Friday, June 6, 2014
Is Community Spouse's IRA Countable in Determining Medicaid Eligibility? Arkansas Supreme Court Says "Yes"
In Arkansas Department of Human Services v. Pierce, the Arkansas Supreme Court ruled on May 29 that individual retirement accounts owned by a wife were "countable" in determining her husband's eligibility for Medicaid as a resident in a nursing home in Arkansas. In so ruling, and treating the issue as a matter of first impression in Arkansas, the Court rejected the analysis of a Wisconsin court, and aligned itself with the analysis of a New Jersey Court in determining that the state's decision -- to include IRAs owned by either spouse in the "snapshot" of resources subject to spend-down -- did not violate federal law.
In this case, the community spouse may be significantly affected, depending on her own lifespan. Hoping that her husband of 46 years would improve and not need to stay in a nursing home, it appears she had already paid "privately" for nursing home care for 18 months. With the ruling, if her husband continues to need nursing care, she will be allowed to keep $109,560, and thereby will likely spend much of her IRA savings (totaling about $350,000) towards his care.
This fact pattern arguably explains one of the reasons why Elder Law professionals have turned to Medicaid-qualified annuities and other permitted planning tools, to convert countable "resources" into uncountable "income," thereby better assisting the community spouse in financing his or her own final years, particularly if the community spouse hopes to stay at home as long as possible. Will community spouses get timely, qualified assistance with such planning?
Monday, June 2, 2014
We've written here about the high profile Mancini case of alleged assisted suicide here in Pennsylvania, that was resolved in 2014 when the trial court dismissed the charges pending against the daughter, a nurse, who was alleged to have facilitated her ill, elderly father's death by a morphine overdose.
Charges have now been filed in another Pennsylvania case that is, perhaps even more troubling, although probably less likely to attract support from "death with dignity" movements. The case does, however, raise important questions about both mental health and income supports for persons at risk, including those facing poverty.
Last week, Koustantinos "Gus" Yiambilisis, age 30, from Bucks County, PA, was charged both with assisted suicide and homicide for the death of his 59 year old mother by carbon monoxide, following his alleged use of a borrowed generator to accomplish a mutual suicide pact. News reports, including articles by Jo Ciavaglia for the Bucks County Courier Times, suggest that the son had recently lost his job and needed surgery for a brain tumor, while both mother and son are reported to have left suicide notes behind. The son survived, revived after emergency workers summoned to the house found the mother and son unconscious in the home. The mother later died in the hospital.
Tuesday, May 27, 2014
Continuing Care Retirement Communities (CCRCs) utilize a variety of payment arrangements to attract potential residents. One option popular prior to the 2008 recession was a "100% refundable entrance fee" model, where the new resident was promised return of his or her upfront entrance fee upon "termination," subject to certain conditions, usually including re-occupancy of the unit in question by a new resident. During good financial times, this refund option benefited both parties. The company could rely on a quick "resale" of the unit, either for the same or a higher entrance fee. Thus the company often took the position it was able to "use" the original resident's entrance fee immediately, subject to any state regulations for mandatory reserves or other repayment guarantees or restrictions.
But who bears the risk of a downturn in the senior living market, especially the dramatic downturn that accompanied the 2008-2010 recession?
In Stewart v. Henry Ford Village, Inc., the issue was whether a departing resident must accept the company's offer of a lower refund, tied to what any new resident would pay as an entrance fee to reside in that unit. The difference was hefty, as the resident had paid $137k in 1998 when she moved in, but when she left the community in 2010, comparable units were reportedly going for $89k.
In a rare court decision analyzing a refundable fee, the Court of Appeals for Michigan ruled that the parties' contract language controlled, and in this contract the contract did not provide for a lower refund amount. Further, the company's obligation to comply with the contract terms was subject to an implied obligation of good faith (a Contract Law concept my students would, I hope, recognize!) to promptly market and "resell" the unit, thus suggesting a CCRC would not be in good faith for delaying a unit's resale as a negotiation tool. Here is the heart of the court's analysis:
"Given the totality of the circumstances, the status of the parties, and the rights and obligations as set forth in the Agreement, the Disclosure Statement, and the [state's Living Care Disclosure Act] we find no support for the conclusion that plaintiff should or is obliged to bear the risks of a declining real estate market. To the contrary, those risks would seem properly to fall to defendant. By way of example, when a lessee properly complies with his or her lease in vacating a rental property, the lessee bears no responsibility for the fact that the landlord may need to lower the rent to attract a subsequent tenant. Rather, it is the landlord alone who must bear the consequences of the existing market risks. Additionally, plaintiff notes that if the unit was subsequently reoccupied with a higher entrance deposit, defendant would not furnish additional monies to plaintiff. Defendant has not suggested otherwise.... It strikes us as incongruous, as unsupported contractually, and as of questionable good faith (without adequate disclosure), that plaintiff be held to bear the risks of a declining real estate market without the ability to reap the rewards of a booming one."
In the "unpublished" (and therefore nonprecedential) opinion, the Michigan appellate court remanded for an evidentiary hearing. The ruling demonstrates the importance of the contract language, state regulations, and, I suspect, the likelihood that future refundable fee CCRC contracts will provide clearly that refunds will be tied in whole or in part to "resale" amounts, at least for any so-called 100% refundable fee agreements.
It should also be noted that refundability of admission fees is potentially a separate issue from actuarially sound practices for CCRCs in the handling of such fees. Along that line, I note that one of the residents who pioneered concerns about financial soundness in CCRCs, Charles Prine of Pittsburgh, passed away recently. Mr. Prine's articulate advocacy included testimony before the Senate Special Committee on Aging. Chuck will be missed.
Tuesday, May 20, 2014
In Doe v. South Carolina Department of Social Services, the state's Supreme Court analyzes the standards for state intervention to provide involuntary protective services on the grounds the individual is a "vulnerable adult" under South Carolina's statutory authority. In a 3 to 2 decision filed on April 30, 2014, the majority of the court Court concludes:
"Although we believe the family court was well intentioned, we find that it erred in classifying Doe as a vulnerable adult under the Act. Specifically, there was no evidence that Doe's advanced age impaired her ability to adequately provide for her own care and protection. Without this threshold determination, the court erred in ordering Doe to remain in protective custody until the identified protective services were completed."
The dissent finds the majority's reasoning too narrow, pointing to the following facts:
"On July 31, 2012, law enforcement officers went to the home of Doe, then age 86. Doe, suffering from a heart condition, lived alone. Doe refused entry to the officers. The doors and windows to the home were barricaded. The officers noticed a hose running from a neighbor's home through a hole in the roof of Doe's home. This was Doe's only source of water, for water service had been stopped for nonpayment. The inside of the home was, according to the officers, 'in an unsanitary and deplorable condition.' There was mold present as well."
The outcome of the case is influenced by the testimony of a physician, who despite the conditions of the home and the physical infirmities of Doe, observed that she "appeared to have 'the minimum levels of competency to function independently' as there was no evidence of dementia, severe emotional issues, or obvious physical limitations." Doe was apparently either without adequate financial resoures or unable to manage her resources to live more safely in the home, but she firmly rejected the alternative of transfer to another setting.
Although overruling the trial court's conclusion that Doe was a vulnerable adult, the Superme Court also remanded for additional findings of the current status of Doe, who received emergency services in the interim.
Tough facts that demonstrate the challenge of balancing safety for persons at risk of "self neglect" with respect for the autonomy of the individual, a challenge that can arise at any age. Poverty adds to the challenge.
Friday, May 16, 2014
Okay, let the song metaphors begin, and please, let's sing them with a nice falsetto.
Singer Frankie Valli, now age 80, has been starring in a long-running divorce proceeding. (He and his wife separated in 2004). On May 15, it was the California Supreme Court harmonizing with him over his claim that a $3.75 million life insurance policy he purchased in 2003 with "community funds," and on which he named his then-wife as the sole beneficiary, retains its character as community property. In other words, the surrender value of the policy ($400,000) is not entirely hers to keep.
Here's a link to In re Marriage of Frankie and Randy Valli.
I'll start with "Big Girls Don't Cry" -- or maybe "My Eyes Adored You."
Thursday, May 15, 2014
Maryland Elder Law and Disability Law specialist Ron Landsman provides a thoughtful analysis of use of trusts, especially "special needs trusts," to assist families in effective managment of assets. His most recent article, "When Worlds Collides: State Trust Law and Federal Welfare Programs," appears in the Spring 2014 issue of the National Academy of Elder Law Attorneys (NAELA) Journal. Minus the footnotes, his article begins:
"'Special needs trusts,' which enable people with assets to qualify for Supplemental Security Income (SSI) and Medicaid, are the intersection of two different worlds: poverty programs and the tools of wealth management. Introducing trusts into the world of public benefits has resulted in deep confusion for public benefit administrators. . . . The confusion arising from the merger of trust law with public benefits is sharply drawn in the agencies' [Social Security Administration (SSA) and Centers for Medicare and Medicaid Services (CMS)] attempts to define what it means for a trust to be for the sole benefit of the public benefits recipient. Public benefits administrators have focused on the distributions a trustee makes rather than the fiduciary standards that guide the trustee. The agencies have imposed detailed distribution rules that range from the picayune to the counterproductive and without regard, and sometimes contrary, to the best interests of the disabled beneficiary."
Drawing upon his experience in drafting trusts for disabled persons, Ron takes on the challenge of explaining how and where he sees the agencies' focus on "distribution" as misguided. He contends, for example:
"The [better] task for CMS and SSA [would be] to use their authority to develop standards and guidelines that utilize, rather than thwart, competent, responsible, properly trained trustees as their partners in making special needs trusts an effective tool in serving the needs of people with disabilities. If this were done properly, capable trustees would be the allies of the federal and state agencies in the efficient use of limited private resources. Beneficiaries would live better, more rewarding lives to the extent that resources can make a difference, at a lower cost to Medicaid, with a greater possibility of more funds recovered through payback."
Ron is detailed in his critique of agency guidelines and manuals, and he provides clear examples of his "better" sole benefit analysis.
May 15, 2014 in Estates and Trusts, Federal Cases, Health Care/Long Term Care, Housing, Medicaid, Property Management, Social Security, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)
Monday, May 12, 2014
- Record the name of the family caregiver when a loved one is admitted into a hospital;
- Notify the family caregiver if the loved one is to be discharged to another facility or back home; and,
- Consult and prepare the family caregiver on the medical tasks – such as medication management, injections, wound care, and transfers – that he/she may perform at home.
Friday, April 25, 2014
Chicago-Kent Law Professor Alexander A. Boni-Saenz shared a copy of his law review article, "Personal Delegations," published recently in the Brooklyn Law Review. Here is an intriguing excerpt from the introduction, minus the footnotes:
"Donald and Gloria Luster married on October 5, 1963 and had four children. Donald retired in 2005, and it was about this time when Jeannine Childree, his youngest daughter and a registered nurse, noticed that he was exhibiting signs of dementia. After a number of consultations with doctors, Donald was officially diagnosed with Alzheimer's disease in 2009 due to his memory loss, disorientation, and other cognitive impairments. Based on these medical evaluations, a Connecticut probate court declared Donald incapable of handling his personal or financial affairs and appointed Jeannine and his other daughter, Jennifer Dearborn, as his guardians. Shortly thereafter, Gloria filed for a legal separation from Donald, and in response, the daughters counterclaimed for divorce, suspecting their mother of financial and emotional abuse. Should the guardian-daughters have the authority to sue for divorce on behalf of their father?"
The author then offers a second fact pattern, involving a man serving as agent for his incapacitated brother under a power of attorney, asking whether the agent should have "authority to execute a will on his brother's behalf," where only a small percentage would be left to the brother's biological child.
Professor Boni-Saenz suggests that the numbers of people lacking "decisional capacitiy" are in the millions and "will only increase with an aging population." This likelihood "presents many difficult questions" while also creating "an opportunity to rethink and reevaluate how the law treats people with cognitive impairments." He then introduces his "personal delegation" thesis, in support of giving greater deference to agents in certain circumstances, permitting them to make binding decisions that might otherwise be questioned under what he outlines as a bias or presumption in current law:
"The central claim of this article is that in the case of decisional incapacity, decisions that implicate fundamental human capabilities should generally be delegable. Thus, it rejects the rationale employed by courts to justify nondelegation--that these types of decisions are too personal to be made by another. This line of reasoning confuses nondelegation for nondecision, and it only serves to privilege a status quo outcome over the expression of fundamental human capabilities by individuals with cognitive impairments."
The full article is easily available on SSRN and on Professor Boni-Saenz' faculty web page, linked above.
April 25, 2014 in Cognitive Impairment, Dementia/Alzheimer’s, Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)
Tuesday, April 22, 2014
In some instances where a resident of a nursing home fails to qualify for Medicaid, the question may involve a transfer of a nonexempt asset by the resident or by someone (usually a family member) acting in place of the resident. If the nursing home is not then paid privately, a debt is incurred. Depending on the specific reasons for a ruling of ineligibility, the nursing home, as an unpaid creditor, may be motivated to challenge the transfer as "fraudulent." This in turn may trigger application of the Uniform Fraudulent Transfer Act (UFTA), as adopted in the specific state.
Along that line, there is a new article, "Reconsidering the Uniformity of Uniform Fraudulent Transfer Act," by Steven Boyajian, Esq., published this month in the American Bankruptcy Institute Journal. The article outlines proposed amendments to the UFTA currently under consideration:
"The UFTA has been adopted in 43 states, Washington D.C., and the U.S. Virgin Islands, and has not been specifically amended in the 30 years since it was drafted. Despite the UFTA's admonition that it 'shall be applied and construed to ... make uniform the law with respect to subject of [the UFTA] among states enacting it,' portions of the UFTA have been subject to conflicting interpretations by courts nationwide....
Amendments being considered by the Drafting Committee proposed to resolve the conflicting judicial interpretations of the following issues: (1) the effect of § 2's presumption of insolvency if a debtor was generally not paying its debts as they become due; (2) the standard of pleading and proof applicable to a claim that a transfer was made or obligation incurred 'with actual intent to hinder, delay, or defraud any creditor'; and (3) the allocation of burdens with respect to the elements of a claim to avoid a constructively fraudulent transfer or obligation."
In outlining the proposals, the author emphasizes the continuing nature of the discussions about UFTA proposals. One of the cases cited as part of the discussion is a nursing home collection case, Prairie Lakes Health Care System v. Wookey, 583 N.W. 2d 405 (S.D. 1998).
Pennsylvania also has a case involving intepretation of a UFTA claim in the context of a nursing home collection matter. In Presbyterian Medical Center v. Budd, 832 A.3d 1066 (Pa. Super. Ct. 2003), a nursing home plaintiff turned to Pennsylvania's filial support law as an alternative to a claim under UFTA, thereby permitting potential recovery against an adult child, without proof of fraud required.
Saturday, April 12, 2014
I think it is safe to say that in more than twenty years of working in law and aging, the last twelve months have been the "busiest" I can remember on the topic of financial abuse of older persons.
As examples, in just the last six months, in addition to international projects on safeguarding policies, I have been invited to assist a team of attorneys on a series of well-attended CLE presentations on "powers of attorney," testify at the invitation of the Pennsylvania House of Representatives on the topic of financial abuse and exploitation, and serve on an Abuse and Neglect Committee for the Pennsylvania Supreme Court's Elder Law Task Force.
Certainly the concerns about financial abuse of older adults are not new. However, a steady drumbeat of local news reports about financial abuse, plus the demographics of aging populations, has drawn increased attention of state legislators, courts, and practitioners. In many jurisdictions, the focus is no longer just on "whether" but "how" to address the problem of exploitation of older people. In addition, the high profile cases involving philanthropist Brooke Astor and actor Mickey Rooney, reportedly at the hands of family members and others, have made it clear that no level of society is immune from the potential for abuse.
Along this line, in Pennsylvania a series of events have helped to shape the current debate on abuse of older persons or other "vulnerable" adults, and thus has generated proposed legislation. Perhaps Pennsylvania's history will resonate with those addressing similar concerns in other jurisdictions:
- In 2010, the Pennsylvania Supreme Court addressed the question of whether a state agency that was responsible for administering a specific retirement fund was entitled to good faith immunity under state law when taking action in reliance on a purported Power of Attorney (POA) presented by the spouse as agent of his employee/wife. In Vine v. Commonwealth of Pennsylvania, a majority of the Court concluded that where the employee's "X" on the POA was improperly obtained by her husband while she was incapacitated after a life threatening car accident, the POA was invalid -- in other words "void" -- and therefore the "immunity" conferred by the state's POA law was not available to the agency. (There were strong dissents to the majority's ruling,). The decision had implications for POAs generally, and certainly POAs presented by family members or others to banks on behalf of older people who needed or desired agents to handle financial matters. In Pennsylvania, financial institutions began questioning POAs, seeking reassurances that the document in question was valid. The commercial viability of POAs was thus at risk. This became known as the "Vine" problem in Pennsylvania.
- Attorneys representing various stakeholders, including families, financial institutions and district attorneys, began to weigh-in with proposed "fixes" for the Vine problem, while sometimes also raising other concerns related to financial abuse of older or vulnerable adults.
- The Uniform Law Commission, after years of hard work by academics, judges, attorneys and other interested parties nationwide, issued a proposed "Uniform Power of Attorney Act" (UPOAA) in 2006. Central to the proposed legislation were safeguards intended to better protect the incapacitated principal, as well as address concerns by agents and third parties. By 2014, fourteen states have enacted revisions of POA laws, drawing upon the Uniform Act for guidance. As with other uniform law movements, the Commission's work on UPOAA recognized the need for accepted standards for instruments used in national commerce, instruments that frequently cross state borders.
- In Pennsylvania, the UPOAA has influenced two bills, House Bill 1429 (introduced by Representative Keller) and Senate Bill 620 (introduced by Senator Greenleaf). Each bill passed in their respective houses. (This single sentence truncates several years of history about the negotiations, all set against the background of need for a "Vine" fix.) Both bills address the concerns of banks and other third-parties who want reassurances that they may rely in good faith on POAs that appear on their face to be valid.
- Following legislative hearings that included testimony from individuals representing banks, legal service agencies, and protective service agencies, other legislative proposals emerged. These pending bills include: SB 621 (Senator Greenleaf) with significant, additional updates to POA laws, as well as other parts of the probate code; HB 2014 (Representative Hennessey) proposing significant revisions of the state's Older Adult Protective Services Act; and HB 2057 (Representative White) amending the Older Adult Protective Services Act to create a private right of action, including attorneys fees and punitive damages, for victims of exploitation against the abusers.
In Pennsylvania, which has a year-round legislature, there tend to be two windows for major action on pending legislation, including the "budget" cycle that ends on July 1 and again during autumn months. In following the various bills, it seems to me likely that HB 1429 will be the vehicle for the "Vine" fix. There is also the possibility that Senator Greenleaf's second bill, SB 621, and other tweaks will be passed, either as standalone legislation or as amendments to HB 1429 or other bills. Thus, for interested persons and stakeholders, the weeks leading up to July 1 will mean keeping a watchful eye (and alert ear) for last minute changes.
All of the stakeholders are well-intentioned and concerned about the best interests of older adults who because of frailty often have no choice but to rely on agents or others acting in a fiduciary capacity.
At the same time, as I've watched the events of the last four years in Pennsylvania come to a peak the last six months, I've observed a complicating factor. Those who are most likely to see violations of POAs, including district attorneys, protective service agencies and the courts, probably do not see the larger volume of commercial transactions that happen routinely and appropriately without the added cost of enhanced accounting or oversight. By comparison, professional advisors who routinely facilitate families in estate planning, including transactional attorneys, tend not to see the abusers. Finally, financial institutions, who probably feel caught in the middle, and who are often on the front lines of witnessing potential abuse, seek the ability to report suspected abuse without incurring liability, while also avoiding the costs of becoming "mandatory" reporters (a topic addressed in some proposed amendments of the Older Adult Protective Services Act). Thus it is challenging to balance the viewpoints of different groups in crafting effective (including cost effective) solutions.
There is also the potential that by focusing primarily on POAs, which in Pennsylvania is driven by a very real need for a "Vine" fix, we may be missing or minimizing other significant instances of abuse via joint accounts, questionably "signed" checks, or misuse of bank cards and credit cards. The amounts of money per transaction may be smaller in those instances, but depending on the victim's resources, the impact may be even more significant.
Ironically, as the population of older adults increases, state funding, including Pennsylvania funding, is under constant threat, thus weakening Protective Services, Legal Services and the courts, all entities that can help victims, and that have expertise in investigation and intervention where abuse is indicated.
Friday, April 11, 2014
It is Friday and time for a catch-up on recent law review articles. I posted last month on Memphis Professor Donna Harkness' article on filial support laws, but she is not the only one with recent publications analyzing the seemingly renewed interest in enforcement of such laws around the country and the world. Here are highlights from recent comments and articles (minus those pesky footnotes):
"The Parent Trap: Health Care & Retirement Corporation of America v. Pittas, How it Reinforced Filial Responsibility Laws and Whether Filial Responsibility Laws Can Really Make you Pay," Comment by Texas-Tech Law Student Mari Park for the Estate Planning & Community Property Law Journal (Summer 2013):
"Texas should join the other twenty-eight states that already have a filial responsibility statute. Placing the duty of support on able family members first is a centuries-old obligation that has managed to survive into the present day despite opposition. While filial responsibility may seem harsh, it is simply making families care for each other. With the number of indigent elderly quickly rising, long-term care costs are likely affecting many families. Instead of ignoring the issue and hoping the government will shoulder this burden, maybe it is time for families to step up and take responsibility."
"Filial Responsibility: Breaking the Backbone of Today's Modern Long Term Care System," Article by Elder Law Specialist Twyla Sketchley and Florida State Law Student Carter McMillan for the St. Thomas Law Review (Fall 2013):
"The costs of long term care are staggering and a solution must be found for this crisis. However, mandatory filial responsibility is not the answer. Enforcement of filial responsibility in the modern long term care system is unsustainable and ineffective. Filial responsibility has been recognized since the Great Depression as ineffective in providing for the needs of elders. Scholars have recognized that families provide care, not out of legal obligation, but personal moral obligation, and do so at great sacrifice. Enforcement of filial responsibility in today's long term care system burdens those who are the least able to shoulder the additional burden. Based on the value and the consistency of the care provided by informal caregivers, informal caregiving is the one piece of the long term care system that is working. Therefore, the solutions to the long term care financing system must encourage and support the informal caregiving system[,] not add additional, unsustainable burdens."
"Intestate Succession for Indigent Parents: A Modest Proposal for Reform," Comment by Toledo Law Student Matthew Boehringer for the University of Toledo Law Review (Fall 2013):
"Filial support statutes have already laid the groundwork and rationale behind adults supporting their dependents and should provide a convenient outlet for a government looking to reduce spending. Society will inevitably find more parents dependent on support from their children. Consequently, more of the elderly population will find that avenue of support estopped should that child die and without a means of familial support. A modest reform of intestacy laws will address this situation and smooth over inconsistencies between different applications of the same purpose. The burden on the estate should not be excessive because the decedent was already providing for the elderly parent before death. Moreover, probate courts will already know the facts of the case and, thus, are in the best position to provide an equitable treatment for all parties dependent on the decedent. This modest proposal offers little harm but much benefit for some of the weakest of society."
In addition to the above articles addressing obligations that may run from adult child to parent, an article on "Who Pays for the 'Boomerang Generation?' A Legal Perspective on Financial Support For Young Adults," by Rutgers-Camden Law Professor Sally Goldfarb for the Harvard Journal of Law and Gender, analyzes the practical obligations assumed by many single parents, often women, to support adult children who are not yet self-sustaining. Professor Goldfarb observes that a "financially struggling single mother who provides support for her adult child is at heightened risk of becoming an impoverished elderly woman." She proposes:
"Instead of urging mothers to 'just say no' to financially dependent adult children, a better approach would be to ensure that the burden of financial support for young adults is distributed more equitably.... Divorced, separated, and never-married mothers of financially dependent young adults are in a position of derivative dependency. If they cut their financial ties to their adult children, they jeopardize the children's financial security. If they don't cut those ties, they jeopardize their own. A solution that safeguards the well-being of both mothers and young adults is urgently needed. In the absence of widely available public programs to meet the needs of young adults, the most obvious solution is to divide the cost of supporting them fairly between both parents...[as she explains in greater detail]."
Don't hesitate to write and let me know if I have missed your recent article addressing filial support laws or related concepts.
Monday, April 7, 2014
Causation Proof Needed for Breach of Contract Claims Against "Responsible Parties" in Nursing Home Cases
We have another interesting appellate decision from Connecticut on the question of personal liability of an individual who signed an agreement as a "responsible party" when admitting his parent to a nursing home. The opinion is in Meadowbrook Center, Inc. v. Buchman, issued by the Connecticut Court of Appeals with a decision date of April 8, 2014.
The majority of the three judge panel concludes that the son who signed the agreement cannot be held liable, based on the evidence -- or rather lack of evidence -- in the record. Although the evidence establishes the son failed to provide all information requested by the state Medicaid department following his mother's application for Medicaid, and therefore breached duties he assumed as a "responsible party" under Section IV of the nursing home agreement, the majority concludes he cannot be held liable because there "is no evidence in the record...indicating that, had the defendant [son] complied with his obligations under the agreement, [the nursing home] would have received any Medicaid payments."
In other words, the nursing home proved breach, but not causation of damages, even though "the parties stipulated...that if the department granted Medicaid benefits to the defendant's mother, the department would have paid the facility $47,561.18." The ruling focuses on that "if," noting:
"The testimonial evidence submitted to the court demonstrated, on the one hand, that submitting the proper information to the department merely triggered a review of the resident's eligibility and, on the other hand, the submission of such information was not a guarantee of approval to receive such benefits.... [A]n eligibility services supervisor at the department...testified that the department could not determine whether an applicant qualified for Medicaid absent a review of the applicant's financial information, which was not furnished to the department in the present case. As the defendant notes in his appellate brief, the plaintiff did not ask Leveque 'if, based upon the defendant's testimony regarding the assets maintained by [his mother], he had an opinion regarding whether ... [she] would have qualified for [such] benefits.' In addition, the record before us does not indicate that the plaintiff was prevented from presenting the proper financial documentation, expert testimony, or other evidence that would have otherwise established the resident's likelihood of approval, nor has the plaintiff in this appeal directed our attention to any such evidence."
There is a complicated history to third-party liability issues in nursing home contracts, especially in Connecticut. As readers of our Blog may recall, last year the Connecticut Supreme Court declined to hold a signing family member liable for costs of the parent's care, where that individual did not have a Power of Attorney or other authority to apply for Medicaid. See "Nursing Home Contracts Revisited: The Nutmeg State Adds Spice," commenting on Aaron Manor, Inc. v. Irving, 57 A.3d 342 (Conn. 2013). Further, as we note in that post, Connecticut made significant changes to its Medicaid laws effective in October 2013, as a result of a series of nursing home cases involving third-parties. In certain circumstances, Connecticut now seeks to impose statutory liability on individuals who are either transferors or transferees, connected to the resident's ineligibility for Medicaid because of disqualifying transfers.
The Meadowbrook decision is also well worth reading for anyone interested in the related but separate concepts of contract law and promissory estoppel.
Further, in a separate concurring opinion, a third judge concludes that the nursing home agreement should not be construed as imposing liability unless the "responsible party" has been shown to have misappropriated the resident's resources, because without that personal fault, the responsible party agreement becomes a "guaranty," prohibited by federal Medicaid law. The majority, however, "strongly" rejects that analysis. We'll keep our eyes open to see if the Meadowbrook case goes to the Connecticut Supreme Court.
When I first began analyzing "responsible party" liability in nursing home contracts, I became convinced the contracts drafted by many facilities created a minefield of problems. In some instances, the providers seem to intentionally blur the lines of responsibility for third-parties. On the one hand, facilities "need" agents to sign for new residents who are often lacking capacity to contract. So the admissions office points to the "no personal liability" language in the agreement signed by the third-party. On the other hand, if something does go wrong with the Medicaid application, that same facility will often be quick to point out that it is the third-party signer's obligation to fix the problem, or face potential personal liability.
The nursing homes, of course, whether for profit 0r nonprofit, are not in the business of providing free care.
The last ten years of litigation have only increased the importance for individuals to understand the significance of nursing home agreements. Individuals may want legal advice from specialists in state Medicaid law before signing the agreement; further they may need to seek legal help again if there is any hiccup in the Medicaid application process. After the Meadowbrook case, I think it is safe to say care facilities will be better prepared to prove causation of damages.
Friday, April 4, 2014
The Florida Supreme court ruled unanimously in Aldrich v Basile on March 27 that property acquired by a testator after execution of her will was not be controlled by the will, because although she had made bequests, the "E-Z Legal Form" she used did not include a residuary clause to address non-specific bequests. Thus the after-acquired property passed by intestacy laws to family members not mentioned in the will.
The testator has used the "will form" to make specific bequests of several items of valuable property, including her house, vehicle and bank accounts (identified by numbers) to her sister, and provided that if her sister "dies before I do I leave all listed to" her brother. The sister died first, leaving "Putnam County" property to the testator. Two nieces (children of a second brother, also deceased) asserted an interest in the probate action, arguing that "without any general devises and in the absence of a residuary clause," the will "contained no mechanism to dispose of the after-acquired property." They could recover under Florida's intestacy laws.
The court also rejected consideration of a separate hand-written note by the testator as evidence of her "true" intent with regard to the after-acquired property to the named brother, because Florida's law requires "the same formalities" as a will for codicils.
In a separate concurring opinion, Justice Pariente pointed to the pre-printed will form, noting there was no "space to include a residuary clause or pre-printed language that would allow a testator to elect to use such a clause." Justice Pariente described the unfortunate decision by the testator to rely on a form, rather than hire a "knowledgeable lawyer," as an example of the "old adage 'penny-wise and pound-foolish:'"
"I therefore take this opportunity to highlight a cautionary tale of the potential dangers of utilizing pre-printed forms and drafting a will without legal assistance. As the case demonstrates, that decision can ultimately result in the frustration of the testator's intent, in addition to the payment of extensive attorney's fees -- the precise results the testator sought to avoid in the first place."
For another example of a "penny-wise and pound foolish" outcome from use of commercial estate planning "forms," see our October 2013 post on a Pennsylvania case, see "Do-It-Yourself Wills: Penny Wise & Pound Foolish?"
Thanks to Professor Laurel Terry for pointing to an ABA Journal Blog post on the Florida case.
Thursday, April 3, 2014
That's a frequent paper topic proposal for students in my Elder Law course, and one that usually triggers a conversation about the potential for "ageism." I remind students it will be important to provide evidence in support of their proposals, and not simply recount anecdotes about bad older drivers.
But, in truth, there is plenty of data to identify risks associated with older driving, as suggested by Elder Law Attorney Robert Fleming on his great Blog, citing statistics from the Center for Disease Control about risks for "fatal" accidents over age 75. See "Driving, Aging and Dealing with Family Dynamics."
ElderLawGuy Jeff Marshall takes a very personal look at his own driving future on his Blog, and uses that moment of self reflection to also examine strategies for encouraging older drivers to give up the keys. Read "What to Do When Dad Shouldn't Be Driving."
This is another area of "social policy" where the laws are not uniform on how to intervene when the older driver refuses to stop driving or to make other appropriate adjustments in when and where to drive. Here is a link from the insurance industry's Claims Journal to a recent "State by State Look at Driving Rules for Older Drivers."
And, for a somewhat more theoretical approach to the topic, from University of Miami Law Professor Bruce Winick, the always thoughtful guru of the therapeutic jurisprudence movement, see "Aging, Driving and Public Health: A Therapeutic Jurisprudence Approach." Professor Winick proposes creation of community-based "safe driving centers," as a means of encouraging impaired drivers "voluntarily to cease or restrict their driving by offering inducements and alternative transportation solutions."
And of course, we have Professor Becky Morgan's preferred solution, the Jetsons' car that drives (and parks) itself. Read "New Study on Autonomous Cars."
Tuesday, March 18, 2014
Professor Donna Harkness: "What Are Families For? Re-evaluating Return to Filial Responsibility Laws"
Donna Harkness, clinical professor of law and director of the Elder Law Clinic at the University of Memphis Cecil C. Humphries School of Law, has a new article on filial support laws in the most recent issue of the University of Illinois's Elder Law Journal. In "What Are Families For? Re-valuating Return to Filial Responsibilities Laws," she concludes:
"Despite their long history, filial responsibility laws have clearly failed to remedy existing needs. The lack of uniformity in filial responsibility laws, the difficulty and cost of enforcement, along with the fact that such laws provide no coverage to those elder Americans that have no adult children to look to for support, render them a limited response at best. In addition, to the extent that filial responsibility laws are enforced, evidence indicates they would be destructive to family ties and have the counterproductive effect of further eroding and destabilizing the network of support available to elders.
Furthermore, by focusing solely on economic support, filial responsibility laws do not address the fundamental need that all persons, and most especially the vulnerable elderly, have to be supported by caring relationships. To the extent that the institution of the family, however defined, is the key to ensuring that such relationships exist, it behooves us as a society to strengthen and foster family ties through policy initiatives that reward caring relationships."
Thursday, March 6, 2014
In companion appellate cases, a brother and sister argued the Commonwealth of Pennsylvania was "collaterally estopped or otherwise barred by the constitution and/or statute" from bringing criminal charges against them arising from payments from a trust account, because of a civil order "approving" the final accounting in the estate. Pointing out that the state was not a "party" to the Orphan's Court proceeding, even if it had an interest in proper disbursement of estate funds, the Pennsylvania Superior Court rejected the estoppel arguments as a "matter of law."
The Court observed, "As [Charles] McCullough has indentified no ruling or filing in the certified record that made the Commonwealth a party to the Orphan's Court proceeding, we conclude that it was not a party. As such, collateral estoppel cannot apply."
The rulings in Commonwealth v. Charles McCullough and Commonwealth v. Kathleen McCullough, decided on February 27, allow the siblings' cases to go forward on multiple criminal counts, including allegations of theft by unlawful taking and conspiracy. The allegations go back to 2007, with multiple continuances of the scheduled trial dates.
The court appeared to credit the Commonwealth's theory that the complexity of the case was largely the result of the brother, a licensed attorney, who "intentionally obfuscated his roles as trustee and agent," creating confusion on the part of the bank, a co-trustee. The brother was charged with "24 crimes arising from his actions as an agent and co-trustee for Shirley Jordan, now deceased. Jordan was approximately 90 years old, a widow without any children, and living in a senior living center when she executed a springing power of attorney in favor of McCollough." The Court observed that it was estimated that "Jordan had assets of approximately fourteen million dollars at the time."
Charles is accused of misusing Jordan's assets for his own benefit (including an alleged $10,000 gift to a charity allegedly connected to his family) and of arranging for his sister to be hired at an "exorbitant" rate of $60 per hour for companion services for the elderly woman, as compared to a "Department of Labor estimate of average wages of $8.63 to $9.74 per hour."
The appellate opinions in the cases are fairly dry. In fact, the sister was charged with theft of what, at first blush, seems like a fairly small sum, $4,575.01.
The larger back story, however, includes the allegation that the sister was "hired" as a companion by her brother, using his authority under a Power of Attorney, just weeks after she had been fired and accused of misappropriating more than $1 million from her previous corporate employer. In a separate criminal proceeding, Kathleen McCullough was convicted in 2010 of theft from two companies that employed her, as detailed in the Pittsburgh Post-Gazette.
Thursday, February 27, 2014
As earlier reported on this Blog, the Court of Common Pleas of Schuylkill County in Pennsylvania, dismissed the high profile criminal charges against Barbara Mancini, the nurse charged with "causing or aiding" the suicide of her aged father, in violation of 18 Pa.C.S. Section 2505(b). The ruling reviewed testimony presented during a preliminary hearing before a magistrate, as required by the defendant's petition for a writ of habeas corpus. Much has been said by proponents and opponents of assisted suicide in connection with this ruling, but here is the actual opinion, all 47 pages.
The opinion demonstrates a high level of emotion for everyone involved in the case, including the judge. There was a gag order in place during the last several months, so key details about the evidence or the arguments made by counsel are only now available. So, please forgive me if I now use the blogger's prerogative to do more than just report the facts. Three starting points:
- What strikes me as important about this ruling is that it should not be misconstrued as a "win" for those who claim there is a constitutional or other legal right to provide or receive assistance in death. At least not in Pennsylvania under its current law.
- Further, a careful reading of the opinion demonstrates the potential for more confusion (and additional cases) for those who interpret -- misinterpret -- Powers of Attorney, Advance Health Care Directives, Living Wills, or Do Not Resuscitate Orders as granting them legal authority to provide assistance in suicide. Again, that is not the current law in Pennsylvania, or in most other states.
- Finally, a careful reading of the opinion makes it clear -- at least to me -- that the hospice aides who called 9-1-1 in response to the facts in front of them, were acting within the law. They were responding to what the opinion documents fairly well as "admissions" of the criminal act of assisted suicide, facts that took the matter beyond the patient's right to accept or reject life-saving efforts.
In terms of "proof" of a criminal act, the opinion demonstrates the importance of careful preparation of a criminal case when called upon to demonstrate the prima facie elements of the crime charged, as occurs during a preliminary hearing. That is the job of the prosecution team, not the hospice workers. The prosecution, in this instance the Pennsylvania Attorney General's office, either failed or was unable to present independent proof of the facts alleged, and instead were focusing almost solely on the "admissions."
In Pennsylvania, as the opinion discusses, the prosecution needed to present evidence of the person's intention to kill himself, action taken to effectuate the suicide, the third-party's intentional aid or assistance in that attempt, and evidence that the third party's action actually "caused" the attempted suicide. Under Pennsylvania's corpus deliciti rule, the prosecution had to establish these elements without "just" relying on the defendant's own alleged admissios or confession. In particular, the opinion shows the importance of expert testimony to establish cause of death, needed in this case to explain "morphine toxicity."
What the entire case also suggests -- not just the opinion -- is the need for Pennsylvania, and most states, to give fresh consideration to the topic of assisted suicide. The record makes it pretty darn clear that Joe Yourshaw had lived a long life, fought the good fight, was ready to die, was tired of living in pain, and he was competent when talking about his wishes to die. We cannot just stick our heads in the sand and say "this case isn't likely to happen again."
The tragedy associated with the last days of Joe Yourshaw and the confusion surrounding the circumstances under which Barbara Mancini, his daughter, was charged, are events that can and should permit Pennsylvania, like Oregon and Washington before it, to consider whether competent individuals with terminal illnesses should be permitted to work directly with health care professionals to make carefully considered decisions about whether to choose professional assistance with their death. Sons, daughters and spouses, whether or not "nurses," should not be put in this position, and other states have shown us there are options.
Some people will argue that the real tragedy would be to leave loving family members with no option but to violate the law (and either face the potential for criminal prosecution or "hide" the evidence) or turn a blind eye and deaf ear to a loved one's carefully considered pleas. As you may be able to tell, while I think the hospice workers in this case were right to report the evidence they saw and heard that pointed to violation of Pennsylvania's current law, I'm one of those people ready to reconsider that law.
Wednesday, February 26, 2014
AARP recently launched a new multi-state caregiving advocacy campaign, with nearly every AARP State Office involved. Working with governors, state legislators, other policymakers and community partners, we’re determined to advance policy options that will help family caregivers. Two significant components of the campaign are:
- The Caregiver Advise, Record, Enable (CARE) Act Caregiver Advise, Record, Enable (CARE) Act, and
- The State Plan in Support of Family Caregivers, also referred to as the Caregiver Resolution.
The Caregiver Advise, Record, Enable (CARE) Act.
- In Oklahoma SB 1536 – the Oklahoma version of the CARE Act – just passed the Senate and will be heard in the House soon. Meanwhile, Governor Mary Fallin declared this month as “February Caregiver Month” to honor the state’s 600,000 family caregivers.
- AARP Hawaii, is urging the Senate Judiciary Committee to pass Senate Bill 2264, the Hawaii equivalent of the CARE Act. AARP members in Hawaii are now contacting members of the committee asking them to support the 169,000 family caregivers in the state by passing Senate Bill 2264.
By passing the CARE Act these states will ensure that:
The name of the family caregiver is recorded when a loved one is admitted into a hospital or rehabilitation facility.
The family caregiver is notified if the loved one is to be discharged to another facility or back home.
The facility must provide an explanation and live instruction of the medical tasks – such as medication management, injections, wound care, and transfers – that the family caregiver will perform at home.
Last week I blogged about tax questions facing some nonprofit senior living operations, especially nonprofit Continuing Care Retirement Communities (CCRCs). This week, we pass on news of a federal court suit filed by residents of a for-profit CCRC, challenging the company's accounting and allocation of fees, especially entrance fees, paid by the residents.
Residents of Vi of Palo Alto (formerly operating in Palo Alto as "Classic Residences by Hyatt") in California are challenging what could be described as "upstream" diversion of corporate assets to the parent company, CC-Palo Alto Inc. They contend the diversion includes money which should have been protected to fund local operations or to secure promised "refunds" of entrance fees. Further, the residents allege the diversion of money has triggered a higher tax burden on the local operation, a burden they allege has improperly increased the monthly maintenance fees also charged to residents. According to the February 10, 2014 complaint, Vi of Palo Alto is running a multi-million dollar deficit and the residents point to the existence of actuarial opinions that support their allegations. The complaint alleges breach of contract, common law theories of concealment, misrepresentation and breach of fiduciary duty, and statutory theories of misconduct, including alleged violation of California's Elder Abuse laws.
Representatives of the company deny the allegations, as reported in detail in Senior Housing News on February 23. A previous resident class action filed in state court against a Classic Residence of Hyatt CCRC, now called Vi of La Jolla, also in California, settled in 2008.
Thursday, February 13, 2014
In August, 2013, we reported on the case of Barbara Mancini, charged with unlawful assisted suicide under Pennsylvania law, for the death of her 93 year old father, on hospice. Mancini, a nurse, was alleged to have provided her father with a fatal dose of morphine. When hospice employees learned the circumstances of the transmission, a report was made that resulted in emergency removal of the father to the hospital, where he died four days later, followed by the criminal charges against the daughter. Pennsylvania's Attorney General took over prosecution of the case, after the local D.A. reported a conflict of interest.
On February 11, a county Common Pleas Court judge issued a multi-page opinion, dismissing the case against Mancini. News reports point out that the court order was issued on the one year anniversary of her father's death. The parties had been under a gag order. Mancini has begun speaking about the case following the court's ruling, with support from organizations such as Compassion & Choices.
My Elder Law Prof colleague Becky Morgan posted earlier today, asking whether "aid in dying" is a trend. More evidence in Pennsylvania that the answer is "yes," although we have not yet seen major support for changes at the legislative level in Pennsylvania.
My own reaction is that on several key fronts, including same sex marriage equality and legalization of marijuana, social change advocates have discovered there is enormous potential in "states' rights" -- once more the fortress for conservatives who opposed social change -- to build support, state by state, and thereby achieve cutting edge law reforms. Social media play increasingly important roles in organizing support. Perhaps this can be seen as a "Face Book" approach to building momentum for social change and law reform.