Nugen Law; specializing in estate planning and elder care law, emphasizing independence and quality of life.

Serving Indiana, Ohio, Michigan, and Florida.

More information at NugenLaw.com.

well it's Wednesday night and that means LIFE Ahead night here on PBS Fort Wayne.

I'm Sidney Thompson, the host of the show.

If you haven't watched us before I encourage you to put Wednesday night seven thirty on your calendar.

We have different topics each week and as a goal here at PBS we try to provide you with information on education that will help you make choices and decisions in your LIFE Ahead.

That's why we have the name for Head.

Well tonight we are talking about asset protection and elder law and how that all combines in a way to help you make sure that you are ready for protection, if you will, with your finances.

If you reach that point in your life .

>> With me tonight, no stranger to our show.

I have Brian Nugent here.

Brian, thank you for coming.

Thank you, Sandy , for having me.

>> I appreciate it.

Good topic.

Thank you topic.

Thank you.

I appreciate that.

And I will tell you that Brian, by the way is a specializes in elder law.

So you've had a lot of experience.

Thirty years or something like thirty years believe it or not.

Yeah.

So you've had a lot of people that you've helped or have come to you with issues?

>> I think so.

Well, asset protection let's first of all just define assets or I mean people think money money in the bank not necessarily that's all there is though.

>> That's right.

It's not just money in the bank.

It's anything that has a value.

So that could be your real estate to your point, Cindy, that could be money in a checking account, money in a savings account.

It could be a life insurance policy that has a cash value.

So if you cashed in and it has a cash value that would be an asset like property farms, stocks, bonds, CDs, IRAs, qualified money.

So anything that has a value more so than just cash those are the types of things that we're thinking about and elder law about protecting if our health may change or we're concerned about how to provide payment for that care as we age, how is it that I make sure that I don't lose the farm that the house doesn't have to be sold to pay for me?

>> Right.

And I know you and all attorneys that come on the show always promote early not early intervention, early planning.

>> What's the purpose of that, Brian?

>> So normally we like to see if you're going to engage in asset protection.

We'd like to see you do that as early as possible.

>> And the typically the the the key number of of years is five years.

We'd like to see assets protected and sheltered at least five years or more in advance.

And the reason for that is that if you're looking for a benefit program to provide payment for your care like Medicaid or like a VA Veterans Administration, they have timelines where they would be looking at in the past so many years, three years for VA, five years for Medicaid.

So they want those assets out of your hands and protected before you need to have that care paid for .

So ideally, Sandy , we'd like to see elder law attorneys like to see our clients trying to protect those assets five years or more in advance.

It's never too late to protect assets but five years is the key if we can get it now and you said five years in advance but it's hard to know when you're five years away from needing additional care whether it be memory care or retirement home or some sort of facility.

>> So how do we guess when we're five years away?

>> The first thing that we would be looking at is the individual's age and the individual's health .

We are also looking at within their family what what your parents your grandparents were there instances where at a particular age they were needing that level of care?

I there isn't a magic number for every person to share by a certain age you need to have something in place or we're really looking at that individual.

What's their health ?

Do we have an early onset dementia?

So those five years we may need to start that earlier.

Do we have a cancer that maybe has gone into remission or that so we're thinking about gosh that could come back and we're thinking I may need more of that help in the future.

But generally I like to say to people bye bye 70s seventy five.

I really like to see those those assets protected and typically a very unique type of a trust that we use.

I like to see that done so that you have to five years and generally folks that are in their 60s, maybe early 70s they're still spending, they're traveling, they're doing those types of things and so that when we protect those assets they may not have as much freedom as they once did.

Not that we couldn't still access funds if necessary but they may not have as much freedom as they once did.

So if they are still and spending mode and you're still having fun and doing those types of things, your 60s may be a little too early to start thinking about that.

>> But I would really like to see or I encourage folks to think about that during their mid seventies.

Typically people spend when they retire there's kind a spending pattern that they go into and then when you hit your mid 70s or early 70s you're spending kind of plateaus and may even slow down a little bit.

So when we're looking at that that arc at that point we're seeing slow down a little bit.

>> Right.

But if you wait too long then you may not have the five years.

>> So I always give my grandparents as an example my great grandfather is an example.

My grandparents passed it one hundred and one so they could have done this.

>> Yeah.

Good genes then.

Yeah that's about right.

Ninety four ninety five they could have been doing this and yet other folks at 67 may have some serious health issues and we're concerned they have the five years so it is unique to each person and I would encourage any of the folks that are thinking about doing this type of asset protection be candid with the attorney that you're working with.

Let them know what's going on, what your concerns are, what your health condition is because it's going to help him or her to assist you in giving guidance about what's the appropriate time for that to be in place.

>> I understand we do have a phone call and then I want to get back to the asset protection issue.

Kevin called in thank you, Kevin , for watching our show tonight and he says after a person has passed and assets have been dispersed, how long do you have before Medicare swoops in to take any remaining funds?

>> Well, very interesting question.

Yeah.

Kevin for for calling in.

I appreciate the question.

-So d Medicare so Medicare doesn't actually look to have any type of reimbursement if Medicare has spent money on your behalf.

However, Medicaid does have the ability to come in and make a claim in your estate if there is an estate.

So if there's a state that's opened when you've passed the personal representative or the executor in the estate has the responsibility to put Medicare on notice that you've passed and then they are Medicare or Medicaid.

Thank you.

I'm sorry.

>> Thank you, Andy.

So we have to put Medicaid on notice that you've passed and that they have the ability to come in and file a claim in the estate.

But frankly, if you're doing appropriate asset protection either early or I use the phrase crisis planning crisis planning I mean we didn't have those five years and you have a nursing home placement memory care unit placement if you were working effectively with your elder law attorney and that instance you shouldn't have the responsibility to open a state such that Medicaid could come in and file a claim and be reimbursed for any money that they've spent on your behalf.

But if that if you haven't done that and you open in a state in that instance, we do need to put Medicaid on notice that the person has passed that money has been spent on their behalf and Medicaid.

>> We're giving you the opportunity to file a claim in the estate for us to reimburse you how long a time does Medicaid have to to question your estate or turn in a bill if you will?

If I'm not mistaken, there's a seven month period for Medicaid where they have the ability to open in a state to file a claim to come in if one hasn't been opened.

So it's a great question, Sandy .

And I don't mean to be evasive.

I'm thinking it's seven months for Medicaid traditional claims in the end in a state if we open the estate they have three months within which they can file a claim.

So that would be like a credit card company or somebody that believes that you owe the money.

>> They have a three month period if you open an estate now if you don't open an estate, this is deviating a little bit from the Medicare Medicaid question.

But if you don't open an estate and you wait for nine months and a day, any unsecured debts, unsecured debts would be like the credit cards I was talking to you about earlier or if somebody believes that you owe them money if you don't open a state or you open an estate and nine months in a day if they don't open an estate on your behalf or on behalf of the deceased, then they've waived the right to be reimbursed from the estate.

>> So sometime you'll see attorneys waiting nine months to open an estate.

So if there are some creditors out there that we're not sure about or we're trying not to to provide payment to those creditors, we may wait nine months in a day before we open that estate.

>> OK, let's go back to the terms Medicare and Medicaid.

Yes.

It's so complicated.

I wish they had really different names for them because they are very different economics team up so everybody that comes in does right.

I do that all the time on this pshow.

Yeah OK Medicare everybody gets when you've retired and that's what you sign up for and you get your Social Security check and you know you get you know Medicare some Medicare assistance medically Medicaid on the other hand not everyone's entitled to Medicaid or is eligible.

So Medicaid eligibility for the type of work that I'm talking about with mature folks we're 65 years of age or older and we have some type of a cognitive so our memory or thinking process is a little muddied or we need assistance with something called ADLs activities of daily living, bathing, using the restroom, dressing ourselves grooming.

Remember to take medications, those types of things.

If you are determined to need assistance with those ADLs activities of daily living, have some type of a cognitive impairment or at the particular age that's the first thing Medicaid's going to look at.

Do you qualify based upon age and based upon some type of a condition then Medicaid is assets side of the equation sod- they're going to look at your income.

Is your income too high and how many assets do you have in your name?

>> So remember it's even if your income is too high there's a way to reduce your income in a way that Medicaid recognizes as an appropriate way to reduce it.

We use something called qualified income trusts here what people also say Miller trusts.

>> Miller trusts.

Yep.

OK, so if I have an income that's over the threshold of what Medicaid considers appropriate, our money comes into our personal checking account or savings account.

We then take it from that and put it into this Qualified Income Trust Miller Trust and then from the Miller Trust we use the money to pay for our care.

It could be in home, it could be an assisted living facility, could be a nursing home memory care unit and if we pass away and we haven't used all the money that went into that Miller trust that qualified income trust the money then goes back to the the Medicaid in your state in which you live.

>> So it we go back to Medicaid to reimburse them for funds that they spent on your behalf and then the second part of the asset income equation is assets.

>> How much money do you have in your name?

So the threshold currently is around two thousand dollars which seems very low.

>> So back to the point that you were asking about earlier, Sandy , that if we've protected our assets in advance, if we sheltered them in a very unique type of a trust, they're still there.

They haven't gone anywhere but Medicaid recognizes that it's been out of your hands for a period of five years or more.

So we're not going to look at that money as being available to you assuming that the trusts are drafted appropriately and we have all the right things in place and the right people in place to manage the money Medicaid would ignore that if you didn't do that asset protection in advance we might consider means of protecting those assets at the time you're going into the nursing home or if you've been there for a period of time and you thought you were coming home but you aren't so what can we do?

There are still processes that can be recognized and put into place to protect assets.

>> It's never too late to never to plan.

Nope.

So even if you're in facility.

Yes.

Or you're receiving daily at home care.

You can still work on protecting your assets without a doubt.

>> How what's different about it doing it then as opposed to five years before you get to that point.

>> Sure.

So generally what I would say is that if you're a single person we normally can protect real estate.

That's not as much of a challenge to protect.

That does depend upon the state in which you're living because every state is different about how you can or cannot protect real estate but generally real estate is one of those things that's a little bit easier to protect.

>> And then so if you're a single person, other assets aside from real estate I generally say 50 percent or more can be protected based upon the your income is one factor that we look at and another factor is the cost of care if you're a married person generally all assets can be protected even at that time and any of the techniques that are used there are certain types of annuities that are implemented.

There are gifts and notes that are implemented.

But any of those processes that are put into place, those techniques that are utilized, none of that is done clandestinely or that's all that's all shown to Medicaid.

>> There is no mystery there is a process to go through in order to protect those assets.

All of that's disclosed to Medicaid.

I have heard people say, you know, we're doing this secretly or we're doing this you know, is that legal or not legal?

And it most definitely is everything it's done is disclosed.

There's no mystery.

We we typically the attorney that you would be working with would make sure to disclose those techniques to Medicaid when the application is filed.

>> All right.

>> Let's go back to the assumption, if you will, or a scenario where you're not on Medicaid, you have a higher income or you don't qualify for Medicaid and you go into a facility or get at home care for yourself and you're going to self pay you're going to write the check every month or your trustee whomever is mishandling your finances.

>> How is that different and is there asset protection required then?

>> So you have the option of saying I don't want to protect any assets.

I my goal is to just privately pay the entire time that I'm at the facility the entire time that I'm at home and getting care.

You are welcome to do so.

You are welcome to write that check every month.

There's nothing wrong with taking that approach and in frankly if you have a significant amount of wealth that's producing enough income to provide payment for all of your care, the conversation you should be having with your attorney is here's here my assets, here's my income.

If I needed to privately pay can I afford to do so?

Is that an appropriate approach for me?

And if it is appropriate for you, your elder law attorney should recognize the amount of assets that you have.

You're producing one hundred and some thousand dollars a year in income from your assets so we're never going to be dipping into principle and so it may not make sense for you to do that asset protection in advance.

It may not.

Every person is unique.

What I would encourage you to do when you're speaking with with your attorney is to be very candid with them and let them know what your concerns are.

Talk to them about your assets, disclose all of that.

They can only help you if they have all of the facts.

So it would be appropriate for you to say I've thought about privately paying can I afford to do that?

And you may also take the approach if I privately pay and I run out of money, that's OK.

I'm going to run out of money and at that time when I'm out of money I'll apply for Medicaid.

Oh OK.

So that's like a backup if you will.

>> It is yeah.

I do like to say though regardless of how your care is being paid for if it's being paid for privately where you're writing a check every month if Medicaid is paying for it, if VA is paying for it for long term care insurance is paying for it if your child is paying for it however it's being paid for the standard of care remains the same.

>> That was my next question.

>> If it doesn't change those attendance that are caring for you, the nurse that is overseeing your care, the facility that you're in, the care that you're receiving in your home from that caregiver, the quality of care, the level of care is not changing.

That caregiver is being paid by some attorneys.

We call them clients by one client.

If it's Medicaid the next client that's long term care.

The next on it's privately paying the attendant.

>> The nurse has no idea how that care is being paid for and they're going from client to client, patient to patient and providing the same level of care, the same meals, the same companionship, the same same type of rules, same team.

>> It does not change benefits in that facility that's rewarding to know and certainly something I think people should be paying attention to.

>> We have two calls that we want to try to get in here, Jim.

Jim says what is the pace program?

>> The PACE program is based upon an area in which you live.

There are so I'm going to speak specifically about Fort Wayne and Allen County in Fort Wayne .

We have a very robust space program and the PACE program is kind of a hybrid of the level of care that you require is the same as if you were in the nursing home.

However, you're going to remain in your own home and then the PACE program oversees things like your medical care.

>> It could address needing food in the home.

They have a facility on Lake Avenue that you can come to.

It's there's a lovely I'm going to call it a gym.

I don't know that they call the gym but it looks it's a lovely gym that's there.

They have have a lovely activity room that's their Parkview Local Hospital has nurses that are there and doctors oversight you can have within the space program.

>> So the remember I was saying before about cognitive issues or needing assistance with activities of daily living in your age all of those things would qualify for being eligible for the PACE program.

>> The difference is that you're going to be using that facility on in our community there on Lake Avenue and being able to receive care in your home as well.

It's a lovely program.

It's worth you're looking into.

I I really highly recommend it.

>> OK, I've heard such good things about this program.

Barnes is called in as well and his question is this when this is timely now according to the news when politicians talk about getting rid of Social Security, how is that possible ?

Are they able to get rid of the funds that you generated?

Because there is talk right now about cutting back Medicare and Social Security.

Yeah, yeah.

Well this may be a little bit above my pay grade but so we've all paid into the Social Security system and without being political whatsoever, I think that some of those funds maybe have been used for some governmental programs and so people are getting nervous.

Is there enough money there to continue being able to provide payment for folks that have paid in so that they have a Social Security payment as they retire and as age?

Are they able to get rid of the funds you generated?

Well, it is our Congress and our Congress if they deem it's appropriate would would be able to manipulate that program that was tactful politically do we don't know but that's a it's a concern and I've heard that for many, many years and it hasn't happened yet and I think I don't know I'm just guessing if if if it was something that was going to be passed it would have we'd have a lot of no notice that we'd say OK in six years or something and it would have such an impact on our community in our society.

I think that a lot of people rely on Social Security as their retirement and so we have a huge aging population.

I've said this before ten thousand people a day hit the age of sixty five.

We haven't even hit our peak.

It's the fastest growing population is that senior population boy that would have a huge impact on that on that part of our society and you need to be a good citizen as well.

>> And if if you do start hearing more in the news about that and you have concerns, your congressperson or legislator for your area and give your opinion you know that can always make it that's it.

>> OK, almost done here with our show.

Brian, any last words that you want to give of advice?

>> Well, I think that some of the most basic documents that you need to have in place if you're thinking about asset protection or not I think I say this on every show Sandy durable power of attorney it seems to be so basic but my gosh, it's essential to have a durable power of attorney in place.

I think it's very essential to also have something called a health care representative designation in place where your designate who can make health care decisions on your behalf and that power of attorney is allowing somebody to do what you can do in writing for them to be able to sign checks for you, make financial decisions for you.

>> Those two instruments are essential for everyone to have.

>> What if the person that you have chosen moves or there or not in a position to take on that responsibility then one so the moving part isn't as much of a concern to me as maybe it would have been several years ago.

It's a small world.

Everything is digital we can sign online I so the distance isn't as important to me as the person being able to fulfill those duties and recognize the responsibility that comes with it.

Normally within those documents you'll have a succession of people.

So if person one can't serve that person to a person who can't serve them person three So normally you would want in your power of attorney your health care rep designation to designate who can make those decisions on your behalf if you're unable to do so.

>> All right.

And as far as beneficiaries, why are they important and what do you need to put a beneficiary on her name one so beneficiary designation it beneficiary designation on assets like checking account savings accounts, brokerage accounts, even real estate in certain states.

>> You can do that.

You have to be careful with those beneficiary designations if your estate plan says my children can't get the money until there are twenty five or my grandchildren get the money at certain ages or if someone has special needs at the time that they're inheriting then we're going to protect that in something called a special needs trust.

>> If you're using your beneficiary designation and the money is going right out to them you can bypass all of your estate planning buys parcels, special needs trusts.

So we have to be very careful and judicious when we're making those beneficiary designations and making sure it really does fit with your plan.

And it makes sense if I have a person that has more than one child and we may be treating children differently or we're putting qualifiers on them when they get the money, those beneficiary designations bypass that.

>> So we have to be very careful with it.

Thank you, Brian.

Thank you.

Said to you I appreciate a lot of information for you to digest and to think about and of course every Wednesday night we'll have more information to help you with your choices in your LIFE Ahead.

Brian Nugent, thank you for coming.

Thank you all for watching.

>> Stay safe and stay healthy.

We'll see next week Nugen Law; specializing in estate planning and elder care law, emphasizing independence and quality of life.

Serving Indiana, Ohio, Michigan, and Florida.

More information at NugenLaw.com.