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News

Estate Administration and Probate

• Debt collectors target the dearly departed
  Mar 19, 2009

  In a sign of how difficult economic times are for debt collection and credit agencies, many are targeting a rich new source of income: collecting debts of the dead.

   

  Collections agencies are finding that calling the relatives of deceased individuals to ask that they pay their loved one’s debt is a fruitful pursuit.  Many family members feel obligated to pay the debts of their kin, even though they may not be required to do so by law (laws differ by state).

   

  While collections agencies can target the estate of deceased individuals, many are finding that a gentle touch with living relatives is easier and yields better results.  Agents are specially trained to speak kindly and compassionately to family members, in the hope that the positive interaction will induce them to pay up.

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Asset Protection

• How To Avoid Wasteful Spending On Health Care
  Apr 29, 2010

  If we are aware of it or not, we often are our worst enemy when it comes to wasteful spending, particular on matters of health care. 
  
  The new research, part of the 2009 Drug Trend Report produced by Express Scripts, identifies five behavioral profiles that contribute to wasteful spending in health care:
  

  
  The Active Decliner: the patient who says she feels fine most of the time and questions whether taking her medication is really necessary.

  The Refill Procrastinator: the patient who gets distracted, runs out of time and fails to refill his prescription before the medicine runs out.

  The Sporadic Forgetter: the patient who remembers to take her medications during the week, but gets off schedule on the weekends and simply forgets.

  The Loyalist: the patient who uses brand-name medications because that's what the doctor first prescribed. He is slow to ask his doctor about changing to a lower-cost generic drug.

  The Traditionalist: the patient who routinely goes to the store for other items and enjoys the personal contact, but has never made a deliberate decision about whether to switch to Home Delivery (i.e., mail order) for her medications.
  
  According to the report, three simple behaviors can help achieve savings:
  
  Adhering to the prescribed drug therapy (thereby avoiding the medical expenses associated with non-adherence).
  
  Choosing the more cost-effective drug, including lower-cost brand and generic alternatives, when appropriate for the therapy.
  
  Finally, identifying the most appropriate channel for delivery of the drug to the patient (mail order, for example) can save $6 billion a year.

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• Health Care Debate: Long Term Insurance Overhaul
  Jan 05, 2010

  Congressional Democrats and President Barack Obama began work in earnest Tuesday on difficult issues still standing in the way of their national health care overhaul after months of tortuous debate. Topping the list: How to help Americans pay for insurance premiums.
  
  Click here for entire article - 23 - 30

• Survey uncovers surprising long-term care myths and facts
  Oct 29, 2009

  MetLife recently released the results of a survey that was conducted to see how well informed Americans are about long-term care.  The survey results were telling, revealing that many Americans are uninformed about the realities and costs of long-term care.

   

  One key point that many Americans fail to grasp is the fundamental truths about long-term care.  The majority of individuals surveyed did not fully understand how expensive long-term care can be, how it can be paid for and what benefits are available to help pay for it.

   

  MetLife summarized some of the common misconceptions about long-term care in the U.S.:

  • Long-term care is usually provided in a nursing home (false: most long-term care is provided at home).
  • Medicare, health insurance and disability insurance all pay for long-term care costs (false: the only form of private insurance that pays for long term care is long-term care insurance).
  • You can qualify immediately for Medicaid to help pay for your long-term care by transferring your assets to your family (false: Medicaid looks back over the previous five years to determine if you are eligible).
  • The primary factors in long-term care insurance are family history, income and age (false: age is the primary factor in how long-term care insurance premiums are determined).

   

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• Healthcare reform may offer another option for long-term care planning
  Oct 25, 2009

  Many Pennsylvania residents face the same issue when they near the end of their life – they no longer have money to pay for their own nursing home or long-term care, and have to rely on the government for assistance.

   

  In an effort to provide additional options for Americans struggling to plan for their future, Congress has included a provision in the massive healthcare reform bill for a government-run long-term care insurance program.

   

  Proponents of the program see it as a good thing, as they hope it would eventually reduce the strain on Medicaid.  While Medicaid is intended to help low-income elders pay for their nursing home care, many people find themselves turning to it for help after their personal savings are drained.

   

  With the cost of nursing home care averaging about $75,000 to $90,000 a year, many people who are initially able to pay their own way run out of money and end up needing help from Medicaid.  A long-term care insurance program would help those individuals and slow down federal and state spending on Medicaid.

   

  Of course, the bill hasn’t been passed yet, and critics worry that yet another government program would eventually require a taxpayer bailout.  It remains to be seen if the healthcare bill will pass – with this proposed long-term care insurance program included.

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• Dozens arrested in nationwide Medicare fraud bust
  Jul 29, 2009

  Many people who rely on Medicare worry that there won’t be enough federal funds to cover their medical expenses down the road.  One reason for Medicare’s precarious financial situation is the amount of fraud perpetrated every day by people taking advantage of the system.

   

  This week authorities are fighting back against fraudsters, arresting 30 people across the country in a variety of Medicare fraud busts.  The $16 million bust required the work of 200 federal agents and resulted in arrest warrants being issued for a number of doctors and other individuals at various heath care businesses.

   

  One popular scam involved giving patients expensive “arthritis kits” which were nothing more than orthotic braces and heating pads.  Despite clinics billing Medicare up to $4,000 for each kit, many patients claim they never received them nor did they want them in the first place.

   

  Another scam involved billing Medicare for thousands of dollars of Ensure – a liquid food given to patients who cannot eat – even if the patients never actually received the goods or were deceased.

   

  The crackdown is part of an effort by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius to fight the billions of dollars of Medicare fraud that happens every year.

   

  The amount of fraud is shocking.  Just since 2007 federal strike forces have indicted over 293 suspects and organizations that over the years have fraudulently billed Medicare for more than $674 million – and that’s only in Miami, Detroit, and Los Angeles.

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• Will Pennyslvania lawmakers divert Medicaid stimulus money?
  Jul 29, 2009

  The shaky condition of Medicaid is a concern for many who depend on Medicaid benefits to keep them or a family member in a nursing home.  In order to help preserve healthcare benefits for struggling families, $4 billion in additional Medicaid funding will go to the Pennsylvania state treasury by the end of next year.  This money is part of the national stimulus package

   

  However, some Pennsylvania lawmakers are eyeing these additional funds as a way to cover budget shortfalls in other areas.  Medicaid funds could be diverted to pay for transportation project or prison costs, leaving less available for nursing home residents.

   

  Taking money away from Medicaid could have devastating consequences.  In a state with a high number of elderly residents, many of whom rely on Medicaid to pay for their care, diverting Medicaid funds for other purposes could be devastating.

   

  Medicaid is an important benefit: 65 percent of nursing home residents rely on Medicaid and 15 percent rely on Medicare.  Even those individuals who begin their stay in a long-term care facility by paying out of pocket usually end up relying on Medicaid when their funds dry up – something that is happening sooner than expected for many, given the sorry state of the economy.

   

  Another issue is that nursing homes are already being paid less by Medicaid than what they bill.  On average, nursing homes are paid by Medicaid $14 a day (about $5,000 a year) less than what they are owed for the cost of caring for Medicaid residents.

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• Will families lose their homes to reimburse Medicaid costs?
  Jun 28, 2009

  Governor Ed Rendell is looking for ways to bring money into the beleaguered state coffers, and his latest budget proposal contains a change to how Pennsylvania recovers costs from estates for long-term care spending after a patient dies.

   

  One component of the new bill proposed by Rendell could be devastating to families.  After a Medicaid recipient dies, the government would be able to place a lien on any property in which the deceased had an interest, for up to the full amount of care that was covered by Medicaid.

   

  Up until this point the state has avoided counting the home as an asset available for Medicaid recovery, for sound reasons that serve the public interest.  By allowing families to keep their homes, neighborhoods are preserved, family farms can stay in the family, and properties maintain clean titles.

   

  This new bill would be a significant change that potentially affects a huge number of people because so many rely on Medicaid to cover the cost of their long-term care.  Because long-term care can cost elderly residents $8,000 a month, many families have no other option but Medicaid.

   

  After spending down their personal assets to afford long-term care, families could lose their land and their homes as well if this bill passes.  Even worse, critics contend that this provision would only bring in a fraction of what the state pays out in Medicaid every year.

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• Will revised estate tax laws pay for health care reform?
  May 12, 2009

  This week the Obama administration announced that it plans to raise money for an ambitious health care reserve fund by changing estate tax law and closing certain tax loopholes.  The administration hopes to raise almost $60 billion over 10 years through proposed changes.

   

  The approximately $634 billion health care reserve fund would be used to revamp the healthcare system and expand health care insurance benefits to Americans without it.

   

  Right now the law allows for a $3.5 million estate tax exemption per person ($7 million per couple).  In order to raise $24 billion over 10 years lawmakers have proposed tightening estate tax laws.  The proposed changes relate to how assets in an estate are valued.

   

  A senior Treasury official, speaking to reporters on condition of anonymity, claimed that less than three-tenths of 1 percent of estates would be affected by the changes.

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• The future of the estate tax is becoming clearer
  Apr 30, 2009

  Confusing and controversial laws have made it challenging for some people to complete their estate plans over the last several years.  However, it looks as though the dust is settling around the thorny issue of what to do with the estate tax in 2010 and 2011.

   

  One criticism of the current estate tax law – which would abolish the estate tax completely in 2010, only to aggressively reinstate it in 2011 – is that it could induce families to hasten or prolong the death of their elderly family members in order to take advantage of the 2010 change.

   

  All morbid thoughts aside, lawmakers are eager to reinstate the estate tax in 2010 and ensure that it remains at a more reasonable level for subsequent years.  Lawmakers agree that there is zero chance that the estate tax will disappear in 2010 as stated in the current law.

   

  Even if Congress’ version of the Obama administration budget, which includes changes to the estate tax, doesn’t pass as written, lawmakers are expected to at a minimum reinstate the state tax for 2010.  It remains to be seen what other changes will be passed in the final budget.

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