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December 2007
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The Changing Face of Elder Law
What you need to know about one of the fastest growing legal specialties
As seen in the November/December 2007 issue of Legal Assistant Today. Copyright James Publishing, Inc. Reprinted courtesy of Legal Assistant Today magazine. For subscription information call (800) 394-2626, or visit www.legalassistanttoday.com.
By Tim Pareti
Americans are leading much longer lives. According to the U.S. Census Bureau, more than 72 million Americans will be 65 by 2030. Additionally, the U.S. Census Bureau projects that the number of Americans 85 and older is expected to grow quickly after 2030, when the baby boomers start to enter this age group.
As the aging population increases, the demand for more medical care and legal services, such as estate planning and long-term care, also will increase. To add to this growing demand, there is an increasing trend in crimes against the elderly, and continuous changes in laws and regulations affecting the aging. All of these factors make elder law one of the fastest growing specialties in law today, as well as a challenging and rewarding career specialty for paralegals.
Long-Term Care
One of the primary concerns in elder law involves a new federal regulation that has changed the landscape of how attorneys and paralegals handle long-term care and estate planning for clients. The Deficit Reduction Act of 2005 has had a tremendous impact on asset transfers and Medicaid eligibility. The federal law, signed by President Bush in February 2006, “aims to cut nearly $11 billion in Medicare and Medicaid program spending over the next five years” (“The Deficit Reduction Act: Spotlight on Medicaid Enforcement,” HealthLaw 360, Guest Column, Portfolio Media, Sept. 8, 2006). Because the DRA is relatively new, many elderly clients are unaware of the changes, most of which affect their estate planning and long-term care under Medicaid.
“[The DRA] has put a chink in our armor,” said Marjorie Brooks, who has been a paralegal since 1991 for Jim Schuster, elder law attorney, in Southfield, Mich. With one attorney and three paralegals, the practice, which originally specialized in employment law, has been specializing in elder law for 11 years. “There are fewer tools to help out our single elderly clients,” Brooks said.
Under the new federal law, the look-back period for disclosing asset transfers and gifts increased to five years from three. That means the government will now look back five years from the date of a Medicaid application, instead of three, to determine if a gift or asset transfer made by an elderly client to a relative is reportable. As a result, some of the planning methods for Medicaid applications have changed or are no longer available. A few states have not adopted the DRA but are expected to within the next two years.
“We no longer advise gifting as a way of protecting assets,” Brooks said. “We are very limited as to what we can use to protect assets now for a single person ... One of the things that we can still use is an annuity that complies with [the Department of Human Services] rules. However, that is not the best tool as the state of Michigan must be named the contingent beneficiary of the annuity.”
The beginning date for the period of Medicaid ineligibility or the penalty period for gifts and asset transfers also has changed. Under the old law, the penalty period began on the date the gift was made. Under the new law, the penalty period begins on the date of the Medicaid application. In other words, for any asset transfer or gift made on or after Feb. 8, 2006, the penalty period begins when the applicant applies for Medicaid and not when the transfer is made. The DRA rules that govern certain types of assets, such as a home and gifts, differ slightly from state to state.
“It is important for a paralegal to know the basic Medicaid rules, keep on top of what is currently happening on the federal and state level for any changes in Medicaid, and make certain that the attorney’s Medicaid plan for the client is carried out,” Brooks said.
The new law also prevents states from rounding down the penalty period for Medicaid applicants. Before the DRA, Medicaid applicants were penalized for asset transfers greater than $5,549 per month — the average nursing home cost set by DHS, and used by Medicaid as a “divestment penalty divisor.” DHS would determine the penalty period based on a gift or transfer 36 months prior to the date of the Medicaid application, and then round down the number of months of ineligibility. Now, states can’t round down that number, resulting in partial months of ineligibility.
“Some clients thought they could give $12,000 a year to their kids and that it would not count for Medicaid,” said Jeanne Tolomeo, a certified case manager, geriatric care manager and paralegal. “That’s their biggest surprise, when they find out that it does count. The [DRA] has changed the whole complexion on how someone can plan for long-term care. There are a lot of planning tools we used that we can’t use anymore.”
Tolomeo has nine years of experience at Fletcher, Tilton & Whipple in Worcester, Mass., which has 40 attorneys and 50 paralegals, and established an elder law practice nine years ago. “I believe that an elder law paralegal benefits by reading as much as possible to be aware of the laws [and] regulations, as they change often,” Tolomeo said. “I truly believe an elder [law] paralegal has to be aware of the many afflictions that can render a person incapable of making good decisions. The elderly population is vulnerable.”
Because the passage of DRA makes it more difficult to gain Medicaid coverage in most states, it’s more important than ever to plan ahead, Tolomeo said. Gifting, trusts, life estates, annuities and long-term care insurance are some of the planning tools elder law attorneys and their paralegals use to help their clients plan for long-term care.
“If the client is 65 to 70 and in good health, we may suggest gifting, trusts and life estates as planning tools, always keeping in mind the five year look-back,” Tolomeo said. “Because, should something happen to cause an individual to be in a long-term care facility, the gifts would have to be returned to the parent. We may suggest the client take a look at long-term care insurance with [his or her] insurance agent.”
Julie Dyer, a paralegal and marketing director for Margolis & Associates in Boston, a leading elder law firm in Massachusetts, agreed that DRA has served as “a roadblock” to preserving clients’ assets. As a result, the firm’s attorneys and paralegals are getting more creative and cautious in light of DRA in order to adjust to the new law. “What we once could do with regards to long-term care planning and preservation of assets, we cannot now because of the changes in the law,” Dyer said.
As an example, a widowed client of Margolis & Associates wanted to protect her sole asset — her house, which exceeded in value the state’s new DRA limit of $750,000. The client was considering selling the home after her grandson moved out. Any transfer would have caused five years of ineligibility for state Medicaid benefits under DRA. So the firm’s attorneys devised a plan where the client transferred her home in an irrevocable trust and her children paid the premium of long-term care insurance, which would cover her for five years in case she needs to enter a nursing home. After five years, the family can opt to keep the insurance. The home is protected and the client is covered.
This plan might not work for everyone, said Dyer, who has been a paralegal for two years. Long-term care insurance is expensive and not everyone can afford it. Transferring assets into annuities is another way to protect a client’s assets and provide an income stream for the “at-home spouse,” Dyer said. However, the state must be the primary beneficiary of the policy, she added.
Just before DRA went into effect, Dyer said her firm called all of its clients, urging them to plan ahead for the new law.
Harry S. Margolis, founder and managing attorney of Margolis & Associates, comprised of 12 employees, including four attorneys and three paralegals, also is the founder and president of ElderLawAnswers.com, a Web site that provides a network of qualified elder law attorneys and resources to help the elderly and their families understand some of the legal issues facing them. “We started www.elderlawanswers.com with two goals in mind: to provide consumers with clearly written information about solutions to the legal problems facing American seniors, and to assist them in finding qualified elder law attorneys,” Margolis said. The site also provides a discussion forum for users and online practice tools for attorneys. “We are pleased that we now have more than 600 law firms participating around the country and that more than 70,000 consumers use the site every month,” he added. Margolis also is the editor of The ElderLaw Report, a newsletter, and “The ElderLaw Portfolio Series,” a loose-leaf publication, and is the author of the book “ElderLaw Forms Manual” (all through Aspen Publishers).
“The role of the paralegal is making sure that the clients have the best experience they can,” Dyer said. “Whether we’re talking with them about their estate planning documents or helping get their spouse [or] parents approved for Medicaid, we can assist with all estate planning documents [and] documents used in guardianship or probate cases, as well as applying for MassHealth and getting clients approved.”
Estate Planning
Estate planning is essentially a legal method to protect assets and pass them along to family members in the most amicable and financially feasible way possible. Without an estate plan, the elderly and their loved ones could face immense frustration, stress and perhaps hostility toward each other when the state steps in to devise such documents as a will or guardianship.
In addition, the constant changes in state and federal regulations could affect how a client protects his or her assets. As a result, it’s probably more important than ever to get an estate plan, Dyer said, adding that clients are more likely to receive more tailored service from a law firm that specializes in estate plans and elder law.
Margolis & Associates encourages its clients to plan ahead. “It is critical to plan earlier for your future,” Dyer said. “With [tougher and tougher] regulations for state benefits, it is more important to plan early and get a good foundation for your estate plan, get your ducks in a row, so to speak, for the future.”
According to Dyer, younger clients are now asking to get their estate in order. “It seems to be hip now to get your estate plan done. More people know about it than ever before,” she said.
Estate planning involves more than strategizing and preparing documents, such as a will, power of attorney, deed, advanced directive, guardianship or trust. It also is about discovering who the client is and his or her familial relationships. In other words, paralegals and attorneys need to focus not only on the legal issues regarding their elderly clients but also on the clients’ personal issues. Because paralegals usually are the first to speak to a potential elderly client, they should be aware of the client’s needs. “That is done by being professional but also [by] forming relationships with your clients and really getting to know them,” Dyer said.
Often, relatives will contact an attorney’s office, seeking estate planning advice for their parents who might be incapable of doing it themselves. It’s the task of an attorney and a paralegal to determine who the client really is, assess the client’s condition and represent the client’s needs while being sensitive to caring and concerned family members.
Elder law attorney Thomas Arceneaux of Blanchard, Walker, O’Quin & Roberts in Shreveport, La., a law firm that has 16 attorneys, with two attorneys specializing in elder law, said elder law attorneys and paralegals should focus not only on their elderly clients’ finances and property but their mental state and the clients’ family dynamics.
“Frequently, the person who calls to set up a meeting is not the client,” said Arceneaux, who spoke on elder law in July at the National Association of Legal Assistants’ annual conference in New Orleans. “The attorney needs to know who he is representing, and usually it’s the parent. They should talk about their client’s options in private and declare that their children are not a client. Sometimes, that can be intimidating to an elderly client.”
“Understanding family dynamics is the key to handling an elderly client’s needs,” said Karen Walsh, a paralegal for 18 years who works for The Law Offices of Geraldine E. Champion in Grover Beach, Calif. The firm, which specializes in real estate transactions law and has specialized in elder law for 12 years, has two attorneys, three paralegals, three real estate agents, one registered nurse home care coordinator, two home care coordinators, four certified public accountants and 12 staff members.
According to Walsh, siblings usually have different needs and sometimes second-guess each other or the client’s attorney on decisions affecting the elderly client. “That can create confusion, mistrust and family feuds,” she said. “It can lead to posthumous feuds which waste scarce estate assets. Families may never be the same. Good estate planning can avoid breaking families apart forever.”
As a result, paralegals in Champion’s law office are trained to identify the family “black sheep” — someone who, according to Walsh, “typically is a spendthrift, can’t hold on to money, an alcoholic, drug addict, a little larcenous, or suffered multiple sad divorces, bankruptcies, [or] property foreclosures.
“In elder law, we need to know who the black sheep is and the majority of families have one,” Walsh said. “The answer to the black sheep question tells us who should not be trustee of the parent’s trust or agent under their durable power of attorney. We want to offer clients the peace of mind that comes from naming someone they trust in the event they are incapacitated and cannot handle their own financial affairs,” Walsh added.
By talking to elderly clients and their relatives and paying attention to family dynamics, paralegals at Champion law firm play an integral role in helping clients on elder law matters.
“One of the primary roles for paralegals in estate planning is to meet with the clients to try and help attorneys determine their situation,” Walsh said. “The paralegal will help verify assets, discover who the key family members are and try to determine who the client trusts the most in naming a trustee,” she said.
“We encourage our clients to be truthful and share even painful stories about their family so that we may fully understand the dynamics and work to avoid a family fight after the parents have passed,” Walsh said. “The most valuable asset that we can pass is family harmony. By having an attorney and paralegal in every consultation, the paralegal is able to focus on the family dynamics, listen for clues about a potential black sheep family member client, [and] tune in to how tired the caregiver really is and not the brave face they put on so as to not burden [the] children. The attorney is free to work the case.”
Although the attorney drafts the case documents, according to Walsh, “the paralegal on the case reviews the draft and supervises the document signing.” The paralegal also will assist the clients “with the intake documents, reviewing the information with the clients, signing the trust, [pouring] over wills, deeds, powers of attorney for assets and health care.” Paralegals in estate planning can rely on multiple listservs through websites such as www.specialneedsalliance.com or www.elderlawalliance.com.
Elder Abuse
According to the National Institute of Justice (NIJ), elder abuse is an understudied problem in the United States. Also, there is not a uniform reporting system that keeps track of elder abuse. Studies have indicated that for every reported incidence of elder abuse, neglect or exploitation, five cases go unreported. The American Psychological Association reports that the majority of elder abuse occurs at the victim’s home. Family members or caregivers usually are the abusers.
In addition, according to NIJ, there is little information about the financial exploitation of senior citizens, mainly because these types of crimes are hard to detect. Seniors who are victims of financial abuse such as forgery, fraud or theft often are either too embarrassed to report the crimes or simply unaware of the crimes due to mental or cognitive disabilities. The elderly also might not report a crime because they fear the loss of a caregiver or retaliation. Cases are notoriously difficult to prosecute due to impaired memories or unwillingness on the parts of victims to testify.
Gayle McMorrow, a paralegal who runs a senior home care company in Rocklin, Calif., discovered elder abuse firsthand. Several years ago, she was hired by the family of a wealthy elderly widow to help manage the woman’s health care insurance and finances. McMorrow discovered that the woman was unnecessarily paying out of pocket for services covered by her insurance. After further review of the woman’s finances, McMorrow discovered discrepancies in the woman’s checking account, which was controlled by a hired home caregiver.
It turns out the caregiver was stealing money from the client by repeatedly asking for advances from the victim and telling no one about the advances. The 87-year-old victim, who was suffering from mild dementia, had no idea what was going on. In total, the caregiver stole an estimated $7,000 in a four-month period.
It took three years to prosecute the case because the caregiver could not be found, but eventually the caregiver was charged and convicted on 10 felony counts of elder abuse. The Placer County District Attorney’s Office officially honored McMorrow as a citizen who went above and beyond the call of duty.
McMorrow started her company, McMorrow Senior Care, in 2005, based on her own experiences as a caregiver. “I realized that people want their loved ones to be under reliable care while they are provided a much needed break,” she said. Her business provides services such as insurance billing, finding caregivers, grocery shopping, bathing, cooking meals, light housecleaning and filing.
Although it’s difficult to ferret out elder abuse, there are identifying markers. However, many attorneys, paralegals and health care professionals are not trained to identify them. In some states, such as Illinois, paralegals have mandated reporting requirements for which they are required to notify the appropriate authorities of cases of suspected elder abuse.
Jeffrey Helewitz, a senior court attorney assigned to the domestic violence division of the New York City Criminal Court, said many paralegals will at some point come in contact with elderly clients.
“They have to be aware of what to look for; what are the warning signs … because paralegals usually do all of the initial intake and are usually the person in the office who has the most regular contact with the elderly client and would notice indications that there might be an abuse situation,” Helewitz said.
Some of the warning signs could be “unexplained bruising, change in mannerisms, missing property or the elderly client looking at the abuser before speaking,” Helewitz said. He taught paralegal courses at Baruch College, New York Career Institute and Manhattan Marymount College and wrote several books on elder law, including “Elder Law” (Delmar Cengage Learning).
“Elder abuse is hard to pin down,” Helewitz said. “The victim might be afraid of saying something or [he or she] will report the abuse but people think they’re senile.”
Paralegals can be the advocate for an elderly client, McMorrow said. “Often the elderly cannot comprehend what is going on, so the paralegal [can] be watching out for them in a variety of ways to protect them,” McMorrow said. “This could be financially, physically, even emotionally.”
Privacy laws such as the federal Health Insurance Portability and Accountability Act are obstacles in helping elderly clients because many businesses and medical personnel will not release personal information to anyone but the client, McMorrow said. If a paralegal does not have a power of attorney over a client’s medical care, a family member could add the paralegal’s name to records so he or she doesn’t have as many obstacles to overcome in obtaining information.
Many jurisdictions are beginning to recognize the growing problem of elder abuse and are making attempts to address it. In Placer County, California, the district attorney’s office created an Elder Abuse Victim Witness program, McMorrow said. The program sends out an advocate to talk to the victim, help him or her prepare for trial, provide transportation to and from court, and “alleviate any fears they might have.”
Meeting the Challenge
In order to meet the growing demands of an aging population in America, elder law paralegals can play an important role. Understanding family dynamics, watching out for the client’s well-being, recognizing signs of elder abuse and staying current with the latest changes in state and federal regulations — these are all key factors for a happy client and a successful paralegal career in this expanding specialty.
Tim Pareti is a Chicago-based freelance writer. He has written articles for the American Bar Association, Chicago Tribune and Texas Lawyer. He holds a master’s degree in journalism from Texas A&M University at Commerce and a paralegal certificate from Harper Community College. He is a member of the Lambda Epsilon Paralegal National Honor Society. His e-mail address is tpareti@juno.com.
