by Tom Olofsson, Attorney at Law, www.MyTrustLawyer.com (773) 905-1193

When a person applies for Medicaid benefits their financial paperwork is carefully looked at.

The Medicaid Department looks for certain gifts or transfers. If transfers were made then Medicaid calculates whether a penalty will result. Medicaid will not pay the medical bills of the person during this penalty period.

The penalty period is figured by dividing the amount of the gift by the amount that it costs to stay in a nursing home for one month. In the Chicago area the cost to stay in a nursing home is around $6,000 per month. So, the amount of the gift is divided by $6,000. If the gift is $6,000 and we divide it by $6,000 we get a penalty of one month ($6,000 divided by $6,000 = 1).

In this case Medicaid will not pay the medical bills of the applicant for one month.

If the gift or transfer was $60,000 then we divide that amount by $6,000 and we get a penalty period of 10 months ($60,000 divided by $6,000 = 10). If the gift was $120,000 then the penalty period is 20 months ($120,000 divided by $6,000 = 20). So, if a person gives away $120,000 they will not be eligible for benefits till a period of almost 2 years passes.

The date upon which the penalty begins is as important as how long the penalty period lasts. This start date, in Illinois, will change soon. It is important that your attorney understand all gifts which have been made in order to do the best job planning and in preparing your Medicaid application.

by Tom Olofsson, Attorney at Law, www.MyTrustLawyer.com (773) 905-1193

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by Tom Olofsson, Attorney at Law, www.MyTrustLawyer.com (773) 905-1193

In years past a person could give away his home and money and qualify for government health benefits (Medicaid) the next day.

In 2006 new rules were put into effect in most state which effectively limit the amount of assets which may be
given away and still qualify for Medicaid.

The State of Illinois does not take anything away from the person applying for benefits. The State can and does disqualify applicants from receiving benefits based upon how much was given away and when the gift was made.

Certain types of transfers are not counted when figuring out the disqualification. These factors are used by Medicaid Lawyers to help their clients work within the rules to keep the largest amount of assets possible for the client to pass on to their family.

Full disclosure is important. Your lawyer must know everything in order to give his best efforts in helping you

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by Tom Olofsson, Attorney at Law, www.MyTrustLawyer.com (773) 905-1193

What does an elder attorney do?

An Elder Attorney works in the area of Elder Law. Elder Law is a broad category of legal practice. It includes many of the issues that are important to Seniors and to their families.

It touches upon several areas and combines them into a unified approach to the way a Senior interacts with his or her family, estate, government programs, with medical care providers, and with his or her community.

The main areas that we explore with our Senior clients include:

* Power of Attorney
* Last Will and Testament
* Living Trust
* Guardianship for Disabled Persons
* Nursing Home Questions and Problems
* Elder Abuse and Neglect
* Medicaid Planning Protecting wealth and property from high nursing home bills
* Preparing for Incapacity
* Passing Wealth and Property to children and loved ones

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by Tom Olofsson, Attorney at Law, www.MyTrustLawyer.com (773) 905-1193

An Associated Press report, which was picked up by several newspapers, states that some nursing home residents feel as though they are being held against their will. They allege that nursing homes have a strangle hold on Medicaid reinbursements. These residents state that it is too hard for them to get care at home and that the situation needs to change.

The story by Matt Sedensky is titled, “For Some, Nursing Homes Are a Prison.

The story states, “…Medicaid recipients across Florida challenging the nightmare of the old and disabled: to be forced from comfort and familiarity into a nursing home.

The story says, “the state is illegally forcing them to live in nursing homes when they should be able to live where they choose. Advocates charge that nursing homes, afraid of losing money, have successfully pressured politicians to make qualifying for community care more difficult. They have filed a federal lawsuit… on behalf of nearly 8,500 institutionalized Floridians.”

Sedensky continues, “There are very, very, very few people who cannot be cared for outside in the community,” said Stephen Gold, a Philadelphia disability lawyer who, along with AARP attorneys and others, is representing the group. “Why should the state give a damn whether you put the money in the left pocket of the nursing home or the right pocket of the community?

“There’s a lot of concern that the nursing home industry is very powerful in many states and has made sure that a lot of Medicaid dollars go to institutional care as opposed to home and community-based care,” said Toby Edelman, an attorney at the Center for Medicare Advocacy.”

It remains to be seen whether this will become a trend. Patient advocates could sue on behalf of Illinois Medicaid recipients. With its large aging population Illinois could be next

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When you give someone a gift you sign a check. When you buy a meal in a restaurant you sign a credit card receipt. When you sell your home you sign a deed.

In each of these situations it is your signature which marks that the sale has taken place.

If you wish to give assets to someone after your death something different has to happen. Since you can not sign after you have died, someone’s signature must be substituted in place of yours.

The judge, in probate court, substitutes his or her signature in place of yours. This way any money and property, which was in your name when you died, can get into the hands of the new owner.

This is one of the main purposes of the probate court.

The process is more complicated than I have described but when you boil it down, we are getting stuff out of your name and into the name of the people you let it to in your will.

There is nothing wrong with the process. Probate allows for the orderly passing of assets from generation to generation.

The reasons which most people give for wanting to avoid probate can be boiled down to these:

1. Probate takes too long. Probate generally takes between 1 and 2 years. During the process the family must relive the death of their loved one with each new letter and each meeting with the executor. If the process can be made shorter then the family will be able to come to closure more quickly.

2. Probate costs too much. The fees for Probate in Illinois can average around 5% of the estate. With home values over $300,000, in many cases, it is easy to see why people would like more of their money to go to their children and less to court costs and fees.

3. Probate is not private. The courts are public and so are most court records. Many people I talk with keep their financial matters private during their lives and tell me that they would like to keep their information private even after their deaths. It makes sense, then, to stay keep the estate distribution process private. This can be done by staying out of court.

Tom Olofsson, Attorney at Law, www.MyTrustLawyer.com 773-905-1193

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The information in this website is accurate to the best of my knowledge. It reflects the laws in the State of Illinois at the time the pages were written. Every effort has been made to make them readable and understandable to non-lawyers because of this they are necessarily general in nature.

Visiting this website does not create a lawyer-client relationship. The only way to become a client is for us to meet personally and discuss whether I am the right lawyer to work with you on your plans for the future. I also need to satisfy myself that your interests do not conflict with my duty to any of my existing clients. This sort of planning and analysis is not easily done by email or by phone.

The information in this site is designed to get you started on the planning process. You should always check with a lawyer before signing any legal documents. Any sample forms found on this sight are for reference only since I can not control how they are completed nor how they are executed.

I am licensed to practice law in Illinois. There are important differences between Illinois laws and those of other states. If you are a resident of another state please consult an attorney licensed to practice law in your home state. If you are not currently working with a lawyer you may want to call your state bar association.

Circular 230 Disclosure: Content of this message cannot be used to avoid IRS tax penalties. For more information go to http://www.cbo.gov/ftpdocs/65xx/doc6512/07-06-EstateTax.pdf