for their loved one with disabilities. It is best to use each option for different purposes despite having some common characteristics. The main reason to create an SNT is if there is substantial money, more than allowable in an ABLE account, to fund the trust without affecting public benefits or if you want to fund more than an annual ABLE account maximum. A special needs lawyer or disability attorney law can assess your financial situation and the needs of your loved one with disabilities to find the right solution.

We hope you found this article helpful. If you’d like to discuss your particular situation, please don’t hesitate to reach out. Please contact our Cincinnati office by calling us at 513-771-2444 and schedule a consultation.

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Olivia K. Smith, Attorney at Law
Cornetet, Meyer, Rush & Stapleton Co., L.P.A.
123 Boggs Lane,
Cincinnati, Ohio 45246
Tel: (513) 771-2444
Fax: (877) 483-2119
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Recent Posts

  • Appeal Rights for Medicare Recipients
  • A Guide to Being Appointed as a Guardian of Property
  • How to Take Care of Your Elderly Parents
  • Special Needs Trusts and ABLE Accounts: A Comparison
  • How to Manage Someone Else’s Social Security or Veteran’s Benefits

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Olivia K. Smith, Attorney at Law
Cornetet, Meyer, Rush & Stapleton
123 Boggs Lane
Cincinnati, OH 45246
Phone: 513-771-2444
Fax: 877-483-2119
oksmith@cmrs-law.com

Family Law Attorney Olivia K. Smith, LLC represent clients in Cincinnati, Anderson Township, Batavia, Loveland, Mason, Milford and other communities in Hamilton County, Clermont County, Butler County and Warren County.

Disclaimer: The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. I invite you to contact me and welcome your calls, letters and electronic mail. Contacting me does not create an attorney-client relationship. Please do not send any confidential information to me until such time as an attorney-client relationship has been established.

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