January 2023 Newsletter
January 2023 Issue
Setting Estate Planning Intentions This January
The start of a new year is the perfect time for reflection and goal setting, including in your estate plan. It’s important to consistently revisit your plan, keep it current, make any adjustments along the way, and ensure your plan is still helping you achieve your goals.
Below are a few key points to consider as you review your current plan and determine what you need to do this year. Together we will make sure you have everything you need!
Have your needs changed recently?
Life is full of changes, many of which can impact your estate plan. It’s important to keep your estate plan up to date as your life twists and turns. Looking back on 2022, did you:
- Get married or divorced,
- Welcome a new baby, or
- Lose a loved one?
If so, your needs likely changed in the past year, and your plan needs to change with you.
Have you completed your beneficiary forms?
Does your current estate plan name who will receive your assets in the event of your death? If so, does the distribution still reflect your wishes? Sometimes clients come into our office, years later, asking to revisit their beneficiaries. Through life’s ups and downs, people drift apart, children are born, and separations or unions occur in our lives. Major life events like these may cause you to reconsider your beneficiaries and necessitate a new form.
If not, January is still a perfect time to complete a new beneficiary form so your assets are properly protected and your loved ones are spared extra stress after your passing.
Designating a beneficiary or beneficiaries ensures your assets are distributed according to your wishes after your death. Taking the time to complete these forms is a critical step in estate planning and should be revisited on a regular basis.
Do you need to include Pay on Death (POD) or Transfer on Death (TOD) on your bank accounts?
Both Pay on Death (POD) and Transfer on Death (TOD) are options that allow you to designate beneficiaries for your bank accounts. Each will allow you to name one or more beneficiaries who will receive the assets in the account upon your passing. In Massachusetts, POD and TOD designations will also supersede the instructions in your will or trust.
However, there is one key difference between the two.
Pay on Death allows you, as the account holder, to name a beneficiary for your checking, savings, or CD account. Your beneficiary will have no rights to the account while you are alive. After you pass away, your beneficiary will be able to collect the account’s funds.
Transfer on Death is similar to POD. For example, your TOD beneficiary will have no rights to the account until your passing. However, unlike POD, TOD may only be available for investment accounts, such as brokerage accounts or mutual funds.
Remember, while estate planning can help you accomplish a variety of goals, it’s only helpful when it’s kept up to date! You owe it to yourself and those you love to ensure your plan is current and organized. If you need help during your review, feel free to contact our office for support!
The Latest Updates and Trends in Elder Law That You Need To Know
A new year also brings updates to MassHealth and Medicare programs that could impact your eligibility or the support you receive.
MassHealth’s 2023 Updates
In 2023, the spouse of a Medicaid recipient living in a nursing home is able to keep as much as $148,620 without jeopardizing the Medicaid eligibility of the spouse receiving long term care. This program is referred to as Community Spouse Resource Allowance or CSRA.
MassHealth’s Spousal Impoverishment Numbers are meant to help avoid the risk of impoverishing a stay-at-home spouse to a nursing home resident. A risk that is unfortunately an all-too-common reality with the rising costs of care.
Medicaid can also provide a monthly maintenance needs allowance (or MMNA) to a community spouse if their own income is insufficient to live off of each month and they take some or all of the institutionalized spouse’s income. In 2023, the maximum MMNA is $3,435 and the minimum is $2,288.75.
Included in the Minimum MMNA are the spouse’s Standard Shelter Expenses for rent, mortgage payment, property taxes and insurance, and/or condo maintenance. If the spouse’s housing expenses are over 30% of the MMNA, (30% of $2,288.75 = $686), the additional need is referred to as the Excess Shelter Allowance. If the spouse needs to increase the income they keep in order to cover their upkeep or cost of living expenses to a value over $600/month they are entitled to a hearing under Federal Medicaid Law. Medicaid payments for services are required to continue during the time the application is waiting for a fair hearing, and the state must make corrective payments if the spouse wins.
Another important issue a Medicaid recipient in Massachusetts needs to be aware of is the value of their home and how that impacts eligibility. In Massachusetts, real estate values run the spectrum of value. Yet, MassHealth will only count an applicant’s equity interest in a home if it is more than $1,033,000.
Generally eligible assets transferred five years prior to a MassHealth application will disqualify an applicant. That’s why proper planning is an absolute must.
Trends in Medicare
Older adults who need assistance and support during their daily activities, but can still live independently, are perfect candidates for assisted living facilities. However, the costs associated with living in the facility are high, roughly $4,500-$8,500.
Thus, clients are often dismayed to learn that Medicare will not cover the majority of assisted living costs. Medicaid does not cover room and board for assisted living, but in certain instances and in certain facilities, it can help pay for personal care services, on-site therapy, and medication management.
An experienced Elder Law Attorney, like Susana, can help you and your family make the best decision for you. You can read more about what is covered in our recent blog, Paying for an Assisted living facility with Medicare?
Additionally, effective January 1, 2023, Medicare coverage has been expanded to include “medically necessary dental service.” This change allows people with life-threatening dental conditions to receive care related to conditions approved by CMS. This expansion is a move in the right direction and will help many seniors afford much needed care.
You can read more information regarding what is covered and who qualifies in our recent blog, Hooray! It’s a Beginning: Medicare Now Covers Medically Necessary Dental Care.
A Personal Note From Susana
Are you ready for the Lannik Law Challenge?
One of my favorite things to do at the beginning of a new year is write a letter to my future self. The first time I did this, I sealed the letter and gave it to a friend, with a stamp, so they could mail it to me in six months. When it arrived at my home, I had almost forgotten that I even wrote it in the first place! But it was a wonderful opportunity to review what my intentions were just six months prior.
For me, this challenge is a fun way to keep myself accountable and dream up possibilities for the year ahead! Perhaps you want to travel to an exotic location, intentionally spend more time with family and friends, or even get your ducks in a row and complete your estate planning. And I’d love for you to take the challenge with me this year!
If you’d like to participate, check out our blog to learn how. I look forward to hearing how the challenge goes for you, so be sure to keep us updated!