Sunday, September 18, 2005

The Legal Responsibility of Adult Children to Care for Indigent Parents

A conservative policy group has released an issue brief proposing that states begin enforcing filial responsibility laws in order to reduce long-term care costs. Thirty states, including Ohio, have filial responsibility laws that require adult children to care for their indigent parents. The National Center for Policy Analysis (NCPA) claims that if these statutes are enforced, adult children would have to reimburse the state programs that provided care for their indigent parents.

Filial responsibility laws have traditionally not been enforced, possibly because federal law prohibits state Medicaid programs from looking at the finances of anyone other than the applicant or the applicant's spouse for eligibility purposes.  There is, however, no such restriction in resource recovery, the statutory right of a state to recover assets after the death of a Medicaid beneficiary.

The NCPA, a group whose goal is to develop and promote private alternatives to government regulation and control, cites a 1983 report by the Health Care Financing Administration that says enforcing these statutes would have reduced Medicaid long-term care spending by $25 million, and argues that today the figure would be much higher.

Of course, the implications of enforcement of filial responsibility for seniors and their families are complex, but deserve some consideration in day-to-day estate planning.  One can easily imagine a future in which the states routinely sue children in order to recover amounts paid for their parent's long-term care, with children then being forced to apportion these costs among themselves, sometimes through legal action between and among them.  Whether these collections will and must involve the probate court, and whether avoiding probate in the first instance will discourage or prevent these actions remains to be seen.  Regardless, asset protection planning finds one more threat among those justifying and supporting such planning.  
To read the full brief, click here.

Saturday, April 2, 2005

Higher Intensity Physical Therapy Improves Outcomes, Reduces SNF Stay Lengths

McKnight's recently reported the results of a study finding that physical therapy of a higher intensity results in better patient outcomes and shorter lengths of stay for some nursing home patients.

According to the article:
Researchers found that for all three types of conditions studied, residents provided with 1 to 1.5 hours of therapy a day had shorter lengths of stay than residents getting less than 1 hour per day over a seven-day period. Researchers studied nearly 5,000 patients with strokes, orthopedic and cardiovascular/pulmonary conditions in 70 different skilled-nursing facilities nationwide.  The study helps establish the minimal therapy required for optimal results at 1.75 hours per day for a 5-day model and 1.5 hours of therapy for a six-day therapy model, said the study's authors.
The findings offer caregivers and skilled-nursing providers guidelines on therapy utilization to improved patient outcomes in functional independence and reduced lengths of stay, the authors say, writing in the March issue of Archives of Physical Medicine and Rehabilitation.

Patients receiving therapy account for more than seventy percent ( 70% of total skilled costs, according to the report.

Saturday, January 1, 2005

Account Management Complicated By New Banking Rules

Every Account Holder Should Be Aware of Changes

Americans write about 40 billion paper checks each year. In addition, for the first time that number recently was eclipsed by the annual number of automated transactions involving checking accounts. Checking account transactions are such a widespread part of our lives that consumers of banking services are well advised to become acquainted with major changes affecting banking laws. Federal legislation called the Check Clearing for the 21st Century Act, or "Check 21" for short, went into effect on October 28, 2004.

Check 21 will allow financial institutions to process "substitute" checks--high-quality paper reproductions created from electronic images of both sides of an original check. In time, check processing will be faster, and this is where there will be ramifications for check writers and depositors.

While it has always been prudent to have enough money in your account to cover a check the moment you write it, who has not used the lag time in check processing to make a necessary deposit? That will soon become a riskier strategy as electronic check processing becomes more prevalent. It will also be more important than ever to keep checkbooks up to date, especially bearing in mind deductions for ATM withdrawals, bank fees, and debit-card purchases.

The risk is merely financial if you unintentionally "bounce" a check from time to time. But, if you have come to rely upon the float, and particularly if you use the float from two different accounts, you may find your problem is criminal in nature. The increased speed with which banks process checks may mean more charges of check "kiting." Check kiting is among the most common, and most dangerous, forms of check fraud foisted upon financial institutions. A kite is a form of shell game using at least two accounts at separate financial institutions. The common practice of allowing depositors to have immediate use of uncollected funds facilitates the scheme. Indeed, Regulation CC mandates early access to deposited funds. In the typical scheme, an NSF check is written by on one account and then deposited into an account at another institution. A check drawn on the second account is then used to cover the resulting overdraft on the first account. Taking advantage of the float caused by normal delays in the collection system, the wrongdoer creates fictional balances in each account and uses these balances to obtain cash advances.

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