Thursday, December 5, 2013
Calling it a "matter of first impression," an intermediate appellate court in Pennsylvania has ruled that a woman's renunciation of her interest in a dissolved marital support trust was a transfer "for less than fair consideration," thus triggering ineligibility when she entered a nursing home and applied for Medicaid.
As reported in Schell v. Pa. Department of Public Welfare, decided December 4, 2013 by the Pennsylvania Commonwealth Court, a testamentary trust was dissolved in 2009, leaving approximately $300,000 to be distributed to the settlor's widow. The widow formally renounced her interest in the distribution, permitting the sum to be divided equally between the couple's two children, one of whom was disabled. Two years later, in 2011, the widow entered a nursing home and applied for Medical Assistance.
While DPW accepted the widow's "hardship" argument regarding the half distributed to the disabled daughter, the Court upheld DPW's challenge to the distribution of the other half to the son. The Court rejected the widow's argument that the penalty period could not apply to a trust created more than five years before her nursing home admission, on the ground that the key event was termination of the trust within the Medicaid lookback window:
"Once the trust was dissolved, Petitioner became entitled to any remaining income and principal therein. This income and principal was available for Petitioner to use for her support, but she made an affirmative decision not to receive the same, without any good cause explanation for so doing. . . . Upon Petitioner’s renunciation, the trustee distributed half of the remaining income and principal from the trust, $151,231.76, to her son. Petitioner received nothing in return, and, thus, the [Bureau of Hearings and Appeals] properly concluded that this transfer was for less than fair market value, thereby resulting in the imposition of a penalty period of 582 days."
Saturday, November 23, 2013
Residents of a nursing home in Pennsylvania overcame an interesting challenge to their votes during a November 5 election, but it took a court hearing to get that result. State Court Judge Joseph Cronin in Delaware County, outside of Philadelphia, ruled in favor of the seniors on November 20.
Background: A Pennsylvania poll-watcher challenged a number of absentee ballots cast by residents of a nursing home in the November 5 election, reportedly on the grounds that "various types of handwriting" appeared on the voters' applications to vote by absentee ballot or on the envelopes they used to cast the absentee ballots. Of course, absentee ballots may be important for individuals unable to travel easily to the polls.
Under Pennsylvania law, voters are entitled to notice and an opportunity to contest the challenge before the county Election Board. However, apparently none of the residents at Broomall Rehabilitation and Nursing Center were notified of the November 11 Election Board hearing, although a "subpoena was delivered to a member of the nursing home staff by a Pennsylvania constable," according to the Daily Times. The Election Board then ruled 2 to 1 in favor of the Republican poll-watcher's challenge on ballots by 61 of 67 residents of the nursing home, with the vote splitting along party lines.
Ultimately, 14 of the residents then retained an attorney and filed a formal court appeal, resulting in the ruling in their favor. They did not, however, testify or even appear at the court hearing, which apparently focused on procedural errors in the ballot challenge.
I would like to think that someone on the defense side of the case had a moment of pause, when they learned the judge assigned to the case was a senior judge. In my experience, senior judges are not terribly receptive to arguments that appear to presume a lack of mental capacity based on age. On the other hand, I suppose one could also ask why ALL of the residents who cast challenged absentee ballots were not a part of the court appeal?
Thursday, November 21, 2013
I sometimes try to hold a provocative or interesting case until the last session of an Elder Class. This semester I asked the students to read:
- John Payne's recent article on "Ethical and Public Policy Considerations Related to Medicaid Planning," and
- Aaron Manor, Inc. v. Irving, 57 A.3d 342 (Conn. 2012)
The combo seemed to work well, giving students a chance to revisit a number of issues from the semester. For, example, we talked about the role of an attorney in advising family members. In the Irving case, did either the daughter or the son have legal advice (the same lawyer?) regarding the roles they took when their mother was admitted to the nursing home? If anyone would like my outline of questions for students on these two documents, feel free to email me.
And if any of you have a great way to end the semester in either Elder Law or Wills, Trusts & Estates, please share!
Thursday, November 14, 2013
Nursing homes, contracts, agents and payment demands. I'm seeing interesting cases and laws coming out of Connecticut. The topic is whether (and when) liability arises for an individual, often a son or daughter, who admits a parent to a nursing home, if a gap arises in payment for that parent's care. Here are a few highlights from the Nutmeg State:
- In early 2013, the Supreme Court of Connecticut upheld a judgment in favor of a defendant/daughter, who was sued for breach of contract by her father's nursing home. The judgment included attorneys' fees for daughter under a state law governing the rights of successful consumers in disputes with commercial parties. The daughter had signed documents at the time of her father's admission, as a condition of admission. The nursing home's contract attempted to establish contractual obligation for the signer as a responsible party "if the responsible party has control or access to the patient/resident's income and/or assets, including but not limited to making prompt payment for care and services...." Under the court's ruling, however, this clause did not bind the daughter to pay for her father's care, as she was neither an appointed agent under a power of attorney, nor a court-appointed guardian. Aaron Manor, Inc. v. Irving, 57 A.3d 342 (Conn. 2013).
- Digging deeper into the Aaron Manor case, I looked to see why there was a payment gap. What wasn't clear from the Aaron Manor decision by the Connecticut Supreme Court, was the potential importance of the role played by another adult, the father's son. As reported in greater detail at the intermediate appellate level, the son (and thus also brother to the daughter/defendant discussed above) did have a power of attorney and control over the father's accounts, had not signed the admissions contract, and had made transfers (including gifts) to himself and his sister from those accounts. Eligibility for Medicaid was not discussed in the intermediate court's case history. My best guess is the son declined to pay the nursing home bills for dad (and the history suggests a gap of a couple of months may have been connected to terms of some private insurance, so perhaps there was a separate insurance coverage dispute), but the son wasn't sued because he hadn't signed that nursing home contract. Connecticut has a filial support law, by the way, but it is not comparable to Pennsylvania's filial law. Aaron Manor, Inc. v. Irving, 12 A.3d 584 (Conn. App. 2011).
- Here is where things get interesting (spicier?) -- at the Legislature. Effective on October 1, 2013, the Connecticut Legislature amended state law to permit a nursing home to collect a debt for unpaid care for a resident from third parties, if that resident has been denied Medicaid because of one or more transfers by or to those parties, causing ineligibility. The Connecticut law provides that nursing home collection suits may be filed against the "transferor" or the "transferee." A successful nursing home may also seek attorneys' fees. Sections 128-130 of Connecticut Public Act 13-234.
It looks like the statutory change is a direct response to the type of facts represented in the Aaron Manor case, and would give nursing homes potent options for the future, as the son was a transferor (and transferee) and the daughter was a transferee. I have written about liability issues arising out of nursing home contracts, including discussion of an earlier Connecticut case, Sunrise Healthcare Corp. v. Azarigian, 821 A.2d 835 (Conn. App. 2003), a case that was distinguished by the courts in analyzing Aaron Manor. (In fact, the last few years I've spent so much time reading contracts and cases connected to financial responsibility for long-term care, that I finally volunteered to add Contract Law to my teaching package.) No secret that I find this area to be a fascinating juncture of substantive concepts, requiring analysis of health care policy, family law, contract law, agency law and elder law (which includes, of course, Medicaid law).
How did the Legislative change come about? According to a report by Wiggin & Dana, a Connecticut law firm representing providers, the changes to Connecticut law "grew out of a multiyear effort by LeadingAge Connecticut to convince the General Assembly to address the need to assist nursing homes facing bad debts. . . . Although the elder law bar and legal services advocates initially opposed the legislation, the Co-Chairs of the General Assembly's Human Services Committee . . . led a successful mediation process resulting in compromise language that received the support of all parties."
In writing about the new Connecticut Law, ElderLawGuy Jeff Marshall comments that this may be part of a "trend to make perceived 'wrongdoers' . . . liable for unpaid nursing home costs." Further he predicts such an approach, which is an alternative to liability under filial support laws, could "spread to other states."
See also the Elder Law Prof Blog's earlier post: "New Hampshire Establishes Liability for Agents Who Fail to File Timely Medicaid Applications."
Feel free to comment below on your views on this potential trend.
Sunday, November 10, 2013
So-called "Slayer Rules" bar a murderer from inheriting from his victim, and often apply not only to intestate succession but also to gifts made under wills or nonprobate transfers. The bar may arise by common law, often rooted in equity, or statute.
As Harvard Law Professor Robert Sitkoff summarizes well in his 9th edition (Dukeminier) of Wills, Trusts & Estates, "Nearly every state has enacted a statute dealing with the rights of a killer in the estate of a victim, but the details of these statutes vary considerably and often leave gaps to be resolved by the courts."
However, states have also been expanding the notion of "no profit" from wrongdoing to include abusers -- and theories regarding elder abuse appear to be part of the reason.
For example, in a 2013 case, the Washington Supreme Court analyzed application of a 2009 amendment of that state's slayer statute to include "abusers," defined as "any person who participates, either as a principal or an accessory before the fact, in the willful and unlawful financial exploitation of a vulnerable adult." The court concluded in a 5-4 decision that the date of filing of a petition to declare a beneficiary an abuser serves as the trigger for timing questions.
The Washington case involved allegations made by three surviving children against their father's second wife. The father was in his late eighties when he married the younger woman, who was younger by fifty years. The history of the case includes a discussion of the father's dementia, and allegations the wife made large transfers to herself and others before his death. See In re Estate of Haviland, 301 P.3d 31 (Wash. 2013).
In 2012, Michigan amended its slayer statute to include abusers, as part of a series of changes to state laws reportedly intended to provide better protection for elderly and vulnerable adults. Cooley Law Professor Linda Kisabeth analyzes the Michigan changes in her recent article "Slayer Statutes and Elder Abuse: Good Intentions, Right Results? Does Michigan's Amended Slayer Statute Do Enough to Protect the Elderly?" in 26 Quinnipiac Prob. L. J. 273 (2013).
And for an interesting alternative take on slayer laws in their more traditional application, to "murderers," see the 2013 article by Professor Carla Spivack (Okla.City Law), "Killers Shouldn't Inherit From the Victims -- Or Should They?"
Hat tip to Professor Harvey Feldman for pointing the way to the Washington case.
November 10, 2013 in Cognitive Impairment, Crimes, Dementia/Alzheimer’s, Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)
Friday, October 25, 2013
This semester in my course on Wills, Trusts & Estates we have talked about the trend in modern cases to resolve conflicts over wills and trusts by attempting to respect the "intent" of the testator or settlor, even when imperfectly expressed in a written document. But, there are often lines beyond which courts will not go to supply missing words or resolve ambiguity.
In Estate of George Zeevering, decided by an intermediate appellate court in Pennsylvania on September 26, 2013, the court was facing an incomplete do-it-yourself will. The testator had not consulted with a lawyer. He attempted to make specific bequests. One bequest was deemed a "nullity" because the property was already titled in the names of the decedent and a son as joint tenants with right of survivorship. The father also stated that the "failure of this will to provide any distribution" to three of his daughters was "intentional."
However, there was no provision made in the will for any residuary and the residuary estate, after payments of debts, totaled over $200,000.
The appellate court upheld the distribution of the residuary to all of the children:
"[I]t was proper for the orphans' court to conclude that where the intent of the testator is not clear from the will, where the will fails to dispose of a decdent's entire estate, and where the will fails to provide a residuary clause, the residuary estate is to be distributed under intestacy laws."
Wednesday, October 23, 2013
Powers of Attorney (POAs) are a key tool in estate planning and Medicaid planning. A thoughtfully drafted POA can avoid the need for a guardianship, for example, and thus avoid delays, embarrassment and greater expense for a principal who later becomes incapacitated.
Unfortunately, POAs can also be a tool for misuse by agents who can't resist the temptation to help themselves, rather than their principals. For a number of years, states have been struggling to balance utility against risk.
In Pennsylvania, for example, prior to 1999, statutory law governing POAs permitted principals to grant agents the authority to make gifts. Civil case law interpreted such gift-giving authority, unless expressly limited, as permitting agents to make "self-gifts." Even if the agent's self-gifting put the principal in serious financial jeopardy, some prosecutors declined to prosecute. Following a series of troubling reports and cases, in 1999 the Pennsylvania legislature amended state law to declare that all agents appointed under POAs were subject to specific fiduciary duties. The change also imposed a statutory presumption of limited gift authority (tied to annual federal gift tax exclusions) unless the principal expressly granted the agent "unlimited" gift authority.
Concern about misuse of powers of attorney has grown on a nationwide basis,especially after high profile cases such as that of New York heiress Brooke Astor, where her son used a POA to sell off artwork and other valuable property, while reportedly keeping his mother isolated from friends.
Even before the Brooke Astor case came to light, academics, legislators, judges and practitioners worked together in the Uniform Law Commission to propose amendments to statutory authority governing POAs, resulting in the Uniform Power of Attorney Act of 2006 (UPOAA), which superseded prior uniform law proposals. The UPOAA attempts to rebalance risk and power, or as the Commission summarizes:
"The UPOAA seeks to preserve the durable power of attorney as a low-cost, flexible, and private form of surrogate decision making while deterring use of the power of attorney as a tool for financial abuse of incapacitated individuals. It contains provisions that encourage acceptance of powers of attorney by third persons, safeguard incapacitated principals, and provide clearer guidelines for agents."
Adoption of the UPOAA has been fairly slow. As of today, only 13 states plus the U.S. Virgin Islands, have enacted the UPOAA.
In 2013, legislatures in Mississippi (H.B. 468) and Pennsylvania (S.B. 620) are considering adoption. In Pennsylvania, the need for clarification has been heightened by reaction to the Pennsylvania Supreme Court's opinion in Vine v. Commonwealth, 9 A.3d 1150 (Pa. 2010), where a POA was signed by a hospitalized principal, and used by the husband/agent to make self-benefiting changes to his wife's retirement accounts, while his wife was incapacitated.
Court practice and enforcement policies on POAs, guardianships and elder abuse are also under consideration by the Pennsylvania Elder Law Task Force (2013), chaired by Justice Debra Todd of the Pennsylvania Supreme Court.
In Pennsylvania, views on what changes to POA laws are necessary differ in small or large ways among bankers, estate attorneys, elder law attorneys and district attorneys, just to name a few of the interested parties.
The scholarship of law professors has been important to the debate over proper use of POAs, including two articles by Valparaiso Law Professor Linda Whitton, "Durable Powers of Attorney as Alternatives to Guardianship: Lessons We Have Learned" and "The New Power of Attorney Act: Balancing Protection of the Principal, the Agent and Third-Persons."
By the way, when I first drafted this post, I titled it "The Problem(s) with Powers of Attorney." Overnight, I rethought that title, because many POAs are never abused and agents frequently go above and beyond in performing uncompensated services, including financial management, for aging principals. I therefore retitled the post. What law reform movements are attempting to do is reduce the potential for abuse. Human nature being what it is, there is probably no law that can prevent abuse by a wrongly motivated agent. Who to trust with powers granted under a POA will always be an important matter for families to consider and discuss with their legal and financial advisors.
October 23, 2013 in Advance Directives/End-of-Life, Current Affairs, Estates and Trusts, Ethical Issues, Medicaid, Property Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)
Friday, October 11, 2013
Today I received another telephone call from a stunned adult child living in another state, trying to make sense of papers he'd received, telling him was being sued because there was money due on his parent's nursing home bill. Another filial support case, filed under Pennsylvania's law. As far as I could hear, the son had not done anything wrong, other than trying to figure out why his mother was so deeply in debt even before she went into the nursing home. But Pennsylvania's filial support law -- and most states' filial support laws (see this week's earlier post about siblings sued for filial support in North Dakota) -- does not require proof of fault in order to trigger liability. Kinship of the right degree is all that's necessary for potential liability.
So, once again it was time for me to get out my list of elder law attorneys, to suggest who might be able to help the son.
Experienced Pennsylvania elder law attorneys probably make more money because of the state's unique history of nursing homes suing for filial support. Families need their expertise to avoid even the slightest problem with nursing homes' admission and billing practices. Plus, there is a minefield of eligibility rules associated with Medicaid applications. So you would not think Pennsylvania's elder law attorneys would have time or interest in repealing filial support laws. Wrong. Pennsylvania elder law attorneys are tired of seeing adult children caught in family tragedies, struggling to figure out how to help their parents, without enough money to go around.
Sure, sometimes the nursing home suit is caused by "bad" children, but I hear from a heck of a lot of folks who fall into Pennsylvania's filial support trap without any affirmative misconduct.
Pennsylvania elder law attorneys -- through PAELA, the Pennsylvania Chapter of the National Academy of Elder Law Attorneys -- have taken a stance. They are urging Pennsylvania legislators to repeal the state's filial support law. Details of PAELA's position are set forth by long-time elder law guru Jeff Marshall on his Elder and Estate Planning Blog. And if you want another way to stay on top of developments, check out ElderLawGuy on Twitter. Yes, Jeff's that "guy," too!
Tuesday, September 17, 2013
While preparing for a Neurology Grand Rounds presentation on "Dementia and the Law" at Penn State Hershey, I read the 11th Circuit's decision in Goodman v. Kimbrough, affirming summary judgment in favor of defendant jail officials. The June 2013 decision in this civil rights claim has me asking questions. I suspect the case could provide opportunities for important discussion in a large number of law school courses. As our blogging partner Becky Morgan would say, an opportunity for teaching elder law "across the curriculum," although a pretty disturbing opportunity.
Basic facts: A 67-year-old man "suffering from dementia and prone to disorientation and confusion," was severely beaten by his cell mate while detained in a jail in Clayton County, Georgia. Why was he in jail? He apparently wandered away from his home at night, became confused, and "attempted to gain entry to another trailer." No indication in the opinion of breaking and entering. No indication in the opinion of violence. The man was "arrested for loitering and brought to the Jail." That bears repeating: "loitering."
The man's wife of more than 30 years, after awakening to find her husband gone, called 911 and learned of her husband's arrest. She went to the jail and "showed the officer at the second-floor desk her husband's medical records, explained that he was cognitively impaired and showing signs of dementia." Further, the wife:
"asked the officer to ensure that her husband received his medication and that he be placed either in the infirmary or in isolation so that he would not unintentionally insult another inmate and thereby come into harm's way."
While the timing of some events is not clear from the opinion, on the critical morning in question, when the jail officials opened the man's cell at 5 a.m. to deliver breakfast, they found him "covered in blood," with contusions on his face, eyes swollen shut, and the cell "laden with blood." His injuries were severe, requiring hospitalization in intensive care. Eventually, the jail's investigation determined the man had been beaten by his cell mate.
The 11th Circuit opinion criticizes the conduct of the jail guards in failing to make required hourly cell checks throughout the night and reportedly deactivating the emergency button of another detainee who testified he tried to alert the guards to the sound of the fight coming from the cell. In affirming summary judgment, the court concluded, however, that the plaintiff failed to offer the necessary evidence that the two guards "subjectively knew of a substantial risk of serious harm."
As I continue my preparation to talk with medical professionals about dementia and the law, I keep coming back to the question: "What if this man were your father or husband?" As our population ages and families struggle 24/7 to cope with dementia while keeping loved ones at home, we need better understanding of the condition at all levels. At a minimum there needs to be much better communication about dementia in the criminal justice system, especially if there is to be any justice from the system.
Sunday, September 15, 2013
New York City, Two Wills, 100+ Year-Old Testator, $300 Million Estate: Can You Guess Where This is Going?
Bingo. Although this time the court case (cases?) is not about Brooke Astor. This time the tragic subject is another heiress, the reclusive Huguette Clark. The will contest case is scheduled to start jury selection on September 17.
Thanks to Professor Ann Murphy, Gonzaga School of Law, for pointing us to the September 15 New York Times article by Anemona Hartocollis, "The Two Wills of the Heiress Huguette Clark."
Tuesday, August 27, 2013
Following up on Becky's posting today on same-sex marriages and federal benefits, it is timely to report that another state, New Mexico, has taken a major step towards confirming marriage rights for same-sex couples.
On Monday, August 26, New Mexico District Court Judge Alan Malott granted mandatory injunctive relief in the state's most populous county (Bernalillo, surrounding the city of Albuquerque), ruling that New Mexico's Constitution prohibits discrimination in marriage licensing on the basis of sexual orientation. Last week a similar ruling in favor of same-sex marriages was issued in Santa Fe County's District Court.
News reports indicate that the Bernalillo County Clerk's office began issuing marriage licenses to same sex couples today, August 27, 2013.
For those who might ask "why are these cases case reported on an Elder Law blog?," remember the lead plaintiff in U.S. v. Windsor, 133 S. Ct. 2675, decided June 26, 2013, was an older adult, challenging the adverse estate tax consequences of the IRS's refusal to recognize the validity of her marriage, following the death of her long-time partner.
In August, PBS's Frontline aired a story on the assisted living industry titled "Life and Death in Assisted Living," asking questions about safety both for residents and staff, and pointing to the potential need for greater regulation. Emeritus Senior Living, the country's largest assisted living company responded strongly to the story, rejecting the use of what it viewed as "isolated incidents" as grounds for stricter or more nationalized regulations.
Now there is news that Emeritus has settled a state court lawsuit that claimed Emeritus underpaid workers at facilities in California. The follow-up is reported by ProPublica, a nonprofit "independent newsroom" that conducts investigative journalism, often partnering with major media, including PBS on the assisted living stories. Details of the reported $2.2 million settlement are available here. In California, settlements of class actions must be approved by the court.