In many cases where a child is permanently injured in an accident or medical mistake the settlement funds are placed into a Special Needs Trust for the benefit of the child. This technique allows parents to provide a better quality of life for their child while maintaining eligibility for benefits programs to provide the minimum medical coverage. Insurance companies that paid for treating a child’s injuries seek to recover their expenses against the settlement as you may expect.

Recently, U.S. District Judge John P. Fullam made an interesting decision in Mills v. London Grove Township. Judge Fullam strictly interpreted the insurance company’s claim for reimbursement to only exist against the ERISA beneficiary which in this case was the child’s father. The litigation on behalf of the child, Grace, was settled by placing the funds directly into a Special Needs Trust to provide ongoing care. Judge Fullam relied partially on this fact to deny the insurance company’s claim for reimbursement against the funds allocated to Grace’s Special Needs Trust.

This is an important decision for parents with children that have been injured and that use a Special Needs Trust to provide for their child. If the decision stands on appeal, parents can hope to preserve more of their child’s funds for their own care without reduction by insurance reimbursement claims.

You can read the full opinion here.

What is the difference between a family that loses hundreds of thousands of dollars to nursing home costs and a family that preserves hundreds of thousands of dollars from nursing home costs? In many cases, the difference is time and the desire to obtain effective legal advice from an experienced Connecticut Medicaid Attorney.

Let me share the story of a client of mine. This client one day mentioned that her mother “Helen” resided in an assisted living facility. Helen was doing well with no chronic health issues, although naturally she was getting older and her risk for Alzheimer’s and other chronic health issues increased every year. Like many people, Helen preferred the majority of her life savings pass on to her family rather than be consumed or at risk for possible nursing home costs that exceed $90,000 per year in Connecticut.

After reviewing the situation with Helen and her family to gain a better understanding of her wishes and the financial realities of the situation, I put together a plan to accomplish Helen’s goals of keeping her life savings within the family without jeopardizing her own eligibility for Title 19 Medicaid benefits. Helen’s family promptly reviewed and acted on my recommendations. We did not give everything away and leave Helen at risk to her family’s desire to pay for expenses nor did we assume any risks without a thorough discussion of those risks and careful hedging against the unavoidable risks. Helen was my client and she was protected throughout the entire plan.

The reason I bring this up now is to remind everyone about time. My work with Helen began approximately three years ago. Back in 2004, I completed the initial analysis for Helen’s family which was the foundation for evaluating asset protection and Title 19 eligibility strategies. A critical portion of that analysis was making a reasonable, realistic, and informed estimate for how the next three to five years would unfold in terms of health and finances. I am proud to say Helen and her family have been exceedingly pleased with results. As we approach the third anniversary of Helen’s planning, her goals have been accomplished and the critical three year look-back window (this was before the DRA of 2005) is going to close in the very near future. The plan was carefully thought out and it was successful. I helped Helen and her family protect over $900,000.

Let’s consider an alternative for a moment. What if Helen’s daughter mentioned her mother’s situation to me back in 2004 and I told her that since everything was fine right now they should not consider any additional planning until it became obviously necessary? Well, as you may know the Deficit Reduction Act of 2005 was enacted which extended the look-back period to five years. This change alone would have had a significant impact on Helen’s ability to achieve her goals. There were additional restrictions on Title 19 eligibility included in the Deficit Reduction Act of 2005 that would have also had adverse effects on Helen’s options.

It is an unfortunate fact that Connecticut nursing homes are expensive. They average over $9,000 per month. It is also an unfortunate fact that none of us know who is going to need nursing home care and who will not need nursing home care. For many people, nursing home costs are the single greatest threat to their life savings and their estate plan. An annual bill of more than $90,000 can devastate a modest family.

What’s the difference between protecting over $900,000 and risking over $900,000? As we can see, in many cases it is a matter of time and getting the right legal help. I don’t know when the next wave of regulations or case law that further restrict Title 19 Medicaid eligibility in Connecticut will come along and in general I don’t recommend my clients wait to find out either. I do know what I can do today to secure my client’s estate plan and life savings. Medicaid planning and protection does not happen overnight. In Helen’s case, it took three years; and she is in a much better position than if she waited until the last minute.

Do you have a plan?

Are you protected? Do you want to be in charge of what happens to you, or are you content to hope for the best? Speak with a Connecticut Medicaid Attorney today and take the first step to protecting your family.

It’s that time of year again, the critical numbers for Connecticut Title 19 Medicaid eligibility during fiscal year 2007-2008 have been released. Effective July 1, 2007:

• The average monthly cost of care has surpassed $9k and is set at $9,096.00.
• The minimum MMNA is now $1,711.25.
• The shelter adjustment is $513.37.
• The monthly personal allowance jumped an awe inspiring $2 to reach $63.00.

It can happen to you, and I don’t mean the lottery. HIPAA has been with us for a little more than 10 years now and the conflicts between patient privacy, a family member’s right to know, and a health care professional’s desire to stay out of trouble continue. The New York Times recently ran an article highlighting some of the unfortunate roadblocks everyday people have run into with health care professionals when trying to get informed of a relatives medical condition.

• Nancy Banks called her mother’s hospital room in Tampa Bay, FL and heard screaming, yelling, and crying. When Nancy tried to find out what was going on from hospital representatives, they refused to discuss it with her because they believed they were prevented from doing do by HIPAA. She drove over twenty hours to the hospital to get some answers and was told the same thing. The best she was offered was being able to speak with the doctor in the morning. Unfortunately, the next morning she learned her mother had heart failure and her kidneys were shutting down after many hours of having no idea what was going on.
• An emergency room nurse in Palos Heights, IL threatened Gerard Nussbaum with arrest for scanning his father-in-law’s medical chart following admission for a stroke. Luckily Gerard is a HIPAA consultant and did not back down. Mr. Nussbaum discovered the nurse was about to administer a dangerous round of sedatives to his father-in-law by reviewing his chart. Who knows what could have happened if he followed the nurse’s orders and did not act to protect his father-in-law?
• Nurses in an emergency room at St. Elizabeth Health Center in Youngstown, Ohio, refused to telephone parents of ailing students themselves, insisting a friend do it, for fear of passing out confidential information.

The article does a good job in pointing out that many of these roadblocks people run into are not intentional roadblocks. They are health care professionals taking a very conservative and cautious approach in interpreting an at times vague regulation to avoid getting into trouble. So, even though there is no legal obstacle in a family member’s right to be involved in many cases, everyone runs the risk of encountering an overzealous nurse and there is no way to avoid that risk.

What can you do to protect yourself? Prepare a HIPAA authorization release and give it to your family members that are likely to be involved with your treatment at a hospital. It may not be legally necessary, but in many cases this is the best way to placate the overzealous nurse that they will not get into trouble by speaking with you.

You can read the full New York Times article here.

You can find another story of one mother’s encounter with HIPAA when trying to help her son here.