Thoughts on the Coronavirus
With the spread of the Coronavirus (named COVID-19) in the news and changing seemingly by the minute I decided to devote this week’s post to the topic. People are understandably nervous. It can seem impossible at times to sort through the information, especially when one government official says one thing but then almost immediately is contradicted by another. There are some facts and advice that, at least right now, public health and government officials agree on. The symptoms of COVID-19 are similar to the flu, which especially hit younger and older people the hardest. At this point, the majority of deaths are to the elderly and other patients with underlying serious health conditions. A concern is that seniors – including those in group living settings such as senior housing, nursing homes and assisted living facilities – are especially vulnerable because spreading the virus is much easier. We have certainly seen this on cruise ships. Much media attention has been placed on Washington State where the virus has spread among residents and workers at a Seattle area nursing home. Many facilities here in New Jersey have cancelled industry networking events to limit the risk of visitors bringing the virus into their buildings. Notices appear on front entrances asking people not to visit if
What to do if a Bank Refuses to Honor Your Power of Attorney
2 years ago I wrote about bank and other financial institutions' resistance to powers of attorney (POAs). Since then we have seen an increase in frequency of these issues so it bears revisiting some of the common problems and solutions. When we draft POAs for clients we tell them to expect some resistance. Many financial institutions act out of an abundance of caution. They are concerned about fraud and their own liability, however they often go too far. Bank policies are often too restrictive, lack common sense or just plainly violate state laws. We tell clients to expect push back but if you find yourself in that situation (ie. looking for bank approval of a POA) what should you or can you do? The more official looking the POA the less resistance to honoring it you are likely to get. For one thing, I don't recommend "do it yourself" or "internet" POAs. Often they are done incorrectly. I have seen some in which the principal (the person designating someone to act for him/her) lists him/herself as the agent rendering the document meaningless. Unfamiliarity with legal documents can lead to mistakes that invalidate
What the 2020 Candidates are Saying About Social Security – Part 2
Last week I posted about the future of Social Security and what is being said in this 2020 election year. President Trump’s comments have been ambiguous as far as whether he would cut or protect Social Security, although his recent budget proposal includes cuts of $72 billion to the Social Security Disability program. This week we’ll take a look at what the Democratic candidates have said. As one would expect, none of the candidates has proposed cutting Social Security. Bernie Sanders and Elizabeth Warren support an expansive increase in benefits. Warren has suggested an immediate increase to benefits of $200 per month across the board. Several of the candidates have talked about a more accurate cost of living adjustment which would be reflective of the inflation rate faced by seniors – a CPI index for the elderly. All the Democratic candidates support increasing the minimum Social Security benefit for low income retirees to keep their income at or above 125% of the federal poverty line. Several of the candidates have talked about increasing benefits for caregivers whose wages are reduced because they must care for family members. Since benefits are based on earnings and how much a retiree paid into the system thru payroll deductions, one proposal is to exclude nonworking years for caregivers. This would have the effect
What 2020 Candidates are Saying About Social Security (Part 1)
This being an election year there is talk again about what the candidates propose to do about the Social Security program which most recent projections suggest will run out of money by 2035. The Medicare program projections are more dire, with that program now expected to be insolvent by 2026 which is 3 years earlier than was predicted in 2017. I have written about this problem a few times over the past 10 years but Washington D.C. has done nothing about it except to raise the full retirement age gradually for baby boomers – those born between 1946 and 1964 – who are now or will soon be reaching retirement age. There are a few reasons for this problem. One is that people are living longer in retirement and thus collecting benefits longer than was ever anticipated. The aging population is also a cause. Back when Social Security was instituted the ratio of workers contributing to Social Security versus retirees collecting benefits was much greater than it is now. It is not difficult to do the math and see that more people taking money out and less people putting money in is going to be a problem. What makes it worse is that as the percentage of Americans with traditional pensions has declined and with only about ½ of all American
Married Couple Medicaid Redetermination Challenges – Part 2
Last week I started talking about Medicaid’s redetermination process. Pretty much every county Medicaid office is now sending out annual redetermination notices. As I said last week, married couple cases can be especially tricky. That’s because even after Medicaid is approved, the healthy spouse must keep certain rules in mind. Let’s first review some of the Medicaid rules. In order to qualify for benefits in the case of married couple where only one applies for benefits, the countable assets are totaled as of the first day of the first month of continuous institutionalization – known as the snapshot date. The assets are then divided in half and the non-Medicaid or community spouse can keep ½ but only up to a maximum of $128,240 (in 2020). That is known as the Community Spouse Resource Allowance (CSRA). The Medicaid spouse must have no more than $2000 in assets to his/her name. I explain this to clients and repeat it many times during the course of the spend down process leading to Medicaid and again during the Medicaid application process. What people tend to focus on is the first part but not the second. I mean that clients focus on the target number they need to get to for Medicaid eligibility but not the part about how much of that amount must
Medicaid Married Couple Redetermination Challenges – Part 1
Last year I wrote about the challenge of keeping Medicaid after you’ve been approved. Whenever I give prospective clients an overview of the Medicaid rules and what is necessary to qualify, I also explain that the rules must be followed even after Medicaid eligibility is achieved. You can’t let your guard down and completely forget about the Medicaid rules. Medicaid does a redetermination once a year. For many years the redeterminations were sporadic. I had clients on Medicaid who never received a redetermination notice. I’ve noticed, however, in the last 5 years or so that just about every county in which I file Medicaid applications now sends annual redetermination notices like clockwork. While the” redets” as we call them are much easier to work thru (since the process doesn’t involve providing 5 years of records), most of our clients either handle it themselves or the facilities take care of it, especially in the case of single Medicaid recipients where all the income goes directly to the facility and they have most of the information needed to process it. There are several reasons redeterminations are necessary. Some of the numbers change from year to year. For example, Social Security and pensions typically have a cost of living adjustment. Health insurance premiums, which can be deducted from income before turning the