CarenSLaw: HOW WILL I EVER PAY FOR NURSING HOME CARE?

CarenSLaw: HOW WILL I EVER PAY FOR NURSING HOME CARE?:      Have you ever wondered how you will pay for a nursing home should the need arise?  All of us have thought about this subject briefly ...

HOW WILL I EVER PAY FOR NURSING HOME CARE?

     Have you ever wondered how you will pay for a nursing home should the need arise?  All of us have thought about this subject briefly at some point.  Some people believe the government will pay.  Many people believe Medicare will pay the cost.  Other people believe their health insurance will pay.  And others believe they will pay for nursing home care from their own pocket.  I will summarize the options and the advantage and disadvantages of each.

      First, it is important to know that Medicare will not pay for custodial long term, nursing home care.  If you or a loved one is discharged from a hospital to a nursing home, Medicare will pay for up to 90 days of care as long as the nursing home is providing essential services and your condition is improving.  Once you cease to improve or the 90 day period expires, Medicare will no longer pay the bill.  As important as it is to have health insurance is, your health insurer will not pay for care at a nursing home.  Once your Medicare benefit has expired you must examine other options.

      One option is to pay for the nursing home yourself.  There are some advantages to this alternative.  Certain nursing homes do not accept residents whose stay is being paid by the government.  The government pays the nursing home much less than an individual pays the nursing home, so in some instances the nursing home does not want to accept a reduced payment and will not accept government pay residents.  This is legal as a nursing home is a private entity.  The advantage of being a private pay is an increased availability of nursing home placements.  In certain situations, a private pay resident might receive better care than a government pay resident.  The disadvantage is the cost.  It costs approximately $100.000.00 per year to be a nursing home resident.  For a married couple, the cost is approximately $200,000.00 per year.  Residents needing more than basic nursing home care can pay as much as $180,000.00 per year per person.  If your total estate is $3,000,000.00 or higher you will probably be a private pay unless you do some sophisticated planning at least 5 years before you are admitted to a nursing home.

    The second option is to have your long term care insurer pay.  Depending on the level of benefit you purchase your long term care insurer can pay a significant if not all of the cost of the nursing home.  The advantage of this option is that you keep your assets and you can pass them along to your hiers when you die.   Another advantage is that if you have long term care insurance at a certain minimum level, the government will not force you to sell your home in the event government benefits are provided.  Additionally, if you have long term care insurance the government will not try to collect from your probate estate any balance due for government benefits provided.  And finally, any long term care premiums you pay will be tax deductible.  The disadvantage of having long term care insurance is that it can be expensive. And of course, like any insurance product, you may never need it.

     The final option is to qualify for government benefits  In Massachusetts this joint federal state program is called Mass Health.  Mass Health provides medical care for low-income aged, blind and disabled persons.   If you own assets worth $2,000.00 or less you qualify.  Your social security or other income will be paid to the nursing home and you will be left with a very small needs allowance.  If the value of your assets total more than $2,000.00 your can gift them and/or put them in a trust, but you must do this at least 5 years before you enter a nursing home.  If you are close to needing nursing home care and your assets exceed $2,000.00 in value, you can convert them from countable assets to non-countable assets.  For example, you can take $10,000.00 in cash and put it into a burial plan or your spouses's home.  If you are married, your spouse can keep at least $115,920.00 of assets.  Excess assets can be put into a special private annuity.  Qualifying for Mass Health can be complicated so you should seek professional advice.  The rules are complicated, they change often and intrepration is not consistent among Mass Health employees.

      I hope my summary helps you or a loved one decide which option is best in his or her unique situation.

    TEN MISCONCEPTIONS ABOUT CHILD SUPPORT AND ALIMONY

1. Your expenses are relevant in a determiantion of the appropriate level of child support.
   Truth:  In general, expenses are not relevant.

2.  Child support must be used on the children, and the receipient must account to the payor.
     Truth:  The recipient can use child support for family expenses and expenses of the recipient.

3.  If the payor loses his or her job, the obligation to pay support ceases.
      Truth:  If the payor loses his or her job that party must file a modification action.

4.  You can't get blood from a stone.
      Truth;  The Court has ways of making deliquent parents pay.  Ask me.

5.  If a party gives up a career to raise the children that party is entitled to alimony.
     Truth:  Only if other factors apply.

6.  If the payor has no realionship with the children there is no obligation to pay support.
      Truth:  The amount and/or duration of support is not related to the quality of the payor's relation-
                  ship with the children

7.  Child support can be determined by a simple mathematcial calculation
      Truth: There are many factors that go into the calculation and often times the calcuation is not
                  simple.

8.  Once the parties agree on a child support amount it cannot be changed.
     Truth: Child support may be increased or deceased upon a change or circumstance.

9.  When one child is emancipated, child support is dramatically changed.
      Truth:  The change is not automatic, you must go to court, and the percentage of the change
                   is not large.

10.  If you are entitled to an alimony termination under the new Alimony Reform Act, you can just
        go into court and terminate alimony.
        Truth:  There are dates before which an alimony termination case may not be filed and the dates
                     are based upon the length of the marriage and the age of the payor.

REAL ESTATE ISSUES IN DIVORCE

            When a couple divorces, frequently the biggest issue is how to handle the real estate.  Most couples own a home which in the divorce court is referred to as the marital home.  In many cases, the divorcing parties also own income property.   How the real estate is handled depends to a large extent on whether or not the real property has equity.  The options can be summarized as follows:  

MARITAL HOME WITH EQUITY

1.     Parties can sell the property and split the equity;

a)     Either the parties agree or the Court orders it;

2.     One party can re-finance and buy-out the other party;

b)     Either the parties agree or the Court orders it

3.     The parties can agree to sell when the children graduate high school;

c)     Generally, the Court will only order this if the children will be graduating in the next few years;

4.     The parties can agree to sell when the children graduate college

d)     Generally, the Court will only order this if the children will be graduating in the next few years.

5.     The parties or the Court can allocate the marital home to one party.

MARITAL HOME WITH NO EQUITY

1.     One party accepts ownership and refinances to remove the other from the deed;

2.     Parties can agree to sell;

3.     The Parties or one party can agree to retain the property and sell at a later time;

MARITAL HOME UNDER WATER

1.     Parties agree to a short sale;

a)     Court may order the sale so property is not foreclosed;

2.     One or both parties agree to pay arrears;

3.     Court can order one or both parties to pay arrears;

4.     One or both parties can apply for a loan modification;

5.     Parties cannot agree and property is foreclosed;

a)     This is not a good option.

INCOME PROPERTY

1.     All the sale, re-finance and buy-out, retention and/or allocation issues are available depending on equity;

2.     Income can be allocated to one party or split;

3.     Expenses can be allocated to one party or split;

4.     Income can be held in escrow by an attorney.

If you have any questions, call or e-mail Caren Z. Schindel at 508-651-1000 ext. 214 or Cschindel@mrmbw.com

                         BIGGEST DIVORCE SETTLEMENTS EVER


1.  Mel and Robyn Gibson- Robyn received $425 million
2.  Michael and Juanita Jordan- Juanita received $168 million
3.  Neil Diamond and Marcia Murphey- Marcia received $150 million
4.  Greg and Laura Norman- Laura received $105 million
5.  Tiger Woods and Elin Nordengren- Elin received $100 million
6. Steven Speilberg and Amy Irving.  Amy received $100 million
7. Madonna and Guy ritchie- Ritchie received $92 million
8.  Harrison Ford and Melissa Mathison- Melissa received $85 million
9.  Kevin Costner and Cindy Silva- Cindy received 80 million

10. James and Linda Cameron- Linda received $50 million

         The divorce laws that apply to celebrities are the same as the ones that apply to the rest of us.  Just like the real world, in 9 of 10 celebrity cases, the Husband paid a settlement to the Wife.  In one case (Madonna v. Ritchie), the Wife paid the Husband.  The celebrities fight about money and children just like the rest of us.    If you ever feel the laws and the Courts are not fair, just remember no one can escapes the divorce laws.  

                                   

                                           Governor Patrick signs long term care insurance bill

                        The Massachusetts Chapter of the National Academy of Elder Law Attorneys (MassNAELA) today announces a legislative victory for seniors, as Governor Deval Patrick has signed into law a bill protecting individuals from losing their homes if they choose to use long-term care insurance for community-based care before entering a nursing home. Bill S.2359 grants an exemption from MassHealth estate recovery claims whether an individual uses their long-term care insurance for at-home or nursing home care. Prior to this bill, the MassHealth estate recovery exemption only applied when long-term care insurance policies were used for nursing home care.

Marriage and Divorce Agreements

MARRIAGE AND DIVORCE AGREEMENTS

Premarital Agreements – executed in contemplation of marriage

1.     Validity of Agreement

            -recognized in when signed

            -freedom to contract

            -permitting parties to arrange their financial affairs as they deem fit

            - agreement could so unreasonably encourage divorce as to be against

              public policy

2.     Judicial Review of Agreement

            -generally approved

            - parties are free to reject an unsatisfactory agreement

3.     Fraud and Coercion

            -not enforceable if tainted by fraud and coercion

            -party alleging fraud and coercion must prove it

            - parties are considered to be dealing at an arms’ length

            - were parties informed

            - was signature voluntary

4.     Disclosure of Assets

            -full and fair disclosure

            -informed decision

            -written statement

                        -significant assets with approximate value

                        - approximate annual income

                        -significant future acquisitions or changes in income

                        - disclosure need not be exact

5.     Waiver

            -meaningful choice

            - representation by counsel

            -adequacy of time to review agreement

            -party’s understanding of rights       

6.     Fair and Reasonable Terms

            -fair and reasonable when signed and when enforced

Postmarital Agreements- signed during marriage

1.     Validity of Agreement

            - recognized in now

2.  Judicial Review

            - carefully scrutinized

            -choices are different when spouse attempting to save a marriage

            -situation full of opportunity for one spouse to sue threat of dissolution to                           bargain themselves into a position of advantage

                        - parties not at an arms length

                        -knowing and explicit agreement to waive the right to equitable division

            3.  Fraud and coercion

                        -burden shifting analysis

                        -intensity of negotiations

            4.  Disclosure of Assets

                        - duty of absolute fidelity

                        -confidential relationship

                        -fiduciaries without the safeguard of divorce obligations and court-ordered                           disclosure

            5.  Waiver

                        -knowing and voluntary relinquishment

            6.  Fair and Reasonable Terms

                        - context of agreement

                        -purpose of agreement

                        -disparity of income and assets

                        -may not be equal bargaining power

                        - consideration of divorce factors

Separation/Divorce Agreement- signed in anticipation of divorce judgment

1.     Validity of Agreement

            -recognized since 1976

2.     Judicial Review

            -parties have full protection of divorce laws

            - Court will review every term

            -considered in light of your Judge’s experiences

3.      Fraud and coercion

4.     Disclosure of Assets

            -required by statute

            - more than approximate values

5.     Waiver

6.     Fair and Reasonable Terms

            -influenced by views of your Judge