Elder Law

Elder Law

Elder law is an area of law that deals primarily with issues concerning the elderly. However, elder law attorneys help many younger clients prepare for old age as well. Elder law attorneys have the skills and knowledge to help their clients plan for long-term care and legal incapacity. They can also help clients create wills, living trusts, durable powers of attorney, advance health care directives and other estate planning documents.

In addition, elder law attorneys can help clients with issues revolving around public benefits programs, such as Medicaid (or Medi-Cal), Medicare, and Social Security.

Elder law attorneys also know about the applicable tax consequences of transferring assets and some attorneys specialize in elder abuse. Attorneys practicing elder law can also help refer you to other resources and services available to the elderly.

Selecting a competent elder law attorney is important because the rules surrounding this area of law are obscure, confusing and irrational. To make matters worse, the rules are neither well known nor well published. In order for an attorney to give his/her client accurate and complete advice and information, he/she must receive training in this area of law. Unfortunately, many attorneys do not take the time to receive this training and therefore, their advice may not be the best. Contact the Kisner Law Firm today and start planning for tomorrow.  

Medi-Cal Planning is basically asset preservation. Many middle-income families have lost their homes and life savings to the high cost of nursing home care. But, with Medi-Cal planning, those families could have preserved their major assets and had their nursing home bills paid for by Medi-Cal.

Medi-Cal is California's Medicaid health care payment program. It is funded by the state and federal governments. The program is designed to pay for the medical care of those California residents who have limited income. However, effective as of January1, 2024, the law was changed in the state of California to abolish the resource limitation for determination of eligibility, which mean that the Medi-Cal applicant and, if applicable, the applicant's spouse can own assets of any value and still be eligible to receive Medi-Cal benefits to help pay for long term care.

However, California will still impose a period of ineligibility for Medi-Cal benefits for gifts of non-exempt assets that were made before January 1, 2024.

You should consult an elder law attorney if you or a family member will be applying for, or is considering applying for, Medi-Cal.

An elder law attorney can help you through the application process and design a plan for you that will preserve the maximum amount of your assets and income. Some accountants and financial planners try to provide the same services for their clients. However, they may not know the intricacies of this area of law and are not authorized to give legal advice. 

The spouse of a Medi-Cal beneficiary applying for benefits on or after January 1, 2024 is no longer limited as to the amount of income and assets that he/she is allowed to keep. Under prior law, there were limit on what value of non-exempt assets a spouse of a Medi-Cal beneficiary can own, which limits were referred to as the Community Spouse's Resource Allowance (CSRA).  Unde the new law in effect after January 1, 2024, the limitations on the dollar amount of the CSRA no longer are applicable.

However the monthly income of the Medi-Cal beneficiary and the monthly income of the beneficiary's spouse are still taken into account to determine the Medi-Cal beneficiary's "share of cost." 

Learn more about the realities and financial implications of long-term care.

Paying For Long Term Care. Contact the Kisner Law Firm today and start planning for tomorrow.

The Realities of Long-Term Care

Long-term care refers to the supervision and assistance that someone with a chronic illness or disability may need for an extended period of time. A person in need of long-term care usually requires assistance with activities of daily living such as eating, bathing, dressing, taking medication, and toileting. They may also require skilled nursing care, therapy, or rehabilitation services.

Likelihood of Needing Long-Term Care

The number of people who need long-term care rises every year. This is because we are living longer and because our population of persons age 65 and older is increasing. As we age, we are more likely to suffer from a chronic illness or disability that impairs our ability to perform activities of daily living. Currently, 60 percent of all Americans over the age of 65 need long-term care - that's every 6 in 10 people. The percentage of women needing long-term care is even higher because they tend to live longer than men. 74 percent of nursing home residents age 65 and older are women.

The Cost of Long-Term Care

Long-term care is expensive. Many people have sold their homes and have spent their life savings in order to pay for long-term care. Here are some statistics on the cost of long-term care*:

In California, the average cost of home care is more than $20,000/year.

Nationwide, the average cost of care at a nursing home is $3,891/month or $46,692/year.

• In California, the average cost of care at a nursing home is over $100,000/year.
• The average length of stay in a nursing home ranges from 272 days to 781 days, depending on the type of nursing home one stays in. This means that you can expect to pay anywhere between $37,260 and $106,986 for your stay in a nursing home located in California.

Types of Long-Term Care Facilities

There are many types of facilities that provide long-term care. The amount or type of care that a patient receives depends on the kind of facility that he/she is staying. For example, a skilled nursing facility provides both custodial care and skilled nursing care. But, a residential care facility for the elderly provides only custodial care. Custodial care (or personal care) refers to assistance with activities of daily living such as bathing, dressing, toileting and eating. Skilled nursing care refers to care that must be given or supervised by registered nurses and rehabilitative staff such as injections, tube feeding and physical therapy.

The three main types of licensed facilities are skilled nursing facilities, intermediate care facilities and residential care facilities for the elderly. However, there are other services and/or programs to choose from, including:

• Adult Day Care
• Continuing Care Retirement Communities (CCRCs)
• Home Health Care
• Hospice Care Facilities
• Intermediate Care Facilities (ICF)
• Nursing Facilities (NF)
• Residential Care Facilities for the Elderly (RCFE)
• Respite Care Services
• Retirement Residences
• Skilled Nursing Facilities (SNF)
• Specialized Long-Term Care Facilities

New Nursing Home Admission Agreement Requirements

Effective January 2, 2006, all California nursing homes must use the new standard admission agreement established by the California Department of Health Services as a replacement for their own admission contracts. The standard admission agreement will help protect residents from the deceptive and illegal provisions contained in many nursing home admission contracts. The act establishing the standard admission agreement says it applies to all residents admitted on or after January 1, 2000. The standard admission agreement and background information about it are available on the California Advocates for Nursing Home Reform (CANHR) website at Canhr.org (external link to http://canhr.org/).

According to the CANHR website, the standard admission agreement and the new regulations will benefit residents and their representatives by:

Clearly stating that a resident's representative assumes no personal financial liability when signing the agreement on behalf of a resident.

Fairly describing the resident's and nursing home's rights and obligations;

Prohibiting nursing homes from: (1) presenting an arbitration agreement as part of the standard admission agreement; or (2) requiring residents or their representatives to sign an arbitration agreement or any other document as a condition of admission or continued stay. The top of any arbitration agreement must contain a prominent, bold-faced advisory alerting residents that they "shall not be required to sign this arbitration agreement as a condition of admission..."

All California nursing homes must use the standard agreement, including skilled nursing facilities (SNFs), intermediate care facilities (ICFs) and distinct part SNFs and ICFs.

Contact the Kisner Law Firm today and start planning for tomorrow.

*Data sources include the CDC and Calpers.

Will a Bad Decision Regarding Long-Term Care Wipe Out Your Family's Estate?

Every day families are making bad decisions regarding how to pay for long-term care because they do not know about Medi-Cal. Medi-Cal is a federally funded program administered by the state of California that will pay for the long-term care of loved ones. Whether due to lack of professional representation or because they made faulty assumptions or were given wrong information, some families are losing the family home or wiping out their life savings to pay for long-term care that would have otherwise been paid by Medi-Cal.

Often, decisions about long-term care for a loved one must be made quickly. This can be a very stressful time for the family. By getting professional advice, you will avoid stress, have peace of mind and stop the discord among family members. An elder law attorney can help you make the right decisions about the care needed by your loved one and preserving the family estate at the same time.

Paying for Long-Term Care

Some people are able to pay for long-term care out of their own funds. Others are able to get long-term care insurance before they became ill. Unfortunately, the majority of people needing long-term care have already become ill and cannot obtain long-term care insurance. They also cannot afford to pay for the cost of long-term care themselves without depleting all of their life savings and other assets. A person under these circumstances is forced to look to public benefits programs, such as Medicare and Medicaid, for help.

What Is Medicare?

Medicare is a federal health insurance program primarily for Social Security recipients who are 65 years of age or older. Many people assume that Medicare will cover the cost of long-term care. However, the reality is that it will only cover the cost of some nursing home care. For example, the program will pay for skilled nursing care, but will not pay for custodial care – the kind of help that someone in need of long-term care usually requires. Also, Medicare will pay the full cost of the first 20 days you spend in a nursing home as long the only services you receive are Medicare "covered" services. After that, the Medicare recipient will need to make a co-payment of $200.00 a day for days 31 - 100 (for 2023). Altogether, Medicare will not pay for more than 100 days of skilled care in a nursing facility. That copayment may be covered by a patient's supplemental healthcare insurance.

What is Medi-Cal (aka California Medicaid)?

Medi-Cal is California's version of Medicaid as it is known in the other 49 states.  Medi-Cal is a "means-tested" health care payment program funded by the state and federal governments. The program is designed to pay for the medical care of those California residents who have very limited income or resources. 

Starting in approximately 2015, “expanded Medi-Cal” is available as the primary health care insurance coverage under the Covered California program for those under age 65 who have sufficiently low income to qualify but without regard to the value of the applicant’s assets in determining eligibility.

Another Medi-Cal program is for those over 65, disabled or have special health needs , pays for the bills of most nursing home residents in California. It used to be that you had have very limited assets to qualify for this program if you own very little. However, the law changed as of 1/1/2024.

Who Is now Eligible Medi-Cal program for those over 65, disabled or have special health needs?

According to the new California law under AB133, effective for those applying for Medi-Cal benefits on 1/1/2024 or afterwards, Medi-Cal eligibility will be determined without regard to the value of any resources or assets owned by the applying Medi-Cal beneficiary or the applicant’s spouse.

However, the state will still impose a period of ineligibility for Medi-Cal benefits if the Medi-Cal applicant or spouse made one or more gifts of their assets before 1/1/2024.

What Is "Share of Costs?"

If a Medi-Cal recipient has monthly income, he or she must help pay for the cost of his or her care. The amount contributed by the Medi-Cal recipient is called the "share of cost." How much a recipient will have to contribute depends on his/her income and marital status.

Unmarried Persons

An unmarried person is allowed to keep a personal allowance of $35 from his monthly income. The person will also be able to deduct the amount of health insurance premiums paid monthly. The remainder of the person's income will be paid to the nursing facility and is referred to as the "share of cost."  The Medi-Cal program will pay the balance of the skilled nursing home’s bill.

Married Persons

A married Medi-Cal recipient is able to keep a personal allowance of $35 from the couple's combined income plus the amount of health insurance premiums that will be paid monthly. The at-home spouse of the Medi-Cal recipient, who is referred to as the "community spouse," is also allowed to keep up to $3,853.50 (for 2024) of his/her individual monthly income. This is called the Minimum Monthly Maintenance Needs Allowance (MMMNA). If the community spouse does not have income on his/her own that is at least equals the MMMNA, the community spouse may take all or a portion institutionalized spouse's income to make up the shortfall between the community spouse's monthly income and the MMMNA. Any remaining income must be paid to the nursing facility as the "share of cost." 

About Estate Recovery Claims

The state of California can recover Medi-Cal benefits paid on behalf of a recipient by making claims against the estate of the Medi-Cal recipient. However, starting on January 1, 2017, the state can make a recovery claim only on assets that are subject to a California probate administration on file with the probate court. Therefore, the state cannot make a recovery claim against assets that avoid a probate, such as holding assets in a living trust, or assets that pass to heirs without probate court involvement.

Also effective January 1, 2017, the state can no longer make a recovery claim against a surviving spouse for the Medi-Cal payments made to the deceased spouse. 

As before, the state still cannot make a recovery claim against the deceased recipient’s assets when the recipient is survived by a minor, blind, or disabled child. 

About Legal Capacity

The issue of legal capacity often arises in elder law. Legal capacity is the term used to define someone who is able to understand and appreciate the consequences of his/her actions. A person who lacks legal capacity cannot, for example, enter into a contract, give a power of attorney, make a will, consent to medical treatment, or transfer property. The older we become the more likely we are to develop a mental disease or disability such as Alzheimer's disease or dementia. Because legal incapacity is always a possibility, it is never too early to prepare for it by creating a document such as a durable power of attorney with gifting authority. However, if you are the spouse or child of an already incapacitated person, you may still be able to transfer your loved one's assets by obtaining a conservatorship. A spouse also has the alternative option of filing a petition for a proceeding to authorize a transaction involving an incompetent spouse (Probate Code §3101 petition). You should consult an elder law attorney to help you with these documents and procedures in order to assure that they are done correctly.

Durable Powers of Attorney

A durable power of attorney is a written document in which a person (called the principal) appoints someone else (called the agent or attorney-in-fact) to act on his/her behalf. A non-durable power of attorney terminates when the principal who created it becomes legally incapacitated. A durable power of attorney, on the other hand, continues to be valid even after the principal becomes incapacitated. If you want to prepare a power of attorney but do not want the attorney-in-fact's powers to vest until you become legally incapacitated, you can create a "springing power of attorney." A springing power of attorney states that it becomes effective only upon the happening of an event that you have designated, such as your legal incapacity determined by the method that you specify. 

No matter what type of power of attorney you create, it will terminate automatically when you die.

The best time to create a power of attorney is when you are legally competent and in good health. But if you are suffering from some health problems or starting to see the early signs of dementia or Alzheimer's disease, you should create one immediately. By creating a durable power of attorney for finances, you can appoint someone else to handle your personal finances, including the authority to transfer your assets (if it expressly gives your agent the power to make gifts), even after you become incapacitated. This is important because if you become a Medi-Cal recipient and lose legal capacity, the person you appointed in your power of attorney would still be able to implement plans to save your home and other valuable assets for you.

A conservatorship comes into play when you or a loved one is already legally incapacitated. There is an immediate need for a conservatorship when the Medi-Cal recipient/applicant is legally incompetent, and has not created a good durable power of attorney. If you become legally incapacitated, you or a loved one can ask the probate court to appoint a conservator for your estate. 

A conservatorship is a legal arrangement whereby a person (called the conservator) is appointed to manage the personal or financial affairs of someone else who is incapacitated (the conservatee). As conservator of the incapacitated person's estate, you can file a substituted judgment petition asking the court to authorize you to transfer the conservatee's assets out of his/her own name for Medi-Cal planning purposes. Therefore, if you or a loved, one becomes incapacitated it is still not too late to transfer assets out of your/their name before death if the proper probate avoidance planning has not been put into place.

Conservatorships

A conservatorship can be costly and the procedure can take a long time. Consult a Medi-Cal planning/estate planning attorney if a loved one is in need of a conservatorship.

Probate Code §3101 Petitions

If you are the spouse of an incapacitated Medi-Cal recipient/applicant, you may be able to file a California Probate Code § 3101 petition for a proceeding to authorize a transaction involving an incompetent spouse with the probate court and avoid a conservatorship altogether. A PC3101 spousal petition for approval of a gift or transaction, is a means of asking the probate court to authorize the Medi-Cal recipient's/applicant's spouse to initiate a transfer, or series of transfers, of the incapacitated spouse's assets. The assets involved can be community property or the separate property of the incapacitated spouse. The petitioning spouse will have to prove that his/her spouse lacks legal capacity. 

How the Deficit Reduction Act of 2005 will affect you.

The following was updated on February 26, 2013. Federal legislation will have a significant effect on Medi-Cal (i.e., Medicaid) planning as described in this website, when the legislation is made effective in California.

Status of New Legislation

The United States Congress passed the Deficit Reduction Act of 2005 (S. 1932) (hereinafter the "ACT" or the "DRA") that was signed into law by President Bush on February 8, 2006.

As of September 29, 2008, the State of California passed statutes (see SB483) but not yet the necessary regulations to put any substantial part of the DRA into effect in California. Therefore, California is still following the laws and regulations that were in effect before the DRA was signed into law by President Bush and SB483 was signed by Governor Schwarzenegger. The California Department of Health Care Services has published proposed regulations for the implementation of the DRA, but such regulations have not been made effective as of September 2020 and therefore, most of the DRA is not yet effective in California.

See the following article DRA is On the Way on the CANHR website for more information.

The provisions of SB 483 will not be effective until the regulations are filed with the Secretary of State of California, which may still take a while. Although proposed regulations have been published they are not yet adopted as final regulations. Such provisions will not be retroactive.

The following is a summary of the salient provisions of the DRA. Please note that any transactions made before the date of enactment would be treated under existing Medicaid law (except for Section 6014 of the ACT regarding home equity).

1. Lengthening Look-Back Period (Sec. 6011 (A))
2. Section 6011 (a) would make the look-back period 60 months for all transfers (outright transfers as well as transfers to and from certain Trusts).
3. Change in Beginning Date for Period of Ineligibility (Sec. 6011(B))

Section 6011(b)(2) adds a new clause in the case of a transfer of assets made on or after the date of enactment of the ACT, providing that the beginning date for the period of ineligibility is the first day of a month during or after which assets have been transferred for less than fair market value, or the date on which the individual is eligible for medical assistance under the state plan and would otherwise be receiving institutional level care based on an approved application for such care but for the application of the penalty period, whichever is later, and which does not occur during any other period of ineligibility.

Section 6011(b)(1) retains current law in the case of a transfer of assets made before the date of enactment of the ACT, such that the beginning date for the period of ineligibility is the first day of the first month during or after which assets have been transferred for less than fair market value and which does not occur in any other periods of ineligibility.

3. Disclosure and Treatment of Annuities (Sec. 6012)

Disclosure and Notice (Section 6012(a)). Section 1917 of the Social Security Act (42 U.S.C. § 1396p) is amended by re-designating subsection (e) as subsection (f) and adding a new subsection (e). For purposes of being eligible for long term care services under Medicaid, the applicant or his or her spouse must disclose any interest in an annuity (or similar financial instrument that may be specified by the secretary).

Such application or recertification form shall include a statement that the State becomes a remainder beneficiary under such annuity or similar financial instrument. Also, the state shall notify the issuer of the annuity of the right of the state to be a preferred remainder beneficiary in the annuity.

The change in the annuity rules shall apply to transactions (including the purchase of an annuity) occurring on or after the date of the enactment of the ACT (Sec. 6012(d)).

Please refer to SB483 for the new laws regarding annuities.

4. Disqualification for Long-Term Care Assistance for Individuals with Substantial Home Equity (Sec. 6014)

Section 6014 provides for a denial of benefits for an individual who has equity in a home that exceeds $500,000. It allows states to increase the $500,000 limit to an amount not greater than $750,000, which California SB483 does do. Starting December 31, 2011, such limit will be increased by changes in the consumer price index.

The change in the Medicaid eligibility rules as to Substantial Home Equity shall apply to individuals whose eligibility is based upon a Medicaid application filed on or after January 1, 2006 (Sec. 6014(b)).

Under SB483, "equity interest" means the lesser of the following:

(1) The assessed value of the principal residence determined under the most recent tax assessment, less any encumbrances of record.

(2) The appraised value of the principal residence determined by a qualified real estate appraiser who has been retained by the applicant or beneficiary, less any encumbrances of record.

Under SB483 this equity limit does not apply to an individual if any of the following circumstances exist:

(1) The spouse of the individual or the individual's child, who is under 21 years of age, or who is blind or who is disabled, as defined by federal law, is lawfully residing in the individual' s home.

(2) The individual was determined eligible for medical assistance for home and facility care based on an application filed before January 1, 2006.

(3) The Department of Health Care Services  determines that ineligibility for medical assistance for home and facility care would result in demonstrated hardship on the individual. Demonstrated hardship shall include, but need not be limited to, any of the following circumstances:

(A) The individual was receiving home and facility care prior to January 1, 2006.

(B) The individual has been determined to be eligible for medical assistance for home and facility care based on an application filed on or after January 1, 2006, and before the date that regulations adopted pursuant to this section are certified with the Secretary of State.

(C) The individual purchased and received benefits under a long-term care insurance policy certified by the Department of Health Care Services' California Partnership for Long-Term Care Program.

(D) The individual's equity interest in the principal residence exceeds the equity interest limit, but would not exceed the equity interest limit if it had been increased by using the quarterly House Price Index (HPI) for California, published by the Office of Federal Housing Enterprise Oversight (OFHEO).

(E) The applicant or beneficiary has been denied a home equity loan by at least three lending institutions, or is ineligible for any one Federal Housing Administration (FHA) approved loan or reverse mortgage.

(F) The applicant or beneficiary, with good cause, is unable to provide verification of the equity value.

(G) The applicant or beneficiary meets the undue hardship criteria set by law.

5. Impose Partial Months of Ineligibility (Sec. 6016  (A))

Section 6016(a) provides that states are no longer allowed to round down the penalty period to the lowest whole number. Rather, the penalty will, in essence, be a per diem penalty. For example, if a transfer is made creating a transfer penalty period of 4.25 months, the applicant will be ineligible for 4 months and 8 days.

6. Multiple Transfers Into One Penalty Period (Sec. 6016(B))

Section 6016(b) adds a new paragraph (H) to 42 U.S.C. § 1396p(c)(1). It applies to "multiple fractional transfers of assets in more than 1 month for less than fair market value" by the community spouse or institutionalized spouse after the enactment date. The term "multiple fractional transfers" is ambiguous but presumably it applies to transfers made in successive months. For purposes of determining the period of ineligibility, Paragraph (H) gives states discretion to treat as one transfer, the total cumulative uncompensated value of all assets transferred by the individual or spouse during all months on or after the look-back date in 42 U.S.C. § 1396p(c)(1)(B). The period of ineligibility begins on the earliest date which would apply under 42 U.S.C. § 1396p(c)(1)(D).