FAQ: My dad passed with $5,000 in a checking account. Can I get these funds to pay for the funeral?

Answer:  Yes.  Pennsylvania has a statute that allows a bank, credit union, and other savings institutions to pay the amount on deposit to the spouse, any child, the father or mother or any sister or brother of the decedent (in that order of preference) if the total amount on deposit does not exceed $10,000.

You must provide a funeral bill receipt or an affidavit of a licensed funeral director that states that satisfactory arrangements for payment of funeral services have been made.

Bank personnel generally do not know about this law, so it might take a little extra effort to make this happen.  Here is what you could do: 1) have an original death certificate to give to the bank; 2) have the funeral bill receipt or the affidavit of the funeral director as mentioned above to give to the bank; 3) have a photo ID ready and if there is no surviving spouse, have a death certificate for the other deceased spouse; 4) call the bank where the funds are held and discuss your intentions and set a time to visit the branch; 5) be prepared to present the bank with all the information listed above and take this citation to the PA law 20 P.a.C.S. § 3101 with you because an inexperienced customer service rep at a bank might need to send it to their legal counsel for approval.

The process above is a pretty straightforward one.  For many people, this is the first question they have when calling or emailing our office.  If this is the only issue in an estate that you are handling, then hopefully this is all the answer you will need.  But, it’s important to remember that probate and estate administration is a legal process and the representative of the estate can run into liability if he or she mishandles the administration to the detriment of the beneficiaries.  And, the estate administration process can be emotional, complex, and time consuming.  We help families sort out all the legal issues involved in estate administration and protect the representative from liability.  We handle all types of estate administrations from simple to quite complex.  If you are handling the estate of a loved one and are questioning how best to get it done, contact Baroni Estate Planning & Elder Law.  We can help.

Take These Three Steps When Your Child Turns 18

If your child has reached the teenage years, you may already feel as though you are losing control of her life. This is legally true once your child reaches the age of 18 because then the state considers your child to be an adult with the legal right to govern his or her own life.

Up until your child reaches 18, you are absolutely entitled to access your child’s medical records and to make decisions regarding the course of his treatment. And, your child’s financial affairs are your financial affairs. This changes once your child reaches the age of 18 because your now-adult child is legally entitled to his privacy and you no longer have the same level of access to or authority over his financial, educational and medical information. As long as all is well, this can be fine. However, it’s important to plan for the unexpected and for your child to set up an estate plan that at least includes the following three crucial components:

1. Health Care Proxy with HIPAA Release

Under the Health Insurance Portability and Accountability Act, or HIPAA, once your child turns 18, the child's health records are now between the child and his or her health care provider. The HIPAA laws prevent you from even getting medical updates in the event your child is unable to communicate his or her wishes to have you involved. Without a HIPAA release, you may have many obstacles before receiving critically needed information, including whether your adult child has even been admitted to a particular medical facility.

Should your child suffer a medical crisis resulting in the child's inability to communicate for him or herself, doctors and other medical professionals may refuse to speak with you and allow you to make medical decisions for your child. You may be forced to hire an attorney to petition to have you appointed as your child’s legal guardian by a court. At this time of crisis, your primary concern is to ensure your child is taken care of and you do not need the additional burden of court proceedings and associated legal costs. A health care proxy with a HIPAA release would enable your child to designate you or another trusted person to make medical decisions in the event your child is unable to convey his or her wishes.

2. Durable Power of Attorney

Like medical information, your 18-year-old child’s finances are also private.  If your child becomes incapacitated, without a durable power of attorney you cannot access the child's bank accounts or credit cards to make sure bills are being paid. If you needed to access financial accounts in order to manage or resolve any problem, you may be forced to seek the court’s appointment as conservator of your child.

Absent a crisis, a power of attorney can also be helpful in issues that may arise when your child is away at college or traveling. For example, if your son is traveling and an issue comes up where he cannot access his accounts, a durable power of attorney would give you or another trusted person the authority to manage the issue. An alternative may be to encourage your child to consider a joint account with you.  However, this is rarely recommended because of the unintended consequences for taxes, financial aid applications, creditor issues, etc.

3. Will

Your child owns any funds given to him or her as a minor or that he or she may have earned. In the catastrophic event that your child predeceases you, these assets may have to be probated and will pass to your child’s heirs at law, which in most states would be the parents. If you have created an estate plan that reduces your estate for estate tax or asset protections purposes, the receipt of those assets could frustrate your estate planning goals. In addition, your child may wish to leave some tangible property and financial assets to other family members or to charity.

While a will may be less important then the health care proxy, HIPAA release or durable power of attorney, ensuring that your child has all three components of an estate plan can prevent you, as a parent, from having to go to court to obtain legal authority to make time-sensitive medical or financial decisions for your child.

If you have a child (or grandchild) who is approaching adulthood, talk to your elder law attorney about having the child execute these three crucial documents. 

Don't Let Health Care Providers Use the Improvement Standard to Deny Medicare Coverage

Have you or a loved one been denied Medicare-covered services because you’re “not improving”? Many health care providers are still not aware that Medicare is required to cover skilled nursing and home care even if a patient is not showing improvement. If you are denied coverage based on this outdated standard, you have the right to appeal.

For decades Medicare, skilled nursing facilities, and visiting nurse associations applied the so-called “improvement” standard to determine whether residents were entitled to Medicare coverage of the care. The standard, which is not in Medicare law, only permitted coverage if the skilled treatment was deemed to contribute to improving the patient's condition, which can be difficult to achieve for many ill seniors.

Three years ago in the case of Jimmo v. Sebelius the Centers for Medicare & Medicaid Services (CMS) agreed to a settlement in which it acknowledged that there's no legal basis to the “improvement” standard and that both inpatient skilled nursing care and outpatient home care and therapy may be covered under Medicare as long as the treatment helps the patient maintain her current status or simply delays or slows her decline. In other words, as long as the patient benefits from the skilled care, which can include nursing care or physical, occupational, or speech therapy, then the patient is entitled to Medicare coverage.

Medicare will cover up to 100 days of care in a skilled nursing facility following an inpatient hospital stay of at least three days and will cover home-based care indefinitely if the patient is homebound.

Unfortunately, despite the Jimmo settlement, the word hasn't gotten out entirely to the hospitals, visiting nursing associations, skilled nursing facilities, and insurance intermediaries that actually apply the rules. As a result, the Jimmo plaintiffs and CMS have now agreed to a court-ordered corrective action plan, which includes the following statement:

 

The Centers for Medicare & Medicaid Services (CMS) reminds the Medicare community of the Jimmo Settlement Agreement (January 2014), which clarified that the Medicare program covers skilled nursing care and skilled therapy services under Medicare’s skilled nursing facility, home health, and outpatient therapy benefits when a beneficiary needs skilled care in order to maintain function or to prevent or slow decline or deterioration (provided all other coverage criteria are met). Specifically, the Jimmo Settlement required manual revisions to restate a “maintenance coverage standard” for both skilled nursing and therapy services under these benefits:

Skilled nursing services would be covered where such skilled nursing services are necessary to maintain the patient's current condition or prevent or slow further deterioration so long as the beneficiary requires skilled care for the services to be safely and effectively provided.

Skilled therapy services are covered when an individualized assessment of the patient's clinical condition demonstrates that the specialized judgment, knowledge, and skills of a qualified therapist (“skilled care”) are necessary for the performance of a safe and effective maintenance program. Such a maintenance program to maintain the patient's current condition or to prevent or slow further deterioration is covered so long as the beneficiary requires skilled care for the safe and effective performance of the program.

The Jimmo Settlement may reflect a change in practice for those providers, adjudicators, and contractors who may have erroneously believed that the Medicare program covers nursing and therapy services under these benefits only when a beneficiary is expected to improve. The Settlement is consistent with the Medicare program's regulations governing maintenance nursing and therapy in skilled nursing facilities, home health services, and outpatient therapy (physical, occupational, and speech) and nursing and therapy in inpatient rehabilitation hospitals for beneficiaries who need the level of care that such hospitals provide

“The CMS Corrective Statement is intended to make it absolutely clear that Medicare coverage can be available for skilled therapy and nursing that is needed to maintain an individual’s condition or slow deterioration,” says Judith Stein, Executive Director of the Center for Medicare Advocacy and a counsel for the plaintiffs. “We are hopeful this will truly advance access to Medicare and necessary care for people with long-term and debilitating conditions.”

While this doesn't change the rights Medicare patients have always had, it should make it somewhat easier to enforce them. If you or a loved one gets denied coverage because the patient is not “improving,” then appeal.

To read the court order implementing the new corrective action plan, click here

Using a Prepaid Funeral Contract to Spend Down Assets for Medicaid

No one wants to think about his or her death, but a little preparation in the form of a prepaid funeral contract can be useful. In addition to helping your family after your death, a prepaid funeral contract can be a good way to spend down assets in order to qualify for Medicaid.

A prepaid or pre-need funeral contract allows you to purchase funeral goods and services before you die. The contract can be entered into with a funeral home or cemetery. Prepaid funeral contracts can include payments for: embalming and restoration, room for the funeral service, casket, vault or grave liner, cremation, transportation, permits, headstones, death certificates, and obituaries, among other things.

One benefit of a prepaid funeral contract is that you are paying now for a service that may increase in price—possibly saving your family money. You are also saving your family from having to make arrangements after you die, which can be difficult and time-consuming. And, if you are planning on applying for Medicaid, a prepaid funeral contract can be a way to spend down your assets.

Medicaid applicants must spend down their available assets until they reach the qualifying level (usually around $2,000, depending on the state). By purchasing a prepaid funeral contract, you can turn available assets into an exempt asset that won't affect your eligibility. In order for a prepaid funeral contract to be exempt from Medicaid asset rules, the contract must be irrevocable. That means you can't change it or cancel it once it is signed.

Before purchasing a contract, you should shop around and compare prices to make sure it is the right contract for you. Buyers need to be careful that they are buying from a reputable company and need to ask for a price list to make sure they are not overpaying. 

For information from the Federal Trade Commission on shopping for funeral services, click here.

 

 

Long-Term Care Scorecard Finds States Have Room for Improvement

A new report finds that states have made incremental improvements in providing long-term care, but need to make more improvements in order to meet the needs of the growing number of people who require long-term care services. According to the 2017 Long-Term Services and Supports State Scorecard, while long-term care remains unaffordable for middle class families, there has been some progress in other areas.

The scorecard, a collaboration between the AARP, The Commonwealth Fund, and The SCAN Foundation, measures states' long-term care system performance in five areas: affordability and access, choice of setting and provider, quality of life and quality of care, support for family caregivers, and effective transitions between care settings.

The 2017 scorecard found that states showed progress since the previous scorecard in 2014 in reducing inappropriate antipsychotic drug use for nursing home residents, helping family caregivers, reducing long-term nursing home stays, increasing the number of Medicaid recipients receiving care at home or in the community rather than in an institution, and reducing potentially burdensome hospitalizations for people who die in a nursing home. However, the scorecard concludes that overall improvements are not keeping up with the demand. For example, there are not enough home care workers to meet the needs of individuals with disabilities living in the community. In addition, while states have made improvements in providing home health care, progress is moving too slowly to keep up with growing needs.

According to the scorecard, the top five states for long-term care are Washington, Minnesota, Vermont, Oregon, and Alaska. The bottom five states are Tennessee, Mississippi, Alabama, Kentucky, and Indiana. Tennessee and New York made the most progress since the previous scorecard in 2014.

To see where your state ranks, go here: http://www.longtermscorecard.org/2017-scorecard