A Little-Known Community Spouse Medicaid Compliant Annuity Planning Technique

The legislation regarding annuities contained within the Deficit Reduction Act of 2005 ("DRA") seems to apply only to the "annuitant who has applied for medical assistance." However, most post-DRA states apply the provisions also to an annuitant that is the spouse of an individual who has applied for medical assistance. Notwithstanding the above, a handful of post-DRA states do not requires an annuity purchased by a community spouse to be irrevocable, non-assignable, actuarially sound, and provide equal payments. The provisions pertaining to designating the state Medicaid agency as a remainderman still apply. This means community spouse can take advantage of balloon-style Medicaid Compliant Annuities in the select states that do not apply DRA in its entirety to spousal annuity purchases. A balloon-style Medicaid Compliant Annuity is an immediate annuity structured with very small monthly payments, with the exception of the last payment which is very large. Upon maturity, the final payment is paid to the insured. Why would a community spouse want to take advantage of a balloon-style Medicaid Compliant Annuity? In light of the very small monthly payments derived from the balloon-style Medicaid Compliant Annuity, the community spouse may receive a large income diversion from the institutionalized spouse. Of course, this will vary depending on the community spouse's income level and the applicable monthly maintenance needs allowance.

Meet Clarence and Martha. After a long struggle with Alzheimer's, Clarence entered a Florida nursing home on January 1, 2012. Together, he and his wife Martha have a home, standard furniture and personal property, one car, prepaid funeral plans, and $245,000 in non-IRA bank accounts. Clarence has monthly income from social security and pension of $2,300 while Martha has monthly income from social security of $500. Clarence's nursing home bill is expected to be $6,200 per month. Martha would like to immediately qualify Clarence for Florida Medicaid benefits. The Balloon-Style Medicaid Compliant Annuity. Of the countable resources, Martha is allowed to keep no more than $113,640 as her community spouse resource allowance, and Clarence is allowed to keep $2,000 as his institutionalized individual resource allowance. After the protected resources are taken into consideration, the spend-down amount is $129,360. With Martha being 79-years-of-age she is allowed to purchase a balloon-style Medicaid Compliant Annuity with a period certain of 1194 months. With an investment amount of $129,360, the balloon-style Medicaid Compliant Annuity will provide income to Martha of $116.32 for 188 months, with the final balloon payment of $128,286.32 occurring in month 119.

Medicaid Eligibility. If Martha purchases the annuity in February of 2012, the spend-down amount is eliminated and Clarence is immediately eligible for Florida Medicaid benefits. As a result, in February of 2012 and each month thereafter Clarence's Medicaid co-pay is $40.32. This amount was determined by reducing Clarence's monthly income of $2,300 by the $2,224.68 that was shifted to Martha, and his $35 monthly personal needs allowance. Economic Results. With Clarence and Martha expecting to pay $6,200 per month for Clarence's nursing home care, by immediately qualifying for Medicaid benefits Clarence and Martha will save $6,159.68 in February of 2012, and each month thereafter. Advantages of the Balloon-Style Medicaid Compliant Annuity Plan. Clarence obtains immediate Medicaid eligibility and is able to contribute to Martha's income so that she may continue to reside in the community as long as possible. Had Martha opted to proceed with a level-pay Medicaid Compliant Annuity in lieu of the balloon-style Medicaid Compliant Annuity, Clarence's co-pay would have been $1,066.05, resulting in a monthly savings of $5,133.95. This is $1,025.73 less per month than the balloon-style Medicaid Compliant Annuity plan. Disadvantages of the Balloon-Style Medicaid Compliant Annuity Plan. If Martha predeceases the 119-month period certain of her balloon-style Medicaid Compliant Annuity the Florida Medicaid program will be entitled to be reimbursed for the Medicaid expenses paid on behalf of Clarence. In such an event, Martha's balloon-style Medicaid Compliant Annuity may leave little or no residual benefits to intended heirs. Alternate Balloon-Style Medicaid Compliant Annuity Option. In that the Florida Medicaid program does not have a restrictive definition of "actuarially sound" Martha may want to reduce the period certain of her balloon-style Medicaid Compliant Annuity to ensure that she will outlive the term. Unlike a level-pay Medicaid Compliant Annuity, decreasing the term of a balloon-style Medicaid Compliant Annuity changes the monthly pay-out on a very miniscule basis - usually only pennies. Should Martha opt for a 60-month term instead of the previously outlined 119-month term her monthly pay-out would only increase by $0.49. Interesting Planning Points. Should Martha decide not to proceed with the aforementioned balloon-style Medicaid Compliant Annuity plan and instead continue to privately pay for Clarence's nursing home care, Clarence and Martha will exhaust their entire spend-down amount in approximately 33 months. Should Martha's financial needs change (i.e. her health deteriorates and she transfers to an assisted living facility) she may require a greater amount of income than the balloon-style Medicaid Compliant Annuity provides. At any time during the pay-out period of the balloon-style Medicaid Compliant Annuity, Martha may elect to convert the balloon-style Medicaid Compliant Annuity into a level-pay Medicaid Compliant Annuity; this is a one-time election. If Martha's balloon-style Medicaid Compliant Annuity is nearing maturity and Martha decides it is not in her best interest to receive the final balloon payment, she may elect to continue/rollover the balloon-style Medicaid Compliant Annuity into another policy, taking her new life expectancy into consideration.

Attorneys Who Protect Our Most Vulnerable

Many elderly persons rely entirely on their children, family members or other trusted individuals to help them. This dependence upon caregivers or family members makes an older person more vulnerable to abuse and financial exploitation. Legal arrangements and protective actions by family may be necessary to shield loved ones from making bad decisions or from being taken advantage of. Though you wouldn't think a child could take advantage of his or her mother or father, there is no way to know what someone will do who is desperate for money or who feels entitled to an inheritance. For example: David's parents' health was failing and living alone in their home was becoming a concern. His sister Jill wanted to look into assisted living for them. David immediately became upset at Jill for wanting to spend their money. He packed up his parents and brought them to his home. Being single and working, he was not available to them during the day, but left food and water on the table to sustain them until he returned home in the evening. Jill lived over 300 miles from David and when she could get to his house to visit; she found her parents' care was not acceptable. They could not remember if they took their medications or if they had even eaten a meal that day. David was also draining their savings account and when confronted about it, became angry and complained that he needed their money to pay expenses for their care. Clearly Jill felt her brother's care of their parents was abusive, but David's defense was he provided a home for his parents in which he could care for them. This family needs a professional advisor to help them understand and clarify the issues concerning their parents' care.

Making legal decisions about property, finances, power of attorney, and final wishes are important tasks to complete for the final years of life. Having legal documentation for a will, for medical treatment and for the person designated to be responsible for parents' welfare can avoid family disputes and financial abuse, and help to conserve assets that are needed for care. Elder law attorneys specialize in legal issues affecting the elderly. They are knowledgeable about Medicare and Medicaid programs. They work with the elderly in assisting them and their families with all aspects of estate planning and implementing necessary legal documents for the final years of life. In addition, they help individuals to apply for and possibly accelerate coverage from Medicaid. An elder law attorney can also help with disputes with Medicaid. Below is a partial list of what an elder law attorney might do: •Preservation or transfer of assets seeking to avoid spousal impoverishment when a spouse enters a nursing home

•Medicaid qualification and application and Medicaid planning strategies •Medicare claims and appeals •Veterans Benefits claims •Social security and disability claims and appeals •Disability planning, including use of durable powers of attorney, living trusts and living wills •Help with financial management and health care decisions; and other means of delegating management and decision-making to another in case of incompetence or incapacity Probate •Administration and management of trusts and estates •Long term care placements in nursing homes and assisted living •Nursing home issues with patients' rights and nursing home quality •Elder abuse and fraud recovery cases A Certified Elder Law Attorney (CELA) is an elder law attorney who is highly proficient in meeting the legal needs of elders and in understanding and applying the rules of Medicaid. A CELA has successfully handled a requisite number of pertinent cases in order to receive that designation. This experience will make an attorney with this designation more competent with elder planning issues than other attorneys lacking this designation. Most elder law attorneys do not specialize in all of the areas iterated above. When considering an attorney you will want to find one who has experience in the area you need help. According to The National Academy of Elder Law Attorneys -- http://www.naela.org/: "Ask lots of questions before selecting an elder law attorney. You don't want to end up in the office of an attorney who can't help you. Start with the initial phone call. It is not unusual to speak only to a secretary, receptionist or office manager during an initial call or before actually meeting with the attorney. If so, ask this person your questions. •How long has the attorney been in practice? •Does his/her practice emphasize a particular area of law? •How long has he/she been in this field? •What percentage of his/her practice is devoted to elder law? •Is there a fee for the first consultation and if so, how much is it? •Given the nature of your problem, what information should you bring with you to the initial consultation?" A good way to choose an attorney is by referral from friends, family, clergy or other associations. Before you meet for your initial consultation, prepare the items you want discussed and taken care of. Bring pertinent documents and questions. Be sure you get clear answers and that you understand what your attorney is proposing. Two-way communication is the best way your attorney can understand your needs and concerns. Does the attorney listen to what you say, appear to really care about your concerns or return your phone calls? If not find another attorney. Most Elder law Attorneys sincerely want to help make you or your parent's elder years a well planned for, peaceful experience for all involved. There are a number of ways attorneys charge for their services. They may charge a flat hourly rate. Or they may charge hourly for some services and add on additional expense for out-of-pocket costs such as paperwork, stamps, phone calls, etc. Or they may charge a single fee for a mutually agreed-upon course of action or plan. Some attorneys who specialize in appeals for veterans benefits or Social Security may work on a contingency basis. It is important to understand how you will be billed so there will be no surprises in the end.

Do You Need an Employment Law Lawyer

An Employment law attorney can be very valuable to employers and employees. As employers and employees have rights and obligations in the workplace, it is important to know when and how to get professional help, what to look for and what to expect.

And employers need to write contracts for staff approval of legal terms so as not to be in violation of the laws or discrimination. You can get professional legal advice to ensure contracts are legally binding, which can avoid problems in the future.

It should also company documents such as manuals for staff and policies and procedures are checked by a lawyer to ensure compliance with appropriate laws.

For employees, and labor law covers issues such as unfair dismissal, discrimination, and repetition. If you are an employee or employer, and are affected by these issues, then you will need to make sure that you have the right to legal advice so you can get the result you want. For employers, it can be a long legal process and expensive, and for the staff, it can be a matter of clearing their names, or get what they are entitled by law.

Should be mentioned often in cases of discrimination employers, media and staff remember can explain the way they talk and treat their employees and colleagues as discriminatory. Sexual, religious, age, and gender-based discrimination against the violation of all laws that may affect discrimination on the server for both parties involved. If employees do not receive assistance and support from staff, management or human resources departments, then they may need to obtain professional legal advice. Moreover, companies want to take legal advice if they have been discriminated against employees, or thinking about a lawsuit against the company.

There are many other issues that affect employers and employees, and can lead to a situation where both parties must take legal advice. May not have been the case of bullying or racism is taken seriously by management. Can an employee who has been surpassed in order to enhance their real reason to think have been discriminated against, not just a case of sour grapes. Permissible for a father who does not allow time to take care of their children, the sick, or do not grant maternity leave or paternity leave, they also have reasons to seek the advice of the lawyer the right to work.

Labor law there to assist and protect the employee and the employer, not only when things go wrong in the workplace. If you are an employer wishes to assist in the establishment of contracts for new staff, or simply to find out your rights to maternity leave or redundancy, and labor law attorney will be able to advise you, and give you all the help you need.

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