THE Cambridge Connection - Episode 38

It’s really great. It is great. And another message, fake news, can come from friends and family that think they know everything. And as an individual, you must be your own advocate and find that you’re getting the right information from true professionals that know what they’re talking about. Just to latch on to that for a second, my oldest daughter is a medical doctor and she always says, do not go on the internet and look up what you think is wrong with you and self-diagnose.

And I think that applies to so many different pieces of our lives. Indeed. Well, they say, what, money can’t buy me love and happiness. It certainly can buy you grief and aggravation if you don’t handle it right. Absolutely.

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So we’re going to save enough time for Gina. We’re going to take a quick break. This is The Cambridge Connection. We’ll be right back. Spring is here and it’s a great time to clean up your debts with a debt management plan from Cambridge Credit Counseling.

Reduce your credit card interest rates and lower your monthly payments. Call Cambridge Credit Counseling today. 1-800-CAMBRIDGE. Welcome back, everyone. This is The Cambridge Connection.

Guest introduction and background

I’m your host, Gordon Oliver, here with my substitute co-pilot, Lisa Riley. And we have our special guest today. We have Gina Barry from the law offices of Bacon & Wilson. Hello, Gina. Hello.

Hi, Gina. Hi. Thank you for having me. We thank you for your time. We had a guest on, Michelle Altubello, who works in an assisted living facility.

And we were talking about some of the challenges from that side. And in the financial times that we’re in, and I’ll tell you personally, I had similar situations with dealing with my mom before she passed away, and this information couldn’t be more important for people that are dealing with long-term care. So tell our listeners a little bit about yourself and your bio. Well, I am an estate planning, elder law, and real estate attorney with Bacon & Wilson. I’ve been practicing 22 years, and one of my favorite things to do is to help families navigate the care system, and particularly how to find financing for care that their loved one would need.

So that’s one of my favorite things to do. Yeah. And this show is about everything financial wisdom, financial empowerment. And I think one of the things that, in the many years that I have counseled people and talked to people about their financial situations is, this is a difficult conversation sometimes, and certainly one that shouldn’t be done when you’re in the midst of this situation where an elderly family member needs assisted living care. So I guess the first message is, obviously, this is something that should be talked about way before an event, because you need to do some planning.

Medicare coverage for nursing home care

100%. So the most successful planning actually happens at least five years prior to someone needing any type of care, whether it’s home care, assisted living, or nursing home level care. And that would also be, of course, when the elder is able to participate in their own planning, which is great. So yes, time is of the essence. That doesn’t mean that we can’t help families who find themselves in crisis.

We do a lot of crisis planning, which is what we call, you know, the planning on the nursing home steps. But what I find a lot of times is that there’s a lot of either misinformation or a complete lack of information. And so I’m really happy to be here today to say, there are professionals out there that can help you with this, and just letting them know where to find us. Yeah. And even in, you know, again, my career, just as a human being, traveling through time, have seen this messaging again and again and again, and how important this is.

And you write for a newsletter called Prime. Is that correct? That’s correct. Yes. Okay.

Prime is a reminder publication. I’ve been writing for them for 17 years. And what I do is I usually provide them about 750 words, so nothing that’s too heavy of a read every month on topics related to estate planning, elder law, residential real estate, and we know whatever might be timely. So yeah, and those articles can be found on our website. com.

And at the end of each article, my contact information is there. So if you access the article, you can certainly reach me. Awesome. This is all about who’s going to pay and how do you protect your assets, right? So one of the first things you address is that Medicare doesn’t pay.

So can you talk about that a little bit? Right. So a lot of folks think if they go to the nursing home that Medicare is going to pay for them because Medicare has paid for them in the hospital. And so Medicare does cover hospital stays, and it will cover usually skilled nursing in a nursing home, so that means rehabilitation. So you’ve broken a hip, and you’ve come out of the hospital, and now you’re in the rehab facility, which is probably a nursing home.

home on another floor. And so you’re able to stay there under your Medicare benefit. Medicare will pay 100% of the first 20 days for that rehab, 80% of the next 80 days. And if you have an additional Medigap insurance, usually it’s like an AARP or it could be Blue Cross Blue Shield, whatever it might be, that one will pay that gap, that 20%. But at any time during that 100 days, if you are no longer in need of skilled nursing services, the Medicare benefit will cut off.

And they are required to give you a letter called a Medicare cut letter that says after this day, Medicare is not paying for you. So if that person can then not go home and they have to stay permanently in that facility because they weren’t able to recover to an extent that they can go home, then that’s when we’re going to have to find an alternative payment source. So Medicare is not going to pay for the nursing home for the rest of someone’s life. So Gina, if somebody’s in that situation and they don’t have any other funding to cover it and they’re not done with their rehabilitation or their medical needs, can the nursing home kick them out? I’ve not actually seen someone being, you know, kicked out without some more due process.

So they’re not allowed to simply send someone into a dangerous situation. There are appeal rights with respect to Medicare. There’s also an organization that we work with, the Center for Medicare Advocacy, that, you know, will handle appeals and what have you. So sometimes it’s possible to get more Medicare. But usually what happens is once the Medicare cuts off, if the appeals are exhausted and the person cannot go home, then that’s when we’re going to look at perhaps applying for Medicaid as opposed to Medicare or using private payment.

Or if we’re really lucky, there might be some long-term care insurance. But most folks who are at this stage of their life now did not have long-term care insurance made available to them for purchase or weren’t able to purchase it. And so that’s where Medicaid comes on the scene and becomes the benefit that most people are looking to obtain. The costs at some of these facilities, I mean, you’re talking, I mean, I’ve seen numbers like $12,000, $13,000, $15,000 a month. A month.

Five year planning and Medicaid

A month. You got it. And that just, I mean, that adds up. So we had brought up the second topic that you had in this newsletter was you may need a five-year plan. So for people that are listening, again, think about that cost.

If one of your elder family members gets ill and all of a sudden has to go into an assisted living facility, now you’re going to be faced with needing to do this. And the five-year plan is so important because you want to try to set the family up so that they can protect some of the assets strategically from being liquidated to pay for these services. Right. So you do need a five-year plan at best. However, as indicated earlier, it is possible to do some crisis planning.

And to say that, you know, normally we are looking when it’s $12,000 to $15,000 per month, that is usually nursing home level care. Assisted living care is usually, you know, $6,000 in that range up to the nursing home range. And then at some point, you have the assisted living plus additional care being added to where you’ll reach a point where you probably should be switching level of care into the nursing home. So the assisted living is going to be less expensive than the nursing home because it’s not as intensive in terms of the care that’s being provided. But even at $6,000 a month, who can afford that?

Right. You know, very few people. And so in today’s call, we don’t have enough time to really talk about all the different home care programs, assisted living programs, veterans programs. There’s so many different programs that are available. And the home care programs are under, again, you know, the Medicaid umbrella.

Assisted living programs under the Medicaid umbrella. But I think if we can talk today about nursing home and then but know that there may be other programs available because this type of planning is so specific to someone’s situation that no one should be navigating this based on, you know, a few minutes that they’re hearing on the radio show today. They should definitely be reaching out, you know, to a professional who can analyze their specific situation in order to get them qualified for the program that’s going to be best for them. The reason that we say to plan five years in advance is because if you want to protect assets from costs, most of the programs that you apply for, they’re going to ask you, have you in the past five years given any of your assets away? And of course, the reasoning is that if you have given assets away, they want to know because that means those are assets you could have used to pay for care, but you chose to give them away.

And so if they find that you’ve made a gift within that five-year period, there will be a penalty that’s associated with having made that gift. And the easiest way to beat the system is to have made any gift that needed to be made five years in one day prior to needing to apply so that when you apply and they ask, have you made any gifts in the past five years, if it’s been at least five years in one day, the honest legal answer is no, I have not. If there are gifts within that five-year period, those sometimes have to be returned and it’s not going to be as successful as a gift that was made five years prior, five years in one day prior. So Gina, what’s the percentage of clients that you run into that actually will create a five-year plan versus go into crisis planning? Because I would think with, you know, people living longer, staying home longer, staying in their homes longer, there’s more health care within the homes that can be navigated, that maybe the crisis care has become sort of the top priority in your world versus the planning care, but maybe I’m wrong.

No, actually, I would say the planning is probably 75%, 25% crisis planning. And that’s because we are far more effective at preserving assets if the planning is done in advance. When the planning is done on the nursing home steps, our options are far more limited. And so folks who have their eye on the horizon and say, oh, there could be care needs in the future, are contacting us and we’re also raising it as part of their general estate planning. So sometimes they’ll contact us and say, you know, we’d like to put a will in place and we’ll say, okay, great.

And during that meeting where we’re fleshing out all of their goals and concerns, we will raise the issue, do you have concerns about long-term care and how you might pay for it? And if so, then we can offer that advice. So the clients that we’re working with, we do try to put that on their radar, you know, several years in advance, but sometimes people just don’t know what they don’t know and that’s, you can’t fault someone for that. And that’s what the show is all about, raising awareness on such important information like this. If you don’t mind, we’re going to take a quick break.

Break and podcast promotion

If we can hold you over, we can continue this conversation to give more of this great information. All right. We’re going to take a quick break. This is Gordon Oliver with The Cambridge Connection. We’ll be right back.

Well, Tina Marie, here we are already in our mid thirties. Have you checked your license lately? You’re a far cry from being in your mid thirties. No, no, not me. Our show, The Cambridge Connection, we’re already more than halfway through our first year of great guests and need to know topics.

Oh, I thought you were talking about your age. Well, that would take a lot longer than we have in this message, but what only takes a moment to share is that if you miss any of our shows on Saturdays on WHMP, don’t worry. com, click on podcasts, and all of our shows are listed there. Plus, listeners can find us on all the podcast sites where they listen to their favorite podcast. Well, when I get home, I’m going to listen to my favorite episode.

And what’s that? You know, the one with me in it. Welcome back, everyone. This is the Cambridge Connection. I’m your host, Gordon Oliver, here with my substitute co-pilot and producer, Lisa Riley, and our special guest, Gina Barry-Esquire from Bacon & Wilson.

Wills health care proxies and power of attorney

And we’re talking about planning for long-term care. And this is really, again, I wish we had a three-hour show to do this because it’s so much information to unpack. And again, even at least there’ll be some awareness on things that people can go look towards to start putting a plan together or thinking that they should be starting this conversation with their family. So Gina, you mentioned before we took a break about people coming in and start the conversation with you regarding estate planning, will, and last will and testament. What is the average age of that person coming in to start the last will and testament?

Because when my girls were really little, like 30 years ago, my husband and I had a will drawn up in case something happened to both of us. We wanted to make sure they were taken care of. In my mind, there really isn’t an age limit or starting point on when you start that conversation, but maybe I’m wrong. No, I mean, I think we’re talking about sort of different segments of the population. So we do estate planning for someone who’s age 18 until they pass away.

So my oldest client, I think, started her planning at 98. So we can plan for anyone who’s over the age of 18. When do we raise these issues? Probably when someone has reached their 60s and definitely if they’re older than that. So I would say that’s when we sort of see people starting to focus on it.

But a lot of times what people think about is, oh, well, I know I’m going to die, right? And so that’s what brings them into the office. And then if they don’t know the questions to ask, that’s where we come in as the professionals to say, have you also looked at this aspect of your planning? And so when someone comes in for estate planning, yes, we look at their will, which of course talks about how their assets are distributed if they were to pass away and who’s going to be in control of that process. The person known now as the personal representative used to be the executor.

We also look at planning for disability. So there’s some additional documents that we would recommend for that. And then if it’s appropriate, we’ll raise the issue of long-term care. You know, is that something that’s on the radar that you’re concerned about? And some people will say no, and other people absolutely will want to hear what the possibilities are for planning to have a better result for their family if they do need that care.

Can you talk about the dark side? Like if you don’t have a last will and testament and you pass away, what are the consequences of that? So first of all, I want to just clearly say that a will is for assets that you leave in your name alone that have no beneficiary. So many people think if I have a will, I avoid probate. Probate is the process of passing assets that you’ve left in your name alone with no beneficiary.

So having a will is going to make that process more efficient, less expensive. And so that’s why you want to have a will, so that if that process has to be undertaken, it’s going to be orderly. There’s going to be a person named who’s in charge. So you don’t have a will. If you don’t have a will, what’s going to happen is the state is going to essentially make, I should say the commonwealth, is going to make a will for you.

So assets will pass to your intestate heirs, meaning your heirs if you don’t leave a will. Your spouse is also an heir, and so the state has set up a distribution system that they think most people would agree with. You don’t have to leave your money to your children. You don’t have to leave your money equally. You don’t have to leave, you don’t really have to leave it anywhere except to your spouse.

Your spouse is the only person you can’t fully disinherit. So not having a will means you gave up the power to talk about how you wanted your assets to be distributed. So say, for example, you wanted to repay something to a charity or, you know, you had cancer and they really helped you and you wanted to acknowledge that, you know, your will is where you would do that. So if you don’t have a will, you’ve given up the ability to do that. You’ve also given up the ability to name who’s in charge.

So say you pass away and you don’t have a spouse, but you have children, three children. If you haven’t said who’s in charge, then all three of your children have equal right to be in charge. And you know what that can lead to? Arguments. Absolutely.

And fighting. And then you’ve got a mess. And so having the will in place is going to, again, put order into the process, make it more efficient. And there are also administrative provisions that will make the processing of the probate estate much less expensive and time consuming than it would be without the will. So Gina, do different states have different laws when it comes to wills and health care proxies?

I mean, we have a large base of listeners across the United States because this show translates into a podcast each week and it is distributed on all different podcast sites. So there are a lot of people, some of our biggest listeners are in Oregon and out on the West Coast. Does it matter where your health care proxy or your will were written, even if you’re living somewhere else? So generally speaking, if someone creates a will or a proxy, health care proxy or a durable power attorney in one state and they move to another, if it’s possible, we would like to see them update that document simply because there can be local practice that could impact it. However, generally speaking, there is full faith and credit between the United States.

So if you create a will in Massachusetts, it’s valid here. The other states are going to determine that to be a valid will as well. But to give you an example, if you have a will here and you’ve named your friend to be your personal representative, that will in Florida could be problematic because Florida wants your personal representative to be either a Florida resident or a family member. So there could be problems moving from one state to the next. So when you establish your will, you obviously want to do that in a state where you live and then if you move, if you’re able to, I would say have a local practitioner take a look at it.

I did want to just touch on quickly the health proxy and the power of attorney just to make sure that the listeners understand what those are. So, of course, the health proxy is naming someone to handle your health care decisions. If you can’t, power of attorney is naming someone to handle your financial decisions if you can’t. And those two documents are absolutely critical and they might have slightly different names in different states. So it might be an advanced health care directive or something along those lines.

But those are critical for keeping you out of the probate court. If you don’t have those documents in place and you lose capacity to make those decisions, your family members or loved ones will have to petition the court to become your decision maker. And that’s a very expensive, very lengthy. And it’s also very public. So you can keep things private and less expensive and much more efficient by having a plan in place.

Advice and cost considerations

If you packaged all together from your experience, you know, what’s the one main piece of advice you can give to people listening today? and just general experience on what people should be doing. Take their advice from a qualified professional. Not a family member, not a friend, not the one that thinks they know exactly how it works. Exactly, because there’s so much misinformation and really the professionals are the ones who are going to be able to navigate you through the minefield and get you to the, you know, approval for benefits or the documents that you need to make sure that everything is carried out efficiently, effectively, with the least amount of cost and consternation for your family and loved ones.

And on the financial wellness, financial empowerment side from here, it’s if you think that the cost of hiring a professional like yourself to do this versus the cost of if it gets caught in probate because you didn’t plan accordingly, it’s not even close. Right, and we do spend a lot of time cleaning up mistakes, things that perhaps were overlooked, what-have-you, and it’s definitely much more expensive. And unfortunately, you know, it’s the family that takes the brunt of that, you know, so prior proper planning is what we’re looking for to get the best result. So Gina, before we let you go, can you give a rough estimate of what a cost in your firm or working with you would be estimate, could give a range, to just do a health care proxy and a power of attorney, not even get into the will component? Yeah, that’s usually just a few hundred dollars apiece, so maybe five, six hundred dollars, somewhere around there.

Again, a very small investment to protect a very, very big potential loss. Massively. If you have to go to court for either a financial or a medical decision maker, you’re probably going to spend about $2,000. Yep, absolutely. Yeah.

All right, two questions. Number one, would you come back on the show again so we can continue this conversation? It’s so meaningful. Absolutely, anytime. Awesome.

And then lastly, can you let our listeners know, once again, where they can find you? Yes, so I am at Bacon Wilson. com. Gina, thank you so much for being our guest today. This information is so incredibly important, so thank you again for joining us.

Thanks, Gina. Absolutely, my pleasure. Thank you. All right, this is The Cambridge Connection. We’ll be right back.

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For over a century, Bacon Wilson PC has been a trusted resource for individuals, families, businesses, and municipalities in search of strategic, personalized legal services. They currently have five locations, including Springfield, Amherst, Hadley, Northampton, and Westfield. With over 125 years of experience, they are comprised of over 40 attorneys and 80 supporting staff professionals. Bacon Wilson PC is consistently recognized for legal excellence and for dedication to the community, as Bacon Wilson attorneys practice in nearly all areas of law and are able to address a myriad of legal concerns that you may face. More importantly, their dedicated attorneys have earned the trust of clients throughout Western Massachusetts and Northern Connecticut.

com or call 413-781-0560. That’s 413-781-0560. Welcome back, everyone. This is The Cambridge Connection. So did you bring us a quote?

Closing quote and sign off

Of course you know I did. Are you ready for it? I’m always ready for your quotes, Gordy. I believe that the biggest mistake that most people make when it comes to their retirement is they do not plan for it. They take the same route as Alice in the Story from Alice in Wonderland, in which the cat tells Alice that surely she will get somewhere as long as she walks long enough.

It may not be exactly where you wanted to get to, but you certainly get somewhere. Mark Singer, The Changing Landscape of Retirement, What You Don’t Know Could Hurt You. m. com and click on podcasts or you can find the show where you listen to your favorite podcast shows. Once again, be part of the conversation.