News & Events

Elements of Elder Law

By: Stacey L. Janssen, sjanssen@dysarttaylor.com, 816-931-2700

As the American population ages, the legal issues that have particular impact on older persons has grown. Attorneys focusing on the particular needs of the elderly and disabled refer to themselves as elder law attorneys. Often elder law is thought of as Medicaid planning. However, the practice of elder law is considerably more broad than just Medicaid planning to include traditional estate planning, long term care planning, guardianship, health care decision making, elder abuse, patient advocacy, disability benefits, etc. This presentation will address only the major factors in determining how to pay for long term care and highlight some of the ethical issues that can be confronted by the elder law attorney.

1. PAYING FOR LONG TERM CARE

  • Medicare Coverage. For persons age 65 or determined to be disabled by the Social Security Administration. You must have paid into the system by way of FICA employment taxes. Generally if you have worked for ten years in a job where FICA was paid, then you are fully covered, www.medicare.gov.
    • Part A provides coverage for hospitalization. No premiums for part A.
    • Part B provides medical coverage for doctors and other certain procedures. There is a premium for Part B.  The standard part B premium for 2017 is $134.00. Certain higher income beneficiaries will pay more. The Part B premium is automatically deducted from Social Security benefits, unless it is paid by Medicaid for certain low income beneficiaries. Beneficiaries must also enroll in Part B. Initial enrollment takes place for a period of seven months beginning three months before a person turns 65. Failure to enroll in Part B at age 65 will mean increased premiums when you do enroll.
    • Part C is a Medicare HMO or PPO. These plans often have no premium and provide drug coverage as well.
    • Part D provides coverage for prescription drugs. Plans vary widely in terms of coverage and cost. Beneficiaries must enroll in a drug plan.
    • Medicare Coverage of Long-Term Care. Medicare provides coverage for skilled care. Most persons in long term care need custodial care which is not covered.
      • Prior hospital stay, three midnights
      • Skilled Care
      • 100 days of coverage. Co-pay for days 21-100 is $183.00 for 2017.
         
  • Medicaid Coverage. Medicaid is a federal welfare program which is administered by the states. Federal law is the source of all Medicaid regulations. Title 42 of the Code of Federal Regulations (CFR), parts 430 and 456. In Kansas, Medicaid which is now part of KanCare is administered by the Department for Children and Families (DCF). In Missouri, Medicaid is known as part of MO HealthNet administered by the Family Support Division of the Department of Social Services.
    • Regulatory Authority. Each state takes federal rules and then promulgates its own regulations. There can be significant and subtle differences state to state.
    • General Eligibility. To be eligible for Medicaid benefits you must be a U.S. citizen or legal alien, be low income and low resources, be pregnant, disabled or over age 65. Traditional nursing home payments are a federal entitlement. Waiver programs may expand Medicaid to in home services, adult day care and assisted living.
    • Single Person
      • Medically Needy Test, age 65 or determined to be disabled
      • Income Test, generally your income is insufficient to meet your medical care needs.
      • Resource Test, countable resources cannot exceed $2,000 in Kansas and Missouri
      • Transfer Test, can be disqualified because of transfers or gifts
    • Married Persons, Spousal Impoverishment
      • Well Spouse. This is the spouse that is not applying for Medicaid. Typically the well spouse lives independently in the community. It is also possible that the well spouse may reside in assisted living and still qualify as the well spouse.
      • Institutionalized Spouse. This is the spouse that is applying for Medicaid benefits, also referred to as the ill spouse or nursing home spouse. Typically this spouse is in assisted living or a traditional nursing facility.
      • Community Spouse Resource Allowance (CSRA). This term refers to the portion of the countable resources that the well spouse will be allowed to keep.
      • Minimum Monthly Maintenance Needs Allowance (MMMNA). This is the amount of monthly income that is allocated to the well spouse as set out in KEESM. The income is only divided if it benefits the well spouse.
      • Income Provisions. The well spouse is entitled to the first $2,030.00 of the couple’s income. This is referred to as the minimum monthly needs allowance or MMMNA. If there are excess shelter expenses, then the well spouse can qualify for up to $3,023.00 of the monthly income (through June 30, 2018).
      • Resource Provisions. Medicaid looks at the countable resources of the couple at the time long term care begins. The well spouse is entitled to keep a portion of the countable assets knows as the Community Spouse Resource Allowance (CSRA), those amounts for 2017 are as follows:

         
      • Transfers.
        • LOOK BACK PERIOD. The look back to sixty (60) months, or five years, for all transfers.
        • TRANSFER PENALTY PERIOD. If there are uncompensated transfers for which there is not an exception, then a penalty period, or a loss of Medicaid eligibility, is imposed. The amount of the uncompensated transfer is then divided by the penalty divisor to give you the number of months (or days) of ineligibility. The penalty is computed on a daily rate The Missouri daily rate is $160.73 or a monthly amount of $4,889. The daily rate in Kansas is $197.88. The penalty period is now imposed from the date that the applicant is otherwise eligible for Medicaid.
           
  • Veterans Administration. A veteran who served during war time and received at least a general discharge may be eligible for an enhanced pension known as Aid and Attendance. The Veteran must meet income and asset guidelines and there must be documentation of the need for assistance. Generally, the income of the Veteran needs to be insufficient to pay for care after taking into account all medical expenses. As a general rule, the Veteran’s assets cannot exceed $80,000.
     
  • Other Public Benefits
    • Social Security Benefits, Old Age, Survivors and Disability Insurance (OASDI). Like Medicare, Social Security is funded by payroll deductions. To be eligible for retirement benefits a worker needs to be fully insured or have 40 quarters of OASDI coverage. A maximum of four quarters can be earned in one year. Survivor benefits provide payments to the minor children of deceased workers, again based on coverage. To be eligible for disability payments a worker is fully insured when they have 20 of the last 40 quarters of OASDI coverage.
    • Supplemental Security Income (SSI). SSI is a welfare program providing monthly cash payments to low income and low asset elderly, blind and disabled. These are persons who did not pay into the Social Security system or who do not have enough quarters for full coverage. Eligibility is determined by including all sources of household income and countable resources which cannot exceed $2,000. SSI for 2017 is $735 for an individual and $1,103.00 for a married couple.

2. ETHICAL CONSIDERATIONS IN ELDER LAW

  • Joint or Multiple Representation. When representing families of any age, attorneys run the risk of joint or multiple representation. This is even more likely when representing older and disabled persons.The Rules of Professional Conduct, 1.7 Conflict of Interest and 2.2 Legal Intermediary, addresses these issues. Joint representation is potentially at odds with the attorney’s duty of loyalty to a client, but a client may consent to representation even if there is a conflict. There is a two-part test: 1) the attorney must reasonably believe the client will not be adversely affected and 2) the client must consent to being jointly represented after consultation. The attorney must disclose the multiple representation and disclose the implications of multiple representation, advantages and disadvantages.
     
  • Scope of Representation. Rule 1.2 provides “A lawyer may limit the objectives of the representation if the client consents after consultation.” Clarifying the scope of representation is always a good idea, but particularly so when multiple parties are involved or the attorney is undertaking broad life planning issues. For example, if an attorney is undertaking an estate plan, then it would be advisable to be clear whether that representation will include issues of federal estate tax or whether the attorney will be providing advice regarding long-term care planning. An attorney would be under no duty to provide assistance the attorney believes is improper or illegal. For example, if you as an attorney believe that long-term care planning or Medicaid planning is improper, you should disclose that you will not provide that service. The attorney has a duty to clarify the limitations of the representation with the client.
     
  • Confidentiality/Communication with Third Parties. When dealing with disabled persons, a lawyer may come in contact with other persons who have concerns, most of whom want to be helpful. This may include family members, friends and care givers. How should you respond?
    • Rule 1.6 provides the duty of loyalty to the client and serves to protect the client’s privacy interests. The obligation extends to all information about a client acquired in the course of representation, regardless of whether disclosure would be embarrassing or detrimental. The obligation of confidentiality encompasses more than the attorney-client privilege (which is an evidentiary rule) since it includes the client’s confidences and secrets discovered from other sources.
    • Rule 4.2 limits contact of the attorney with persons who are represented. If a client shows up in your office with drafts of estate planning documents from another lawyer, are they represented? Contact should be made with the other attorney to make sure that you are not dealing with persons who are already represented.
    • Rule 1.4 discourages an attorney from lying even if it is to advance the interests of client. Rule 3.3 (a) requires candor to a tribunal. So when dealing with unrepresented third parties it is best to be truthful in communications, but also be clear about whom you represent so as not to create a de facto attorney client relationship as discussed in Rule 4.3
       
  • Confidences
    • KRPC 1.6: An attorney shall not reveal information relating to representation of a client unless the client consents after consultation, except for disclosures that are impliedly authorized in order to carry out the representation.
      • ABA Formal Opinion 96-404 provides that an attorney representing a client of questionable capacity may disclose confidential information in consulting with the client’s physician, client’s family members or other interested persons who are in a position to aid in the attorney’s assessment of the client’s capacity. The attorney should be careful to limit the disclosure to the information necessary to assess the client’s capacity or as appropriate to take protective action.
    • ABA 2002 Model Rule 1.14, Comment 8: disclosure of a client’s diminished capacity could adversely affect the client’s interest.
       
  • The Impaired Client. DUTY TO MAINTAIN A NORMAL ATTORNEY- CLIENT RELATIONSHIP, Rule 1.14 and Rule 2.1 Attorney as Advisor. The attorney representing an impaired client still has a duty to maintain a normal attorney-client relationship. This includes the need to advise the client of the full implication of their decision. The attorney should be careful, however, not to exert too much control over the client.
     
  • Taking Protective Action. If you represent a disabled client who has become a danger to themselves or is being exploited by others, can you take protective action? This is permitted under Rule 1.14(b). In taking protective action, the attorney needs to be concerned with protecting the confidences of the client as provided under Rule 1.6. Disclosure of any confidences may be impliedly authorized within the meaning of Rule 1.6. ABA Ethics Opinion 96-404, page 17, provides a good discussion of an attorney’s options including contacting other persons, such as family, and filing for Guardianship.

    Factors to Consider in Taking Protective Action:
    • Least Restrictive Alternative. Can you do something besides Guardianship, for example, execution of trust, voluntary conservatorship, a representative payee, complaints to state agencies.
    • Withdrawal from Representation. Governed by KRPC 1.16 (b), attonrey may withdraw if withdrawal will not have a material adverse impact on the client.
    • Act as a de facto Guardian. Comments to KRPC 1.14 seem to permit an attorney to act as a defacto guardian, “If the person has no guardian or legal representative, the lawyer often must act as a de facto guardian.” ABA 2002 rule 1.14, removes the word de facto guardian.
    • Appointment of a Guardian. ABA Ethics Opinion 96-404 discussed the alternative to seeking guardianship:
      • Lawyer may file a petition, may prefer to have someone else do it.
      • Lawyer should not attempt to represent a third party who is the petitioner, because of conflict of interest.
      • Can consider the requests of family members or other interested persons and be responsive to them.
      • Lawyer should not seek to be appointed the Guardian except in extreme circumstances.
      • Lawyer may support the appointment of a Guardian. If the lawyer will be hired by the Guardian should disclose to the court.
      • Lawyer may tell the court about preference of the client.
      • After a Guardian has been appointed, lawyer may represent the Guardian.
    • Capacity/Competency. When dealing with disabled persons the issue of capacity is always in play. The attorney should begin by determining what the legal standard of capacity is. The definition of a disabled person for purposes of a guardianship and/or conservatorship is different than contractual capacity and/or testamentary capacity.
      • ACTEC Commentary to MRPC 1.14: If there is doubt about the capacity of the client the lawyer should proceed with caution. If the lawyer is sure the client lacks capacity the lawyer should not prepare the estate plan. This should be balanced with the need for testamentary freedom. The lawyer should take steps to protect evidence of the client’s testamentary capacity
      • Functional Test. One way to determine capacity is to provide a functional assessment. The attorney should undertake some assessment of the client’s reasoning ability. That assessment should take into consideration the context of the decision. For example the ability to balance a checkbook is a different skill than deciding the distribution of the client’s estate at death. Any assessment should also take into consideration the temporary effects of medication or the likely benefit of therapy or rehabilitation.
      • Professional Diagnostician. An attorney may appropriately seek professional assessment from a psychiatrist, phytologist, or family physician. A diagnosis alone will not be as helpful as an evaluation of the client’s ability to make a decision about a particular matter. For example, some clients may not be able to make decisions about money, but may be able to decide where they want to live. An attorney should also consider the different legal standards for competency. An attorney seeking the assistance of a professional should take steps to protect the client’s confidences during the process. A release or other appropriate authorization is desired.

3. GUARDIANSHIP/CONSERVATORSHIP

  • Jurisdiction and Venue
    • Kansas. A petition may be filed in the county of residence, or the county where the person is actually found, or where the person owns property. K.S.A. 59-3058, K.S.A. 59-3059, K.S.A. 59-3060, K.S.A. 59-3061.
    • Missouri. RSMo. 475.035 gives four options: Missouri county of domicile for the respondent, county where the respondent actually resides, if no domicile, then the county where the respondent has property and in any county where the respondent or his/her property is found.
    • The grant of jurisdiction and venue is intentionally broad but can bring about conflict. The Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act (UAGPPJA), proposes to resolve conflicts much like in child custody actions. This act has not been adopted in Kansas or Missouri.
       
  • Need for Guardianship/Conservator.
    • Kansas Definition of Disability, K.S.A. 59-3051 (a), Adult with an impairment in need of a guardian or a conservator or both means a person 18 years of age or older, …whose ability to receive and evaluate relevant information, or to effectively communicate decisions, or both, even with the use of assistive technologies or other supports, is impaired such that the person lacks the capacity to manage such person’s estate, or to meet essential needs for physical health, safety or welfare, and who is in need of a guardian or conservator, or both.
    • Missouri Definition of Disability, RSMo. 475.010 (5), Unable by reason of any physical or mental condition to receive and evaluate information or to communicate decisions to such an extent that the person lacks ability to manage his financial resources. Incapacitated person, one who is unable by reason of any physical or mental condition to receive and evaluate information or to communicate decisions to such an extent that he or she lacks capacity to meet essential requirements for food, clothing, shelter, safety or other care such that serious physical injury, illness, or disease is likely to occur. The term "incapacitated person" as used in this chapter includes the term partially incapacitated person unless otherwise specified or apparent from the context;
    • Definition of In Need of a Guardian K.S.A. 59-3051 (f), means a person who, because of both an impairment and the lack of appropriate alternatives for meeting essential needs, requires the appointment of a guardian.
    • Definition of in Need of a Conservator, K.S.A. 59-3051 (g), means a person who, because of both an impairment and the lack of appropriate alternatives for managing such person’s estate, requires the appointment of a conservator.
       
  • Standing/Notice/Appointment of Counsel.
    • Any person may file the petition for an involuntary guardianship and/or conservatorship. K.S.A. 59-3058, K.S.A. 59-3059, K.S.A. 59-3060; RSMo. 475.060 (in the case of a voluntary conservatorship the conservatee files the petition).
    • Report of Examination and Evaluation. K.S.A. 59-3064 requires that the alleged ward/conservatee be evaluated. This evaluation can be completed prior to filing the petition and filed with the petition. K.S.A. 59-3058(c). Having completed the evaluation can avoid the unnecessary filing of a petition providing confirmation of the impairment and heading off a contest over the level of impairment. RSMo. 475.075 (4), (5), the court can direct a physician to make an evaluation and compel testimony.
    • RSMo. 475.075, K.S.A. 59-3065; K.S.A. 59-3066; sets out the rights of the proposed ward/conservatee, notice to interested parties, sufficiency of evidence.
       
  • Appointment of the Guardian and Conservator.
    • Statutory Preference,
      • K.S.A. 59-3068 (a). The court does not have unlimited discretion in the appointment of guardian and conservator. Kansas law gives priority in the following order (note there is not a next of kin preference): nominee of the proposed ward made with in a durable power of attorney, nominee of a natural guardian, nominee of a minor who is over 14 years of age, nominee of the petitioner.
      • RSMo. 475.055 Missouri-who is a suitable guardian. A person over the age of 18; NOT a person or corporation licensed by Department of Mental Health or DSS or any administrator, owner, operator, manager or employee for a resident at that facility unless related to resident within the 4th degree of consanguinity; NO full-time judges or clerks of court unless related within 3rd degree of consanguinity; no one who is disabled; no one who is a habitual drunkard; NO prior revocation as guardian or conservator in the last 2 years (any prior revocations might pose an issue for bonding and with the court’s discretion to appoint); no convicted felons unless you have consent, may vary by jurisdiction.
      • Statutory preference. RSMo. 475.050; a person nominated by the disabled person; a person nominated in a power of attorney; spouse, parents, adult children, adult siblings; or any other qualified person.
    • Third Party Options. Serious conflict between the family members can sometimes only be resolved by the appointment of a third party guardian or conservator. Kansas there is no public guardian. Missouri has office of public guardian.