Ohio High Court Rules That Transfer of Home Between Spouses Prior to Medicaid Eligibility Is Improper

A narrowly divided Ohio Supreme Court has ruled that the transfer of a home between spouses prior to Medicaid eligibility is an improper transfer and is subject to the community spouse resource allowance (CSRA) cap.  Estate of Atkinson v. Ohio Department of Job and Family Services (Ohio, No. 2013–1773, Aug. 26, 2015).  One year and six days after hearing oral argument in the case, the majority ruled that "federal and state Medicaid law do not permit unlimited transfers of assets from an institutional spouse to a community spouse after the CSRA (Community Spouse Resource Allowance) has been set."  The court distinguished, and did not overturn,  the 2013 federal appellate court ruling in Hughes v. McCarthy, that permitted use of spousal transfers using "annuities."

In 2000 Marcella Atkinson and her husband transferred their home into a revocable living trust. In April 2011, Mrs. Atkinson entered a nursing home and soon applied for Medicaid benefits. In August 2011, following Medicaid’s “snapshot” of the couple’s assets, the home was removed from the trust and placed in Mrs. Atkinson's name. The next day, Mrs. Atkinson transferred the house to her husband. The state determined an improper transfer had occurred and imposed a penalty period.  Mrs. Atkinson passed away, and her estate appealed to court, arguing that under federal and state statutes a spouse is not ineligible for Medicaid for transferring a home to the other spouse and that an institutionalized spouse may transfer unlimited assets to the community spouse between the date the spouse is institutionalized and the date that the spouse's Medicaid eligibility is determined. The estate lost at both the trial court and the Ohio Court of Appeals, and the estate appealed.  

In a 4-3 decision, the Supreme Court of Ohio rules that transfers between spouses are not unlimited after the snapshot date and before Medicaid eligibility and that such transfers are proper only up to the amount that fully funds the CSRA. The court rejected the estate’s reliance on the Sixth Circuit Court of Appeals’ holding in Hughes v. McCarthy (6th Cir., No. 12-3765, Oct. 25, 2013) that an annuity purchased by a community spouse before a Medicaid eligibility determination is not an improper transfer, finding that the purchase of annuities are subject to special rules and “not applicable under these facts.”  The court, however, remands the case for review of the penalty imposed because the Medicaid agency may have applied the wrong statute.  “Neither federal nor state law,” the court wrote, “supports the agency's confiscation, after the CSRA has been set, of the entire amount of transferred assets, some or all of which may have already been allocated to the community spouse on the snapshot date.”

A dissent joined by three justices states that “[w]hat this family did is and was permitted by state and federal law. . .  the home is explicitly excluded from the definition of 'resources' for purposes of establishing the CSRA.” (emphasis in original).  But, the majority rejected various "exempt asset" and "timing" arguments, in effect, interpreting state and federal law in the manner that would permit  sheltering the minimum possible assets after the ill spouse's admission to the nursing home.

For the full text of this decision, click here.

Home-Care Workers Win Right to Overtime Pay and Minimum Wage

Home-care workers won the right to overtime pay and the minimum wage after a U.S. court Friday upheld a Labor Department rule that was challenged by business groups.

The Obama administration said the decision by the U.S. Court of Appeals for the District of Columbia covers almost 2 million workers “whose demanding work merits these fundamental wage guarantees.”

The rule helps ensure a “stable and professional workforce” for recipients of the services, according to a statement Friday from the Labor Department.

“We are thrilled that this historic ruling will remedy an injustice millions of dedicated, hardworking caregivers have had to tolerate for far too long,” said Christine Owens, executive director of the National Employment Law Project.

A lower court had ruled that the Labor Department exceeded its authority in extending the wage protections. The rule was opposed by the Washington-based U.S. Chamber of Commerce, which has said it would make home-health care too expensive for some.

Congress extended benefits to domestic workers when it amended the Fair Labor Standards Act in 1974. The measure included a narrow exemption for babysitters and workers who provide “companionship” services that the Labor Department later interpreted to include direct-care workers.

Where Are Our Family Photos?!? Planning for a Digital Legacy

Attorneys Sasha A. Klein, and Mark R. Parthemer have written an excellent article, published in GPSolo, a publication of the American Bar Association,  explaining how current law does not provide adequate protection of digital assets upon death of an owner of these assets. After explaining the dificiencies and difficulties presented, they posited some sage advice for the planning necessary to protect these all-to-common and valuable assets: 

What can we do now? Plan! Fiduciaries face many obstacles with respect to digital assets that do not apply to traditional assets, including password protection and encryption. Therefore, proactive planning for these assets is necessary. Clients should take two critical steps.

First, identify and create an inventory of all digital assets, which should be updated regularly. Many applications exist to help clients plan for their digital assets. For clients who change their password frequently or use many different passwords, applications such as 1Password, LastPass, and Dashlane store all passwords with access to the list through only one main password. Several third-party digital asset storage providers also act as “electronic safe deposit boxes” that release information only on the user’s death or incapacity. These allow clients to easily update information during life and grant their executor or guardian immediate access on death or incapacity. Privacy concerns exist, however, because these storage providers are targets for identity theft. In addition, this is a relatively new industry, and there are no guarantees these companies will still be in business at a client’s passing.

Second, provide the fiduciary access to the digital assets. During life, a client may wish to grant an individual the ability to have immediate access by creating an account with multiple users or appointing an agent through a durable power of attorney. If using a durable power of attorney, a provision granting access to digital assets (which could be specific to certain types of digital assets or broadly apply to all digital assets) should be explicitly included. The power should also expressly provide consent to access such accounts. Currently no states have modified their power of attorney statutes to include digital assets. In addition, a review of the TOS agreement is essential because it may trump any lifetime planning. Your client also may wish to create backup files of his tangible media through DVDs, CDs, flash drives, external hard drives, or a cloud service.

After death, a last will and testament or revocable trust can give a fiduciary access to a decedent’s digital assets. The will or trust can specifically devise digital assets and appoint a fiduciary (such as a “digital executor” or “digital trustee”) to administer the digital assets. Another option is to draft a separate letter of instruction for digital assets and incorporate it by reference into a will or trust (to the extent allowed under state law). Consider including a definition of digital assets in the will or trust (you may want to use your state’s definition if one exists or the UFADAA’s definition). Your client’s will and trust should specifically provide which digital assets are under the fiduciary’s control and where and how to dispose of them after death. Explicit directions are more likely to convince the service providers to grant the fiduciary access.

Our clients have one additional tool to solve these problems: LegalVault.^®   LegalVault^® is an advanced document storage system which allows you to:

• access healthcare directives such as a living wills and healthcare powers of attorney at anytime and any location;

• provide critical information to caregivers such as emergency contacts, allergies, medications and primary care provider details;

• store other documents such as trusts, wills, deeds, contracts, oil and gas leases, installment contracts and the like;

• store digital asset information, such as pictures, movies, songs, a list of professional advisers, and site passwords. 

Go here for more information regarding LegalVault.^®

Go here to read the full article.


    

Ohio Guardian and Ex-Probate Judge Admits to Stealing from Wards

The Youngstown Vindicator, in reporting upon an on-going investigation into county corruption, discovered that  ex-county Probate Court Judge Mark Belinky, convicted last year of tampering with government records, admitted to "stealing money from people that he was a guardian over."   He also admitted to altering probate court documents to further such theft, by, for example, using a Mahoning County probate computer to create false probate court records. The admissions were gleaned from previously sealed affidavits in an ongoing case investigating political corruption. The now unsealed affidavits recount the financial fraud visited upon Mahoning County wards at the hands of the person appointed by the court to protect their interests.  

For more, go here.

Happy Birthday Social Security!

August 14 marked the 80th anniversary of the Social Security Act. Acting Commissioner Carolyn W. Colvin announced the launch of the agency's event-filled celebration, with many activities leading up to this date.

President Franklin D. Roosevelt signed the Social Security Act in 1935, providing economic security for workers when they retired. Today, Social Security provides benefits to more than 56 million retirees, disabled workers, and their families.

Read more: http://www.benzinga.com/pressreleases/15/08/p5767355/social-security-act-celebrates-80th-anniversary#ixzz3jmlVhY00