Signs it’s time to update estate planning documents

Having outdated or incomplete estate planning documents leads to a false sense of security as we enter our senior years.

Therefore, it is important that we periodically review our documents to make sure they reflect our current wishes and meet current laws.

However, this is easier said than done – it is all too easy to forget or to put it off. There are, however, certain events that should automatically trigger a review.  

  • Marriage or remarriage. Spouses do not automatically inherit your entire estate by default; without a Will, he or she may only inherit a portion of your estate. This is a particular concern in the case of a second or subsequent marriage and blended family situations – you want to make sure your family is taken care of the way you want, not the way the state decides. 
  • Your spouse has passed away. When a spouse has passed away, the other spouse will need to update his or her estate plan to reflect that change, such as addressing in your estate plan any inheritance which you may have received, or changes to your agent appointments.
  • Divorce. Although a divorced spouse cannot inherit from you by default, it’s important that you make sure that your ex’s name is removed as joint owner or beneficiary from your accounts and policies, removed from trusts, etc.
  • You had a child or grandchild. You may need to make estate plan changes to reflect this birth, such as including that child/grandchild in your estate, creating trusts to manage funds until the child becomes mature enough in your opinion to manage an inheritance, providing for a guardian of a minor child, and many other considerations. 
  • Your financial situation has changed. Whether you have received a windfall, a significant pay increase, or even lost a job, you will want to make sure that your estate plan appropriately reflects those changes.
  • You’ve purchased real estate. A home is many people’s biggest investment, and you want to make sure it is covered in your estate plan, including such things as how to pay any mortgage off and who gets the real estate when you die.
  • You started (or ended) a business. Either of these circumstances is sure to have an impact on your financial life and warrants a review of your estate plan. Succession planning is a big part of business and estate planning, so that you can make clear what will happen to the business if you die or become incapacitated.

There are numerous other life events that should trigger a review of your estate plan, but these are some of the biggest. If any of these events occurs, visit a qualified elder law attorney to review and discuss your current estate plan, and any changes which may be appropriate.  You can also contact us anytime by clicking here and we’ll be in touch.

The Value of a Living Will

I was in my doctor’s office the other week and I noticed a large collage on one wall all about the importance of Advance Directives, or Living Wills.

It emphasized the importance of Living Wills, regardless of your age, and reinforced what our office always stresses to our clients or members of the community to whom we speak.

An Advance Directive or Living Will is a document in which each of us tells our loved ones how we want the end of our life to be handled – when we are in a permanent vegetative state, permanent state of unconsciousness, or in the end-stage of a medical condition, all with no reasonable likelihood of any significant recovery, do we or do we not want to be resuscitated, tube fed, or the like? 

How will our loved ones know our wishes on these matters if we don’t communicate them in a meaningful way?

The best way to do so is to create an Advance Directive now, while we are still able to decide for ourselves. One of the quotes on the doctor’s display said, “End of life decisions should not be made at the end of life.” Another said, “For human beings, life is meaningful because it is a story, and in stories, endings matter.”     

Most of us know what medical decisions we want made on our behalf at the end of our lives, but have we communicated that to our family and our loved ones? If not, how are they to know? The display had another quote: “I have an advance directive, not because I have a serious illness, but because I have a family.”

When we meet with clients to help them create estate planning documents, we always point out to them that they have the option in their Living Will of deciding what, if any, extraordinary measures they want taken at the end of their lives. Once they select those options, we then come to perhaps the most difficult question of all: should their instructions be binding on their families and providers, or do they want their loved ones to be able to override their decisions?

Many opt for binding instructions, so their loved ones do not have to take on that difficult decision in the heat of a devastating crisis. Either way, they have expressed their desires to guide their loved ones in making tough decisions.

Age is not a factor in creating a Living Will; tragedy can strike unexpectedly at any age. The expense is low, but the peace of mind in knowing that when our time comes we control the quality of our passing on is priceless, both for us and for our loved ones.

So, start the conversation with your family. Communicate your wishes to them, and urge them to communicate theirs to you. Then, go to a qualified estate attorney and put those wishes on paper in an Advance Directive/Living Will so that, when your time comes, all involved, including your medical providers, know how you want the end of your life to be managed.  

If you want to get the process started the first step is to join us for one of our free educational workshops.  Just click here for more information and to grab a seat.


Guardianships in Pennsylvania

If you are dealing with elderly people, it is important to understand the recently revised rules for guardianships in Pennsylvania.  The reason for these major changes is due to growing concern about financial, physical, or emotional abuse of the elderly who are no longer able to speak for or protect themselves. Among other goals, the new rules are designed to increase oversight and accountability of the guardians.

Guardianships of elderly people typically result when a person does not have a financial or medical power of attorney, and is no longer able to manage healthcare or financial decisions. Even when an elderly person has a financial and/or health care power of attorney, there are times when a guardianship is still necessary. 

For example, a person starts to give away money to strangers or based on solicitations, when that has not been that person’s pattern previously. Often, the person will not even remember doing it. Having a power of attorney does not take away that person’s right to deal with their own health care or finances; it merely names others who can assist that person. Thus, an elderly person’s designated power of attorney generally cannot prevent the elderly person from making unwise or unhealthy decisions. A guardianship is needed to accomplish that.  

Only a judge can appoint a guardian.  It is a decision they do not make lightly, because appointment of a guardian results in the incapacitated person essentially losing her/his right to act on her/his own behalf.  There are two aspects of a person’s life for which guardianships can be granted. First, a guardianship of the person addresses general health and quality of life issues. Second, a guardianship of the estate addresses financial issues. A judge can appoint a guardian to address one or both of those areas, depending on the needs of the person.

There are two parts to a guardianship proceeding. The first part relates to whether the person can make appropriate decisions concerning health care and/or finances. This part requires medical evidence from a doctor. If the judge finds a person is unable to make such decisions,  then that person is ordered to be incapacitated.

The second part relates to the judge appointing an appropriate guardian. The judge considers testimony or other evidence that the person seeking guardianship will provide appropriate healthcare and/or financial decisions in the best interests of the incapacitated person. Frequently, a close relative, such as a spouse or child, is the one seeking guardianship.

The new rules place greater requirements on the guardian.   For example, a potential guardian must provide a criminal background check because a criminal history can affect that person’s ability to serve. Also, there is now an electronic reporting system which allows guardians to file required annual financial reports. The new state-wide monitoring program is meant to provide more thorough screening of annual reports and trigger appropriate follow-up action if needed.  

Given the increased requirements, responsibilities, and oversight of guardians, it may no longer be the case that a spouse or child will automatically be appointed.  It is now more important than ever for clients and attorneys to screen potential guardians and determine whether that person could serve under the new rules. 

This article addresses a few changes to the guardianship laws and procedures in Pennsylvania.  There have been many changes, all of which are intended to provide better protection for those who are unable to care for themselves or their finances.  Please seek professional legal advice for further information which may relate to your specific circumstances.  Do discover more about this and other estate planning and/or asset protection planning topics join us for one of our upcoming workshops.  Just click here.

I really want to make gifts to my grandkids!

First, let us be very clear – we strongly discourage gifting as an estate planning tool! People often come to us and say they want to, for example, give away some of their assets now to avoid inheritance tax when they die. NO, NO, NO!! (See #1, below.)

Still, grandparents often want to help out their grandchildren, not as a planning strategy, but out of love and affection. The grandparents have achieved financial security, and want to share that with their grandchildren for many purposes, such as summer camp, college tuition, wedding costs, the down-payment on a first home, they don’t want their children and grandchildren to have to wait for an inheritance.

However, helping out family members raises a number of legal issues involving eligibility for public benefits and questions of fairness among family members. Here are six issues grandparents should consider before making gifts to grandchildren. (To be clear, these issues apply to anyone making gifts, not just grandparents.)

  1. Beware the Medicaid penalty. Grandparents need to be aware that if either of them needs skilled nursing level of care, either in a nursing or their own home, and they apply for Medicaid to pay for that care within five years of making the gift, then they will be ineligible for Medicaid benefits for some period of time, which will depend on the amount of the gifts.  
  2. Is it really a gift? Does the grandparent expect anything in return, for example that the funds be repaid or that the money is an advance on the grandchild’s eventual inheritance? If yes, this should be made clear, in writing, whether in an informal written agreement, a promissory note (if a loan), or the grandparent’s Will.
  3. Is everyone being treated equally? Not all grandchildren have the same financial needs, and grandparents don’t feel equally close to all of their grandchildren. Although it’s the grandparent’s money and she can do what she wants with it, if she’s not treating all of her grandchildren equally, she needs to consider whether unequal generosity will create resentment within the family. Many people may help out some children and grandchildren more than others based on need, with the expectation that this will be kept private. 
  4. 529 plans. Many grandparents want to help pay higher education tuition for grandchildren. But not all grandchildren are the same age, making it difficult to make sure that they all receive the same assistance. A great solution is to fund 529 accounts for each grandchild. These are special accounts that grow tax deferred, with the income and growth never taxed as long as the funds are used for higher education expenses. 
  5. Don’t be too generous. Grandparents need to make sure that they keep enough money to pay for their own needs. Too many gifts can quickly deplete a lifetime of scrimping and saving. It won’t do the family much good if a grandparent is just scraping by because he’s done too much to support his children or grandchildren.
  6. Beware taxable gifts. As there is no gift tax for the first $11.4 million (in 2019) each of us gives away, this isn’t a concern for most of us.  Also, there’s no limit or reporting requirement for payments made directly to medical and educational institutions for health care expenses and tuition for others.

There are other issues to consider based on specific family situations. Some grandchildren shouldn’t receive gifts because they have addictions, or the gifts may undermine the parents’ authority or plans for the grandchild. Communication with the middle generation is key to making certain that gifts achieve the best results for all concerned.

If you simply must those gifts, first talk to an elder law attorney about devising the best plan for you and for your grandchildren.  We can help.  Just fill out this simple online form and we’ll be in touch to get you the answers you need.

Coming Soon: Community HealthChoices

Effective January 1, 2020, big changes are coming the central Pennsylvania Medicaid recipients! The Pennsylvania Department of Human Services (DHS) is preparing to implement the Community HealthChoices (CHC) program in Central (which includes York County), Northeast and Northwest Pennsylvania, and the Lehigh Valley.

CHC is a new Medicaid program that uses managed care insurance companies (MCOs) to take the confusion out of healthcare and see that participants get the medical and social supports they need. The CHC program was created to:

  • Make Medicare, Medicaid, Behavioral Health, and Long-Term Services (help at home to live independently) work better together, so participants get all the benefits and help they need to live the life they want
  • Make it easier for people to live independently, rather than in nursing homes, by improving the quality of in-home support services
  • Better address other issues that can keep us from being healthy, like not having a safe place to live, or transportation

The stated purpose of CHC is to enhance care and service coordination, improve health outcomes, and increase availability of community living options for individuals requiring long-term services and supports, so that seniors can have the opportunity to work and spend time with their families, all while having access to long-term services they need.

How will CHC be different from the current Medicaid program? Instead of the Medicaid ACCESS card, Medicaid benefits from the state will come through the CHC health plan that each participant picks. There are 3 to choose from, and you can change your plan at any time:

  • AmeriHealth Caritas (known as Keystone First in the Southeast)
  • PA Health & Wellness
  • UPMC Community HealthChoices

Participants do not need to apply for CHC. It is a mandatory program for people who qualify, so the state DHS will send out information on how to enroll. Pennsylvania’s Independent Enrollment Broker (IEB) can help participants choose or change their plan. They can be reached at 1-844-824-3655 or Enroll 

What will be the same? Medicare. If you are covered by Medicare, you can keep your current Medicare plan and doctors. CHC is only about the Medicaid part of benefits. It does not change or replace Medicare coverage. Medicaid, through CHC, is your second insurance and will cover anything that Medicare doesn’t, like long-term care and transportation. It can also help pay your Medicare Part B premium, if your income qualifies. if you are unsure about what Medicare plan you have, you can talk with an APPRISE counselor at your local Office on Aging by calling 1-800-783-7067.

CHC was first launched in southwest Pennsylvania in January 2018 and southeast Pennsylvania in January 2019. When fully implemented across the state, CHC will cover more than 400,000 older Pennsylvanians and adults with physical disabilities, 94 percent of whom are dually eligible for both Medicare and Medicaid.

Ahead of the final implementation, MCOs will host both provider information sessions, and in the fall participant information sessions, which will offer eligible community members the opportunity to learn more about this program and to gather resources and ask questions to choose a plan that will meet their needs.

If you need help with your Medicare planning we can help.  The first step is joining us for one of our free “The Nuts & Bolts of Medicaid” workshops.  You can RSVP by clicking here now.

Sources: DHS May 13, 2019 Press Release and

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