Cheryl Chapman Henderson, LLC

Why You Need An Estate Plan

“Whether you are leaving a huge financial windfall behind for your offspring or a smaller monetary account, it is important to create an estate plan which allows greater control, privacy and security of your legacy.”

Estate planning can be thought of as the process of anticipating and arranging, during an individual’s life, for the management and disposal of his or her estate during the person’s life and after death, while minimizing gift, estate, and income tax. However, 55% of Americans don’t have a will, reports Wealth Advisor in the recent article, “The 3 Reasons Why People Do Estate Planning.”

When considering a legacy and to whom and what to leave behind, there are three reasons why people do estate planning: probate fees and tax reduction, asset protection and control and management.

Probate Fee and Tax Reduction. When a person has more than a certain level of assets, they may have to pay state and federal estate taxes, depending upon the value of the accounts and based on where they live (some states have estate taxes, while others don’t). An experienced estate planning attorney can help explain the laws and help you to make wise decisions as to whom, where, and when to designate your assets. Working with a legal professional who’s well-versed in estate planning, will help you to reduce probate fees and inheritance taxes.

Asset Protection. It’s critical to protect your assets, like safeguarding your assets from spend-down (the process of reducing assets to qualify for Medicaid) in a nursing home situation. That’s a great reason to be proactive and develop an estate plan.

Control and Management. This is a big reason why many families engage in estate planning. Properly done, it eliminates worries and ensures that your final wishes regarding asset distribution are carried out.

Estate planning also avoids any guessing and provides a detailed plan of who, what, where and when for your heirs during a trying time.

Reference: Wealth Advisor (May 29, 2018) “The 3 Reasons Why People Do Estate Planning”

Law Enforcement Focuses on Elderly Identity Theft

“An expert from the American Association of Retired Persons (AARP) Foundation noted that technology makes life much easier for scammers, as reported by USA Today.”

Security Intelligence noted in its recent article, “Law Enforcement Conducts Largest Coordinated Elder Identity Fraud Sweep in History,” that law enforcement recently conducted the largest ever coordinated sweep of identity fraud cases targeting the elderly.

The U.S. Department of Justice announced that more than 250 defendants have been charged in the sweep, 200 of whom have been charged criminally.

Some of the identity fraud campaigns included a common grandparent scam where seniors were contacted and informed that their grandchildren had been arrested and needed bail money. Other scams told seniors they’d won the lottery but needed to pay a large fee to get the winnings or that they owed back taxes to the IRS.

The Justice Department says that more than 1 million people collectively lost “hundreds of millions of dollars” through these scams.

While some identity fraud is conducted through traditional methods like the telephone, there are other ways of scamming the elderly. For instance, romance scams involve an attacker befriending a senior online and then asking for money to visit the U.S. or some other reason.

The phone-based scams can trap one senior at a time.  However, email and other online media streams let criminals tap into millions of potential victims at once.

The Federal Trade Commission (FTC)’s “Consumer Sentinel Network Data Book 2017” reported that identity fraud made up 14% of consumer complaints last year. That was second only to debt collection.

The FTC also showed that while scams against the elderly are a concern, younger citizens are equally at risk. Roughly 40% of millennials in their 20s said they lost money to fraud—compared to 18% of those over age 70. Nonetheless, seniors usually suffered higher median losses than other age groups, the report found.

In addition, while credit card scams involving new or existing accounts were among the major identity fraud issues highlighted in the FTC’s data, the report also referred to other modes of attack, including online shopping and payment account schemes, data theft via email and social media.

Reference: Security Intelligence (March 27, 2018) “Law Enforcement Conducts Largest Coordinated Elder Identity Fraud Sweep in History”

Kansas AG Proposes Added Protections for the Elderly

“Kansas Attorney General Derek Schmidt and the district attorneys for Johnson and Sedgwick counties have endorsed a proposal to include the infliction of physical injury, unreasonable confinement or unreasonable punishment in the state’s legal definition of criminal mistreatment of an elderly person.”

Three of Kansas’s most prominent law enforcement officers recently announced their commitment to support legislation during the current state legislature that would expand the definition of criminal mistreatment of an elderly person.

The Topeka Capital-Journal reported in “Prosecutors in Kansas to advocate for reform of state’s elder-abuse law,” that Kansas Attorney General Derek Schmidt and the district attorneys for Johnson and Sedgwick counties have endorsed a proposal to include the infliction of physical injury, unreasonable confinement, or unreasonable punishment in the state’s legal definition of mistreatment.

Current Kansas law prohibits financial abuse of an elderly person, but not physical abuse.

“As the population of senior citizens in Kansas continues to increase, we need to update our laws,” the attorney general said.

“It is important that our prosecutors have tools available to them to successfully prosecute those who take advantage of or abuse Kansas seniors.”

In 2015, Kansas had almost 400,000 residents who were 65 years of age or older.

The state’s elderly population is also expected to more than double in the next 50 years, according to a Wichita State University study.

Johnson County District Attorney Stephen Howe and Sedgwick County District Attorney Marc Bennett said they would ask state legislators to adopt the elder law reforms during the legislative session that has just begun.

“This legislative proposal will strengthen our ability to protect some of the most vulnerable members of our community and hold their abusers accountable,” Howe said.

Reference: Topeka Capital-Journal (January 5, 2018) “Prosecutors in Kansas to advocate for reform of state’s elder-abuse law”

Minnesota Wants More Oversight of Senior Care Investigations

“State Senator Karin Housley says she is working on a bill that will give more information to families.”

Minnesota state lawmakers are proposing investigations into the office that itself investigates senior care complaints and say they’ll draft a law to give families more information.

KARE’s report, “Lawmaker calls for new law on secrecy in elder abuse complaints,” profiled cases in which families were kept in the dark—often never even notified—while the state was investigating abuse and neglect complaints about their own parents.

“We have drafted three different versions of that to change, so that family members can get information and can be in on the investigation. At least know what’s happening,” Housley said at a news conference.

The OHFC has been criticized for failing to investigate most of the complaints they receive.

Senator Housley joined State Senators Michelle Benson and Carrie Ruud in calling for an investigation into what they called a “toxic” culture at OHFC. They demanded answers after a whistleblower came forward alleging bullying and harassment at the agency.

The whistleblower was Nancy Omondi, and her attorney says she was fired in retaliation for making her complaints.

"I demand accountability, I demand transparency. I demand immediate attention addressing these issues,” Housley said.

The three state senators called on Minnesota Governor Mark Dayton to answer questions and to make public, meetings of a task force he convened to study issues of abuse and neglect in senior care facilities.

Housley and Benson chair committees charged with overseeing elder care facilities, and solving the issues with senior care in Minnesota was a top priority.

“Families oftentimes aren’t getting answers,” says an attorney specializing in nursing home abuse and neglect cases. What’s even more troubling, he says, is the secrecy involved with the complaints. If the state doesn’t conduct a full on-site investigation, the cases are never made public.

Reference: KARE (December 12, 2017) “Lawmaker calls for new law on secrecy in elder abuse complaints”

The Cost of Long-Term Care Insurance

“With long-term care insurance, it’s important to look at how the benefits are structured.”

Health care costs are sky-rocketing. For seniors or those who need help with some daily activities, the costs can easily run into thousands of dollars.

The Chicago Tribune’s recent article, “Thinking of buying long-term care insurance? Consider these costs,” reports that a 2015 cost of care survey from insurance company Genworth Financial estimated the national median cost of care for a home health aide to be almost $46,000 annually, while the national median cost for a private nursing room home is more than $91,000 annually.

Because of high costs, some people are considering long-term care insurance to pay for these bills.  However, if you’re considering purchasing this insurance,  it is costly, very complex and not everyone will qualify.

It is money well spent to talk to an elder law attorney to see if these policies make financial sense. They can review a person’s assets and any other coverage they may have from Medicare, Medicaid and other state and federal programs that are designed to support the sick and elderly.

For those who don’t have many assets, an LTD policy may be too costly. These policies are less expensive for younger and healthier people. Policies are designed so the buyers purchase a set amount of benefits for a certain time period.

The premiums can go up dramatically as people age.  This is why someone purchasing a policy in their 40s, will spend less than someone in their 50s or 60s. With rising premiums, buyers must consider if they’ll have future assets to cover premium increases. Some policies have optional non-forfeiture riders that will protect what was already paid, if a policyholder can no longer afford the premiums.

LTD policies require medical underwriting, and having pre-existing illnesses will increase the cost.  There are also many situations where a person won’t be eligible for coverage, including cognitive impairments such as dementia, Parkinson’s and Alzheimer’s.

LTD policies last as long as the money purchased by the policy is available, possibly three or four years. When the policies end, people need to use their other assets if they still need care. The policies typically start coverage when someone needs help with two or more daily activities, like bathing or dressing (after a waiting period).

Reference: Chicago Tribune (November 6, 2017) “Thinking of buying long-term care insurance? Consider these costs”

Guardianship Issues Abound in the Silver State

“Guardianships are a legal relationship created by state courts that give one person the authority to make decisions in the best interest of someone judged to be incapacitated—and when no family member or friend is available to assume the role.”

A recent article in Reuters shows the problems in Nevada courts that are responsible for court-appointed guardians for the elderly. This article describes how a private guardian was able to obtain a court order making her the guardian of a couple with no advance notice to them or to their adult daughter. The elderly couple saw all of their assets sold and they were shipped off to a nursing home.

Reuters’ recent article, “With U.S. elder abuse in spotlight, a look at guardians,” reports that the abuses of private-guardian systems in some states have been known by policy and legal experts for years.

When a case involves low-income people, a public guardian typically is appointed, and private guardians are assigned when people have financial assets. A 2010 report by the U.S. Government Accountability Office (GAO) identified hundreds of allegations of abuse, neglect and exploitation by guardians in forty-five states and DC between 1990 and 2010. The GAO reviewed 20 cases and found that guardians had stolen or otherwise improperly taken $5.4 million from 158 incapacitated victims, many of whom were older adults.

Problems with abusive guardianship systems have also been reported in Arizona, Florida, and New Mexico. Reform will require commitment by the states to use more oversight in the selection, training, and monitoring of guardians. Without significant reforms, the problem will grow as the country ages.

Many experts argue that more thoughtful oversight and accountability of guardians is needed. In situations where a judge isn’t concerned about a single guardian or one guardianship organization, they can allow guardians to take hundreds of people under their control. Where money and incapacity are an issue, there is always a risk of abuse without checks and balances.

There are two general legal requirements that must be satisfied before a court will appoint a guardian: (1) there must be a finding of incapacity; and (2) there must be a court determination that there’s a need for a guardian (no one has already been designated by the person in question to act as his or her agent or trustee before they became disabled).

To protect yourself against possible abuses, work with an experienced estate planning attorney to plan in advance and execute legal power-of-attorney documents for your finances and healthcare. Choose a person who you trust to manage your affairs, in the event you are unable to do so. You can also use a bank or trust company as a professional trustee when they establish trusts for clients.

Reference: Reuters (October 20, 2017) “With U.S. elder abuse in spotlight, a look at guardians”

How to Begin the Money Conversation with Your Parents

“If your senior parents don't want to talk about money, here are some tips to start the conversation.”

If your mother is a widow and she lives alone, you may notice that she's beginning to have difficulty getting around and refuses to have help in the house.

nj.com’s recent article, “When your older parent refuses help,” says that as parents live longer, a tension can develop between the kids who want to be sure that mom and dad are safe, and the parents who want their independence.

For many, the only thing they want help with is remaining independent as long as possible. You can start your conversation there. Maybe there's a relative, neighbor, or friend who’s living alone but can't go home after surgery, because there’s no one to nurse him back to health or someone you know has an injury after a fall. You want to make sure this doesn't happen to you.

Create a plan that addresses who will provide the help and how you will to pay for it. First, while your parent's mind is clear, get a durable power of attorney which allows the parent to select who will help him with financial decisions, if such assistance is needed either temporarily or permanently. Ask an estate planning attorney to draw up this document and get a healthcare proxy. The power of attorney only applies to finances.  However, the healthcare proxy appoints a person who can talk to your doctors and gain access to your medical information.

Next, see what professionals in your area could be resources for you. Find a geriatrician in your area. That is a physician who focuses his or her practice solely on seniors. You should also look for a geriatric care manager who knows the resources in your area, and can help you make a plan—whether to bring a parent home from the hospital or to place him or her in a residential care setting.

You should also find a qualified elder law attorney. He or she is trained to identify the elder law issues in routine transactions, like real estate transfers or gifting. In many instances, they collaborate with an informal network of geriatricians, retirement planners and geriatric care providers.

Some parents will welcome this conversation, but many will not, and seniors with dementia can't have this conversation. Collect information before an emergency occurs.

Reference: nj.com (October 11, 2017) “When your older parent refuses help”

Congress Passes Elder Abuse Prevention and Prosecution Act

“Finally, Washington is taking steps to protect older Americans who have fallen into an exploitation trap set for them by state courts.”

Federal officials will soon have the power to investigate in states and prosecute unscrupulous court-appointed guardians and conservators who prey on elderly wards, according to a creators.com article, “Congress Steps Up to Control Court-Ordered Guardianships.”

It’s a long-overdue first act in thwarting the obvious abuses of this mostly secret system. Research shows there are at least 1.3 million Americans now living under guardianship control with $50-300 billion in assets—at risk for exploitation.

Both houses of Congress have passed the Elder Abuse Prevention and Prosecution Act, which is designed to bolster the laws on elder abuse, neglect, and exploitation, including those by telemarketers and email scammers.

Congress has also now finally acknowledged the nationwide issue of judges who pass over family and appoint outside for-profit guardians to handle the financial and personal affairs of the elderly. This can mean that hard-earned estates are wiped out, and inheritances end up paying the fees of total strangers.

There are many appointed guardians who help the elderly with no family members or unavailable family members to help them in their last years. These kind people handle all aspects of seniors' lives, such as medical matters, finances and funeral arrangements.

If President Trump signs the bill into law, the Department of Justice would assign at least one assistant U.S. attorney in each federal judicial district to investigate reports of wrongdoing by guardians. The assistant U.S. attorneys would have the authority to ask specially trained FBI agents to help with these investigations. The law would also mandate that the DOJ to set up an elder abuse resource group to facilitate information-sharing among federal prosecutors. Within 60 days of the president's signing the bill, Attorney General Sessions would designate a DOJ elder justice czar to run this new investigative process.

The Americans Against Abusive Probate Guardianship and other family-centered advocacy groups are pleased that Washington has now acknowledged there is a big problem with state guardianship systems that see judges declare absent citizens as "incapacitated," taking as truth the claims of one family member over all others and continuing to appoint questionable guardians in lucrative cases without much supervision.

AAAPG's research has found that federal investigators are already actively looking into questionable guardian practices in at least six states: New York, Pennsylvania, Rhode Island, Florida, Washington, and New Mexico, where a 28-count indictment on charges of conspiracy, fraud, and theft was recently unsealed against Ayudando, a private guardianship company. More indictments are anticipated against other guardians.

One thing this new bill doesn't do is address the problem with the judicial system. Judges appoint guardians with little or no follow-up, in a system that is so entrenched and unaccountable that only action on the federal level can remedy it.

In addition, the legislation fails to address the need to accurately monitor the number of Americans who are held in guardianship or to create a central registry where complaints against unsavory court appointees could be delivered. Without a way to track unsuitable guardians, they can be repeatedly appointed.

Reference: creators.com (October 7, 2017) “Congress Steps Up to Control Court-Ordered Guardianships”

Mickey Rooney’s Widow Claims Elder Abuse… by Magazine

“Over three years after Mickey Rooney’s death at the age of 93, the movie icon’s widow today is suing The Hollywood Reporter for elder abuse and intentional infliction of emotional distress in a piquant complaint that alleges some very underhanded journalism on the magazine’s part.”

The lawsuit names The Hollywood Reporter itself, Prometheus Global Media, magazine staffers Scott Feinberg and Gary Baum, and Features Editor Peter Flax.

Page Six recently reported in its article, “Mickey Rooney’s widow sues Hollywood Reporter for elder abuse,” that the 79-year old and “frail” Janice Rooney is suing the magazine for wide-ranging but unspecified damages. The action stems from an article posted online by The Hollywood Reporter on October 21, 2015 titled “Tears and Terror: The Disturbing Final Years of Mickey Rooney.”

Janice says the real disturbing story is the “deceiving” Hollywood Reporter article, with which she “felt coerced and pressured” to participate. A court document citing the article says the defendants took her words “out of context and relayed in a manner designed to portray [her] in a publicly negative and personally disgraceful light”, after she agreed to talk to The Hollywood Reporter a year after her husband’s death in 2015.

Rooney contends that in agreeing to the story, she was promised that “none of the questions would be published without also publishing her answers thereto in the article.” The “Tears and Terror” piece technically satisfied that requirement with a link to the full transcript. The link is an exhibit to her lawsuit and reveals that Rooney responded, “I don’t mean to be rude, but I can’t believe that’s a serious question”, when asked if she believed around 2010 that “the government was going to put some Americans into camps and execute the elderly?”

In the article, THR [The Hollywood Reporter] defendants repeated the essence of the slightly reworded false and humiliating allegations and innuendos brought to them by Charlene against Jan, the complaint in LA Superior Court states with reference to Janice’s daughter-in-law, who’s also named as a defendant in the multi-claim complaint. “Astonishingly, there were no allegations against Jan of abusing Mickey in either the restraining order filed on February 14, 2011, or the September 15, 2011 lawsuit filed against Chris and Christina Aber and others,” the eighth Mrs. Rooney said. She also said there were no elder abuse claims, since the settled 2011 action by her husband of almost four decades’ court-appointed conservator Michael Augustine against her eldest son and his spouse in the family civil war suit.

Chris Aber managed Mickey’s business affairs for several years before his younger brother Mark and his wife Charlene took over as Rooney’s caregivers—which started a new battle over the actor’s finances, legacy and name. As a part of that litigation, Janice was accused of physically abusing Mickey in his later years, something she says was a misunderstanding.

“The conduct on the parts of the THR Defendants alleged herein was done by these defendants with knowledge of Jan’s advanced age, and her frail and vulnerable physical and emotional condition, as well as the sensitive nature of the subject matter, all of which they, themselves, acknowledged, “the suit says of a supposedly months-in-the-making piece that Mrs. Rooney claims went to print mere weeks after she first spoke to THR. “Despite this knowledge, however, the THR Defendants nonetheless engaged in the conduct alleged herein, whereby they took advantage of Jan’s vulnerability and frail condition, and threatened and coerced her, for their own personal gain,” was stated in the complaint.

Mickey’s last prolonged public appearance was in 2011, when he testified before Congress that he’d “suffered silently” for years as a victim of elder abuse. A 2013 $2.8 million judgment in his favor in the case against Chris and Christina Aber was never received by Rooney, who died while insurance companies were litigating which of them would pay.

The complaint also names Mark Aber and Christina Aber as defendants.

Reference: Page Six (October 6, 2017) “Mickey Rooney’s widow sues Hollywood Reporter for elder abuse”

Michigan Considers Stiffer Penalties for Elder Abuse

“If a prosecutor can prove a vulnerable adult or senior citizen suffered any injury at the hands of a caregiver, lawmakers in Michigan want to be able to charge that person with a felony crime.”

Right now, Michigan law only allows a felony if a person "causes serious physical harm or serious mental harm to a vulnerable adult,” explains WZZM in its recent article “Lawmakers introduce tougher laws to protect vulnerable senior citizens.”

Legislation recently introduced in Michigan's House of Representatives would toughen the penalties for somebody who "assaults another person that he or she knows or reasonably should know is an elder adult or vulnerable adult" which "causes physical injury, pain, or mental suffering" to them. The individual would be guilty of a felony punishable by imprisonment for more than four years or a fine of not more than $5,000.

The issue is timely and important, after a former Grand Rapids Home for Veterans caregiver Laurie Botbyl was convicted of a misdemeanor last month. With the new proposed law, prosecutors could have sought a felony charge against her.

A video obtained by a news outlet last year shows a fight, as Laurie Botbyl tried to get 83-year old veteran Maynard Mathers under control, while he sat in a wheelchair inside the Grand Rapids Home for Veterans. Immediately thereafter, Botbyl placed both of her hands on the chair's handles, pulled the chair in and pushed the wheelchair forward out of her control. Mathers was injured after the incident. But the local prosecuting attorney said his office didn’t have crucial medical evidence to move the case forward in early 2016 and didn’t indict Botbyl. However, the case was re-opened after a TV investigative team obtained medical evidence indicating that Mathers had multiple injuries, including a "skin tear" on his leg when he was pushed into the desk in his wheelchair. The evidence prompted the prosecutor to take a second look at the case, which led to the criminal charge being filed against Botbyl. She is scheduled to be sentenced for the crime this fall.

"This is the (legislature) trying to protect seniors as a vulnerable group in our state," Rep. Diana Farrington (R-Utica) said.

Rep. Farrington sponsored the bill as part of a six-bill package aimed at protecting senior citizens. The bill addressing vulnerable adult abuse appears to already have bipartisan support.

"There should most certainly be serious penalties for harming an elderly adult or a vulnerable adult," Rep. Winnie Brinks (D-Grand Rapids) said. "If it helps prevent the kinds of tragic abuse and neglect people suffered at the Grand Rapids Home for Veterans, I will gladly vote for it."

Reference: WZZM (September 28, 2017) “Lawmakers introduce tougher laws to protect vulnerable senior citizens”