"Do It Yourself" Estate Plans Mean Risk

Attorney Virginia Hammerle has penned an excellent article, entitled, "Assuming Risk of DIY Estate Planning," for the Dallas Morning News, published online at WealthAdvisor. She writes: 

You can build an airplane all by yourself. Buy a kit or go online and download the instructions. A mere 1,400 work hours later, you should have a flying machine ready to carry you and your family into the wild blue yonder.

Aside from crashing and burning, what could possibly go wrong?

You can also do your own estate planning. Buy a set of forms or go online, download the documents, fill in the blanks and sign as indicated. A mere three work hours later, you should have documents ready to carry you through personal emergencies, sickness, dementia and death.

Aside from fiduciary theft, exploitation, guardianship, contested probate proceedings and having your wishes completely disregarded, what could possibly go wrong? [emphasis added]

We will find out. The Texas Supreme Court has just created do-it-yourself will forms.

More specifically, the court has approved four forms, categorized by type of personal situation: single with children, single without children, married with children and married without children. These are fill-in-the-blank documents. They come complete with definitions and instructions.  

The forms apply to only the most straightforward of situations. For example, the form for “single with children” presumes that you are currently single, have children and that, except for specified gifts, want to leave everything to your children in equal shares. If you want an estate plan that is more complicated, then this form is not for you.

The instructions are equally straightforward. If you make a mistake while filling in the will form, then you are instructed to rip it up and start all over again. You are instructed to fill in the information blanks either on the computer or by hand using the same pen to fill in the full form. There are several places in the form where you are directed not to “add, change or delete any words in Section …” with the explanation that the section is “needed for legal reasons.”

The legal reasons, unfortunately, are not explained in the document. You are left to do your own research.

The form contains only basic provisions, and there is no place to add anything else. Still, they are an improvement over what you usually find online, because the court’s forms contain Texas-required language to appoint an independent executor, self-prove your will and leave your entire probate estate to your named beneficiaries.

Fill it out accurately, follow the instructions and you should end up with a valid will, one that contains the bare minimum of language, and probably adequate if you have little or no estate and no family complications.

The forms can be found on the Texas Supreme Court’s website under Administrative Orders, Rules Advisories, 2023, Order 23-9022. The order was released on May 5, 2023.

If you are looking for other DIY planning forms, then visit Texaslawhelp.org. There you will find basic information on common legal issues and bare-bones forms for such things as powers of attorney and directive to physicians.

While you are researching and looking at forms, heed the warnings. The online documents are not a substitute for legal advice. They are suitable for only the simplest of estates and family situations.

You probably would never attempt to build your own plane. Even if you had the time, you likely lack the skill and knowledge. The price of failure is too high. Drafting your own estate planning documents is the same. You don’t want to crash and burn.

Of course, a bar association endorsing DIY planning begs the question, "Why?"  Aside from altruism in the form of a real desire to assist those who are able to help themselves but lack means to seek legal assistance (despite the availability of pro bono and legal aid services) there is self-interest:  busy lawyers are relieved from the burdens of turning away prospective clients unable to pay, and of taking on basic low return matters in favor of more lucrative representation, such as representing families and family members in cleaning up the spectacular mess that results when estate plans "crash and burn."  

For a real life example of how simple Wills can create problems, consider my prior blog article, "Simple Will- Complex Problems: Will Drafter Does Not Help In Case of Undue Influence."

I noted as I read the article online that there appeared an add for an online DIY Will form:

No doubt the Google Ad algorithm did not discern that the content was a warning against employing such strategies.  

For a more humorous take on the same subject, click here.

             

Shocking Claim- "Comatose People to be Declared Dead for Use as Organ Donors."

A recent article warns that proposed changes to medical standards regarding end of life determinations mean that, "Comatose People to be Declared Dead for Use as Organ Donors."  

The authors are Heidi Klessig, M.D.  a retired anesthesiologist and pain management specialist, and Christopher W. Bogosh, RN-BC, B.Th., a psychiatric mental health registered nurse and author, both observers to the Uniform Law Commission on the RUDDA, and contributors to respectforhumanlife.com. 

The authors have published the troubling article to American Thinker.  

The following is an excerpt from the article (a link to the full article follows): 

The law that redefined death in 1981, referred to as the Uniform Determination of Death Act (UDDA), is being revised.  The UDDA states that death by neurologic criteria must consist of "irreversible cessation of all functions of the entire brain, including the brainstem."  However, in actual practice, doctors examine only the brainstem.  The result is that people are being declared dead even though some still have detectable brainwaves, and others still have a part of the brain that functions, the hypothalamus.  Lawyers have caught on, pointing out in lawsuits that the whole brain standard was not met for their clients.  As a result, the Uniform Law Commission (ULC) is working on updates to the UDDA based on proposals from the American Academy of Neurology (AAN).

In the interest of preventing lawsuits, the AAN is asking that the neurologic criteria of death be loosened even further and standardized across the United States.  The revised UDDA is referred to as the RUDDA.  Below is the proposal drafted at the February session of the ULC, which will be debated this summer:

Section § 1. [Determination of Death]

An individual who has sustained either (a) permanent cessation of circulatory and respiratory functions or; (b) permanent coma, permanent cessation of spontaneous respiratory functions, and permanent loss of brainstem reflexes, is dead. A determination of death must be made in accordance with accepted medical standards.

Notice that the new neurological standard under (b) does not use the term "irreversible," nor does it include the loss of whole-brain function.  The term "permanent" is being defined to mean that physicians do not intend to act to reverse the patient's condition.  Thus, people in a coma whose prognosis is death will be declared dead under this new standard.  An unresponsive person with a beating heart on a ventilator is not well, but he is certainly not dead!  The Catholic Medical Association and the Christian Medical and Dental Association have written letters to the ULC protesting these changes.

In addition, the AAN proposes that there be no requirement for informed consent before initiating brainstem-reflex testing.  One of the tests is called the apnea test.  During this exam, the patient is removed from the ventilator for 8–10 minutes, attempts to breathe are monitored, and carbon dioxide in the blood is measured.  This test has absolutely no benefit for the patient.  It can only cause harm, as rising levels of carbon dioxide in the bloodstream cause an increase in intracranial pressure, which is hugely detrimental for a brain-injured patient.  The idea that there will be no informed consent requirement for this potentially harmful exam violates the ethical principles of autonomy, justice, beneficence, and non-maleficence.

The UDDA has been controversial since its inception in 1981, and experts on both sides of the issue admit that it has serious flaws.  Most notably, organ donors declared dead under its criteria are, in fact, still alive.  The heart beats, lungs exchange oxygen and carbon dioxide, kidneys produce urine, livers remove toxins, children go through puberty, pregnant women gestate babies, hair grows, and in many cases the brain and body communicate to regulate life-sustaining functions.  Organ donors declared dead under the UDDA do not meet the Dead Donor Rule (DDR) and are exploited for body parts.

In 2018, Harvard Medical School hosted "Defining Death."  At this watershed medical conference about "organ transplantation and the 50-year legacy of the Harvard report on brain death," the experts determined that the UDDA was not true to a biological definition of death and the DDR was violated as a result.

These revelations about UDDA and DDR inconsistencies are not new.  In the 2008 affirmation of the UDDA, "Controversies in the Determination of Death: A White Paper by the President's Council on Bioethics," the chairman, Edmund D. Pellegrino, M.D., pointed this out.  "Ideally," he wrote in his minority dissent, "a full definition would link the concept of life (or death) with its clinical manifestations as closely as possible," and the UDDA does not satisfy these objective findings.  He stated: "The only indisputable signs of death are those we have known since antiquity, i.e., loss of sentience, heartbeat, and breathing; mottling and coldness of skin; muscular rigidity; and eventual putrefaction as the result of generalized autolysis of body cells."

ULC commissioner James Bopp, National Right to Life Committee, argues that people declared dead under the neurologic criterion of the UDDA are entitled to the same protections as unborn babies.  He states these are an "identical debate, just a different context."  Thus, those who vigorously defend life as starting at conception (i.e., at the level of cells) are inconsistent when they accept the UDDA whole-brain definition of death.

In May of 2021, Alan Shewmon, M.D. and 107 experts in medicine, bioethics, philosophy, and law recommended that the UDDA be revised but stated that the RUDDA was not the way to do it.  Shewmon has documented 175 cases of people meeting the neurological standard for death who continued to live on, some for over twenty years.  He has also reported and testified in court on behalf of "brain-dead" children, most notably Jahi McMath.  Although legally dead in California, Jahi experienced puberty, which requires brain and body interaction, and even started to recover before she received her second death certificate five years later.  Many have even recovered and have gone on to live normal lives after a diagnosis of "irreversible cessation of all functions of the entire brain, including the brain stem." 

The ULC solicits expert opinions and suggestions on the proposed changes to the UDDA.  We believe that the changes being proposed to the UDDA will only benefit transplant stakeholders at the expense of the rights of patients and families.  Declaring a comatose, brain-injured patient dead to be able to harvest his organs is an issue of concern to every American, especially since roughly 170 million people are registered as organ donors (see "Cherish Your Life! DON'T Be a Registered Organ Donor").  Shewmon put it best: "Just as cigarette ads are required to contain a footnote warning of health risks, ads promoting organ donation should contain a footnote along these lines: 'Warning: it remains controversial whether you will actually be dead at the time of the removal of your organs.'"  The public deserve a voice at the table before a law is passed that takes away their right to life.

You can read the article here.

Note: Monty L. Donohew has contributed article to American Thinker, several of which have been published.  It is the experience of Monty L. Donohew that the author writes the article's title.

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Biden Administration Targets Nursing Home Quality and Aging in Place Alternatives

President Joe Biden’s second State of the Union (SOTU) address Tuesday night included mention of the Administration's efforts to make nursing homes safer for seniors.  In addition, the White House indicated Monday it intends to put even more more pressure on providers.

“We’re protecting seniors’ life savings by cracking down on nursing homes that commit fraud, endanger patient safety and prescribe drugs that are not needed,” Biden trumpeted during the SOTU. The 12-second mention was in direct reference to the administration’s January 18 announcement that the Centers for Medicare & Medicaid Services (CMS) would soon implement targeted audits to determine whether providers are properly assessing and coding patients with a schizophrenia diagnosis. The reasons for these actions are well explained in the following articles available on this blog:

The agency also announced at that time that it will begin publicly displaying disputed survey citations even before their merit is proven or disproven, which no doubt frustrates the industry.  Advocates welcome the transparency, particularly given the historically poor record of CMS enforcement, and poor relationship between ratings and actual quality of care.  See the following: 

The nursing home declaration Tuesday came 36 minutes into a 73-minute speech before a joint gathering of Congress, Supreme Court justices, military leaders and other top federal figures.  You might remember that in his 2022 State of the Union, President Biden was more explicit about his intention to hold certain elements of the long-term care sector to account:

“Medicare is going to set higher standards for nursing homes and make sure your loved ones get the care they deserve and that they inspect and will get looked at closely.” 

He also then promised accountability for “Wall Street” firms that take over facilities and don’t maintain high standards and quality.  The 19-second SOTU mention was believed to be the "most extensive mention of nursing homes" ever in a State of the Union.  The White House released an expansive 21-point reform plan that, today, remains a work in progress. 

Biden’s 2023 SOTU nursing homes mention was hardly as controversial as his last a year earlier. The centerpiece of the previously announced reform effort was a promised first-ever nursing home staffing mandate. See, "White House Announces Measures to Improve Nursing Home Care Quality. Staffing shortages threaten health, and frustrate seniors in planning quality care.  See, Home Health Care Staff Shortages Threaten Health- Frustrates Aging in Place.

A newly developed detailed proposal, feared by many nursing home operators already struggling with staffing, may be released at any time. Recently, an administration official announced that a study encompassing provider interviews and projected cost implications is now complete and strategies are being considered.

 All administrations are duty-bound to crack down on fraudulent activities conducted by nursing home operators, as well as any committed by other healthcare and non-healthcare entities that accept federal funding.  In addition to several high-profile regulatory actions announced by CMS over the last year, the Department of Justice on Tuesday announced that a record $2.2 billion had been recovered via False Claims Act involving nursing homes, and many others.

The White House also issued a new White House Fact Sheet, including a section labeled “Improving safety and accountability in nursing homes” indicating that more regulatory belt-tightening will be coming for nursing homes:  

“As the President directed in last year’s State of the Union, CMS has taken action to strengthen oversight of the worst performing nursing homes, prevent abuse and Medicare fraud, and improve families’ ability to comparison shop across nursing homes. In the coming days and months, CMS will announce new actions to increase safety and accountability at nursing homes.”

On Tuesday night, Biden also urged lawmakers to adopt his upcoming budget plan to pay for more services for seniors in their homes:

“Pass my plan so we get seniors and people with disabilities the home care and services they need, and support the workers who are doing God’s work. These plans are fully paid for and we can afford to do them.” 

The centerpiece of the Trump Administration's effort to encourage and support aging in place focused on Advantage Plans, and expanding availability of alternatives to institutional care outside of traditional Medicare and Medicaid.  A  shift in focus on Medicare, the mechanism that the vast majority of seniors use to pay for  health care, is positive and welcome.  It is long past time for Medicare to take responsibility financially for providing alternatives to institutional care, and for expanding these alternatives where they do not yet exist.  

Conservatorship and Guardianship Abuse Awareness Day

February 1st is "Conservatorship and Guardianship Abuse Awareness Day," a day to raise awareness about the potential abuses of power that can occur within the guardianship system.

Adult guardianship is an intervention, intended to be a tool of last resort, that can transfer most of an adult’s fundamental rights to another person, usually called a guardian or conservator. Courts appoint guardians to protect adults from abuse, neglect, and exploitation when the adult’s cognitive and physical capabilities are impaired by disability or illness. 

In some cases, however, the court process is and guardians themselves are abusive, trampling over a person's rights, and often subjecting that person to the very risks appointment of a guardian is supposed to prevent.  Guardianship abuse (utilizing or threatening to utilize the guardianship system to control or compel a senior) and  abusive guardians (guardians that threaten the physical and financial well-being of a senior) are common villains in stories of helpless seniors institutionalized against their will.  Many of these stories are curated by the National Association to Stop Guardian Abuse (NAGA).  The recent, high-profile case of Britney Spears has served to focus national attention on this type of abuse of power. There are still many other cases, however, particularly involving older adults that go unnoticed, unpublished, and unaccounted for in the modern legal, health care, and social system that struggles with, and sometimes against, reform. 

The National Center on Law and Elder Rights (NCLER) provides legal services and aging and disability communities with the tools and resources to serve older adults with the greatest economic and social needs. A centralized, one-stop shop for legal assistance, NCLER provides Legal Training, Case Consultations, and Technical Assistance on Legal Systems Development. Justice in Aging administers NCLER through a contract with the Administration for Community Living’s Administration on Aging. Lawyers, families, and aging service professionals can utilize NCLER and partner resources to learn more about guardianship abuse, how to spot it, how to avoid unnecessary guardianships in the first place, and how to terminate abusive or unnecessary guardianships as soon as possible.

NCLER has published the following resources and a toolkit.

• NCLER: Legal Basic: Overview of Guardianship and Alternatives to Guardianship (Recording, Chapter Summary, PowerPoint)
• NCLER: When the Guardian is an Abuser (Webcast, Issue Brief and Checklist)
• NCLER: Elder Justice Toolkit
• NCLER: Using Decision Supports to Avoid Guardianship (Recording, Chapter Summary, PowerPoint)
• NCLER: Using Alternatives to Guardianship to Defend Against or Terminate Guardianship (Recording, Chapter Summary, PowerPoint)
• NCLER: Guardianship Termination and Restoration of Rights (Recording, Chapter Summary, PowerPoint)
• National Center on Elder Abuse: Guardianship: Remedy vs. Enabler of Elder Abuse

This blog contains several articles addressing the risk of guardianship in estate planning, including, but not limited to, the following: 

• Guardian Lawfully Refused Family's Request to Remove Ward from Nursing Home Amidst Pandemic;
• Guardianship System Leaves Most Vulnerable Unprotected;
• GAO reports on Guardianship Abuse;
• Hospitals Cause or Facilitate Abusive Guardianships;
• Guardianship Reform Helps, but Planning Shouldn't Wait;
• Contesting Guardianship or Challenging Guardians Is Problematic;
• Estate Plans Should Consider and Attempt to Resolve Guardianship;
• Illinois Permits Guardian Authority to Petition for Termination of a Ward's Marriage;
• Why One Woman Has Spent 5 Years in a San Diego County Jail With No Trial, and Why it Matters.

Guardianship is a risk that is best managed by a modern estate plan.  Most importantly, it is possible, with a revocable trust, to keep the trust assets out of the control of a court-appointed guardian.  Such planning protects your rights, decisions, and decision-making, protects a healthy spouse from abuse, conserves and protects the assets of the estate from plunder, and most importantly serves to disincentive court-appointed fiduciaries like guardians.  If this type of planning interests you, call an estate planning attorney experienced with trusts or an elderlaw attorney.  

 

American Heart Association Updates Recommendations for Age-appropriate Heart Disease Care

As bodies age, heart muscles and arteries can change in ways that increase the risk for heart disease. According to the American Heart Association (AHA), age should be considered in the diagnosis and treatment of heart disease. To that end, the AHA  published a scientific statement in Circulation updating its age-appropriate heart disease care recommendations.

Acute coronary syndrome (ACS) is a group of conditions in which blood flow to the heart is reduced, including angina and heart attacks, or myocardial infarctions.  According to the AHA,  “ACS is more likely to occur without chest pain in older adults, presenting with symptoms such as shortness of breath, fainting or sudden confusion.”

“Management of Acute Coronary Syndrome (ACS) in the Older Adult Population,” highlights normal aging and age-related changes in the heart and blood vessels, and acknowledges that older adults often have multiple medical conditions and medications complicating diagnosis and treatment.  

For example, large arteries and the heart muscle become stiffer with age, and the heart may work harder but pump blood less efficiently. Many normal changes increase the risk of blood clots.

“Age-related changes in metabolism, weight and muscle mass may necessitate different choices in anti-clotting medications to lower bleeding risk,” according to a press release. Kidney function also declines with age. 

One of the issues the authors highlight is that clinical practice guidelines are based on clinical trial research, but older adults are often not included in trials because their health care needs are more complex when compared to younger patients. 

According to said Abdulla A. Damluji, chair of the scientific statement writing committee and an associate professor of medicine at Johns Hopkins School of Medicine in Baltimore, “[o]lder patients have more pronounced anatomical changes and more severe functional impairment, and they are more likely to have additional health conditions not related to heart disease." “These include frailty, other chronic disorders (treated with multiple medications), physical dysfunction, cognitive decline and/or urinary incontinence – and these are not regularly studied in the context of ACS.” 

The authors emphasize the need to look beyond the clinical outcomes for older adults, like bleeding, stroke, and heart attack, and to also focus on quality of life and the ability to live independently and/or return to their previous lifestyle or living environment. 

CMS Releases Spousal Impoverishment Standards, Income Caps, and Home Equity Limits for 2023

The Centers for Medicare and Medicaid Services (CMS) issued revised Spousal Impoverishment Standards, Income Caps, and Home Equity Limits for 2023.  These standards, caps, and limits govern Medicaid eligibility determinations.

Spousal Impoverishment Standards

The spousal impoverishment thresholds will increase 8.2 percent over 2022’s figures.

The official spousal impoverishment allowances for 2023 are as follows:

• Minimum Community Spouse Resource Allowance: $29,724.
• Maximum Community Spouse Resource Allowance: $148,620
• Maximum Monthly Maintenance Needs Allowance: $3,715.50

The Minimum Monthly Maintenance Needs Allowance for the lower 48 states will rise to $2,288.75 ($2,861.25 for Alaska and $2,632.50 for Hawaii) until July 1, 2023.

Income Cap (in applicable states): $2,742

Home Equity Limits:

Minimum: $688,000

• Maximum: $1,033,000

You can access the complete chart of the 2023 SSI and Spousal Impoverishment Standards from CMS.

Ohio Department of Medicaid Changes Treatment of Retirement Plans- Eases Burden of Planning

The Ohio Department of Medicaid (ODM) has finally adopted a change that means retirement accounts will no longer be counted  as resources for determining Medicaid eligibility. This means that Ohio law now comports with existing federal law,"[a]fter six suspenseful years," as one law firm characterized the change,  Understanding the change, and its impact, requires some appreciation of  Medicaid and its role in paying for long-term care.

As most know, Medicare provides no real long-term care benefit. Medicare does not cover the cost of any care in a nursing home when a person requires only custodial care. Custodial care includes the following services:

• bathing
• dressing
• eating
• going to the bathroom

Generally, if the care or services that a person requires can be provided by another person without a degree or certification, Medicare does not cover the service.  There is no licensing required for one person to assist another to bathe, or to dress themselves.  There is, of course, licensing required for dispensing medical care, or providing certain rehabilitative care services such as physical therapy and occupational therapy.  

Further, non-custodial care is not fully covered by Medicare.  The best Medicare will do is pay for acute or rehabilitative care for a short period of time following a three-day hospitalization.  The Medicare benefit provides payment for twenty (20) days of institutional care following hospitalization, and additional payments for necessary care up to a total of one hundred (100) days.  After that one hundred (100) days, if a person needs long-term care (in-home assistance, assisted living, or a nursing home), that care is not paid for by private health insurance or by Medicare. 

Nursing home care can cost, on average, $8-12,000/month. Most people cannot afford to pay out of pocket such a large amount for long, so many turn to Medicaid to cover these costs.

Medicaid will pay for the cost of a nursing home or assisted living facility, provided that the institution accepts Medicaid reimbursement, but Medicaid benefits are limited to the impoverished.  That means that:

• A single person can have no more than $2000 to their name (in addition to a home and a car);
• A married couple is limited to a maximum of $139,000 and often less if the combined estate is less that $278,000 (the Community Spousal Resource Allowance or CSRA is one-half of the estate up to $139,000 but only one-half whatever the estate is valued at if the estate is less than $278,000).

To qualify, Medicaid applicants must "spend down," a euphemism for impoverishing themselves, especially since the person receiving their benefits may have to contribute their income to their cost of care.

Taxes and Retirement Accounts Under The Old Rules

For many people, retirement accounts (IRAs, 401ks, 403bs, deferred compensations, Roths, etc.), have replaced the home as the most valuable asset in their estate. Retirement accounts are owned by human beings (for example, trusts or LLCs cannot own retirement plans), and cannot be transferred between people except by death or divorce. Except for Roth IRAs, the taxes haven’t been paid on the accounts, so if individuals want to cash it out, they’ll incur significant income tax. 

Safeguarding the home or after-tax investments from spend-down ahead of time under the Medicaid rules is and has been fairly straightforward. Simply, to protect the retirement accounts, the account would be liquidated and the tax  incurred and paid.  In addition to the tax consequence, liquidation often meant losing the future benefits of tax deferred growth.  The options for safeguarding retirement accounts were limited, complex, expensive, and, for most people and advisors, frustrating. 

Many people would simply leave their retirement assets exposed to spend-down risk, choosing to forego the tax incurred and necessary, and protect their home and other assets.  Imagine a senior paying the cost and expense necessary to protect their $200,000 home, only to lose their $500,000 IRA left exposed. Those who chose against protecting the IRA in advance would, in crisis situations, end up with a severe tax consequences liquidating their IRA to either pay for care, or to protect other assets.

Under the old rules, if a couple had $500,000 in retirement assets, that amount counted toward their asset limit. They would have to spend their money until they reached $139,000 in total countable assets, incurring taxes along the way.  Retirement accounts were not treated any differently than checking or brokerage accounts for eligibility purposes.

Taxes and Retirement Accounts Under The New Rules

Starting in 2016, Ohio changed how it takes Medicaid funding from the federal government. As part of that change, it had to align Medicaid with Social Security disability asset rules. Under Social Security rules, retirement accounts are not counted as assets if they pay out regular, periodic payments – those payments are counted as income instead. In other words, as long as you take your required minimum distribution, or set up a recurring distribution that looks like a required minimum distribution, then Medicaid wasn't supposed to consider how much is in that account, just how much those distributions are.

After four years, the Ohio Department of Medicaid finally started talking about making the change. Some counties adopted these rules consistently, others inconsistently, and some not all. Finally, after more than a year of promising guidance, ODM published Medicaid Eligibility Policy Letter 164 on May 26, 2022. This letter clarified how the Social Security rules applied to Ohio and confirmed that retirement account payouts should be treated as income, and the principal should not be counted.

The change means seniors won't be forced to cash out their retirement accounts in order to qualify for Medicaid. It will save taxes and allow more money for the applicant or the healthy spouse. 

Some folks believe, and are being led to believe that the new rules completely protect retirement accounts.  That is not true.  The income is still countable, but estate planning can provide a solution in the form of a Qualified Income if the income is excessive.  Even then, and more fundamentally Medicaid estate recovery still exists.  Medicaid estate recovery permits Ohio to recover money paid in benefits from a Medicaid recipient’s estate.  

Regardless, the change will make planning much comfortable for people with large retirement accounts. 

Medicare Savings Programs

Medicare Savings Programs help pay your Medicare costs if you have limited income and savings. Medicare Savings Programs are also called MSPs, Medicare Buy-In programs, or Medicare Premium Payment Programs. There are three main programs, with different benefits and eligibility requirements, and a fourth program if you have a disability. 

The three main MSP's are:

• Qualifying Individual (QI) Program: QI pays the Medicare Part B premium, and reimburses the recipient for premiums paid up to three months before your MSP effective date, and within the same year of that effective date. 

• Specified Low-income Medicare Beneficiary (SLMB): SLMB pays for the Medicare Part B premium, and reimburses for premiums paid up to three months before your MSP effective day.  Unlike QI, a recipient may be reimbursed for premiums from the previous calendar year. 

• Qualified Medicare Beneficiary (QMB): QMB pays for Medicare Parts A and B premiums. A QMB recipient, typically should not be billed for Medicare-covered services provided in a recipient's Medicare Advantage Plan’s network. A QMB recipient should not owe Medicare deductibles, copayments, and coinsurances, from network providers. 

There is a fourth MSP called the Qualified Disabled Working Individual (QDWI), which pays for the Medicare Part A premium for certain people who are eligible for Medicare due to disability. Contact your local Medicaid office to learn more. 

There are even more benefits to enrolling in an MSP. MSP enrollment: 

• Allows a recipient to enroll in Part B outside of the regular enrollment periods; 

• Eliminates the Part B late enrollment penalty if there is one, and; 

• Automatically enrolls the recipient in Extra Help, the federal program that helps pay Medicare prescription drug (Part D) plan costs 

To qualify for an MSP, a beneficiary must have Medicare Part A and meet income and asset guidelines.  

If a beneficiary does not have Part A but meets QMB eligibility guidelines, the state may have a process to allow you to enroll in Part A and QMB outside of the General Enrollment Period.  

Income and asset guidelines vary by state. Certain income and assets may not count and some states do not count assets at all when assessing MSP eligibility. You can contact your State Health Insurance Assistance Program (SHIP) to learn more about MSPs in your state and to receive assistance with the application process. 

The MSP program helps many beneficiaries satisfy Medicare costs.  Contact your local SHIP to see if you’re eligible for an MSP in your state.

This article is based on a post on Dear Marci, one of the best sources of free Medicare assistance available on the internet. Dear Marci is a "biweekly e-newsletter that helps consumers—people with Medicare, their families and caregivers—understand their Medicare benefits and options." Each issue features Medicare coverage advice, basic health tips and links to vital health care resources. You can subscribe to read and submit questions for thoughtful and helpful answers.  Dear Marci is part of MedicareInteractive.org, powered by the Medicare Rights Center.