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            A recent story that made the news and spread quickly via the Internet reminds us of the importance of having a support system in place because you just never know when you might need it.             In this case it came from a very unlikely source.  A Domino’s Pizza shop in Oregon noticed that one of their very good customers hadn’t placed an order in 11 days.  You wouldn’t think this is abnormal.  I haven’t ordered a Domino’s Pizza since my college days when their tag line was “Delivery in 30 minutes or less or the pizza is free”.  (They changed that a number of years ago after their drivers were involved in accidents which may or may not have been caused by their rush to get the pizzas delivered “on time”.)             But I digress.  In this case 11 days was unusual for Kirk Alexander who placed orders with the Oregon pizza shop every day.  The shop’s managers took it upon themselves to first call Alexander but couldn’t get through to him.  They then sent one of their delivery drivers to his home.  The driver knocked on Alexander’s door but there was no answer despite the lights being on.  He

            Last week I was telling you about the call I received from Shelly.  Her mom was sued by the nursing home where her husband resided for the last 4 months of his life.  She failed to file a Medicaid application which would have covered the cost of that care.  The nursing home obtained a judgment of $40,000 against her and is now trying to collect the money.             I asked Shelly about her mother’s assets.  “She owns a home which has a mortgage, has a minimal amount of money in the bank and $50,000 she is receiving from a life insurance policy on Dad’s life”, Shelly told me.  “The home is worth $250,000 but the balance on the mortgage is $150,000.”             I explained to Shelly that the life insurance proceeds could be attached by the home to satisfy the judgment.  When her dad entered the home her mom signed an agreement that provided that she would do everything necessary to process a Medicaid application if and when that became necessary.  Failing to do so would cause her to be responsible to pay for any services received that are not be covered by Medicaid.             While some nursing facilities will assist in

           Shelly called to ask the following questions, “Does my mom have to tell the nursing home where her bank accounts are located?”  In order to answer the question, I had to dig a bit deeper to find out what exactly was going on.  This is what I learned.            Shelly’s dad had been in the hospital and then moved to a nursing home.  Shelly’s parents had very little assets and the nursing home told her mom she needed to apply for Medicaid.  While it isn’t clear why that was never done, Shelly explained that her mother had been overwhelmed with everything and had “shut down”.              The application never was filed but Dad died 4 months after he entered the home.  Shelly and her mom thought that was the end of the problem until her mom received a bill for $40,000, the cost of care for those months.             What happened after that isn’t exactly clear from what Shelly was telling me but it sounds like her mom continued to ignore the nursing home to the point where they sued her and received a default judgment.  She didn’t enter an appearance in the lawsuit and the home’s attorney went before a judge to obtain

     As the population continues to age and we see the next generation of seniors coming through our office there are differences in the profile of an aging senior today vs. what we saw 15 or 20 years ago.      One change is in the amount of retirement assets that we see as part of the average client’s overall asset base.  It is much higher than 20 years ago.  Likewise, we are seeing fewer and fewer clients with substantial pensions.  We are also seeing clients in their 60’s working full time to try to put away more for retirement knowing that they do not have pensions to rely on for income and Social Security by itself is not enough.  In light of these changes, this week I’d like to take a look at some important changes to retirement account rules.      The amount that may be contributed to an employee’s or self employed retirement account did not increase much because the cost of living index did not increase much.  For 401(k), 403(b) and 457 plans the annual contribution limit is still $18,000 with those over 50 years of age able to contribute another $6000 annually as a catch up contribution.  The total

            Last week I was telling you about Mary who received a personal injury settlement while on Medicaid.  Because she is over age 65 she can’t protect the money by placing it in a special needs trust #SpecialNeedsTrust for her own benefit.  What other option does she have?             What we examine first is whether any other Medicaid exception might apply.  Medicaid regulations provide that a transfer to a disabled individual is exempt from the transfer penalty rules.  The person must either be deemed disabled by the State of New Jersey or by federal guidelines under the Social Security disability program.             I asked Melissa if Mary has a disabled child or grandchild.  She does not.  That left us with two alternatives.  Mary can come off of Medicaid, spend down the proceeds and when her assets fall below $2000 she can reapply.  Her other choice is to give all the money to the State and remain on Medicaid uninterrupted.             Mary and her family were not happy with my answer.  “You mean give it all to the State or the nursing home?  Why did I pursue the case at all if I can’t keep the money”, she asked.             I couldn’t answer the second question

            A personal injury attorney called me recently for assistance.  Melissa had settled a claim for damages resulting from the negligence of a nursing facility in which her client, Mary had been living.  Mary’s net settlement after paying her legal fees and the costs of the lawsuit is approximately $100,000.             Melissa told me it was a good result given the difficulties with the case.  So why was she calling me?  Because Mary was a Medicaid recipient.  Her care at the nursing home is being covered by Medicaid and the receipt of the settlement money will cause her to exceed Medicaid’s $2000 asset limit and she will lose her benefits. Melissa knew this when she took the case.  She just figured that Mary would be able to place the settlement monies in a special needs trust #SpecialNeedsTrust and keep her Medicaid benefits.  Otherwise, most of the money would have to be spent on Mary’s nursing home care at the private pay rate of approximately $11,000 per month.             After she settled the case, however, Melissa learned that she miscalculated in her plan.  That’s because she missed one important limitation in the law that allows for the establishment of a special needs trust. Federal law says