Getting a Spousal Waiver for Medicaid Isn’t as Easy as You May Think in New Jersey 

This blog post is intended to help educate your family regarding the limited instances in which a spousal waiver may be available and help guide you through the tedious process of obtaining one in a suitable case. 

The Managed Long Term Services and Supports (MLTSS) Medicaid Program offers valuable benefits, which can provide for long term services and supports in the home, in an assisted living setting or in a nursing home.  However, federal Medicaid law and policy requires the states to evaluate all of the resources available to the Medicaid applicant during the five years immediately preceding the date of filing of the Medicaid application.  This requirement can make it very difficult to obtain a MLTSS approval, particularly if the Medicaid applicant has been separated from a spouse, has a obtained a divorce from bed and board, or has been divorced in the past five years.

Medicaid law and policy provides for Medicaid eligibility as a last resort, requiring the applicant to spend down any excess resources available over the $2,000 countable asset limit.  Under New Jersey common law, spouses can be held liable for necessary expenses (i.e., the cost of medical care) of their spouse and if their assets are in excess of the maximum community spouse reserve allowance (currently set at $130,380), even if the Medicaid applicant has less than $2,000, his or her Medicaid eligibility can be jeopardized by the funds in the name of the healthy spouse. 

Consequently, in determining eligibility for Medicaid, the County Welfare Office (CWO) will ask an applicant’s marital status, and will consider the applicant and his or her spouse legally married until the entry of a final judgment of divorce.  If the CWO determines that you are still married (which can happen even if you have been separated for years or have a divorce from bed and board), it will typically take a “what’s your’s is mine” approach in determining Medicaid eligibility.  This policy is typically enforced by requiring the Medicaid application to provide the spouse or former spouse’s social security number, if the Medicaid applicant has been married at any point during the five year Medicaid lookback period.  The social security number may be used to conduct an asset search, which will probably enable the CWO to identify and consider the current assets of the healthy current or former spouse.   This verification process places the Medicaid applicant in a Catch-22, because banking privacy laws block access to the healthy spouse’s statements, and the healthy spouse is unlikely to spend down assets under his or her sole control for the care of the sick former partner. 

What is spousal refusal? In some other states, especially New York, the strategy of “spousal refusal” is commonly used.  Under this strategy, the healthy spouse refuses to pay the nursing home bills of the spouse applying for Medicaid.  In response, the CWO in “spousal refusal” states evaluates Medicaid eligibility on the basis of the sick spouse’s own assets and income.  This result is referred to as a spousal waiver

New Jersey’s Strict Policy Regarding Spousal Waivers.  For years, the Garden State had a policy against awarding spousal waivers, in all but the most extreme cases, such was where spouses had lived separate and apart for many years.   As a result, spouse waivers were a rarity, making it best to obtain a final judgment of divorce and then wait more than five years to file a Medicaid application. 

How I was able to obtain spousal waiver for one of my recent clients:

In a nut shell, New Jersey was refusing to recognize federal law which provided for spousal refusal. Other states, including NY, do recognize spousal refusal. A little over a year prior to this case, another attorney’s application for a spousal waiver was denied by the New Jersey Department of Human Services, which prompted the case to be taken to the appellate division and the policy against spousal refusal/spousal waivers was overturned. Par for the course, New Jersey was very reluctant to grant the applications.

In my case, the spouses were still married.  The sick spouse was well-educated, extremely bright and conversant. However, their marriage was so difficult that the healthy spouse obtained a domestic violence restraining order against the other spouse, who nine years later became my client.  From that date forward, the two spouses lived separate and apart.  Eventually, one of the spouses needed long term care, and the spousal waiver was obtained largely on the basis of the restraining order.  It was critical to obtain all of that documentation.  Having the spousal waiver meant that the sick spouse was able to get the skilled nursing care needed, without the cooperation of the healthy spouse in the Medicaid application process.

Jane Fearn-Zimmer is a shareholder in the Elder and Disability LawTaxation, and Trusts and Estates Groups. She dedicates her practice to serving clients in the areas of elder and disability law, special needs planning, asset protection, tax and estate planning and estate administration. She also serves as Chair of the Elder & Disability Law section of the NJSBA.

The Free Britney Movement: How the Pop-Star’s Conservatorship Would Play Out in New Jersey

The Free Britney Movement: How the Pop-Star’s Conservatorship Would Play Out in New Jersey

If you follow pop-star Britney Spears on social media, you’re well aware that her posts as of late seem like less album promoting and more like a cry for help. These posts have gotten the attention of her fans near and far, who are responsible for starting the #FreeBritney movement in an effort to help end an almost two-decade long conservatorship her father has over her, which puts him in full control over everything from her money to her health and almost every aspect of her daily routine. In this post, I’m going to break down what a conservatorship is in New Jersey, what it means, how someone qualifies for one and what you need to do to get one granted.

Little background on Brit:

Britney’s original conservatorship order was entered by a California court to establish a protective arrangement for Britney, as an adult who cannot make her own decisions, similar to a guardianship under New Jersey law. Since every state is so different when it comes to this topic, among other things, I’m going to focus on New Jersey conservatorships since this is the state in which I’ve helped countless families obtain protective arrangements, like guardianship and conservatorship orders, for friends and family.

What is a conservatorship under New Jersey law and how can a conservatorship order benefit the conservatee (the person who is subject to a conservatorship order) and the caregiver of the conservaee?

In New Jersey, there are different types of protective arrangements for adults, depending on whether they are able to make their own decisions (incapacitated) or for whatever reason, even if they are able to make decisions, they are not able to manage their affairs independently.  A judgment of incapacitation awarding guardianship is a judicial order finding an adult person incapacitated (legally unable to make decisions) and can be entered against the wishes of the incapacitated person.  In contrast, a judgment of conservatorship is a voluntary arrangement under court order whereby another adult is appointed by the court to assist an adult who is competent but cannot function independently. As a court ordered arrangement, a conservatorship is more rigid and entails more supervision than a general durable power of attorney.  Because a conservatorship involves an individual with capacity (the ability to make decisions), in ordered to be entered, a conservatorship must be consented to by the proposed conservatee and close family members of the proposed conservatee must be notified.

How does a conversatorship differ from a power of attorney? A conservatorship differs from a power of attorney in that there is annual court oversight, through the filing of accountings and reports to the court regarding the well-being and the finances of the conservative.

When in New Jersey would a conservatorship be entered?

The case of In re Conservatorship of Halley, 777 Ad 68 (N.J.App.Div. 2001) is a classic example. There, a 92 year old man was hospitalized for injuries sustained in a motor vehicle accident and upon his discharge from the hospital, arranged for a local attorney who had managed his legal affairs for approximately seven years to serve as his power of attorney.  Although he had a brother and sister-in -aw in another state, he wanted to maintain control of his finances and living arrangements. The attorney managed Mr. Halley’s affairs and his finances and hired home health aides to care for him in his home, as per his wishes, and arranged for him to travel on a Disney cruise and to take a trip to Daytona Beach.

A former aide from the home health care company filed a complaint with Adult Protective Services alleging that the attorney and the home health care company were taking advantage of Mr. Halley. The APS social worker met with Mr. Halley and determined that he was competent after administering a mini mental status examination. APS filed a complaint and the court appointed an attorney to represent Mr. Halley in the proceedings. A guardianship could not be obtained over Mr. Halley, because he was intelligent, conversant, and clearly oriented to person, time and place and was able to make some decisions, but not necessarily to carry them out independently.

Mr. Halley’s nephew, upon being notified through his father of the conservatorship proceedings, attempted to intervene in the proceedings to secure his own appointment and an accounting of his uncle’s finances.  Mr. Halley expressed his concerns that his nephew was only after his money. The court-appointed attorney for Mr. Halley interviewed the attorney who was serving under the power of attorney, Mr. Halley’s physician, and others closely connected with Mr. Halley, and after reviewing medical and financial records, found that the attorney who was serving as the power of attorney should be appointed as Mr. Halley’s conservator. As a result, the attorney originally serving under the power of attorney was appointed as the conservator of Mr. Halley.

There is an old saying that sunlight is the best disinfectant. In the Halley case, the court’s scrutiny of the arrangement, which ultimately was determined to be beneficial to Mr. Halley in allowing him to maintain his independence and some control over his affairs, worked to the benefit of both Mr. Halley and the attorney who was helping him. This is a great example of how a conservatorship can protect both the conservator and the conservatee.  Mr. Halley was able to maintain his independence in the home, and manage his own affairs through the conservatorship arrangement. The attorney serving as the conservator remained subject to court oversight for the protection of Mr. Halley and no one could reasonably question her professional integrity or judgment in caring for Mr. Halley once the court became involved and essentially ratified her work for Mr. Halley

How long does it take to get a conservatorship in New Jersey?

The New Jersey judiciary is one of the best in the nation; however, due to the courts’ heavy dockets, getting a conservatorship will not be a fast process. You will have to schedule examinations with two doctors and obtain completed paperwork from those doctors and then a court filing (called a verified complaint and order for hearing) must be made.  Once the papers are filed with the court, they are reviewed by the Surrogate, sent to the judge for review and assignment of a hearing date, and there is typically a delay of anywhere from 30 days to up to two months between the date of filing and the hearing date.

Key takeaway: If you are caring for a friend or neighbor and you have a professional license, obtaining a judicial blessing of the caregiving relationship through a conservatorship can protect your license and your career from the stress and adverse consequences, which could otherwise result from an investigation and/or complaint by Adult Protective Services. Based on my example above, if Mr. Halley and his attorney had sought a conservatorship from the beginning, they likely would not have had to deal with an APS investigation initiated by a disgruntled former home care company employee.

For more information about conservatorships, guardianships and a power of attorney, please feel free to reach out.

Jane Fearn-Zimmer is a shareholder in the Elder and Disability LawTaxation, and Trusts and Estates Groups. She dedicates her practice to serving clients in the areas of elder and disability law, special needs planning, asset protection, tax and estate planning and estate administration. She also serves as Chair of the Elder & Disability Law section of the NJSBA.

National Caregivers Day, February 21, 2020: An Expression of Appreciation

national caregiver Day 2020

These days, it seems that everywhere I turn, I find caregivers working with unselfish devotion to the people they serve. Caregiving can be formal (i.e., health care professionals working in the hospital, long-term care and hospice industries) or informal (i.e., family members providing care in the home) but it is always an act of service. In honor of National Caregivers day and all the hard working caregivers serving seniors and the disabled, here is a special blog to express my appreciation and thankfulness for all you do!

Working with individuals with dementia can be very physically and emotionally demanding.  That is why self-care is so important.  While paid caregivers may have access to training and co-workers to support them, unpaid caregivers seldom have these resources. Fortunately, for those seeking guidance on how to identify and redefine their needs and responsibilities as unpaid caregivers in the home, there is a helpful book filled with practical tips on the subject. Your Caregiver Relationship Contract (2019), by Debra Hallisey, is available through Amazon.  Her book offers a peaceful framework for caregivers to change an established relationship with a parent who still regards the child caring for them as their little one, not an adult with needs and obligations of her own.  Topics covered include how to deal with guilt and anger, setting boundaries, building a support network and strategies for difficult conversations. Here are some of the tips Ms. Hallisey shares:

  • Start important conversations in the car or while sharing an intimate experience with the person you are caring for, such as baking together or combing hair.
  • Bring up a topic up multiple times in varied settings and eventually your loved one’s no may become a yes.
  • Use “I” words (I need help) and don’t blame.
  • When setting a boundary, be honest and direct. Start the conversation with an expression of caring.
  • Use words that validate your loved one’s choices. Words and tone of voice matter.
  • Compassion fatigue is real. Combat it through self-care.

Questions? Let Jane know.

Jane Fearn-Zimmer is a shareholder in the Elder and Disability LawTaxation, and Trusts and Estates Groups. She dedicates her practice to serving clients in the areas of elder and disability law, special needs planning, asset protection, tax and estate planning and estate administration. She also serves as Chair of the Elder & Disability Law section of the NJSBA.

Increase in the SSI Federal Benefit Rate for 2020

Jane Fearn Zimmer Elder Law Attorney

The federal government recently released its 2020 Supplemental Security Income (SSI) and Spousal Impoverishment guidelines.  The guidelines, which took effect on January 1, 2020, set the SSI Federal benefit rate at $783.00 for an individual and $1,175 for a couple.

SSI is a monthly cash benefit to blind, disabled or elderly individuals with low income and resources.  Subject to the exclusion of certain sources of income, the SSI monthly income cap is set at $2,349 for an individual.  In order to qualify for the SSI benefit, the applicant must have a disability or diseases severe enough such that the applicant cannot engage in substantial gainful activity.  An applicant who is earning more than a set monthly amount of income is considered to be engaging in substantial gainful activity.  In 2020, the substantial gainful activity monthly limit for an elderly or disabled individual who is not blind, is $1,260 in earned income.

Questions? Let Jane know.

Jane Fearn-Zimmer is a shareholder in the Elder and Disability LawTaxation, and Trusts and Estates Groups. She dedicates her practice to serving clients in the areas of elder and disability law, special needs planning, asset protection, tax and estate planning and estate administration. She also serves as Chair of the Elder & Disability Law section of the NJSBA.

 

Changes to Social Security in 2020

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The year 2020 will bring important changes to the Social Security program, including a 1.6 percent Social Security benefit increase and an increased annual earnings cap for the Old Age, Survivors and Disability Insurance (OASDI) tax, which is a component of the Federal Insurance Contributions Act (FICA) tax.  Beginning in 2020, the maximum annual amount of earnings subject to the OASDI will increase to $137,700 from the current limit of $132,900 applicable in 2019.

Also beginning in 2020, the maximum retirement earnings test exempt amounts will be $18,240 annually (or approximately $1,520 monthly) for individuals under full retirement age.  That means that for every two dollars earned in excess of that limit, one dollar in Social Security benefits will be withheld.

In addition, starting in 2020, the SSI federal payment standard will increase to $783 monthly for an individual and to $1,175 per couple. Here is a helpful fact sheet summarizing these and other important 2020 Social Security numbers.

Questions? Let Jane know.

Jane Fearn-Zimmer is a shareholder in the Elder and Disability LawTaxation, and Trusts and Estates Groups. She dedicates her practice to serving clients in the areas of elder and disability law, special needs planning, asset protection, tax and estate planning and estate administration. She also serves as Chair of the Elder & Disability Law section of the NJSBA.