Lawyers With Purpose

VA Health Benefits

Given how much the Veterans Health Administration (VHA) has been in the news for unnecessary wait times and inappropriate scheduling practices that have negatively impacted many veterans, you may not see any value in educating your clients regarding potential VA health benefits. However, VA health benefits might offer more economical health care and/or may be an option for your clients who are underinsured. Another advantage is greater access to health care nationwide, as you may seek care at any VA health care facility once enrolled in the VA health care system.

What are they exactly?

When you enroll in VA health care, you are eligible for what is termed a Medical Benefits Package. This package consists of hospital, outpatient, and extended care services providing basic and preventive care, as well as prescription drugs, emergency care and even in some cases, services like: rehabilitative services; professional counseling and mental health services; durable medical equipment, including eyeglasses and hearing aids; home health services; reconstructive (plastic) surgery; hospice care; and dental care. What exactly is available to the recipient of VA health benefits will depend on the veteran’s unique eligibility status and whether such care or services are deemed medically necessary by VA health care providers. You receive a booklet called the Veterans Health Benefits Handbook after enrollment that gives you the specifics of your individual Medical Benefits Package.

Who qualifies for them?

If your client served in the active military, naval or air service and was discharged under any condition other than dishonorable, the client may qualify for VA health care benefits. There is a minimum duty requirement for veterans who enlisted after September 7, 1980, but there are also many exceptions both before and after this date, so you should consult 38 CFR §17.31 Duty periods defined for the definitions of duty periods applicable to eligibility for medical benefits.

Although family members, with very limited exception, cannot access the VA health care system, family members of veterans may be eligible for CHAMPVA. This is a program that provides health insurance coverage to dependents of a qualifying sponsor who is, or was at the time of death, rated permanently and totally disabled due to a service-connected disability or who died of a service-connected disability.

How do you enroll?

You can apply for VA health care by completing VA Form 10-10EZ Application for Health Benefits and submitting it in person or by mail to the enrollment coordinator at any VA Medical Center. The 10-10EZ form has sections to complete with information about military service, health insurance, and finances. Private health care insurance does not affect eligibility for VA health care. The instructions for the financial section specify that only non-service-connected and service-connected veterans rated at 0% must provide this financial information. However, they go on to state that those receiving VA pension or compensation and/or Medicaid benefits, among others, are not required to disclose financial information. In fact, after a claimant is approved for non-service-connected pension, he/she should be automatically mailed enrollment information for the VA health care system. The financial information is used to determine eligibility and copay responsibility for VA Health Benefits and – with the exceptions noted above – may be a requirement of enrollment.

More information

As part of enrollment, the applicant is assigned to a Priority Group based on the severity and nature of the applicant’s disability and/or income. There are eight Priority Groups for enrollment, from highest priority at #1 to the lowest at #8:

1. Veterans with service-connected disabilities 50% or more disabling, or those unemployable due to service-connected conditions;
2. Veterans with service-connected disabilities 30% or 40% disabling;
3. Veterans who were Prisoners of War (POWs), were awarded the Purple Heart or Medal of Honor, whose discharge was for a service-connected disability, with service-connected disabilities 10% or 20% disabling, or special eligibility under Title 38, U.S.C. § 1151;
4. Veterans receiving aid and attendance or housebound VA benefits or who have been determined by the VA to be catastrophically disabled;
5. Non-service-connected veterans and non-compensable service-connected veterans rated 0% disabled with annual income below the VA’s and geographically (based on your resident ZIP code) adjusted income limits, veterans receiving VA base pension benefits, or eligible for Medicaid programs;
6. Compensable service-connected veterans rated at 0% and various categories of veterans whose military service meets certain requirements;
7. Veterans with gross household income below the geographically adjusted income limits (GMT) for their resident location;
8. Veterans with gross household income above the VA and the geographically adjusted income limits for their resident location.

The Priority Group assignment will determine what the VA Health Benefits enrollee will pay, if anything, in copayments for their health benefits. Generally, the cost of care is free when related to service-connected disabilities, but there may be a copay for all other services, to include prescriptions.

Despite the fact that, when the VHA makes headlines, it’s often not for a good reason, the news isn’t all bad. The VA has taken corrective action to identify and resolve the issues that have plagued the VHA, including requesting the VHA to conduct an audit which then led to the Accelerating Access to Care Initiative. The VA also publishes comprehensive monthly updates detailing pending and completed appointments and average wait times that allow for oversight, and also allow a beneficiary to select a VA Medical Center with lower wait times when there is more than one in their area. For further information on Veterans Health Benefits beyond this overview, consult the website of the Veterans Health Administration at http://www.va.gov/health/.

If you aren't a Lawyers With Purpose member and want to learn more about how we can help you in your estate or elder law practice, click here and join our FREE webinar on Thursday, April 21st at 8 EST "Four Essentials For A Profitable Practice".  On this one hour webinar, you'll discover:

 

• How to turn the complexity of Medicaid and Asset Protection Laws into simple value creation that is easy for clients to identify, allowing you to enroll more prospects into paying clients.
• Proven ways to get to YES faster and EASIER...with less "selling," pressure, or having to later overcome buyer's remorse.
• Why a confused or overwhelmed client will always say NO, and how to instead "show the law" (not TEACH IT) to more effectively earn new business.
• The key "stories" you must tell during the initial meeting (or workshop) so that clients can relate and deeply understand the value you provide (...even when your services cost 5X more than the competition down the street!).
• How to implement time management secrets of successful entrepreneurs, so that you are able to do more in your practice in less time, and have free time left over to do what you love.
• Effective ways for working on the business (not in the business) in order to master lead generation, lead conversion, and serve your clients to create consistent cash flow.
• Discover the key metrics that should be the sole focus of managing your practice...and how successful estate planning and elder law attorneys leverage tracking and reporting to reach their goals.
• Discover the five essential roles that you and your staff must fill to achieve a consistently profitable practice.

Click here to register and reserve your spot now.

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

Victoria L. Collier, Veteran of the United States Air Force, 1989-1995 and United States Army Reserves, 2001-2004. Victoria is a Certified Elder Law Attorney through the National Elder Law Foundation; Author of “47 Secret Veterans Benefits for Seniors”; Author of “Paying for Long Term Care: Financial Help for Wartime Veterans: The VA Aid & Attendance Benefit”; Founder of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Lawyers with Purpose; and Co-Founder of Veterans Advocate Group of America.

Is the VA Opportunity Dying?

As the Veterans Administration plans to implement new laws that would impose a three-year look back for gifts, creating penalties of up to 10 years for both transfers of assets and purchase of annuities, lawyers frequently ask me, “Are we going to be able to do any planning and help wartime veterans and their widows anymore?” What they are really asking is, “Will these changes hurt my law firm?” and “Do I need to stop doing VA benefits planning?”

The simple, candid answers are: “Yes, possibly” and “No, the clients need you now more than ever.”
There is no doubt that the current way of doing things will change. For example, “crisis” VA planning (where an individual could do planning one month and be eligible for benefits the next month) will be reduced to those clients who have limited funds who seek only pre-application consultative advice. Thus, instead of being able to charge for a plan of eligibility, the lawyer may only charge a consultation fee. As always, no one will be able to charge to assist with the completion and filing of an application for benefits.

Even though crisis VA planning will be virtually dead, a new age of pre-planning will emerge. Like Medicaid planning, wherein people structure five-year “wait and see” asset protection plans, veterans will need to construct three-year planning options. This will lead to a new opportunity for advocates to create excellent estate plans that address traditional estate planning and death distribution desires, as well as VA benefits and future Medicaid benefits. This will also lead to the opportunity for licensed insurance brokers to reposition assets into three- to five-year immediate annuities to create guaranteed income streams to pay for the client’s living expenses and health care needs during the look back period. Instead of competing for business, lawyers and financial advisors should work together to create a solid long-term care plan, or, if permissible in your state, the lawyer should consider obtaining a license to sell insurance products to keep the plan under one roof and bolster income at the same time.

The look back and resulting penalties are not the only proposed law changes. The VA also plans to limit not only the acreage that applicants may have attached to their home place, but also the deductibility of certain medical expenses, etc. With all of the changes and the remaining ambiguity in the processing of the claims due to the language of the changes, clients will need lawyers to assist with appeals. Lawyers can charge reasonable fees, as approved by the VA, after a notice of disagreement has been filed. Presumably not many lawyers will want to do appellate work, leaving the field wide open for those who do.

If you want to learn more about Lawyers With Purpose and what we have to offer our members join our FREE WEBINAR on Thursday, April 21st at 8 EST / 5 PST titled "Four Essentials For A Profitable Practice". Click here to join us.  Here is just some of what you'll  get:

• Discover the Four Essentials for a Profitable Practice - Turn the complexity of Medicaid and asset protection laws into simple value creation that is easy for clients to identify.
• Get Access to the Time Management Secrets of Successful Entrepreneurs - Spend your time working on the business (not in the business)...master lead generation and lead conversion and serve your clients to create consistent cash flow.
• Discover the Key Metrics that Should be the Sole Focus of Managing Your Practice - Learn how successful estate planning and elder law attorneys leverage tracking and reporting to reach their goals.
• Discover the Five Essential Roles You and Your Staff Must Fill to Achieve a Consistently Profitable Practice - And much, much more....

Click here to reserve you're spot today.

Victoria L. Collier, Veteran of the United States Air Force, 1989-1995 and United States Army Reserves, 2001-2004. Victoria is a Certified Elder Law Attorney through the National Elder Law Foundation; Author of “47 Secret Veterans Benefits for Seniors”; Author of “Paying for Long Term Care: Financial Help for Wartime Veterans: The VA Aid & Attendance Benefit”; Founder of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Lawyers with Purpose; and Co-Founder of Veterans Advocate Group of America.

Advising Trustees of Special Needs Trusts on Spending Issues

Special Needs Trusts are often created with funds received from legal settlements or inheritances. Special Needs Trusts are important documents when established for people who are receiving government benefits. However, as practitioners we must remember that a Special Needs Trust must not only be effectively drafted for those receiving public benefits, the trustee must also make distributions in accordance with the guidelines of the trust so as not to risk loss of Supplemental Security Income (SSI) or Medicaid benefits for the beneficiary.

The first place a trustee should look when making a distribution from an SNT is the four corners of the document. Even though the state code may allow a distribution, if the trust instrument itself does not, the trustee must abide by the language of the trust. For example, most states will allow SNT funds to be used to pay for vacations, but if the trust instrument itself states it is not to be used for “travel expenses,” the trustee is now limited beyond what the state code might allow. However, once the trustee is familiar with the limitations of the trust document, he should look to the state code and what programs the beneficiary is on for any other limitations on disbursement.

Special Needs Trust payments are designed for “supplemental” or luxury needs not provided for by government benefits. SNT funds are not intended to be used for basic shelter or food, as those needs are provided for by the government benefits. Any money from the trust spent on food or shelter on a regular basis, or given directly to the beneficiary, can count as income for government benefit purposes.

If a beneficiary is receiving SSI benefits, the trustee should be cautious not to make payments directly to the beneficiary, payments to restaurants or grocery stores, mortgage or rent payments, or tax payments on the home. Some jurisdictions also frown on disbursements to basic utility companies, stating that those payments are covered by the SSI payment. Most of these types of payments will result in a 1/3 loss of SSI income. So, while they are discouraged disbursements, there may be some cases in which the trustee determines that the benefit of making the payment outweighs the loss of SSI income. For example, if the beneficiary is unable to pay the tax notice on his home, the trustee may decide to pay the taxes and let that money count as income for the beneficiary the month it was paid.   In this scenario, the loss of the 1/3 income is far outweighed by keeping the home taxes up to date, assuring that the beneficiary has a place to live.

When institutionalized clients come to us with a Special Needs Trust, we must be cautious with distributions as well. However, there are plenty of supplemental needs the money can pay for. Nursing home patients can use the money in an SNT to pay the additional fee for a private room, a television, eye glasses and tooth care not provided for by Medicaid, the travel expenses and mileage of the sponsor to come and check on the patient, and caregiver expenses. Oftentimes, nursing homes are happy to hear that a patient has a Special Needs Trust to pay for additional expenses that arise, and some homes will look more favorably upon Medicaid and Medicaid-pending patients who have such funds to “supplement” care costs.

The LWPCCS software allows us to create both first-party and third-party Special Needs Trusts that conform with the federal and state requirements and allow the greatest discretion possible to your trustees. It is, of course, important that the trustee understand what distributions he can make and that he contacts an attorney with disbursements he is unsure of. This type of trustee guidance is a great opportunity for us to provide our clients with our understanding and counsel through a maintenance plan.

If you are interested in seeing our estate planning drafting software first hand, just click here and schedule your live complementary demo.

Kimberly M. Brannon, Esq., Legal-Technical and Software Trainer

Congratulations to Debra Robinson, Lawyers With Purpose Member of The Month

Greatest success since joining LWP:

For many years I was in practice with a series of different partners.  When I finally broke free and went on my own, I was searching for new and better ways to run my practice.  Molly Hall reached out to me at just the right time, and I believed LWP was a perfect fit for my needs.  Within a few months, I increased my fees, made a scheduling template and stopped interrupting my work flow to answer client calls, and became a much more efficient practitioner.

Favorite LWP tool: 

My team and I are gearing up to start having workshops.  We moved to new offices in January, with a large enough room to hold workshops in-house.  We have watched Dave’s videos together several times, and are in the process of editing and printing all the wonderful material made available by LWP.  Now all I have to do is learn to tell the jokes.

Impact on my team and my practice:

We are having more frequent staff meetings, I’m sharing more educational material with my team because I realized the more they understand, the more they can take on.  We made a list of everything that needed to be done to start having workshops, and everyone pitched in and did even more than I expected

Share something about yourself that most people don’t know about you:

Most people don’t know that my mother was inspirational in how I interact with my elderly clients.  My mother met the love of her life when she was 84 and he was 87.  They had three wonderful years together before his health failed.  They were head over heels in love, and a joy to watch.  I learned from them that no matter what your age, life can still bring wonderful surprises if you are open to taking chances.   

What is your favorite book and how did it impact your life? 

Little Women - I read it as a teenager and it made me want to be a writer like Jo - Maybe someday.

 

In Defense of My Smartphone – By a Generation Xer

On the second day of the Lawyers with Purpose Tri-Annual Practice Enhancement Retreat in Orlando, there was a focus session on the Infrastructure Track called “Bridging the Generation Gap,” presented by Susan Hunter. My presence there was mandatory, as I had been assigned to administrative duties as an employee of Lawyers with Purpose. However, it was also my treat, because I am a big fan of Susan’s presentations and knew I was in for an informative and humorous session – and I was right. Susan talked about the three generations that make up her law firm team: The Baby Boomers, Generation X, and the Millennials. She also explored the challenges and opportunities that may occur when working with someone not from your own generation, as well as the growth mindset needed to bridge this gap.

Among the various characteristics of the Millennials noted was their hyper-ease with technology, especially social media, predominantly via smartphones. It was cited that 98% of Millennials have a smartphone. And it is the smartphone that is usually blamed for promoting isolation and the decrease in face-to-face interactions in real time – not FaceTime. But, in defense of my smartphone, I found that I related more to the Millennials who work in our firm during this trip because of it than I think I would have otherwise. Don’t get me wrong, there was also plenty of good, old-fashioned team building in the form of conversations, brainstorming, card and board games, as well as one night with a home-cooked meal prepared by team members. However, I must confess that our smartphones did play an important part in bringing us together as a team.

My use – excuse me – our use of the smartphone during our road trip from Atlanta to Orlando as well as during the retreat was interactive. First and foremost, we used it to get information like researching recommended places to eat along I-75 or finding the cheapest gas when it was time to refuel. We also used the mapping capabilities of the smartphone extensively to direct us on our route, avoid traffic, and keep us up to date on our ETA despite the pit stops. Then there is what may be the default use of the smartphone: communication. Our firm stayed at a timeshare condo a few minutes from the hotel where the retreat occurred, and this required some coordination to accommodate the needs of all nine team members. We relied on text messages and calls to remain in contact and synchronize needed rides. During the road trip, we would also send regular text messages to Victoria, our supervisor, to give her status updates on our arrival both to Orlando and Atlanta.

Another way we communicated via smartphone was by sharing photos the team took. This included sharing funny pictures of Goofy and the team at the reception, but they also served to document our team’s work at the retreat, like the photo we shared of our completed, collaborative Brainstorming Sprints sheet. Lawyers with Purpose even provided a smartphone app called EventBoard for the retreat and the Practice with Purpose program. The app provides an interactive conference event guide with the schedule, speaker information, sponsors and their websites, floor plans, and online evaluation forms. I really like how the events grayed out on the schedule as the day went on so you could immediately see the highlighted current and upcoming sessions. Sure, there were technical difficulties. When I first opened the application, no details loaded for the sessions and the evaluation forms were blank. However, once I closed the other 20 apps that I was unconsciously, simultaneously running on my iPhone, EventBoard worked quite well.

I will confess that my first sight of some of the Millennials in our firm on any given morning during the retreat was in bed by the light of a smartphone furiously typing. Perhaps they were well on their way to the 50 or more text messages that 50% of Millennials surveyed will send in a day. But I can’t blame them, as the first thing I did every night and every morning while away was to text my family to say “Hi.”

Finally, we used our smartphones to play music enjoyed by the team as a whole. We took turns depending on who had a particular song we wanted to hear. No one had brought a portable speaker, and the van’s stereo system had no speakers in the passenger area, thus we had to improvise with one of those pairs of giant headphones that Millennials often sport to broadcast the music for all to hear. As a result, the music was a little tinny and not as loud as I would have liked. Nonetheless, it relieved the monotony of the road trip as we sang, hummed, and/or danced to music from all three generations and, more importantly I think, moved in harmony as a great team should.

If you want to learn more about Lawyers With Purpose and in particular what it takes to have a successful practice, click here and download our FREE eBook "The Five Essential Roles for A Successful Practice".  

Here Is Just Some of What We'll Reveal:

• Discover the Five Key Roles that must be fulfilled to truly have a successful law firm.
• What you need at all five levels.
• How each role impacts the organization and its ability to perform.
• How each role interacts to achieve ultimate success.
• The bottom line of what you need to create a purposeful practice
• ... and so much more!

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

Victoria L. Collier, Veteran of the United States Air Force, 1989-1995 and United States Army Reserves, 2001-2004. Victoria is a Certified Elder Law Attorney through the National Elder Law Foundation; Author of “47 Secret Veterans Benefits for Seniors”; Author of “Paying for Long Term Care: Financial Help for Wartime Veterans: The VA Aid & Attendance Benefit”; Founder of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Lawyers with Purpose; and Co-Founder of Veterans Advocate Group of America.

The Death of Ascertainable Standards

The recent Pfannenstiehl v. Pfannenstiehl case in Massachusetts is a pretty good indication that the use of ascertainable standards in asset protection planning is dangerous. While this may be news to you, the Lawyers with Purpose legal community has known this for some time and has changed its recommended planning strategy more than seven years ago on how to ensure asset protection is maintained.

When creating an irrevocable trust, some of the most important legal determinations made are the discretion granted to the trustee to make distributions to the beneficiaries. The two most common are "wholly discretionary" and "ascertainable standards." What is the difference? Traditionally when a trustee is allowed to make distributions pursuant to the health, education, maintenance and support of the beneficiary, that is traditionally identified as ascertainable standards, otherwise known as HEMS.

This standard was predominantly created through tax law cases where the question became whether the trustee garnered too much control or authority so as to include the assets of the trust in the taxable estate. The court cases resolved that as long as there were ascertainable standards, it would provide sufficient discretion so as not to have the adverse tax impact. So HEMS became the standard of discretion for trustees. Once again, it was a case of the tail wagging the dog. While estate tax planning was a concern in generations past, since 2001 with the passage of EGTRRA and the massive expansion of the estate tax exemption, the HEMS standard for estate tax purposes only applies to less than two out of 1,000 Americans. Why is it, then, that most lawyers still draft their trust for everyone according to the restrictions required for the two-tenths of 1 percent of Americans? The typical answer is, because that's the way they always did it.

At Lawyers with Purpose, we are absolutely present and future-oriented and always looking at the current laws, but more importantly, we consider the relevance of the laws to the needs of the clients. For example, I remember particularly a case where I drafted an irrevocable life insurance trust and granted powers to the spouse that could deem it to be includable in her estate. While this was not the best tax planning strategy for the client, I clearly reviewed all the rules with the client, explained the adverse consequences and the client's response was "I don't care about the tax impacts; I want my wife to have it." In such a case, I had the client sign an acknowledgment that he was made aware of the adverse consequence, but to any third party reviewing the trust, they were confident I committed malpractice. That's the challenge today: Lawyers want to impose their ways on clients. Our job is not to tell clients what to do; our job is to tell clients what they can do, the pros and the cons of each approach, and to let them make the decisions that best suit the needs of their family. Such is true with ascertainable standards.

It is LWP’s recommendation – and has been for many years – wholly discretionary powers are typically worded as that a wholly discretionary standard be used rather than ascertainable standards, “the trustee shall make distributions to any beneficiary in their sole and absolute discretion….” This assures that discretion is held wholly within the trustee and there is less risk of the trust being invaded by outside sources to ensure for the health, education, maintenance and support of the beneficiary. Can you imagine a court looking at a trust that a senior residing in a nursing home was the beneficiary of and the trust provided that that senior was the beneficiary and the trustee can make distributions for health, education, maintenance and support? How can the trustee not deem a distribution for the cost of that nursing home to be for their health or maintenance or support? It's an accident waiting to happen. In fact some states like Ohio have gone as far as to say that any trust that has ascertainable standards can be pierced to make medical payments in accordance with the health, education, maintenance and support provisions. Don't wait. Stop using ascertainable standards now and protect your clients from any undue risk of having their asset protection trust invaded.

If you would like to learn more about our estate planning drafting software and how it can support you in your estate or elder law practice, schedule a live software demo at: http://www.lawyerswithpurpose.com/Estate-Planning-Drafting-Software.php.  Learn how you can (1) regain lost hours (2) train your team so you spend less time drafting (3) effective document prep for 99% of your estate planning clients (4) and much, much more....

David J. Zumpano, Co-founder - Lawyers With Purpose, Founder and Senior Partner of Estate Planning Law Center 

Utilizing the New LWP-CCS Personal Services Agreement

Personal service agreements, or personal care agreements, are typically agreements between a family member providing care and another needing care. These agreements act as a legal contract between the two parties regarding the range of care one party is providing to the other. As a Medicaid and/or VA planning tool, a personal service agreements may act as a method of spend-down while making sure your elderly client is provided the services needed and is appropriately compensating a family member who is making personal and professional sacrifices to provide the services.

We are excited to share that the LWP Client-Centered Software is now providing a comprehensive Personal Services Agreement that thoroughly addresses the many issues that Medicaid will consider when analyzing a care plan. The care plan also offers the language you will need if a client starts receiving VA benefits and plans to pay those to a child or family member to provide care.

First, the software incorporates all parties involved in the plan and requires that all parties sign the plan.

Medicaid wants to make sure that the compensation offered to the caregiver is reasonable in the area of the country where the services are provided. The LWPCCS incorporates the hourly rates of court-appointed guardians, geriatric-care professionals and general-service providers to justify the hourly rate paid to the caregiver. If you opt to do so, the software can calculate the hourly rate of the caregiver as the average of the rates provided for the professionals mentioned above.

Medicaid will want to know where the care is provided. This can be especially important if the child is moving in with the parent to provide care in lieu of nursing care, as they may later qualify for the child caregiver exemption. The software assumes the care is at the home of the person needing care. However, with the click of a button you can choose another place of care, be it in the child’s home, an assisted living facility, an independent living facility or a nursing home.

The terms of the agreement are an important part of creating a valid contract and meeting Medicaid requirements. The LWPCCS allows you to determine the start date of the agreement, the term of the agreement (lifetime, term of years or term of weeks), how often the caregiver will be paid, and the hourly rate the caregiver receives. Another important note: When the caregiver agreement is produced, it defines the caregiver’s role as that of a general contractor and eliminates any tax liability for the person receiving care, providing additional protections for your client.

The feature of the software that allows you to specify which activities of daily living (ADLs) the person needs assistance with can help with Medicaid guidelines and VA guidelines as well.

Finally, alternate caregivers are named for any time periods during which the caregiver is unable to perform the tasks, due to personal illness, vacation, other employment or any other reason.

You can find the new personal services agreement in the LWPCCS under the Medicaid Qualification folder, since we see it as a critical part of Medicaid planning. Incorporating the new LWP Personal Care Agreement into your practice is yet another layer of solid legal planning and documentation we provide for our clients as LWP attorneys.

If you want to learn more about adding medicaid to your estate or elder law practice register for our FREE WEBINAR "Simplifying Medicaid Eligibility & Qualified Transfers" on Tuesday, March 15th at 2 EST. Click here to reserve your spot now.

Here's just some of what you'll discover...

• Understanding the 12 Key terms of Medicaid
• Learn the Qualification Standards: Does Client Meet Needs Tests?
• Learn the Medicaid Terms of Art
• Learn the Snap Shot, Look Back/Look Forward Distinction: And how to put it all together
• At the end of the event receive an ALL STATES Medicaid Planning Resource Guide
• ...and much, much more!

Just register here to reserve your seat... it's 100% FREE!

Kimberly M. Brannon, Esq., Legal-Technical & Software Trainer, Lawyers With Purpose

Values vs. Valuables

A recent survey conducted by the Allianz Academy of Legacies asked Baby Boomers and their parents to rank priorities when leaving an inheritance.

Overwhelmingly, they preferred passing down their “values” vs. “valuables.”

Yet, only a small fraction of these generations has made provisions for this in their estate plans, mainly due to a lack of professional guidance and a practical legacy plan.

As such, the demand for providing a values solution is expected to increase dramatically in the coming years, and estate planners are in the most advantageous position to benefit.

Not only do families find it difficult to get professional advice on this matter, but also the professionals they consult with have few options to offer – until now.

Over the past decade, the team at Legacy Stories has provided senior care professionals with a life review program that has become an industry standard. Now the methods and technology have been reformatted to serve the estate planning and financial advisor community.

To that end, the “Legacy Values Plan” is designed specifically to be a comprehensive self-guided legacy-building solution that can attract new clients and increase client retention with no added staff or training.

This award-winning solution helps your clients preserve and pass down their life lessons, values and experiences as an essential part of today’s estate plan.

Lawyers with Purpose has made arrangements to offer its members this exceptional program at 20% off.

To learn more go to: https://www.legacystories.org/values

Apply this code for the discount: LWP20

Tom Cormier, Co-founder, LegacyStories.org

Roslyn Drotar, Online Marketing, Content & Social Strategist for Lawyers With Purpose

House Bill 4351: Going After Pension Poachers

House Bill 4351 should be stopped!

For the past several years, bills have been introduced for Congressional approval that would impose a three-year look back, and penalties up to 10 years, for veterans and their spouses who give away their assets and then apply for a pension program designed for indigent wartime veterans. The bills were limited to addressing the concerns of deliberate impoverishment by veterans with the help of lawyers, financial advisors, and others. The bills never passed.

In January 2015, the Veterans Administration published proposed changes to the laws in the Federal Register that would change Title 38 of the Code of Federal Regulations. The VA included penalties for transfers of assets, and used very broad definitions of transfers (i.e. the purchase of an annuity), just like the previous bills that had been introduced. However, the VA went much further, proposing to (1) extend beyond its Congressional authority and (2) extend beyond the scope of the perceived needed changes.

Beyond VA Authority.

Under the pension program for wartime veterans, the claimant must meet an income and asset standard. With regard to income, the VA deducts from gross income all permissible medical expenses. Home healthcare is a permissible medical expense. But the VA proposed to limit the deduction to the average cost of home healthcare based on a national average set two years prior to the proposed changes, which would be $21 per hour. The law is clear that if a medical expense is deductible, then the entire amount must be deducted, and a change of this nature is in violation of the Congressional right.

Beyond the Scope

The purpose of the bills introduced into Congress and the purpose of the proposed changes to the VA regulations is to prevent people from divesting themselves of assets, which they otherwise could use for themselves to pay for care, in order to qualify for tax-free income from the VA to pay for their care. The VA exceeded the purpose of these bills when they included in the proposed changes a limitation on the lot coverage for veteran’s home place. The home place and a reasonable lot area have always been exempt by the VA when applying for pension. A reasonable lot area has always been defined as the same or similar in size to those in the same community or neighborhood. Rather than keeping the long-standing laws, the VA wants to count any property value that exceeds two acres. This makes no sense under the purpose of the law changes to keep people from divesting themselves of assets. First, a 900-square-foot condo in New York City may be worth well over $1,000,000, but it would be an exempt resource under the proposed changes. Whereas, a house sitting on five acres in south Georgia would be a countable resource, even if its value is only $150,000. Moreover, the veterans may have been living in the house for 10, 20, 30 years or more and had no intention of ever filing for the VA pension when they bought the house. Thus, the change in the law has nothing to do with the perceived abuses of people trying to save their assets and qualify for benefits.

Congress has apparently given up on trying to pass a bill that specifically details a look back and penalties for wartime veterans who give money away to qualify for the pension. After all, this is an election year and that would not look very good.

Nonetheless, a few members have found a sneaky way to get the VA’s proposed changes passed by Congress without Congress necessarily knowing what they are actually passing. House Resolution 4351, submitted in the House of Representatives on January 8, was sponsored by Rep. Matt Cartwright of Pennsylvania and co-sponsored by Rep. Sanford Bishop of Georgia, Rep. Sheila Jackson Lee of Texas and Rep. Walter Jones of North Carolina. It has been referred to the Committee on Veteran’s Affairs.

Its stated goal is “To protect individuals who are eligible for increased pension under laws administered by the Secretary of Veterans Affairs on the basis of need of regular aid and attendance from dishonest, predatory, or otherwise unlawful practices, and for other purposes.” The act would be titled, “Veterans Care Financial Protection Act of 2016.”

This sounds really good, because Congress is professing to protect veterans from financial predators. Second, the act does nothing more than mandate that the secretary of the VA work with the heads of federal agencies, states, and such experts as the secretary considers appropriate to “develop and implement Federal and State standards to protect individuals from dishonest, predatory, or otherwise unlawful practices.” The VA would then have 180 days to submit the standards to the Committee on Veterans’ Affairs of the Senate and of the House of Representatives. If this resolution passes, the VA can just hand over the proposed changes in the laws as the standards. The resolution does not say what the two committees are to do once they receive the standards from the VA.

The VA plans to finalize proposed changes (with modifications) by early summer. What is unclear is whether a passage of this “blind” resolution would immediately sanctify any changes the VA has made, or if the changes cannot take effect until after the two committees have taken some action of approval. What is clear is that advocates and veterans must once again push to make your political leaders, specifically those in the two Veterans’ Affairs committees, aware of these damaging changes that have no bearing on the purpose of the proposed changes – limiting home healthcare to an outdated national average and limiting the home place lot coverage to two acres instead of a reasonable lot for the area.

If you would like to know more about the VA Proposed 3 Year Lookback and Other Law Changes join our FREE WEBINAR on Wednesday, March 16th at 4EST. Click here to reserve your spot today.

Victoria L. Collier, Co-Founder, Lawyers with Purpose, LLC; Certified Elder Law Attorney through the National Elder Law Foundation; Fellow of the National Academy of Elder Law Attorneys; Founder and Managing Attorney of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Veterans Advocates Group of America; Entrepreneur; Author; and nationally renowned Presenter.

Who Should Be Trustee?

There's a constant battle between lawyers as to who should be trustee of an irrevocable asset protection trust. The primary school of thought is that it should never be the grantor, and some schools of thought believe it should never be the beneficiary. At Lawyers with Purpose, we disagree with both of those positions, but we recognize the concerns and rely on sound principles of asset protection law in making the final determinations.

Let's first discuss the question of whether the grantor should be trustee. Many practitioners believe that allowing the grantor to be trustee makes the assets of an irrevocable trust available to the grantor's creditors. Such a proposition is ludicrous. The challenge with most lawyers is that they do not allow the grantor to be trustee of his or her irrevocable trust. When pushed to explain why, they typically assume that's the way it was always done. Few dig further to see why it was done that way. So let's examine why grantors were not traditionally named trustee. The most adverse impact is that, if the grantor is trustee, they're deemed to retain enough control to have the assets of the trust included in their taxable estate when they die. For many generations, this was the death knell? of an asset protection trust. But in the last 15 years it's become irrelevant because of the rise of the estate tax exemption. Today only two in a thousand Americans have a taxable estate, so preventing the grantor from being trustee because of a potential inclusion of the trust asset in the estate of the grantor is not relevant to 99.8 percent of Americans. So why hold them to that standard?

The next major argument is a theory that if the grantor has control of the trust, then he could direct it back to himself. Well, that depends. What does the trust say? If the trust says that the grantor is not a beneficiary, or similarly the grantor is not a principal beneficiary but is entitled to the income, does that mean that the grantor as trustee all of a sudden gains a super power to violate the terms of the trust and give himself the principal when it's not allowed for? Hardly. In fact, there is consistent case law throughout all of the states, including cases that lead all the way up to the Supreme Court, that supports the notion that a grantor as trustee has all of the same fiduciary obligations as any other trustee and by no means has authority to act outside the powers granted to trustee. I specifically refer you to my Law Review article, "The Irrevocable Pure Grantor Trust: The Estate Planning Landscape Has Changed" in the Syracuse Law Review. In this article, I go through in‑depth review of all of the case law nationwide, and I'm excited to say that it is sound law that a grantor can be a trustee without risking the assets to the creditors of the grantor. One caveat, however, is if the grantor does retain the right to the income, then absolutely the income will be available to the creditors of the grantor.

So are there circumstances when the grantor as trustee's trust is invaded? Absolutely, but in every single case the invasion was not due to the grantor being the trustee, but rather was due to the pattern of behavior by a grantor trustee who violated regularly the terms of the trust in favor of themselves, and the trust was thereafter deemed a sham. In such cases, I concur with any court that makes that decision based on people who try to defraud the system. Irrevocable trusts must be managed in an arm's length manner, and as lawyers we do not plan for someone to become fraudulent. They are fraudulent to their own peril. But a properly drawn trust when the trustee is the grantor in no way, shape or form creates any risk of loss of asset protection if the terms of the trust are followed, as they are required to be in every case whether the grantor is trustee or not.

So at Lawyers with Purpose we encourage our members to do good legal work based on sound law, not fear, conjecture or because that's the way it's always been done. In the end, the client wins. It is silly to deny thousands of clients that we serve the ability to manage and control their own assets for the benefit of their families, just because some rogue case in some rogue state from some vile fact pattern allowed the court to invade against the intentions of the grantor. Protect your clients. Teach your clients. Share with your clients how these work. They are very safe and a great planning tool.

If you want to learn more about Lawyers With Purpose you can find all the information about becoming a member by clicking here to download our Membership Brochure.

David J. Zumpano, Esq, CPA, Co-founder Lawyers With Purpose, Founder and Senior Partner of Estate Planning Law Center