Wealth Preservation, Trusts and Estates

Annuities have long had a role in Medicaid and nursing home asset protection planning in PA and in other states. There are planning opportunities that allow a husband and wife to shelter a portion of the family assets so that the community spouse (non-nursing home spouse) can remain at home and have greater financial freedom. The case referenced below is a favorable opinion for the Medicaid applicant and should increase the likelihood that certain annuities will be successful Medicaid nursing home planning tools for married couples.
In Weatherbee v. Richman, 595 F. Supp. 2d 607 (W.D. Pa. 2009), the U.S. District Court for the Western District of Pennsylvania reversed the denial of Medicaid benefits to a nursing home resident (“institutionalized spouse”), holding that the income from an irrevocable, non-transferable, non-assignable, single premium, immediate annuity payable to the spouse of the nursing home resident (“community spouse”) was protected under federal law, specifically the Medicare Catastrophic Coverage Act of 1988 (“MCCA”). MCCA provides that the community spouse’s income is completely protected and does not affect the Medicaid eligibility of the institutionalized spouse.
Please call Douglas L. Kaune, PA Lawyer 610-933-8069 for additional information about this case and to discuss Medicaid and nursing home planning opportunities it presents for you.
Wills * Trusts * Probate * Elder Law * Estates * Estate Planning * Asset Protection Planning
Malvern, Phoenixville, and West Chester Law Offices Chester, Montgomery, Delaware, Philadelphia, Berks and Bucks County PA

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by Douglas L. Kaune, Esquire
Estate Planning & Administration, Wills,
Trusts, Asset Protection, Elder Law
Unruh, Turner, Burke & Frees
Phoenixville, Malvern, West Chester PA
Pennsylvania Attorney
dkaune@utbf.com PH: 610-933-8069
 A special needs trust (SNT) (or special needs trust provision in a Will or in another trust) is an important planning option if you are considering a significant gift to a beneficiary who is considered ”disabled” or “incapacitated” and either has or is likely to qualify for government benefits such as social security disability (SSI) or Medicaid.   Generally, the SNT or Supplemental Needs Trust is intended to supplement the government benefits at the sole and absolute discretion of the named Trustee, but you can review this link for some more indepth discussion of the trust options.
The SNT frequently comes under attack by the government entity providing the benefit.  It may be argued that the SNT should be expended for the care of the beneficiary and the government benefits be suspended until the Trust fund is exhausted.   It is our job to make sure that your Special Needs Trust stands up to the scrutiny.  One planning tip is naming multiple income beneficiaries, not just the “disabled” or “incapacitated” beneficiary.  This allows us to argue that the trust is not just for the beneficiary receiving the SSI, Medicaid or other benefit, but is also for these additional income beneficiaries.  Therefore, a complete expenditure of trust assets would be considered to “injure” the income beneficiaries and increases the likelihood that the SNT remains intact to supplement the needs of the intended beneficiary for his or her lifetime.  This is just one of many strtegies we employ to increase the success of these trusts.   We will be reviewing others in the weeks to come.
Please call or email me for further discussion on this and other estate planning topics.
Douglas L. Kaune
dkaune@utbf.com
610-513-2288

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This article was posted
by Douglas L. Kaune, Esquire
Estate Planning, Estate Administration, Wills,
Trusts, Elder Law,
Unruh, Turner, Burke & Frees
Phoenixville, Malvern, West Chester
Pennsylvania Attorney
dkaune@utbf.com PH: 610-933-8069

The Key 2009 Pennsylvania Medicaid Numbers can be found by clicking this link. They include, Community Spouse Resource Allowance (CSRA), Monthly Maintenance Needs Allowance, Average monthly cost of nursing home care in PA, Estate Recovery, Home Equity Limit, Medicaid Transfers and Ineligibility for Gifts. These figures and requirements change annually. Review these important numbers and call to meet with an experienced Elder Law Attorney to discuss ways to legally protect assets from nursing home spending.

Douglas L. Kaune, Esquire

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