ABA GP Solo ELDER LAW COMMITTEE Newsletter Fall, 2008 ABA General Practice, Solo and Small Firm Division Chairs - Kenneth Vercammen, Edison, NJ and Jay Foonberg, Beverly Hills, CA In this issue: 1. 1. MEDICAID PLANNING WITH CARE AGREEMENT 2. Form: "CONFIDENTIAL POWER OF ATTORNEY QUESTIONNAIRE" 3. Difficulties if someone does not have a Will 4. MARKETING SURVEY- We need your marketing success and marketing zero 5. MARKETING SURVEY- PRIOR SURVEY RESULTS:
1. MEDICAID PLANNING WITH CARE AGREEMENT By Thomas D. Begley, Jr., Esquire Care agreements are discussed in HCFA Transmittal 64. The pertinent section reads in part: “While relatives and family members legitimately can be paid for care they provide to the individual, HCFA presumes that services provided for free at the time were intended to be provided without compensation.” The presumption is rebuttable. States may require that a payment arrangement had been agreed to in writing at the time services were provided. The three requirements for a valid care agreement are: (1) that the agreement be in writing, (2) that the payment be made for care delivered after the date of the agreement, and (3) that the compensation be reasonable. Home Modification
Often, children bring a parent into the home of the child until such time as the parent is ready to enter a nursing home. In many cases, the child must modify his home in order to make it adaptable to the needs of the frail parent. In drafting a care agreement, reimbursement for expenses made by the child to modify the home should be covered. Home Maintenance
Expenses in maintaining the home may also be included. Presumably, Medicaid will accept any reasonable formula. One formula would be to total the cost of operating the home, including real estate taxes, water, sewer, utilities, homeowner's insurance premium, condominium fees, and any other shelter-related expenses, and divide that total by the number of persons living in the home, including the client. Food, medical, and other
expenses could be paid directly by the client. Services
A child may provide care for a parent and charge for those services. For example, a potential Medicaid recipient is single and frail, but would be able to stay out of a nursing home with assistance. His son agrees to move him into the son's home and care for him. The level of care will be similar to that provided by an assisted living facility. Therefore, the potential Medicaid applicant may pay the son a reasonable amount for care (i.e., $3,000 per month). To avoid violating the “pig principle,” pay the child 80% of what a third party would charge for the service being rendered. A portion of the payment is for care; a portion is for rent. Other services might be less intense, such as driving a parent to doctor’s visits, doing laundry, maintaining a checkbook, etc. It may be more appropriate to charge hourly for this type of service.
The contract should clearly spell out the types of services to be rendered by the caregiver child. These services typically include the following: ·
Transportation
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Shopping
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Laundry
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Checkbook
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Insurance
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Medications
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Health Assessment
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Secure Health Care
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Monitoring Health Care
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Personal Needs
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Entertainment
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Personal Shopping
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Taxes
Living Arrangements
There are five circumstances under which a care agreement might be appropriate. One is where the child cares for the parent in the child's home. Another is where the child cares for the parent in the parent's home. And a third is where the child provides care to the parent although each live in separate homes. The fourth situation is where the child coordinates care provided by third parties. A fifth situation would be where a child provides services for a parent already residing in a facility to supplement the services provided by the facility. These might include management of a checking account, transportation to doctors, laundry and other services. The care agreement must be carefully drafted to reflect the actual situation.
The Missouri Court of Appeals upheld a care agreement for care provided after the Medicaid recipient had entered the nursing home. On July 25, 2003, Eileen Reed entered a nursing home. In September, she signed a care agreement with her daughter, Sandra Teson, providing that Teson would prepare nutritious, appropriate meals; laundry; assistance with grooming, bathing, dressing, and personal shopping, including the purchase of clothing, toiletries, and other personal items; assistance with purchasing goods for Reed's use and enjoyment; monitoring Reed's physical and mental condition and nutritional needs in cooperation with health care providers; arranging for transportation to health care providers and to physicians of Reed's choice, as well as arranging for assessment, services, and treatment by appropriate health care providers for Reed; assisting Reed in following the instructions and directives of Reed's health care providers; arranging for social services by Social Service personnel; visiting at least weekly and encouraging social interaction; arranging for outings and walks, if reasonable and feasible for Reed; and interacting with and/or assisting any agent of Reed in interacting with health professionals, long-term care facility administrators, Social Service personnel, insurance companies, and government workers in order to safeguard Reed's rights, beneficiaries, and resources as needed. The court held that an $11,000 payment to Reed was in exchange for a binding and enforceable personal services contract and was fair and valuable consideration. Essentially, the contract provided that Teson would provide a communication link between Reed and her doctors and nurses regarding the status of her health, as well as interact with facility personnel to safeguard Reed's rights and benefits. These services supported Reed's independence, autonomy, well-being, and care and enhanced her life in ways that the facility did not and was above and beyond the care provided by the facility.
A Louisiana court also upheld a care agreement. In that case, Louise Carpenter moved in with her daughter in 1989. She moved to a nursing home on February 5, 2004. Mrs. Carpenter transferred $29,339.68, the balance of her Legg Mason brokerage account to her daughter at a point in time close to her entering the nursing home instead of when she moved in with her daughter. They claimed that the $29,339.68 was in consideration for the
care she provided for 15 years. The Administrative Law Judge doubted the credibility as to the reasons why Mrs. Bergeron did not accept payment until after her mother entered the nursing home. The court held that agreement to be valid and compensation to be reasonable. Life Care Contract
It may be possible for a parent to transfer his assets to a child in exchange for lifetime care by the child for the parent. One alternative would be to take the position that, at the time the contract was entered into, the parties had no idea as to the length of time for which the child would care for the parent and, therefore, the entire value of the assets transferred from the parent to the child would be “for value.” A more conservative approach would be to argue that the child is entitled to monthly compensation at a rate similar to that charged by an assisted living facility in the area. The assets would be transferred from the parent to the child, and the child would earn those assets in accordance with the monthly rate established in the care agreement. The rate must be reasonable. If the parent entered a nursing home prematurely, the child would retransfer any excess assets to the parent.
Taxable Income/FICA/FUTA
Payments from the parent to the caregiver child are taxable income to the child and, depending on whether the child is an employee or an independent contractor, would be subject to withholding for FICA and FUTA or subject to payment of self-employment tax. If the parent is being cared for in the child’s home, the agreement may provide that the parent pay a pro rata share of expenses attended to operating the home, such as real estate taxes, insurance, utilities, etc. It could be argued that these are simply reimbursement of expenses and not taxable income. Copyright 2008 by Begley & Bookbinder, P.C., an Elder & Disability Law Firm with offices in Moorestown, Stone Harbor and Lawrenceville, New Jersey and Oxford Valley, Pennsylvania and can be contacted at 800-533-7227. The firm services southern and central New Jersey and eastern Pennsylvania. Tom Begley Jr. is one of the speakers with Kenneth Vercammen at the NJ State Bar Association's Annual Nuts & Bolts of Elder Law and co-author with Kenneth Vercammen, martin Spigner and Kathleen Sheridan of the 400 plus page book on Elder Law. The Firm provides services in connection with protecting assets from nursing home costs, Medicaid applications, Estate Planning and Estate Administration, Special Needs Planning and Guardianships. If you have a legal problem in one of these areas of law, contact Begley & Bookbinder at 800-533-7227. 2. Form: "CONFIDENTIAL POWER OF ATTORNEY QUESTIONNAIRE"
Please fill out completely and fax or mail back. This form is extremely important. Your accuracy and completeness in responding will help me best represent you. All sections and information must be filled out prior to sitting down with the attorney. Please be sure to check all appropriate boxes. If "NONE", please state "NONE". If "NOT APPLICABLE", please state "N/A". PLEASE PRINT CLEARLY 1. Your Full Name: __________________________________________________________ First Last 2. IF MARRIED OR SEPARATED, complete (a) and (b) below: (a) Spouse's Full Name: ______________________________________________________ First Last 3. Your Street Address: ____________________________________ City ____________________ State ____ Zip Code ______________ 4.
Telephone Numbers:
Cell: _______________________________
_________________
Day: ____________________/Night: ________________________ 5.
E-mail address: _______________________________________
6. Referred By: ___________________________________________ If referred by a person, is this a client or attorney? If you heard about the law office on the internet, which search engine? What search terms did you use? 7. Today's Date ____________________ We recommend a Durable Power of Attorney in the event of your physical or mental disability to help you with financial affairs? Yes ________ No ________ We recommend a Living Will telling hospitals and doctors not to prolong your life by artificial means, i.e. Terri Schiavo; Karen Quinlan? Yes ________ No ________
How can we help you? What are your questions/other important information? ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ [It is required that all pages be filled out in person's own handwriting prior to seeing the attorney to avoid conflicts of interest] 8.
Your Sex:
[ ] Male [ ] Female
9. Your Marital Status: [ ] Single [ ] Divorced [ ] Widowed
[ ] Married
[ ] Separated
10. Your Date of Birth: ___________________ SS # __________________ Month Day Year 11. Spouse Date of Birth: _________________ SS # __________________ Month Day Year 2. Personal representative The person charged with administering bills, paying taxes and/or other debts, preserving, managing, and distributing assets and property is called the Personal Representative. This person should be one in whom you have trust and confidence. Your SPOUSE is usually named as primary Personal Representative r, followed by the child who lives closest to your home. Please provide the following information about the person you wish to name to serve in this capacity. 1. PRIMARY Choice of Personal Representative: Name: _________________________ First
______________________________ Last
Relationship: _______________ Address: ________________________ 2. SECOND Choice of Personal Representative: This individual will serve in the event that the primary executor/personal representative is not alive at the time of your death, or is unable to serve. Name: _________________________ First
____________________ Last
Relationship: _______________ Address: ___________________ The two proposed of Personal Representative s must be filled out prior to meeting the attorney. We do not recommend Joint of Personal Representative s, which often cause conflicts and additional work for the Estate. It is best to select one primary person, then a secondary person.
KENNETH VERCAMMEN & ASSOCIATES, PC ATTORNEY AT LAW 2053 Woodbridge Ave Edison, NJ 08817 (Phone) 732-572-0500 (Fax) 732-572-0030 3. Difficulties if someone does not have a Will- Revise & forward to clients By Kenneth A. Vercammen, Esq. In the absence of a will or other legal arrangement to distribute property at death, the state law sets forth how to administer the estate. The result can be lengthy delays before the rightful heirs receive their property. IF YOU HAVE NO WILL: If you leave no Will or your Will is declared invalid because it was improperly prepared or is not admissible to probate: * State law determines who gets assets, not you * Additional expenses will be incurred and extra work will be required to qualify an administrator * Judge determines who gets custody of your children * Possible additional State inheritance taxes and Federal estate taxes * If you have no spouse or close relatives the State may take your property * The procedure to distribute assets becomes more complicated-and the law makes no exceptions for persons in unusual need or for your own wishes. * It may also cause fights and lawsuits within your family When loved ones are grieving and dealing with death, they shouldn’t be overwhelmed with Financial concerns. Careful estate planning helps take care of that. Even if you have an existing Will, there are many events that occur which may necessitate changes in your Will. Some of these are: * Marriage, death, birth, divorce or separation affecting either you or anyone named in your Will *Significant changes in the value of your total assets or in any particular assets which you own * A change in your domicile * Death or incapacity of a beneficiary, or death, incapacity or change in residence of a named executor, trustee or guardian of infants, or of one of the witnesses to the execution
of the Will *Annual changes in tax law 4. MARKETING SURVEY Greetings friends. I am organizing an article for the American Bar Association on marketing and public relations for a law office. To help us, would you please fill out the below form and either fax, mail or even email your response to my office. Supply a marketing tip. 1 Best sources of regular new business: ___________________________ ___________________________________________________________ ___________________________________________________________ 2. Your marketing home run. Something you did to try to get business that exceeded your expectations: ___________________________________ ___________________________________________________________ ___________________________________________________________ 3. Your marketing zero. Something you did marketing/ advertising that was not worth the time, money or effort: ____________________________ ___________________________________________________________ 4. Future trends in the types of law you practice: ____________________ ___________________________________________________________ ___________________________________________________________ 5. Other suggestions for young lawyers starting their practice: [use back of this paper for more suggestions]: ___________________________________________________________ ___________________________________________________________ Please fill out and fax, mail or email back to Kenneth Vercammen, Esq. KenV@njlaws.com Your email: ____________________________ 5. MARKETING SURVEY- PRIOR SURVEY RESULTS: 1. Best sources of regular new business: -Internet -Former satisfied clients -Keeping visible in the community with as high a profile as possible -Lawyer referral services, yellow pages/yellow book print and online, and former or current clients. -Old clients -Client referrals -The internet. I cater to young professionals and 90% of my marketing has been done online. -Current and former clients and other attorneys
-Social service agencies and geriatric care management concerns -Referrals from friends, other attorneys, CPAs and other professionals -Friends and former clients -Referrals from other attorneys; referrals from prior clients; seminars; internet. -Existing clients -Other attorneys and medical doctors -Current clients -Referrals from lawyers with whom have or have had cases 2. Your marketing home run. Something you did to try to get business that exceeded your expectations: -Internet -Take on taxi drivers. They are tradesmen and family men that pass word of mouth recommendation like wildfire. -Advertised in a leading real estate broker's newsletter 8 times per year that is mailed to every residence in the town where I live and work. -Yellow book -Advertise on supermarket shopping carts -We printed a brochure and pass it out on every interview -I planned the first Young Professionals Multi-Group Mixer; bringing together several organizations. -Spoke at an employee "Wellness Training" directed at a company's employees who were caregivers of their aging parents and a lecture at a local university's law school clinical program. -Deliberate and intentional networking with CPAs and financial planners; writing my practice areas specifically on my business cards, so that people don't forget what kind of attorney I am. -Publish BC Bar Association monthly MC/Criminal newsletter - biggest single source of new cases. -Visiting clients -Website -Writing a monthly article in local union monthly newsletters. -Representing a major consumer goods product manufacturer in a nationwide class action. 3. Your marketing zero. Something you did marketing/ advertising that was not worth the time, money or effort: -Yellow pages -Yellow pages -Public speaking to large and small groups on various legal topics. -The phone book never reached our expectations; I guess there are too many competing books lawyers. -Value pack flyers -I have no results with Press Releases. They take a lot of time to put together but not much results.
-An ad in a local paper and an ad in the yellow pages -Putting ads on websites -Placing an advertisement in a local stay-at-home mothers' organizational newsletter. -Classified ads -Newspaper ads -Yellow pages, internet sign-up of potential wills by region -Divorce net.com -Ads in community papers -Hosting a basketball game event 4. Future trends in the types of law you practice: -Immigration effects on criminal defendants -Representation for small business owners and entrepreneurs. They understand the sole practitioner of law quickly and the client relationship is very good. -Specialization will continue to reduce the number of and the market share of general practitioners. -I foresee pleading online like the bankruptcy and federal court-we put off in the beginning, but now I see how much easier and faster it is. -More older people. -More and more young professionals will be online. -More regulation as our population ages and more need for comprehensive planning for families that will include caregivers, community supports and the elderly or ill individual. -My areas of practice are estate planning and criminal law. In the future I see a greater need for specialization in the area of white collar crime. -Pre-nups -Volume for criminal attorneys -I have an ethics practice and continue trying to grow in it Other suggestions for young lawyers starting their practice: -Do not be afraid to seek guidance from experienced mentors within the bar. In fact, I would make it a rule, when in doubt, pick up the telephone or tap on a shoulder and run it by a respected member of the bar. Good lawyers know that extending this long standing courtesy to newcomers makes us all better lawyers and serves all our clients better. We are our own best resource. If the first lawyer you seek does not have time, keep on dialing or tapping shoulders. -Network, Self-Promote, and Originate Business! -Work smart and don't specialize right away. -Introduce yourself to older established attorneys in community and ask to do overflow. -There is nothing wrong with starting a business without getting a loan or finding investors. Organic start-ups grow at a natural pace and you can see how your business is going to do while still working a full time, paying job. -Get a mentor and have lunch with them once every 60 days (and you should buy lunch). Also, set up a new tracking system in your office to alert you to all news in your regional area regarding your specific area of practice. This alerts you to trends public attitude regarding your area of practice and keeps you advised of the "information" and "advice" the
public is receiving regarding the issues in your area of practice and from whom they are receiving it. -Work under or apprentice with more experienced attorney while you save $30,000 to $40,000 cash to open your own practice. Specialize in one area, attend a variety of after work functions and write as many articles as possible. -Write articles and find a mentor. -Partner with a local lawyer and they will share clients; join groups that you enjoy and promote yourself as a lawyer. -Atticus -Don't reinvent the wheel. Find a mentor in your firm or elsewhere to help guide you as a new lawyer. -Get involved. I have been involved in ABA committee work and have received business, mentoring and even a Wall Street Journal interview from them. _______________________ WE PUBLISH YOUR FORMS AND ARTICLES To help your practice, we feature in this newsletter edition a few forms and articles PLUS tips on marketing and improving service to clients. But your Editor and chairs can't do it all. Please mail articles, suggestions or ideas you wish to share with others in our Tort and Insurance Committee. Let us know if you are finding any useful information or anything you can share with the other members. You will receive written credit as the source and thus you can advise your clients and friends you were published in an ABA publication. We will try to meet you needs. Send Us Your Marketing Tips We are increasing the frequency of our newsletter. Send us your short tips on your great or new successful marketing techniques. You can become a published ABA author. Enjoy your many ABA benefits. Send us your articles & ideas To help your practice, we feature in this newsletter edition a few articles and tips on marketing and improving service to clients. But your Editor and chairs can't do it all. Please send articles, suggestions or ideas you wish to share with others. General Practice, Solo and Small Firm Division: Elder Law Committee and the ESTATE PLANNING, PROBATE & TRUST COMMITTEE
Who We Are This committee focuses on improving estate planning skills, substantive law knowledge and office procedures for the attorney who practices estate planning, probate and trust law. This committee also serves as a network resource in educating attorneys regarding Elder Law situations. To help your practice, we feature in this newsletter edition a few articles and tips on marketing and improving service to clients. But your Editor and chairs can't do it all. Please send articles, suggestions or ideas you wish to share with others. Let us know if you are finding any useful information or anything you can share with the other members. You will receive written credit as the source and thus you can advise your clients and friends you were published in an ABA publication. We will try to meet you needs. We also seek articles on Elder Law, Probate, Wills, Medicaid and Marketing. Please send your marketing ideas and articles to us. You can become a published ABA author. ________________________________________ The Elder Law Committee of the ABA General Practice Division is directed towards general practitioners and more experienced elder law attorneys. The committee consistently sponsors programs at the Annual Meeting, the focus of which is shifting to advanced topics for the more experienced elder lawyer. This committee also focuses on improving estate planning skills, substantive law knowledge and office procedures for the attorney who practices estate planning, probate and trust law. This committee also serves as a network resource in educating attorneys regarding Elder Law situations. Kenneth Vercammen, Esq. co-Chair Jay Foonberg, Beverly Hills Co-chair, Author of Best Sellers "How to Start and Build a Law Practice" and "How to get and keep good clients', Beverly Hills, CA JayFoonberg@aol.com> We will also provide tips on how to promote your law office, your practice and Personal Marketing Skills in general. It does not deal with government funded "legal services" for indigent, welfare cases. KENNETH VERCAMMEN & ASSOCIATES, PC ATTORNEY AT LAW 2053 Woodbridge Ave. Edison, NJ 08817 (Phone) 732-572-0500 (Fax) 732-572-0030 Kenv@njlaws.com Central Jersey Elder Law www.centraljerseyelderlaw.com NJ Elder Blog http://elder-law.blogspot.com/