Tag Archives: Maine elder care attorney

Long-term health care planning for same sex couples

By Patrice A. Putman, Maine elder law attorney

On June 26, 2013, the US Supreme Court overturned essential parts of the Defense of Marriage Act, a decision that has a major impact on many of my friends and clients. Until then, the federal Defense of Marriage Act “DOMA” did not allow the recognition of same sex marriage. This meant that a married same sex couple who had lived together for 20 or even 60 years was not able to take advantage of the hundreds of federal benefits that the government gives to married heterosexual couples. Many people realize that same sex couples have not been able to take advantage of the tax benefits associated with filing joint federal income tax returns or Social Security benefits. Something that people are less aware of is the inequity in how long-term care rules have applied to these couples. Now, in Maine, a state where same sex marriage is recognized, these inequities can begin to be addressed.

When a family receives a diagnosis of dementia, they not only need to live with frightening health consequences, they also need to deal with a myriad of financial consequences. Where health insurance and Medicare pay for the diagnosis and treatment of most illnesses, they do not pay for long-term care costs when a person needs to move into an assisted living or nursing home. Only long-term care insurance and Medicaid (called MaineCare in Maine) pay for long-term care. Long-term care generally costs $70,000 a year or more. MaineCare will begin contributing to long-term care costs when a person has less than $10,000 in assets.

When a married person moves into an assisted living facility, MaineCare allows the couple to transfer their assets to the spouse who still lives at home. This means that while the spouse who moves into the assisted living facility can only have $10,000, the rest of the couple’s assets can be kept and used by the spouse at home. When a married person moves into a nursing home, MaineCare allows the spouse living at home to own a home, a car, personal property, and have other assets totaling $115,920. Unmarried couples do not have these options. Only the $10,000 rule applies to the unmarried person.

Now that the Supreme Court has declared significant parts of DOMA to be unconstitutional, the federal government must begin providing same sex spouses the same ability to transfer and protect their hard-earned assets that other married couples have always had. Now, when dementia hits a married gay or lesbian couple, they will have the same heartbreak and the same financial concerns that other married couples have, not 100 times more – at least if they are lucky enough to live in a state like Maine where same sex marriages are allowed and recognized.

The information provided here is for educational purposes only. It should not be construed as rendering legal advice or offering an answer to a specific legal problem.

Second marriages: what if your spouse requires expensive long term care?

By Sally Wagley, Maine elder law and estate attorney

We have had a number of clients, either divorced or widowed, become happily married later in life. Sadly, after a number of years of love and companionship, one of them may start to decline and need expensive care in a nursing home or assisted living facility. For purposes of discussion, we’ll assume that the husband is the one who needs institutional care, with the wife remaining at home. The wife may find out to her chagrine that she is expected to use her own assets — accumulated by her before the marriage from a lifetime of work –on her husband’s nursing home costs. She may find out that after he has depleted his own funds, he will not qualify for state assistance through Maine’s Medicaid program (called MaineCare) until she has spent down her own funds to a certain point. This causes her great anxiety, for two reasons: most important, she wants to make sure that she has enough to live comfortably for the rest of her life; in addition, she may want to be able to pass on assets to her own children.

What can a couple do in this situation? Advance planning, while both are still healthy, is the best option. If they qualify for and can afford long term care insurance, that will make it less likely that the wife will have to spend down her own savings. Another option is an irrevocable trust, whereby the wife places some of her own assets into an irrevocable trust, naming one or more of her children as trustees. She gives up control of the principal in the trust but will receive income from it. In this way, she can put some of her assets off limits for purposes of her husband’s possible future long term care expenses. In order for her to safely do this, however, she must feel reasonably confident that neither she nor her husband will need long term care in the next five years, as MaineCare has a “five-year look-back” rule which penalizes people who transfer assets in order to qualify for MaineCare.

For a couple who is already in crisis, there are still options. The spouse may purchase a certain type of annuity which meets the requirements of the law. This annuity will protect her assets while providing a stream of income. She can invest her countable assets into exempt assets, such as repairs or improvements to her home, or the purchase of a newer car.

As a last resort, some spouses choose to divorce for the purpose of preserving assets. This is a wrenching decision for most clients, but may be the only option for ensuring that the spouse at home to preserve what she has worked so hard for over the years. This divorce, however, will not prevent the wife from continuing to provide love, companionship and care to her husband, just as if they continued to be married.

Second marriages: providing for a surviving spouse in a trust

By Sally Wagley, Maine elder law and estate attorney

We have had a number of clients who fit the following profile: They are married for a second time, each with children from a previous marriage. One of them has substantially more than the other. Let’s assume for discussion purposes that the husband is the one with more than the wife. The husband wants to ensure that, should he die first, the wife has enough income to live comfortably for the rest of her life. However, he does not want to leave assets to her outright, as he wants to make sure that his children will ultimately inherit.

One option is for the husband to leave some or all of his estate to a trust for his wife’s benefit. Such a trust typically provides that she gets all the income generated by the assets placed in trust, to give her a stream of income which is adequate to maintain her standard of living. The trust may provide, in addition, that should the trust income and her own income be inadequate, the wife can receive amounts of principal which are needed for this purpose.

Who should be the trustee of this trust? One option is for the husband to name one or more of his children as trustees. If his estate is substantial, it is possible to have a bank serve as trustee. Or, if the husband trusts the wife to be a responsible trustee and to abide by the rules of the trust, he can name her to be the trustee, with one or more of his children to become the successor trustee if she becomes incapacitated.

This arrangement may be coupled with giving the wife a life estate in any real estate which he owns separately, such as a primary home or a cottage.

Second marriages: pre-nuptial and post-nuptial agreements

By Sally Wagley, Maine elder law and estate attorney

Some clients who marry later in life do not think, before the wedding, about the usefulness of a prenuptial agreement. In the flush of romance, these clients may not have their minds on practical matters, such as ensuring that their assets will remain separate should they divorce and ensuring that children from previous marriages will inherit.

After the wedding, when things calm down, these clients may turn their attention to these sobering issues. They may, at that point, wish they had executed a prenuptial agreement. Is it too late for these clients to execute an agreement of this kind?

No, it is not too late for these clients. Post-nuptial agreements under which each member of the couple agrees to forego certain spousal rights in the event of divorce or upon death. In this situation, each one will need to see advice from his/her own lawyer, as a single lawyer would face a conflict of interest in representing them both. Also, each one has to make full disclosure to the other of all financial assets that each has, so that there are no secrets between them in this regard.

Second marriages: the “elective share,” your spouse’s right to part of your estate when you die.

The law in Maine is such that, absent an agreement to the contrary, a married person cannot disinherit his or her surviving spouse. The law gives the surviving spouse the right to go to court to demand that he or she receive at least one-third of the deceased’s “augmented estate.” The determination of the amount that the surviving spouse can receive takes into account not only the assets in the deceased spouse’s name but also some of the surviving spouse’s assets.

We have many clients who marry later in life, sometimes for the second time. Each spouse has accumulated assets separately and may have children from a previous marriage. One or both spouses may wish to favor his or her own children in the will, choosing not to leave anything to the surviving spouse or perhaps to leave only a modest amount. For those clients who die without being aware or without addressing the “elective share” issue, the deceased’s children may be in for an unpleasant surprise, should the surviving spouse choose to seek more from the estate than what was left to him or her in the deceased’s will.

Clients who are either planning to marry or who are already married, who wish to agree that neither will file for the elective share against the other’s estate can put this in writing in a prenuptial or postnuptial agreement.

Change in Medicare’s “substantial improvement” standard

By Patrice A. Putman, Maine estate and elder law attorney

Aging is never easy and many people experience a short hospitalization followed by a longer stay in a skilled nursing facility. Eldery people in Maine and elsewhere have generally understood that their hospitalization will be covered by Medicare and that Medicare can cover skilled nursing care for up to 100 days. After 100 days, continued care is considered “long-term” or “custodial” care which Medicare does not pay for.

Up until the fall of 2012, Medicare had a practice of only paying for a skilled nursing facility so long as the patient continued to make “significant improvement”. If the patient was no longer making significant improvement, Medicare’s practice was to stop paying, even if this was well before the 100 day allowance. Last fall, this practice of terminating coverage based on the “substantial improvement” standard ended. Now, the new standard for continued Medicare coverage is a whether the patient needs skilled care — even if it would simply maintain the patient’s current condition or slow further deterioration. The stated standard is “The skilled services must be reasonable and necessary for the diagnosis or treatment of your condition.” The care must also be ordered by a physician. This is a big and positive change to a long-standing practice. Medicare is now covering some patients that it was not covering just six months ago.

If you or a loved one is denied Medicare coverage for skilled nursing care in Maine, it may be helpful to meet with us. We are Maine elder law attorneys (referred to sometimes as “elder lawyers” or “elder care attorneys”). We would review the situation to determine whether you are entitled to continue coverage and then help you resolve this with Medicare.

The information provided in this post is for educational purposes only. It describes the law in effect at the time the materials were written. This information should not be construed as rendering legal advice or offering an answer to a specific legal problem.

Average annual nursing home cost now $87,000 per year

By Sally M. Wagley, Maine elder law attorney

 The cost of paying privately for care in a nursing home rose 4.4% in 2011, nationwide, according to a survey done by MetLife.  The current cost of one year in a nursing home is, on average, $87,000.

The cost of care in a Maine nursing home is at least this much, if not more:  generally in the range of $7000 to $8000 per month.

 What might this mean for you and members of your family?  Consider the following:  

  • Do you have adequate income and savings to cover years in a nursing home? 
  • If you were in a nursing home and your spouse were at home, how much would your spouse need in order to remain comfortable?
  • Is it important to you to pass on something to the next generation?   How would you feel if your savings were completely used up on the cost of your care, before you die?
  • What if you had to sell your home or other property in order to pay for your nursing home care?
  • Are you aware that Medicare covers only short stays in a nursing home –only for skilled care and rehabilitation? 
  • Do you know what the Medicaid program (called “MaineCare” in Maine) covers in your state?
  • What is the quality of care at nursing home and assisted living facilities in your area?
  • Have you checked out long term care insurance, to see what it covers and what it would cost?
  • Have you met with a elder law attorney (also referred to as an “elder lawyer” or “elder care attorney”) to find out what coverage might be available to cover some of the cost of your care, and what you can do to get that coverage?  

Be aware that each state is different with respect to nursing homes, Medicaid and other programs. While there may be books on this subject at your local book store, those books won’t tell you the specific things you should know about Maine nursing homes and Maine elder care.  Also, beware of advice given by neighbors and friends.  Each person’s situation is different, and what may have helped someone else won’t necessarily help you.   

In my blogs, I will be addressing some of these issues in the coming weeks.

Proposed cuts to prescription drug help for Maine’s elderly

By Sally M. Wagley, elder law attorney

As an attorney focusing on elder law, I am carefully watching the Maine Governor Paul LePage’s proposed cuts to MaineCare programs serving the elderly.   My last blog post was about the proposed elimination of coverage for residential care (also known as “assisted living” or “boarding home” care).  

The Governor’s budget proposal also includes cuts to prescription drug assistance to Maine’s elderly.   According the Spectrum Generations, the proposed MaineCare cuts are as follows:

  • Prescription Drug and Health Care Assistance for People over 65 and People with Disabilities: Approximately72,000 Maine elderly and people with disabilities would lose some or all assistance they currently receive to pay for Medicare and/or prescription drug costs. Of the 72,000, over 20,000 (with incomes between 135-185% FPL) will lose all assistance they currently receive through the Medicare Savings Program (MSP) to help pay for Medicare premiums, co-payments and deductibles, prescription drug costs, and coverage through the so-called “donut hole”. The remainder, approximately 52,000 people, will lose some assistance with Medicare and/or prescription drug costs.
  • Prescription Drug Assistance for Certain People over 62 and People with Disabilities: Approximately 5,000-6,000 low-income older adults (over age 62) and people with disabilities who do not have Medicare will lose all assistance they currently receive to afford their prescription medications through the Drugs for the Elderly program (DEL). These are individuals with serious health conditions such as diabetes, heart disease and Lou Gehrig’s Disease.

These MaineCare cuts, of course, must have legislative approval in order to go into effect.  Hearings are being held at the State House right now.  More details will be coming.

Governor proposes: no more MaineCare for assisted living and residential care

by Sally M. Wagley

This week Maine’s governor released his proposal for cuts to the MaineCare (Medicaid) program.   A number of the proposed cuts will affect Maine’s elderly. 

An area of particular concern is the elimination of MaineCare coverage of expenses faced by elderly and disabled people who live in residential care and assisted living facilities.   As an elder law attorney, I have many clients in these facilities who cannot afford to pay the monthly cost of $4000 to $7000, who are on MaineCare or will need to apply for it soon.  I also have many clients who are stressed out caregivers who cared for an elderly relative for as long as possible, before reaching the point of exhaustion.  

Assisted living and residential care facilities are for elderly people, many of them with Alzheimer’s and other forms of dementia, who need supervision around the clock. In these settings, they are provided with security, reminded when to eat, dress and bathe, are helped with medication, and provided assistance with some activities of daily living.

 Where will these people go if they can’t get MaineCare and can’t afford to pay privately?  Most will not meet the criteria for nursing home level of care.  So they will have to return to live with exhausted spouses and other relatives, many of them also elderly and with health problems).   For those without families or homes to go to, or whose families simply cannot take them back, the outcome is not clear. 

 The governor’s proposal is at this point just that — a proposal, which will need legislative approval before it becomes a reality.  Regardless of whether you agree with the governor, it is important to be aware that this change may be coming.

New law requires financial institutions to honor Maine powers of attorney

New law requires financial institutions to honor Maine powers of attorney

Have you ever tried to transact business on behalf of an elderly or disabled relative using that person’s financial power of attorney (POA)?  Have you been told by the financial institution that it will not accept the form because it was a) signed too long ago, or b) is not on the institution’s preferred form?  This scenario can be extremely frustrating if you are trying to look after someone, paying bills and monitoring investments.  Your elderly or disabled relative may now be too incapacitated to sign a new POA on a form acceptable to the financial institution, requiring you to spend time and money getting a court order appointing you conservator. 

Hopefully, this will change as of July 1, 2010, when a new Maine law, the Uniform Power of Attorney Act, takes effect.  The purpose of the law is to make it easier to use validly executed POA’s.  Under this law, financial institutions are subject to penalties if they fail to honor powers of attorney which have been properly acknowledged (witnessed by a notary public or attorney at law):

  • Institutions may not require an additional or different POA form if the form you have grants you the authority to perform the act requested.
  • Institutions have a maximum of seven days to honor a POA. 
  • If an institution has a question of concerning the validity of the document or your authority as “agent”, the institution must, within that seven-day period, ask you to sign a “certification” of your authority, or must seek an “opinion of counsel” (letter from an attorney regarding the legality of the document).
  • Once the institution has obtained the certification or opinion of counsel, it has only five additional days to honor the document.  
  • If the institution violates these rules, and if you have to obtain a court order confirming the validity of the POA, the financial institution will be required to pay attorney’s fees and costs incurred by you to obtain that court order. 
  • (There are, however, exceptions to these rules.  An institution will not be required to honor the document or pay attorney’s fees and costs if: the institution had actual knowledge that the POA was terminated; if the institution had a good faith belief that you lack authority to perform the act requested; if the institution had a good faith belief that physical or financial abuse, neglect, exploitation or abandonment has occurred; or if it would be inconsistent with federal law to honor the document.)

Should I give my house to my children?

           A question I often hear from clients is:  “Should I give my house (or camp) to my children?”  Clients often believe that deeding property to others will preserve it in the event of nursing home expenses. Clients may also want to avoid probate, or may want children to help with taxes, insurance and maintenance. It is essential for any client considering this move to know the risks and benefits.

 Possible benefits:

  • If the client is able to go five years without needing nursing home care, but later does need such care, the property will not count against the client if the client seeks financial help from the MaineCare (Maine Medicaid) program.
  • If the property is out of the client’s name at death, the State and other creditors will not have a claim against the property.
  • As a condition of transferring the property (especially a camp), children may agree to pay all or part of the property-related expenses, making life a bit easier for a client on a fixed income.
  • The client may, if desired, maintain a degree of control over the property with a life lease or life estate.*

 Possible risks (and some ways to reduce risks):

  • Nursing home expenses:  If the client needs nursing home care within five years after deeding the property, and if the client needs to apply for MaineCare (Maine Medicaid), the client will be penalized for the gift and will be ineligible for MaineCare for a period of months or years.  The client will either have to go without the needed care for that time period or will have to ask the children to pay for care until the period of ineligiblilty is over.
  • Loss of control:  Having given the property away, the client will need to get approval from the children if the client wants to sell or refinance the property.  (The client can, however, maintain the right to live in or use the property by insisting on a life lease or life estate.*) 
  • Child’s creditors or divorce:  If the child gets into financial trouble or bankruptcy or gets divorced, the child’s creditors or ex-spouse may be able to obtain an interest in the property. (However, the transfer of the property to an irrevocable trust may offer some protection against a child’s creditors or ex-spouse.)  
  • Child’s unexpected death:  If a child unexpectedly dies before the parent, the property may go to the child’s own heirs. (The irrevocable trust or a joint ownership arrangement may be helpful in this circumstance as well.)
  • Tax consequences:  If the client transfers a residence to a child and the property is later sold, there will be a capital gains tax, as the client will no longer be able to use the IRS primary residence exclusion.  The client may also lose property tax exemptions, such as the homestead and veteran’s exemptions.  In addition, the child may later, upon selling the property, pay a higher capital gains tax than if the child inherited it (unless a life estate* or similar arrangement is used).  

 Caution concerning life estates:  Be aware, however, that if you reserve a life estate in the property (treated differently  from a life lease under the State’s MaineCare rules), this  may expose the property at your death to a MaineCare “estate recovery” claim.

  Questions for clients:

          Before advising a client about whether to transfer property, I ask the client a number of questions, including: 

  • How is your health? What are the chances that you might need long term care in the next five years?
  • Do you have long term care insurance?
  • Do you have enough money to pay for nursing home care for all or most of the next five years?
  • Are you willing to give up a degree of control to your children? 

          In short, there is no simple answer to the question “Should I give my property to my children?”  While this may be a reasonable step for some clients, for others (especially older people with chronic health problems and little savings) the risks may be too great.  Any client considering this move should first obtain legal advice from a skilled estate planning or elder law attorney.


The information provided here is for educational purposes only, and should not be construed as legal advice or an answer to your specific legal problem.

Sally M. Wagley practices elder law, estate planning and estate administration with the firm of Levey and Wagley, P.A. in Winthrop, Maine, www.leveyandwagley.com.