Promise Law elder law attorney Elizabeth Bircher recently gave a well-received presentation on Common Legal Misconceptions that was too good to not share albeit in an abbreviated format.
Misconception #1: If I can’t make my own decisions, my family can step in
Fact: If you have a Power of Attorney (POA), then your named Agent can manage your financial affairs to the extent the POA authorizes. Without a POA, someone who has authority on your bank accounts can sign checks and/or withdraw funds. If more extensive authority is necessary or if you do not have a POA, then the Court will need to appoint a conservator to manage your financial affairs for you.
If you have an Advance Medical Directive (AMD), then your named Agent can make your medical decisions to the extent authorized by the AMD or in accordance with your wishes, if known. If you do not have an AMD, then Virginia law lists a hierarchy of decision-makers with whom health care providers may consult but are not required to. If there is a disagreement among your statutory decision-makers or if you do not have an AMD, then the Court may need to appoint a guardian make your medical decisions for you.
Misconception #2: My Will or Trust will dispose of everything after my death
Fact: Maybe or maybe not! A Will or a Trust only disposes of the assets that it controls. That seems obvious, but it is a common occurrence to have assets that pass outside of the control of a Will or a Trust, perhaps to a surviving joint owner, or by a beneficiary designation, or through pay on death or transfer on death provisions. While each of these mechanisms has merits, it is important to understand how they operate to support or frustrate your overall wishes to manage and distribute your assets.
Misconception #3: My family will “do the right thing” after I die
Fact: Your family may want to “do the right thing,” but it may not occur as you planned anyway. Different family members may have different recollections of what the “right thing” was supposed to be, leading to dissension or fractured relationships. External forces such as a bankruptcy, a divorce, a lawsuit, an injury, a layoff, etc., may interfere with, if not prevent outright, your loved one’s ability to “do the right thing.”
Misconception #4: Medicare will pay for nursing home care
Fact: Medicare pays for limited, medically-necessary rehabilitation services following a qualified hospital stay, which is an admission to the hospital, not “observation status,” for at least three nights (the “3 midnights” rule). Medicare pays 100% of the cost for the first 20 days. For days 21 – 100, the patient has a co-pay, which most Medicare supplemental insurance policies will pay. The cost of rehabilitation that is longer than 100 days is the patient’s responsibility. Rehabilitation services may end, and usually do, if they are no longer “medically necessary,” such as when a patient has plateaued, meaning that the patient’s condition both will not improve if additional rehabilitation is provided and will not decline if rehabilitation stops. If the patient is readmitted to a hospital within 60 days of the end of the rehabilitation services, then the rehabilitation services available pick up where the prior stopped. The patient must have 60 consecutive days out of the facility to earn a new full 100-day rehabilitation benefit.
Misconception #5: Medicaid will “take my house” if I enter a nursing home
Fact: Medicaid does not want your home, but it does require that the applicant be resource and income eligible to qualify for its services. In many cases, the home is “exempt,” which means it is a resource, but it does not count against the applicant’s financial eligibility. In other cases, the home would count, but other rules may allow us to exempt it, at least temporarily. The Medicaid rules are different for married couples and single people and a house may be subject to estate recovery if it is owned at the applicant’s death.
Contact an Elder Law Attorney
The elder law attorneys at Promise Law have seen it all in estate planning and administration and elder law. We can help you put your mind at ease about your personal and financial affairs. We promise that we can demystify the planning process so that you can make choices that align with your concerns and values. Call (757) 279-8127 or contact us online to learn how Promise Law can help.