Monday, November 17, 2014
We're discussing fiduciary duties for trustees in my Wills, Trusts & Estates course and perhaps that is why an article in the November- December issue of the ABA publication, Probate & Property, caught my eye. The cover article is "Painting a Not-So-Pretty Picture: Art as an Alternative Investment in Fiduciary Accounts." Author Michael Duffy, from Goldman Sachs, reports on recent eye-popping headlines for auction sales of artwork. He discusses the sales figures against the background of fiduciaries seeking better-than-conservative returns through use of alternative investments. He outlines the tangible and not-so-tangible variables at the heart of art investment, leading to his thesis:
"It is the position of this author, however, that trustees should not be persuaded by the seemingly lackluster performance of their traditional investments reltative to these sensational headlines and that they should ignore the steady drumbeat of savvy marketers who have a vested interest in convincing them otherwise. There are simply too many considerations when buying and selling art that call into question the prudence of any such endeavor when undertaken by a fiduciary held to the highest investment standards under the law."
It is interesting to note that "absence of federal and state regulation" is one of the reasons for caution cited by this financial services author.
Sunday, November 16, 2014
In the October issue of Bifocal, the ABA Commission on Law and Aging journal, the lead article examines the history of Maine's Improvident Transfer of Title Act, 33 M.R.S.A. Section 1021 et seq., enacted in 1988 in an effort to better protect victims of undue influence and financial exploitation. As the author, Maine elder law attorney Sally Wagley, explains,
"For a period of time, the [proposed] bill continued to be unpopular with some sectors of the bar. This was ameliorated to some extent by elder law attorneys collaborating with real property lawyers to successfully propose a number of appropriate amendments related to transfers of real estate: (1) a provision which states that nothing in the Act affects the right, title, and interest of good faith purchasers, mortgagees, holders of security interests, or other third parties who obtain an interest in the transferred property for value after its transfer from the elderly dependent person; and (2) provisions affecting title practices, stating that the examiners were not required to inquire as to the age of the transferor and whether he or she had independent representation."
Has the law been useful in Maine? Wagley concludes that in spite of continuing challenges, including the lack of resources to pursue claims and the effect of delays in litigation on elderly victims, the law's presumption of "improvidence" arising from certain "uncounseled" transfers, has had a deterrent effect. She observes, "Knowledgeable attorneys now refer elders to outside counsel before assisting with a gift to family or others with whom the elder has a close relationship."
For more on Maine's law, see "Maine's Improvident Transfers Act: A Unique Approach to Protecting Exploited Elders."
Saturday, November 15, 2014
Consumer Voice has honored NSCLC Attorney Eric Carlson with its Toby S. Edelman Legal Justice Award. The Toby S. Edelman Legal Justice Award recognizes individuals who go to extraordinary lengths to achieve justice for long-term care customers. Eric received the award for his commitment to advocating for the rights of long-term care consumers, and for his deep expertise in the issues surrounding long-term care. Eric will receive the award at Consumer Voice’s 38th Annual Conference at the Hilton Crystal City in Arlington, Virginia on Sunday, November 16.
Please join us in congratulating him!
Friday, November 14, 2014
The Denver Post ran a good article on how to smooth the way for harmonious inheritances by families. About to inherit? Tips for avoiding family fights and tax trouble ran at the end of October, 2014. The story opens with some eye-popping statistics
A 2012 study of 3,200 wealthy families by U.S. Trust showed that 70 percent failed to successfully transfer the family's assets to the succeeding generation. The study found three reasons for this failure: lack of communication among family members; absence of a generally acknowledged purpose for family possessions; and lack of preparation on the part of heirs.
Following the logic of this study--if it can happen to them, it can happen to any of us, the reporter offers that "[l]ack of preparation, operating without guidance or support and faltering in the face of irreversible tax decisions can negatively impact even diminutive estates." The author offers tips to avoid these mishaps: effective communication (call a family meeting and be prepared). As well, those standing to inherit need to educate themselves ("Heirs should take the time to educate themselves on the importance of good tax decisions.") The article gives beneficiaries some insights for them regarding some of the decisions to make and the import of the governing terms of the plans. Remember to tell clients, tax is important!
The National Senior Citizens Law Center (NSCLC) is offering a free webinar on "Emerging Issues and Consumer Rights in Providing Medicaid LTSS through Managed Care."
Date and Time: Wednesday, November 19, 2014 2-3 p.m. Eastern time
Description: "This webinar will examine the critically important issue of consumer rights in the 28 states that have moved to Medicaid managed long-term services and supports (LTSS) systems. Additionally, it will evaluate emerging issues we've seen in certain states."
More information and registration here.
The November issue of AARP's Bulletin carries a special Medicare cover story, "Inside the Medicare Strike Force" by Rick Schmitt. The article details recent successes by a Justice Department unit formed in 2007:
"The strike force has grown from a single outpost in Miami in 200 to nine cities, with the support of 40 of the 100 attorneys in the fraud section of the Justice Department. . . . Just this September, some 280 prosecutors and agents from around the country attended a Justice Department workshop in Washington, D.C., to learn the finer points of investigating and prosecuting Medicare cases. Increasingly, the crackdown has the look of a major narcotics operation, complete with electronic surveillance and frequent use of informants and cooperating witnesses. Defendants' assets are now routinely seized before trial. Sentences are being measured in decades; even some older beneficiaries are being prosecuted. Agents are backed by forensic accountaints, health care professionals and data acquisition analysts who have a pipeline to Medicare contractors' billing information."
A side bar to the main feature focuses on Peggy Sposato, describing her as a "fraudster's worst enemy," through use of her data analysis skills to create systematic review of billing records. Her methods successfully trace unlawful Medicare payments. Her career as a fraud buster "began in the mid-1990s after a career as a geriatric nurse."
Mather Lifeways, which describes itself as a "unique, non-denominational not-for-profit oganization" that is "dedicated to developing and implementing 'Ways to Age Well' by creating programs, places and residents for today's young-at-heart older adults," is offering a free webinar on marketing.
The Cafe Plus program is on Thursday, December 11 at 2 p.m. Central time, with three speakers, including the vice-president of Mather Lifeways, the director of an Ohio Senior Center, and the CEO of LifeCare Alliance. The webinar offers education on community outreach to older adults, with a special focus on attracting "younger" older adults who may be avoiding traditional senior centers.
More details and registration information here.
Thursday, November 13, 2014
Does "Unlimited" Gifting Power in POA Protect the Agent from Criminal Liability for Self-Gifting? PA Appellate Court Says "No"
Following a nonjury trial in 2012, David Patton was convicted of 95 counts of statutory theft by unlawful taking, arising out of his use of a power of attorney (POA). The POA named him as agent for his 86 year-old aunt. At issue was more than $200,000. Patton appealed the conviction, alleging the POA that expressly granted him authority to make "limited or unlimited gifts," made it impossible for him to be held liable for theft by cashing checks and making withdrawals from his aunt's accounts for his personal use in 2008, 2009 and 2010. In September 2014, the Superior Court of Pennsylvania, an intermediate appellate court, issued a "nonprecedential" written opinion affirming the convictions, concluding:
"Simply stated, we reject Appellant's bold claim that the 'unlimited gift' provision in the power of attorney provided Appellant with a license to steal [his aunt's] assets and use all of her money for Appellant's own benefit. To the contrary, the gifting power was clearly subject to the condition [stated in a statutorily required affidavit signed by Appellant] that Appellant use the power 'for [his aunt's] benefit' - and Appellant clearly violated this condition when he took all of [his aunt's] money and used it as if it was his own. Therefore, since Appellant's actions were not authorized by the power of attorney, Appellant's sufficiency of the evidence claim necessarily fails."
In reaching this decision, the appellate court adopted the trial court's "meticulous" rulings as its own. In the trial court's final order, the judge rejected the defendant's testimony that he had no awareness or notice that using the POA to make the transfers in question was a crime. The trial judge wrote: "He did not need to be notified in writing to know that he could be charged with theft for taking for his own personal use over $200,000 of [his aunt's] savings, using some of it to go gambling in Erie and depriving her of sufficient funds to pay for her nursing home care in her old age."
An additional interesting, and perhaps confusing aspect of the case, is testimony by the attorney who drafted the POA.
When called by the defense to testify as "an expert" on powers of attorney, as well as a fact witness, the attorney testified he "always" included both "limited and unlimited" gifting authority in his POAs. He testified he explained to the aunt that the broadly-worded POA enabled the agent to "do anything that she could do." On direct examination, he testified the gifting language was "completely unconditional."
As we first generation of elder law attorneys reach that point where we decide to retire--or have the decision removed from us, regardless of the reason--the question of closing or selling the law office becomes an important one. Succession planning is more than selling a business-it's entrusting your clients to someone who will care for and represent them as you did. It's not an easy decision to make and not one that happens overnight. How does an attorney reach the decision to close the doors? The ABA Senior Lawyers Division has delved into this topic, with a webinar on what to do when an attorney becomes incapacitated or dies.
The webinar, So It's Time: Responsible Planning for Closing the Law Office, was offered in October and post-webinar materials will be available for purchase from the ABA. Plan and be prepared! A good motto for our clients and ourselves.
With the most recent news about actor Robin Williams as possibly having Lewy Body Dementia, readers might find free webinar materials from Morningside Ministries useful, at their website mm.learn.org. Look for the "In the News" link -- the materials strike me as objective and thoughtful.
Wednesday, November 12, 2014
AARP's Research released a new report on saving for retirement: Planning for Health Care Costs in Retirement: A 2014 Survey of 50+ Workers. According to the introduction, the reason AARP did this research was to understand how health care costs factor into retirement planning. This is not only an interesting point, it's an important one and worthy of research.
The key findings for this report show that as far as this issue, the news isn't good. Almost 40% aren't saving for health care costs and a bit over 40% relate they have no plans to do so. Slightly over a quarter of respondents do plan to begin to save...within the next few years.
Why aren't these folks saving? According to the findings, right now it's unaffordable, either because they're currently caring for another or they have other expenses. Although over 60% are saving for health care costs, almost half worried they won't be able to afford health care.
The study also shows a disconnect-between the belief of the need for saving and when the belief translates into action. I thought this finding quite interesting--this group plans to pay their own way when it comes to health care costs, with almost 90% replying that they will not rely on family for help with the costs of health care.
The survey also inquired into retirement readiness. The key findings show results that aren't particularly surprising, with about 75% respondents reporting they are "somewhat confident" while only slightly over 30% being "very confident". Concomitantly, 75% have saved to some extent while 1/3 saved "to a large extent." The full report is available here as a pdf.
Professor Reid Weisbord at Rutgers Law School - Newark has a new essay that takes on a challenging, two-part question: Whether a donor's estate should be permitted to sell a decedent's body parts or organs posthumously and whether the proceeds of such sales will be distributed to the donor's heirs or beneficiaries. Professor Reid suggests an appropriate starting place is to define and provide for "anatomical intent" of the donor. Before you start imagining vendors on Craigslist or at Sothebys, be advised the essay anticipates a regulated system.
You probably want to read more about this topic, correct? See "Anatomical Intent" by Reed Weisbord from the November issue of Yale Law Review Forum.
Tuesday, November 11, 2014
Penn State Dickinson Law's Registrar, Pam Knowlton, has a not-so-secret life as seamstress, trainer and godmother to several of the most patient dogs on earth. Newman, Thelma and Roger will be hard at work again on Veterans' Day, with scheduled visits at nursing homes and care centers around the mid state. It is pretty much impossible not to smile when these therapy dogs report for duty.
Roger, a French bulldog, apparently has combat training too. Newman, the boxer, has his own blog....
The October 2014 issue of the American Bar Association's Health Law Section publication, The Health Lawyer, has an interesting lead essay, one that I believe would be useful both for practitioners and law students to read. D. Gary Reed, Associate General Counsel for Humana Inc., argues that there are two distinctly different versions of the Medicare Advantage program of health coverage, the version he believes was intended by Congress and the version "found in pleadings, briefs and court decisions."
Attorney Reed starts with a concise statutory overview of coverage under Medicare Part C, leading to introduction of his central thesis: "Litigants and courts too often depend on prior case law for their understanding of the Medicare statute, rather than on the statute itself."
Reed writes clearly and offers helpful citations. He points out that the Medicare statute is, at best, intimidating to the "uninitiated" and the confusion is made worse by inconsistent use of citations to provisions of the legislative Act, rather than to the United States Code.
He offers an "ABCs of Medicare" followed by a more detailed examination of the subparts of Part C, and describes what it means to "opt out." He outlines his approach to how the Medicare Advantage program is intended to function, using examples to show how he believes courts have gotten it wrong. He argues there is "no such thing as a Medicare Advantage insurance policy." The misconception that there is a "policy," he says, "lulls general practitioners and provider collection counsel into suing for breach of the nonexistent Medicare Advantage insurance policy, instead of pursing the exclusive Medicare appeals process."
Reed contends that "[t]ime and money spent by Medicare Advantage organizations defending litigation driven by these misconceptions diverts resources from caring for aged and disabled Medicare beneficiaries." He says "a contributing factor may be the dearth of authoritative materials -- text books, law review articles, or the like -- that explain and contextualize the program in readily understandable terms."
After reading the article, I ask whether a fair implication arises from the apparently significant numbers of claims being made, even if incorrectly and in the wrong forum. Doesn't that suggest there could be real problems with Medicare Advantage? Reed writes that it is important to understand, and to use available statistics to demonstrate, that "the Medicare appeals process exists and is actually available to Medicare Advantage enrollees." But is Medicare Advantage meeting the real needs of health care service users in this program?
Monday, November 10, 2014
Professor Raymond O'Brien, Catholic University Law, and Associate Dean Michael Flannery, University of Arkansas, Little Rock, have collaborated on the latest new classroom text to hit my desk. Published by Foundation Press, "The Fundamentals of Elder Law: Cases and Materials" includes chapters on:
- Elder Estate Planning
- Transfer of Wealth
- Incapacity: Utilization of Powers and Surrogates
- Health Care Decisions
- Social Security, Veterans and Railroad Benefits
- Elder Housing Options
- Payment Options for Elder Housing
- Discrimination and Abuse
Plus, the authors have included text from several key uniform laws as appendices in their book, thus reducing student costs to purchase expensive supllements. I especially appreciate their inclusion of the Uniform Power of Attorney Act, given recent state legislative efforts to provide safeguards connected to use of POAs.By the way, I tried to link to this textbook on the West Academic website here. No luck with searches by author or subject. Is the book too new for the publishers to list? (I've had similar problems before with other title searches on the website, which strikes me as a problem; hopefully one that can be fixed.)
The Demand Institute released a new report on Boomers and housing. The Institute, according to its mission, "illuminates the way in which consumer demand is evolving around the world. We help government and business leaders align investments with where consumer demand is headed across industries, countries and markets. The Demand Institute is a non-advocacy, non-profit organization and a division of The Conference Board... [and] is jointly operated by The Conference Board and Nielsen."
The report, Baby Boomers & Their Homes: On Their Own Terms notes that Boomers will be responsible for 25% of dollars spent on rent or home buying over the next 5 years. According to the report, expect the Boomers to break the mold of retirement housing of that past. The report states that "[m]ost [Boomers] plan to age in place, but many will move into larger homes and take out new mortgages to do so." In the survey done by the Demand Institute, "more than 4,000 Baby Boomer households... [were asked] about their current living situation, moving intentions, and housing preferences, as a part of a broader initiative to understand where future home and community demand is headed." So what is expected to occur in the next 5 years? A large amount of spending, according to the study: "Boomers will spend $1.9 trillion on new home purchases and $500 billion on rent in the next five years." (yes, that says trillion and billion). The study also examines the Boomers retirement readiness, the desire to age in place (most because that is their preference, bur for others, due to a lack of choice primarily fueled by financial limitations). Despite their desire to age in place, according to the report, there is a disconnect between desire and reality: "Boomers are planning major home improvements in the next three years, a significant number will make style and value a priority over aging-friendly features. In fact, the top Boomer reasons to renovate are similar to those of younger generations" which include increasing energy efficiency or home values, and updating the home. The article has great charts and statistics, covers downsizing and upsizing, and desired location. For those of us living in Florida, the stats regarding our future snowbirds are not the best. The report indicates that of the Boomers surveyed, only 1/3 want to move out of state and only 20% want to live in "senior-related housing or active adult communities." Thinking about the Boomers retirement readiness and income security, this part of the report is a bit of a concern "[w]hen they purchase their next homes, more than half [of Boomers] will seek mortgage financing to do so. And most are confident in their ability to qualify for financing."
Sunday, November 9, 2014
On November 5, Genworth Financial Inc., a major player in long-term care insurance, announced third-quarter 2014 performance results, reporting a $844 million net loss that flowed from review of the company's long-term care claims. The review required the company to reallocate more than $530 million (pre-tax) to its LTC claim reserves. Obviously that is not the kind of news that shareholders like to hear. But, it would also appear to hold larger implications.
Financial news reporters quickly followed with analysis.
From the Wall Street Journal: "Long-Term-Care Insurance: What Policyholders Should Know," three "takeaways:"
- "A past rate increase doesn't forestall additional hikes down the road."
- "You're unlikely to find a better deal by switching insurers.
- "It may be possible to cut back benefits and still have good coverage."
From Bloomberg News: "Genworth CEO Sees Tough Turnaround from $844 Million Loss," putting the single company's performance into context by pointing out that "larger rivals MetLife Inc. and Prudential Financial Inc. have stopped selling long-term care insurance as results are hurt by near record-low bond yields and higher-than expected claims costs."
Underestimating how long people will live. Underestimating the demand for assistance with activites of daily living. Underestimating how much it costs to cover health care and social care meeds. These are calculation problems not just for the insurance companies but for individuals, families and (if we are at all realistic) governments. Don't we need to stop addressing these issues in silos?
Friday, November 7, 2014
Two challenging topics for many families: how to handle death and intimacy for aging family members. We're probably doing better coming to grips with the need to address death than intimacy. When long-term care is required, involving third-parties, the question of sexual behavior can become more important.
Along that line, Bryan Gruley at Bloomberg News wrote a thoughtful series addressing the social, legal, moral -- and just plain tough -- questions connected to sexual behavior that can arise with older persons in congregate settings.
Bloomberg Visual Data: Elder Care Sex Survey Finds Caregiviers Seeking More Training
The Bloomberg series quotes Albany Law School Professor Evelyn Tenenbaum, a civil rights, health care, and bioethics scholar, citing her article "To Be or to Exist: Standards for Deciding Whether Dementia Patients in Nursing Homes Should Engage in Intimacy, Sex and Adultery" from the Indiana Law Review.
November 7, 2014 in Cognitive Impairment, Current Affairs, Dementia/Alzheimer’s, Elder Abuse/Guardianship/Conservatorship, Ethical Issues, Health Care/Long Term Care | Permalink | Comments (0) | TrackBack (0)
Thursday, November 6, 2014
My co-blogger, Professor Pearson wrote a post about the silver housing concept published in a recent issue of the New York Times. One of my elder law rock star students, Sushil Cheema, sent me an article from the Wall Street Journal on another story about housing: the mother-in-law apartment.
When I moved to Florida eons ago (or as I like to remind my JD students, last century), one would often see ads describing the perks of houses listed for sale as including a mother-in-law apartment (and it seems to my vague recollection, those were often over a garage...) St. Petersburg is a vibrant, happening place to live. I haven't had a need to be checking the housing market, so I don't know whether houses with these added apartments are still listing them as "mother-in-law" apartments.
But, the phrase isn't evidently as dated as I thought it was. According to the Wall Street Journal article, The Hottest Home Amenity: In-Law Apartments
the hottest amenity in real estate these days is an in-law unit, an apartment carved out of an existing home or a stand-alone dwelling built on the homeowners’ property. While the adult children get the peace of mind of having mom and dad nearby, real-estate agents say the in-law accommodations are adding value to their homes.
Accessory-dwelling units (the more popular term these days) can make a huge difference in the popularity and price of a property. The article mentions trends by home builders, including the addition of a "casita" on the property, or properties designed for multi-generational families, such as "MultiGen dwellings" or "NextGen" dwellings. Regardless of what you call it, dwelling space for the family matriarch or patriarch is the hot topic. "Architects also cite an uptick in requests for in-law units. “We hardly ever do a house anymore that doesn’t have multiple buildings,” often as dwellings for aging parents, said Michael Frederick, an architect in Beaufort, S.C."
As those of us who teach elder law know, multiple dwellings on a property may run afoul of zoning ordinances, especially those zoned single family, or those with homeowners associations. The article recognizes this issue, too. "Until recently, homeowners in many areas weren’t able to build in-law units on their properties because of local regulations that made them either illegal or too complex to build. But efforts by lobbying groups like AARP and individuals like Portland-based ADU blogger and educator Kol Peterson have led to loosened rules in some areas, advocates say."
Of course, the regulations governing and the cost of building aren't the only issues. As mentioned in the article, there are intrinsic and emotional issues to be covered. This is a great overview of the housing issues and I think useful in our classes to engender stimulating discussion.
Dr. Louise Aronson, a clinical professor in Geriatrics at University of California San Francisco, wrote a great piece in the New York Times recently, calling for a "silver" standard for architecture and design, to better meet the needs of older adults in public and private accommodations, while also making life easier and safer for everyone. She explains:
"I unloaded the walker and led my 82-year-old father through the sliding glass doors. Inside, there was a single bench made of recycled materials. I noticed it didn’t have the arm supports that a frail elderly person requires to safely sit down and get back up. It was a long trek to the right clinic and I was double-parked outside. Helping my father onto the bench, I said, “Wait here,” and hoped he would remember to do so long enough for me to park and return.
He nodded. We were used to this. It happened almost everywhere we went: at restaurants, the bank, the airport, department stores. Many of these places — our historic city hall, with its wide steps and renovated dome, the futuristic movie theater and the new clinic — were gorgeous.
The problem was that not one of them was set up to facilitate access by someone like my father."
The irony was that the medical center building Dr. Aronson was writing about was brand new and renowned for its "green" design. Nonetheless, it was failing to meet the practical needs of its many silver-haired clients.
For more on how a revolution -- and incentives -- are needed to better meet the needs of an aging world, see "New Buildings for Older People."