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Long Island's Elder Law, Special Needs & Estate Planning Firm

Thursday, November 17, 2011


On October 14, 2011, the Department of Health and Human Services announced that it would not implement the portion of the Health Care Reform Act that was intended to provide voluntary long term care benefits for working Americans. The program known as the Community Living Assistance Services and Supports Act (CLASS Act) was designed to create a voluntary government program under which employees would pay a monthly premium and would be eligible for modest benefits for their long term care needs after five years of paying premiums.  The program was open to anyone who met certain work requirements - regardless of their health.

Under the terms of the CLASS Act, the program would go into effect only if it were economically viable. Secretary of Health and Human Services Kathleen Sebelius stated that she “did not see a viable path forward for CLASS implementation at this time." The report cited actuarial and solvency impediments as the reason why they had not found a way to make the program work. Premiums were projected to be too high and few healthy people were projected to enroll.

The problem that the CLASS Act was intended to address – aging population and paying for the high cost of long term care assistance - remains a pressing issue. The current cost for a nursing home in New York is $140,000 a year. The cost for home health care is $250 per day for 24/7 care and the cost of assisted living is $3,000-$6,000 per month. These costs are expected to continue to rise.  

Enrollment in private long term care insurance, subject to underwriting, can secure a policy for an individual that will provide the benefits needed for the future - be it staying at home with an aid or moving to a nursing home or an assisted living residence.  As one grows older, the cost of long term care insurance rises substantially and it may simply be unavailable should one become ill.  As a New York resident, one may be eligible for a program called the New York State Partnership for Long Term Care Insurance (NYSPLTC).  This allows residents to protect their assets while applying for Medicaid Extended Coverage if their long term care needs exceed the period covered by their qualified NYSPLTC insurance policy.

Long term care insurance is a benefit offered by employers to their employees and/or key people.  Employers, self-employed, LLC members, Sub C owners and partners in a partnership are eligible to receive income tax advantages as it relates to long term care insurance premiums. In addition, New York State offers a 20% tax credit.  Because long term care insurance is not considered an ERISA benefit, employers can offer it to employees on a select basis. Insurers often offer simplified underwriting and/or discounts to a block of people from a company or an association buying long term care insurance.

Attached is a link to an article from The New York Times that details the ending of the CLASS program: http://www.nytimes.com/2011/10/15/health/policy/15health.html.  

Source:  Robert S. Israel, CLU, Long Island Planning Group

Friday, September 23, 2011

It's Happened!

After many years of speculation, warnings and minor revisions, it has finally happened:

New York State has imposed new regulations stating that the use of LIFE ESTATE interests in real property are no longer an effective strategy for families trying to protect 100% of their property from the high cost of long term care.

If you or anyone you know, utilized a LIFE ESTATE within an estate plan in order to protect the interests of a family home, please be sure to call us immediately to schedule a consultation.  Don’t wait until it’s too late to do anything about it.  We cannot help you restructure your plan if you do not contact us.

Call us at 631-234-3030 to arrange to come in to discuss alternate options while they still exist.

Friday, July 22, 2011

Most Baby Boomers Lack a Plan to Care for Parents

A majority of Baby Boomers say they are likely to become caregivers for their parents, but only half can name any medications their parents take, a new survey shows.

The survey of 600 adults ages 45 to 65, conducted for the Home Instead Senior Care network, also found:

31% don't know how many medications their parents take.
34% don't know whether their parents have a safe deposit box or where the key is.
36% don't know where their parents' financial information is located.
"The majority of caregivers we work with have done no advance planning,'' says Jeff Huber, president of Home Instead Senior Care, a company that provides non-medical care services. "It is not important until it's urgent. So much stress and uncertainty down the road can be prevented."

Lack of planning can lead to serious complications when decisions need to be made quickly, says palliative care nurse practitioner Mimi Mahon, an associate professor at George Mason University in Virginia. "It's vitally important to plan ahead and have these conversations with parents, or families can act out of fear and make mistakes when emergencies arise."

Prescription drugs are of particular concern. In the survey, 49% couldn't name a single drug their parents took. Ask parents about their medications and, if necessary, do research, experts say. Find out the dose, what it's for, who prescribed it and why. People 65 and older account for about a third of all medications prescribed in the U.S., according to the National Institutes of Health, and older patients are more likely to have long-term and multiple prescriptions, which could lead to unintentional misuse.

"It's kind of a never-ending process for caregivers," says Sandy Markwood, head of the National Association of Area Agencies on Aging, part of the Department of Health and Human Services. "It gets further complicated when there is more than the family practitioner. A parent might have several specialists. It's a lot for a caretaker to keep up."

Markwood says the Administration on Aging, also under HHS, has been encouraging better record-keeping by seniors and stronger communication between seniors and caretakers since Hurricane Katrina. "Then you had a situation when seniors were evacuated without their medications and no one knew what medications they were on," Markwood says. "Doctors had to start from scratch."

One must-have answer for caretakers: What drugs can parents go without and which ones must be taken on schedule. For instance, blood pressure and anti-depressant medications cannot be missed, Mahon says.

The bottom line, she says, is being a staunch advocate for your parents' health care starts with "having conversations and putting plans in place."

Source: www.elderlawanswers.com June 20, 2011

Friday, June 24, 2011

Expanded Medicaid Estate Recovery Is Coming To New York

The federal government passed a law in 1993 (2) which contained a mandate that each state must have a Medicaid law containing an estate recovery provision, but left to the states the choice of either limited or expanded recovery. In 1994, New York accepted this mandate and chose to limit estate recovery to the probate or intestate estate of a Medicaid recipient. (3) Recently, New York expanded estate recovery beyond the probate and intestate estate to "any other property in which the individual has any legal title or interest at the time of death, including jointly held property, retained life estates, and interests in trusts, to the extent of such interests." (4) Is this the end of Medicaid planning as we know it?

The answer is we don't know anything for sure right now. What we do know is that while the law has passed with an effective date of April 1, 2011, the law will not be implemented until regulations are adopted by the Commissioner of the New York State Department of Health. (5) The Elder Law Sections of our state and county bar associations, the New York NAELA (6) chapter, and many other interest groups advocating for the rights of people with disabilities and the elderly, are hard at work to help shape these regulations, which may be forthcoming within weeks or possibly years. When finally promulgated, which I expect to be sooner rather than later, such regulations will hopefully clear the way to our understanding of the law and permit the continued use of some planning techniques. For now, we have more questions than answers. If a person has already undertaken Medicaid planning, they should do nothing until such regulations are issued.

Let's break down the new law a little further. First, the new law targets all property in which the Medicaid recipient had a legal title or interest at the time of death. It appears that the reference to "legal title" focuses the law on what is owned at the time of death. Frankly, this seems fair and straightforward. The question we ponder now is whether the term "legal interest" is a concept that goes beyond title or ownership. Is the mere right to income from an asset a "legal interest" subjecting the underlying asset to estate recovery? If the answer is yes, does the answer change if there is no right to income but rather only the right to mere possession of the asset? What about a retained power in a trust document, such as a power of appointment to change trustees or beneficiaries? In other words, to what extent are certain rights and powers going to be considered a legal interest subjecting the whole or part of any asset to estate recovery? Also, does it matter whether the right or power was retained in a transfer or created by a third party? We do not know the answers to these questions.

What is clear is that business as usual is now over in New York. In the past, estate recovery was simply something that we did not have to worry about. We all knew that each county was hanging out in its Surrogate's Court and matching its records against all estates that passed through its doors. Therefore, all we had to do to escape estate recovery was to stay out of Surrogate's Court, that is, to simply avoid probate. Avoiding probate was accomplished easily by having a beneficiary on an account , or by creating joint accounts (7) with right of survivorship, life estates, or revocable and irrevocable trusts. These techniques are all now in question as the new law specifically mentions joint ownership, life estates and trusts. We just do not know as to what extent their usefulness is lost.

Let us turn our attention now to jointly held property. As a practical matter, property owned jointly with the Medicaid applicant would be small, as such property would be available to pay for care, rendering the joint owner ineligible for Medicaid. However, this would not be true for any amounts equal to or less than the personal exemption of $13,800. Therefore, the new law would permit recovery from such exempt accounts. I believe that this will certainly be fair game within the new forthcoming regulations.

In addition, recovery is also permitted from the estate of the surviving spouse, in amounts that can far exceed the personal exemption of $13, 800 allowed the Medicaid recipient. This could involve hundreds of thousands of dollars jointly held between the surviving spouse and the children. Again, I believe that this will be fair game within the new forthcoming regulations. This will prompt spouses to transfer assets out of their names prior to death to avoid estate recovery, a decision which may not be in their best interest or even good public policy. Of course the ethical consideration would depend on the circumstances of each case.

The new law also targets life estates. A common, although often ill-advised, plan is to protect real estate by transferring it to family with the grantor retaining a life estate. Such real estate would not be considered a countable asset for Medicaid eligibility purposes, subject to a five year look back. The new law potentially makes these life estate plans vulnerable to estate recovery as well. At this point, we do not know the extent of this estate recovery. Would the recovery be allowed against the entire property, or perhaps only a fraction equal to the value of the life estate interest at the age of the life tenant at the time of her death? An argument can also be technically made that the value of a life estate at the time of someone's death is zero. Indeed, the new estate recovery statute references the value of the interest at the time of death, not the moment prior to death, so litigation may be necessary to define the extent of the statute's reach. New Jersey, a state which has had such expanded estate recovery for years, chose to recognize the technical problems with such a statute and elected to not apply the law to life estates.

In any event, it is also interesting to note that the law does not distinguish between life estates created by a Medicaid recipient and life estates created by third parties. For example, suppose that upon a father's death, he creates a life estate in the family home for his daughter with disabilities, which then passes to the grandchildren on her death. If such daughter needs Medicaid, will New York have a right of recovery against the home? I would think not, but the potential exists.

Lastly, the law specifically targets "interests in trusts". Recovery now from revocable trusts seems to be a given because of the full control retained by the Settlor. However, it is with irrevocable trusts that suspense exists. Irrevocable trusts have been the most effective planning tool for people trying to protect their assets because it facilitates a full transfer of the assets for Medicaid purposes while allowing the Settlor to retain certain rights and powers and tax favorable outcomes. A typical trust could include the right to retain the income or possession of a transferred asset, or the power to change trustees, change beneficiaries or block the sale of an asset. These extra rights and powers give people the confidence to transfer their assets which might not be there if they were transferring their assets directly to their children. In addition, these rights and powers provide powerful tax benefits, including triggering the Grantor Trust Rules. The Grantor Trust Rules allow us to control (i) who will be taxed on trust income and (ii) who, if any one, will be entitled to deductions, exemptions and exclusions, such as the $250,000 capital gain exclusion on the sale of a principal residence. (8)

Furthermore, retaining the right to the use and occupancy of a personal residence held in an irrevocable trust allows us to keep all the property tax exemptions, including the STAR, Enhanced STAR, Senior and Veterans exemptions. The right to occupancy alone is insufficient to keep these exemptions; the right to "use" is essential and "use"includes the concept of income. Therefore, to retain these property tax exemptions on a principal residence, one must retain the right to the income from such residence, even though such income rarely exists. However, the new law may be interpreted to mean that estate recovery may be had against any asset in which the Settlor retained a right to income. This is the New Jersey experience with estate recovery. Therefore, if the estate recovery law goes this far, a choice will have to be made whether or not to lose the property tax exemptions. Many working and middle class families may not be able to afford such a loss.

Alarmingly, there is no grand fathering of life estates or irrevocable trusts created prior to the new law, unless the regulations will so provide. As such, people who may have created life estates or irrevocable trusts twenty years ago may still see their homes and other assets fall to estate recovery in the future.

So how does one plan today prior to the issuance of regulations? First, stay away from life estates. Life estates are usually a bad idea anyway because of the negative tax and Medicaid consequences that follow a sale of the property during life. (9) Irrevocable trusts still remain the best planning technique for now, but care must be taken to retain the least amount of rights and powers possible. Some clients will insist on retaining certain rights and powers, opting to attempt to eliminate them at some time in the future, such as when the new law comes down, or when they apply for Medicaid, or at least prior to their death. Remember, the law seeks estate recovery to the extent of the interest at the time of death.

One last technical point about the new law is that it also provides that New York can collect against an asset in the hands of the beneficiary. This makes sense, otherwise the law would have no teeth. Therefore, upon the death of the owner, joint owner, life tenant or trust Settlor, estate recovery will be made against an asset in the hands of the person or persons who next own the asset, but only from such asset and only to the extent that the Medicaid recipient held legal title or interest in such asset.
In conclusion, we have a new estate recovery law in New York but we do not know how it will be implemented. Personally, I think this could be a good law if narrowly tailored. We are in difficult economic times and simply avoiding probate makes it too easy to skirt reasonable estate recovery laws. However, if the law is pushed to eliminate the use of life estates and irrevocable trusts, then this law goes too far. People who engage in Medicaid planning are generally working and middle class people who are trying to save their home and modest amounts of assets. If time honored planning techniques are taken away, people will turn to more drastic measures such as (i) outright transfers with the consequent complete loss of control, (ii) divorce or (iii) moving out of New York. Also, there is an inherent unfairness to the law if applied retroactively. Hopefully, the Commissioner of the Department of Health will issue regulations with temperance.

1. Certified Elder Law Attorney by the National Elder Law Foundation (NELF). NELF is not affiliated with any governmental authority. Certification is not a requirement for the practice of law in the State of New York and does not necessarily indicate greater competence than other attorneys experienced in this field of law."

2. "OBRA 93"

3. See Subdivision 6 of section 369 of the Social Services Law, as added by Chapter 170 of the laws of 1994.

4. See Section 53 of Part H of Bill Number S2809.

5. Since we have an effective date of April 1, 2011, it would appear that once we have regulations, the law will be implemented retroactive to April 1, 2011; however, it is possible that the regulations will be prospective in nature.

6. National Academy of Elder Law Attorneys

7. This will include, but may not be limited to in-trust-for bank accounts at banks, TOD or POD accounts, life insurance and annuity accounts with named beneficiaries and may even include IRAs and other retirement accounts with designated beneficiaries (although unlikely due to creditor protection laws for retirement accounts).

8. See IRS Code Section 121.

9. Sale of property with a retained life estate subjects the life estate portion to Medicaid lien recovery or the need to retransfer the property with a new look back. The remainder value will be subject to capital gains.

Wednesday, April 13, 2011

The Pre-Existing Condition Insurance Plans (PCIP) Under 2010's Health Care Reform Law

The 2010 health care reform law, now referred to as the "ACA" (Affordable Care Act), is much like a jigsaw puzzle. To create comprehensive reform, a number of pieces must be in place. One of the most important pieces prohibits private insurance companies from denying coverage to individuals based upon the fact that they have a pre-existing condition. Until the ACA, most persons covered under a group health insurance plan could be covered even when a pre-existing condition was present. However, individuals with pre-existing conditions but lacking group coverage found health insurance to be either unavailable or prohibitively expensive. Therefore, a critical component of the ACA is that, beginning in 2014, insurers will no longer be able to deny coverage to any individual on the basis that he or she has a pre-existing condition.

While this is an encouraging development, proponents of health care reform understood that tens of thousands of Americans with pre-existing conditions would remain uncovered until 2014. Individuals who are already ill would continue to go without coverage and without treatment, become more seriously ill and as a result would need care in a more expensive environment such as a hospital or emergency room. Some would die without necessary medical attention. To avoid the human tragedy and economic loss that results from non-coverage, the ACA included a provision known as "Pre-Existing Coverage Insurance Plans," or "PCIPs."

In November, 2010, the Centers for Disease Control reported that more adults between the ages of 18 and 64 went without health care between 2008 and 2010 than ever before. (See http://www.cdc.gov/vitalsigns/healthcareAccess/LatestFindings.html for this and most of the following data.) Between January and March, 2010, as many as 30 million Americans had been uninsured for more than 12 months. Of the more than 46 million adults in the 18-64 age group, 30% have a disability. The 30% with a disability had gone for more than 12 months without health care. Persons with disabilities were shown to be about twice as likely to skip or delay medical care.

The elimination of pre-existing condition exclusions was a key element of the ACA and provides new planning opportunities for persons with disabilities. The federal government set aside five billion dollars in funding for the program until the 2014 plans come into existence. The programs are completely federally funded and states are not required to participate financially. Twenty-three states and the District of Columbia have chosen to have the federal government administer the program; the remaining states are self-administering the PCIPs under their own rules within the parameters of the ACA.

A PCIP is an insurance plan that does not exclude persons with pre-existing conditions and that has affordable premiums in comparison to the individual plans currently on the market. The ACA defines a pre-existing condition as a condition, disability or illness (physical or mental) which you have before enrolling in a health plan. To qualify to participate in a PCIP, an applicant must (1) be a U.S. Citizen or in the country legally; (2) have a pre-existing condition; and (3) have been without insurance coverage of any kind (including but not limited to Medicaid or COBRA coverage) for at least the preceding six months. Documentation regarding the lack of insurance is required in most states, and may include either a denial by an insurance company, a letter from your doctor, or both. There is no age limitation for applicants to the PCIP coverage.

A PCIP is not a free pool or plan. Premiums vary by state, and, within the states, by age and plan chosen. A visit to www.healthcare.gov or www.pcip.gov will lead you to a map of states and updated information about rates and plans. As an example, the Texas PCIP is federally administered and has premiums varying from $261 to $749 per month. In addition, there are deductibles ranging from $1,000 to $3,000 depending upon the plan chosen. Co-payments also apply; however, the total amount paid out by an individual cannot be higher than $5,950 annually. This is a requirement of the ACA.

The Special Needs Alliance works with individuals who have been determined to be disabled either by the Social Security Administration or through a state's disability determination process. We are keenly aware that many people do not want to make a disability application, have not recognized that a disability is present, or have a condition which, while not currently disabling, is likely to become so. It is very important to recognize that approval to be insured under a PCIP does not require that the pre-existing condition be disabling. This fact can be very important in situations where caregivers for persons with disabilities have pre-existing conditions and are without medical insurance but have chronic illnesses which might be related to or affect their ability to provide care.

The PCIP program initially began with a single option plan; however, experience rapidly showed that this single option was insufficient. The Secretary of HHS has now announced that beginning in 2011, three plan options will be available in federally administered programs. The first is the "standard" plan, with two separate deductibles - a $2,000 deductible for medical expenses and a $500 deductible for prescription drugs. Premiums are lower than they were in 2010.

The second program is the "extended" plan and has a $1,000 medical deductible and a $250 drug deductible. The premiums for this plan will be slightly higher than the 2010 single plan premiums. Finally, there is a "health savings account" option that has a $2,500 deductible but with premiums that are 16% less than the 2010 plan. Persons choosing this option will have the tax advantages that apply to any individual who is accessing an HSA.

For persons with disabilities who cannot otherwise qualify for Medicaid assistance, the PCIPs offer relief until the total prohibition against exclusion of pre-existing conditions in health insurance coverage comes into effect in 2014. At that time, the PCIPs will cease to exist and all citizens will be able to choose from individual, group and state health exchange policies without concern for their existing health status.

Success of the PCIP program has been difficult to assess. In the first months that the program was available, enrollment was scarce. However, between late 2010 and March of 2011, enrollment has doubled from 12,000 to 24,000 people. Those observing the program's growth cite an initial lack of education about the availability of PCIP coverage as the reason for the gradual acceptance of the program's benefits. However, many also recognize that, while PCIP coverage can be a literal lifesaver for many people, it remains economically unfeasible for others. Premiums and deductibles remain out of reach for many people, especially in today's economy. Currently insured individuals (including but not limited to those with Medicaid or COBRA coverage) who might consider shifting to a PCIP plan will often find it too financially risky to go without any insurance for the six months required before they can qualify for PCIP coverage.

Nonetheless, for the disability community, we know that coverage is now available to persons of all ages who have been uninsured for at least six months, and that coverage is comprehensive, providing preventive care, acute care and prescription medication benefits. In most states, applications can be made online. Further information is available at www.pcip.gov.

Source: The Voice, April 2011, Vol. 5 Issue 6, www.specialneedsalliance.com

Friday, March 11, 2011

IRS Raises Deductibility Limits for Long Term Care Insurance

The IRS has raised the deductibility limits for long term care policies purchased in 2011. The premiums you pay for your long term care insurance are deductible as itemized medical expenses (subject to the 7.5% AGI threshold) based on your age at the end of the year. Individual taxpayers can treat premiums paid for tax-qualified long term care insurance for themselves, their spouse or any tax dependents (such as parents.)

The 2011 limits are as follows:

Age 40 or less before close of taxable year - $340

More than 40 but not more than 50 - $640

More than 50 but not more than 60 - $1270

More than 60 but not more than 70 - $3390

More than 70 - $4240

LTC insurance premiums may be paid from a Health Savings Account up to the limits shown above. In addition, a self employed individual can deduct 100% of his/her out of pocket LTC premiums up to the amounts listed above. This is an "above the line deduction" and does not require the meeting of the 7.5% AGI threshold to take the deduction.

The payment of this premium could be a great gift for those who have parents or other relatives who may benefit from this type of coverage. It's tax deductible to you and provides both you and the covered individual(s) with peace of mind that future care has been addressed. Keep in mind that it is only one part of a solid estate plan.

Source: Rosanne Roge, 2/24/11, www.rwroge.com.

Join us Thurs, April 7th at Noon at The Miller Place Inn
Learn a few simple steps that can safeguard your family from having to make painful decisions in the event of a crisis. This Elder Law and Estate Planning seminar and luncheon are FREE but reservations are required, call 631-234-3030 or email jgrisolia@davidowlaw.com today!

Friday, February 18, 2011

The 10 Warning Signs of Alzheimer's

Memory loss that disrupts daily life is not a typical part of aging. It may be a symptom of Alzheimer's, a fatal brain disease that causes a slow decline in memory, thinking and reasoning skills. Every individual may experience one or more of these signs in different degrees. If you notice any of them, please see a doctor.

10 warning signs of Alzheimer's:

Memory loss that disrupts daily life
One of the most common signs of Alzheimer's is memory loss, especially forgetting recently learned information. Others include forgetting important dates or events; asking for the same information over and over; relying on memory aides (e.g., reminder notes or electronic devices) or family members for things they used to handle on their own.
What's a typical age-related change? Sometimes forgetting names or appointments, but remembering them later.

Challenges in planning or solving problems
Some people may experience changes in their ability to develop and follow a plan or work with numbers. They may have trouble following a familiar recipe or keeping track of monthly bills. They may have difficulty concentrating and take much longer to do things than they did before.
What's a typical age-related change? Making occasional errors when balancing a checkbook.

Difficulty completing familiar tasks at home, at work or at leisure
People with Alzheimer's often find it hard to complete daily tasks. Sometimes, people may have trouble driving to a familiar location, managing a budget at work or remembering the rules of a favorite game.
What's a typical age-related change? Occasionally needing help to use the settings on a microwave or to record a television show.

Confusion with time or place
People with Alzheimer's can lose track of dates, seasons and the passage of time. They may have trouble understanding something if it is not happening immediately. Sometimes they may forget where they are or how they got there.
What's a typical age-related change? Getting confused about the day of the week but figuring it out later.

Trouble understanding visual images and spatial relationships
For some people, having vision problems is a sign of Alzheimer's. They may have difficulty reading, judging distance and determining color or contrast. In terms of perception, they may pass a mirror and think someone else is in the room. They may not realize they are the person in the mirror.
What's a typical age-related change? Vision changes related to cataracts.

New problems with words in speaking or writing
People with Alzheimer's may have trouble following or joining a conversation. They may stop in the middle of a conversation and have no idea how to continue or they may repeat themselves. They may struggle with vocabulary, have problems finding the right word or call things by the wrong name (e.g., calling a "watch" a "hand-clock").
What's a typical age-related change? Sometimes having trouble finding the right word.

Misplacing things and losing the ability to retrace steps
A person with Alzheimer's disease may put things in unusual places. They may lose things and be unable to go back over their steps to find them again. Sometimes, they may accuse others of stealing. This may occur more frequently over time.
What's a typical age-related change? Misplacing things from time to time, such as a pair of glasses or the remote control.

Decreased or poor judgment
People with Alzheimer's may experience changes in judgment or decision-making. For example, they may use poor judgment when dealing with money, giving large amounts to telemarketers. They may pay less attention to grooming or keeping themselves clean.
What's a typical age-related change? Making a bad decision once in a while.

Withdrawal from work or social activities
A person with Alzheimer's may start to remove themselves from hobbies, social activities, work projects or sports. They may have trouble keeping up with a favorite sports team or remembering how to complete a favorite hobby. They may also avoid being social because of the changes they have experienced.
What's a typical age-related change? Sometimes feeling weary of work, family and social obligations.

Changes in mood and personality
The mood and personalities of people with Alzheimer's can change. They can become confused, suspicious, depressed, fearful or anxious. They may be easily upset at home, at work, with friends or in places where they are out of their comfort zone.
What's a typical age-related change? Developing very specific ways of doing things and becoming irritable when a routine is disrupted.

Source: www.alz.org

Make a Difference in the Lives of Critically Ill Children.
Join the Walk/Run for Friends of Karen at the Long Island Marathon
- taking place with a 5K Run/Walk on Saturday, April 30 and 10K, Half and Full Marathons on Sunday, May 1, Eisenhower Park, East Meadow, New York. New runners and walkers are welcome to join the Friends of Karen team. For a brochure and donor and sponsor opportunities, please contact Patricia Conway at Friends of Karen at 631.473.1768, ext. 303 or patriciaconway@friendsofkaren.org
There is nothing worse than a child with a life-threatening illness and nothing worse than the day to day issues the families of these children must face. Friends of Karen, now in its 33rd year, provides financial, emotional and advocacy support to families living in the tri-state region with children suffering from cancer and other life-threatening illnesses. In 2010 alone, 1,291 children were helped with services from Friends of Karen.

Wednesday, February 9, 2011

Comparing Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI)

The two primary disability income programs, SSI and SSDI, sound similar, but they are very different programs with different benefits and different eligibility requirements. This article is a brief summary of these two important benefit programs.

Social Security Disability Insurance

Social Security Disability Insurance (SSDI) is a cash assistance program administered by the Social Security Administration (SSA) for people who have a sufficient work history and are either blind or disabled. An individual is considered disabled for purposes of SSDI eligibility if she or he is incapable of performing any substantial gainful activity due to severe physical or mental impairment that has lasted, or is expected to last, at least 12 consecutive months or to result in death.

Federal regulations provide a list of certain impairments and illnesses considered to be of such severity as to entitle an individual to a presumption of disability for SSDI eligibility. Even without a "listed impairment," an individual would be disabled if he or she has a "medically determinable" impairment equal in severity to those listed, or suffers from several physical or mental conditions which, when combined, are considered equivalent to those listed impairments.

With respect to whether a qualifying impairment renders an individual disabled and unable to work, Federal law provides that individuals who have demonstrated an ability to earn in excess of $1,000/month in wages are considered to have engaged in "substantial gainful activity" and, by definition, are not disabled. Therefore, in most cases, an individual who earns income in excess of $1,000/month will not be entitled to SSDI even if he or she has a "listed impairment" or disabling conditions that equal a qualifying impairment. This earned income limit is slightly higher for individuals who are blind.

In addition to meeting the criteria for being considered disabled and evidencing an inability to engage in substantial gainful work activity, individuals between the ages of 31 and 65 who are seeking SSDI benefits based on their own work history must have worked for five out of the last ten years, or twenty out of the last forty quarters, prior to the onset of disability. Fewer work quarters are required for workers under the age of 31 but the same standard of disability applies.

If an individual with disabilities has worked the requisite number of quarters, SSDI provides monthly cash benefits to the worker and his or her eligible dependents. The benefit amount is the same amount that the worker would have received if he or she waited until full retirement age to retire. Disability benefits terminate, however, when an individual is able to return to substantial gainful activity or has reached his or her normal retirement age and is eligible for a Social Security retirement pension.

SSDI is also available to certain disabled individuals who don't have a work history of their own but have specified relationships to workers who are disabled, retired, or deceased. For example, SSDI may be paid to a person who has been disabled prior to age 22 whose parent is retired, disabled or deceased, or to a disabled widow age 50 or over.

Since SSDI is only paid to those individuals who have worked and paid into the Social Security system over a certain period of time (or to their eligible disabled relatives), SSDI actually is an insurance program, not a welfare program. SSDI is not "needs based." A person's assets or other income have no effect on eligibility for receipt of SSDI benefits, and making gifts doesn't affect a person's eligibility. SSDI recipients who are eligible for benefits for at last twenty-four months also are entitled to medial insurance under the Medicare program.

Supplemental Security Income

Supplemental Security Income (SSI) also is administered by the SSA, and is a cash assistance program available to financially eligible individuals who are over the age of 64, blind or disabled. Since SSI is based on financial eligibility and not work history, it is a welfare program, not an insurance program. The same definition for disability applies to SSI as to SSDI, but individuals who are eligible for SSI generally have insufficient work history to meet the requirements for SSDI.

To be financially eligible for SSI, the individual must be both "income eligible" and "resource eligible." To be income eligible, an individual's "countable income" must be less than the "standard of need." For 2011, the standard of need is $674/month for an individual. Countable income includes earned and unearned income, as well as the value of any "in-kind support and maintenance" provided to the individual (examples: payment by a family member or a trust for food, utilities or rent; a parent providing free room and board), subject to certain limits.

Gifts of cash received by the individual are counted as unearned income. The first $20 of income received each month is not counted. In addition, with respect to earned income, the first $65 each month is not counted, and one-half of the earnings over $65 in any given month is not counted. Countable income also includes "deemed" income, which is the income of certain household members such as a spouse or the parents of a minor child. Individuals with countable resources of $2,000 or more per month are not eligible for SSI, and making gifts will affect SSI eligibility.

Unlike SSDI recipients, most individuals receiving SSI will not be entitled to Medicare coverage because they have not sufficiently paid into the federal system through wages. In most but not all states, SSI recipients automatically are eligible for Medicaid benefits. This is not the case in other states, where applicants must file an independent application for Medicaid and may have to meet a more stringent definition of disability.

Although SSI and SSDI are administered by the same federal agency and use the same medical disability criteria, they otherwise are very different programs.

Source: www.specialneedsalliance.com

Friday, January 21, 2011

The Patient Protection and Affordable Care Act of 2010

The Patient Protection and Affordable Care Act of 2010 (ACA) embodies many reforms of the health insurance industry in the United States. The principal objective of the ACA is to ensure access to health insurance for everyone. As of 2014, almost everyone in the United States will be required to have health insurance. In addition, no one may be denied coverage by health insurance companies, regardless of age, preexisting conditions, or the amount of coverage that may be subsequently needed. The rationale for these reforms is that if all Americans are members of the insured pool, the risks for insurance companies will be spread across a larger group of persons so that the cost of private insurance will be less.

The ACA is in some respects similar to Medicare, a health insurance system run by the federal government, funded by a 2.9% tax imposed on everyone who earns wages, with 1.45% each paid by the worker and the employer. Medicare provides health insurance coverage for all individuals who are over age 65 and eligible for Social Security or Railroad Retirement benefits and for those who have received Social Security Disability Insurance benefits for two years or more. There are no exclusions for preexisting conditions, degree of health need, or age after 65. The pool of the insured under Medicare includes those who are healthy and those who are not.

The ACA provides that, by 2014, the pool for private health insurance coverage will be expanded to include nearly everyone. The pool will include younger, healthier citizens than the current Medicare pool. The Congressional Budget Office worked over the numbers daily during the legislative deliberations on the ACA, and the conclusion was that this should work.

Beginning in 2014, health insurance exchanges will be created through the ACA to provide a mechanism for access to health insurance with sufficient coverage -- that is, hospitalization, prescription drug coverage, rehabilitation, mental health services, substance abuse treatment, preventive and wellness health coverage, chronic disease management, pediatric coverage (including dental and vision for children) and maternity coverage.

The health insurance exchanges will provide a marketplace in which to compare plans. The four types of plans that will be available will be labeled Bronze, Silver, Gold and Platinum. Health insurance companies that intend to participate in the exchanges must offer at least one Silver and one Gold plan. The Bronze plan will pay 60% of the insured’s costs, the Silver 70%, the Gold 80% and the Platinum 90%. Bronze plans will have a $5,950 annual limit for out of pocket expenses.

Small businesses will be able to access health insurance for their employees through the exchanges. As noted earlier, health insurance companies will not be able to exclude anyone from coverage for a preexisting condition or set a cap for the amount of coverage.

Beginning in 2014, all individuals in the United States who do not have health insurance coverage will pay a penalty. There is a sliding scale of assistance and premium credits to make health insurance affordable. The term “affordable” means that the premiums may not exceed 8% of the family’s annual income.

If an individual refuses to obtain health insurance, a penalty of the greater of $95 or 1% of his or her annual taxable income will be charged in 2014. In 2015, the penalty is $325 or 2% of taxable income, and in 2016, $695 or 2.5% up to a maximum of $2,085. If a person’s income is too low, there is an exemption from the penalty. In 2014, employers with more than 50 employees will be required to provide health insurance coverage for employees or the employer will be penalized.

There will be a uniform enrollment form for health coverage through the exchanges. The exchanges can be a clearinghouse to determine eligibility for Medicaid, the Children’s Health Insurance Program, or premium credits using this uniform enrollment form. Moreover, the exchanges can screen for families that may be exempt from tax penalties.

Until the ACA, the only health care coverage available to persons with disabilities has been either Medicare or Medicaid. Medicare is only available to workers (and certain dependents of workers) who have a sufficient work history to be eligible for Social Security benefits. For persons with disabilities who have a limited work history, unless they became disabled before age 22 and later qualified for Medicare upon the worker parent’s retirement, disability or death, Medicaid has been the only available source of health care coverage.

Because Medicaid provides health coverage only to the poor, disabled individuals often require special needs trusts in order to shelter so-called excess resources. For special needs planners, assuring access to Medicaid has been a primary focus of planning.

Because the ACA eliminates the option for health insurance companies to deny coverage for a preexisting condition, new health insurance options will open up for some folks with disabilities. As of September 23, 2010, health insurers are no longer permitted to deny coverage to children under the age of 19 who have a preexisting condition.

Depending on the disability, a disabled child who has recovered a personal injury settlement does not necessarily have to plan exclusively for continuing eligibility for Medicaid by transferring the recovery to a special needs trust. Parents who have health insurance through employer-sponsored group health plans can now add a disabled child to their coverage, and can enroll a child up to age 26 as a dependent on the parent’s health plan if the child is without alternative coverage. Thus, there is significant relief here.

Although the ACA will provide near universal access to health insurance in 2014, it does not expand the services available for the long term care needs of people with disabilities or long term chronic diseases. It is still the case that these types of services are available only through private resources or Medicaid.

Look for future newsletterss that will cover some of the ACA’s provisions in greater detail. For example, we plan to discuss one provision in the ACA called the CLASS Act, which may provide some relief for long term care needs, and the extension of Medicaid eligibility to adults who have less income than 133% of the federal poverty guidelines ($14,412 for a single person in 2010).

We will also describe coverage available to persons with preexisting conditions that would otherwise make them uninsurable. These provisions also will open up health coverage for some disabled individuals.

Source: www.specialneedsalliance.com

Friday, January 7, 2011

NAPA Becomes Law

Following the unanimous approval of Congress earlier this month, and the thousands of e-mails and messages advocates sent to the White House last week, President Obama signed the National Alzheimer's Project Act (NAPA) into law. Once implemented, NAPA will ensure our nation has what Health and Human Services Secretary, Kathleen Sebelius calls an "aggressive and coordinated national strategy" to confront the present and rapidly escalating Alzheimer crisis.

Today is a day to celebrate. This is a victory for the 5.3 million people who live with Alzheimer's in this country and the nearly 11 million caregivers. It is a victory for you and more than 300,000 other advocates who stood up and demanded that our nation's leaders create a plan for combating this disease. The journey to take NAPA from concept to law of the land is a victory for all of us.

Tomorrow we will return to the hard but rewarding work that lies ahead. NAPA is a milestone and a very important step forward, but it is not the destination. Our destination is a world without Alzheimer's and we can only arrive there through therapies that stop this disease and improved care and support for those contending with it. Rest assured that we will work tirelessly to maintain the momentum evident today. We will work to ensure NAPA is implemented effectively so that it lives up to its promise, and we will work to advance our other legislative priorities for 2011, including a major, immediate increase in research funding.

As you know, there is no time to waste.

-Harry Johns, President and CEO, Alzheimer's Association

A brief description of NAPA (National Alzheimer's Project Act)
NAPA is the largest legislative victory in many years for the Alzheimer cause. Over the last several years, the Alzheimer's Association has been the leading voice in urging Congress and the White House to pass the National Alzheimer's Project Act. NAPA will create a coordinated national plan to overcome the Alzheimer crisis and will ensure the coordination and evaluation of all national efforts in Alzheimer research, clinical care, institutional, and home and community-based programs and their outcomes. Alzheimer's advocates were instrumental in moving NAPA through Congress. More than 50,000 e-mails, nearly 10,000 phone calls and more than 1,000 meetings by the Alzheimer's Association and its advocates led us to the historic legislative victory for the Alzheimer community.

Source: alz.org