A second “wave” of the coronavirus in the fall appears to be inevitable according to Dr. Anthony Fauci, Director of National Institute of Allergy and Infectious Diseases (NIAID) and lead member of the White House Coronavirus Task Force.
Knowing another wave of the Coronavirus is coming is small comfort, because until we have a vaccine, we cannot fully protect ourselves from it. However, it reminds us that unexpected tragedies do happen. Are you ready? Will you surf through the next wave or will it hit you like a Tsunami?
Invest a little time here to read about 10 ways for you to surf through any disaster so you can protect yourself and your loved ones medically, financially, and legally.
1) Organize Paperwork Now: If you become very ill, such as with COVID-19, you will not feel well enough to do this, so take advantage of being home and start now. Organize your medical, financial, and legal records so they are easily and quickly found (filed alphabetically or by topic). When my clients cannot find important documents easily, I am not able to help them promptly and efficiently.
Let your inner circle (described next) know how you organized your records and where to find them. They may need quick access to ensure your healthcare or to apply for your benefits (e.g., Medicaid for long term care). Also, keep detailed records of financial gifts you make as there may be implications when applying for benefits. Believe me, those charged with your care will be very grateful to you for having taken the time to organize your papers.
2) Identify your Inner Circle: Make a list of your most trustworthy and reliable relatives and friends. Members of this “Inner Circle” will be authorized to speak and act legally on your behalf if you cannot (e.g. if you are on a ventilator).
3) Review and Update Beneficiaries: With your records now organized, list all your accounts (bank, investments, IRA, life insurance policies, etc.). Review the designated beneficiaries for each of them and make sure they are up to date. Designated beneficiaries may have died or may have become estranged. Complete necessary changes immediately to reflect your current intentions.
4) Passwords: Make a list of your passwords. Let your Inner Circle know where to find your list in case they need to quickly access bank accounts or pay a bill for you. Keep the list updated. As we all know, after creating a super great password, we often are required to change it “for security reasons”.
5) Safe Deposit Box: Although a bank’s safe deposit box is secure, it usually is not the most accessible place to keep important documents. Emergencies do not necessarily happen when the bank is open! Additionally, Florida law requires formal procedures upon death, delaying access to a safe deposit box. The more convenient and cost-effective way to store key documents is at home in a water/fire-resistant safe. And remember to let your Inner Circle know how to open it!
You are half-way through my Top Ten. Now that you are organized, let’s dive deeper into your Tsunami protection plan.
6) Estate Planning – Protection DURING YOUR Life: In addition to your Will, your Estate Plan (EP) should consist of papers that protect you during your life. All the documents in your EP must be signed before mental incapacity – whether resulting from COVID-19 and due to being on a ventilator, a medically induced coma, a stroke – or another serious condition. So, act now.
A well-designed EP should include, at the very minimum:
(a) a Durable Power of Attorney: This authorizes a trusted person and an alternate to handle all your financial matters and to apply for benefits;
(b) a Health Care Surrogate Designation: This authorizes a trusted person and an alternate to make health care decisions on your behalf (e.g., to confer with doctors, to approve selected experimental treatments for COVID-19, etc.);
(c) a Pre-Need Guardian Declaration: This names your chosen guardian, and an alternate, if one is needed, thus, avoiding one chosen by the court;
(d) a Last Will and Testament (and Trust if appropriate): This states who gets what and how. Without a Will, upon death, the state’s laws control. Thus, for example, a step-child would inherit nothing and a half-blood child would inherit less than a full-blood child, even if you raised and love them all equally as your own; and
(e) a Living Will: Unlike an informal pact with someone, this officially indicates your wishes as to the use of life-prolonging measures (e.g., a ventilator) and is enforceable, thus, avoiding emotional family disputes.
Some things to consider about the end-of-life Living Will: If you already have one, review it to see if your wishes have changed about the use of a ventilator, now that it is a common treatment for COVID-19 – and given that intubation for weeks may risk long-term lung damage. Also, do you wish to add a request to extend your life – at least until arrangements are made for a “virtual” family gathering – if they cannot visit you in the hospital due to Coronavirus? If visitors are allowed, is there someone who should be barred from visiting you because they agitate you?
7) Long Term Care Medicaid Pre-Planning: As a result of the Coronavirus pandemic, the financial markets have been turbulent, resulting in tumbling values of hard-earned life-savings. As nest eggs shrink, in-home long term care and nursing home prices continue to soar. Therefore, Medicaid pre-planning for long term care is now more important than ever to preserve what you have of your savings.
Without Medicaid, people must either spend their life-savings or rely upon their long term care insurance – if they have any and only for the length of the policy term, which is usually 3 years. Applying and qualifying for Medicaid can take many months and requires a lot of supporting documentation. Pre-planning with an attorney and having records organized now avoids wasting time and paying thousands out-of-pocket later while getting qualified.
Medicaid rules are complicated and evolve continuously. One key point to remember is that you should complete transferring or sheltering your assets effectively 5 years before applying for Medicaid. Otherwise, you face a penalty period of ineligibility. There are acceptable ways to “spend down” certain “countable” assets to convert them into “noncountable” assets under the Medicaid rules to stay under the maximum allowed for eligibility.
Can you “spend down” your money (in order to legally qualify for Medicaid) by buying a new car, eye-care, dentures, a pre-paid burial contract, or maybe even a new computer to help you connect “virtually” with your loved ones? It depends. Medicaid laws are extremely complex and extensive. For the best advice on what Medicaid allows, consult an attorney who is detail-oriented and familiar with Medicaid laws.
8) Hospitalization and Long Term Care Costs: Some people who become seriously ill (e.g., from COVID-19, a stroke, a fall, etc.) need long term care after leaving the hospital. Pursuant to Florida laws, your chances of being partially or fully covered by Medicare or an HMO for “up to” 100 days for nursing home care and/or rehabilitation treatment costs can depend on (a) being “admitted” to the hospital (rather than “for observation”); (b) being hospitalized for at least 3 consecutive days (not counting the day of discharge); and (c) being classified upon discharge as a “skilled” care recipient (rather than for intermediate or custodial care, which is not covered by Medicare/HMO).
After Medicare coverage stops, Medicaid is essential and only plan to cover the massive skilled nursing home costs and treatments for long-term care. Those who are proactive and have consulted a savvy attorney for Medicaid pre-planning, can protect a large part of their life-savings and qualify for Medicaid.
9) Homestead: Florida’s unique homestead laws and exceptions are also complex. The title of a home is crucial and can result in unintended outcomes as to: protection against creditors and predators; property value and taxes upon inheritance and sale; authority to sell or give away in a Will; and the state’s ability to be reimbursed for long term care Medicaid costs.
If you own your home, make sure it is titled to properly carry out your wishes. For example, barring few exceptions, you cannot sell or give away your home in a Will if your spouse or minor child lives there.
If your estate planning attorney recommends that you change the title to match your intentions, have the title changed before it becomes more complicated to do so as the next “wave” arrives and businesses must close again. (There are very few Remote Online Notaries certified pursuant to the new Florida law of January 2020.)
Florida homestead laws can be tricky. For example, if a mother’s self-made Will bequeaths her home to her beloved son who then lives there with his wife (disliked by the mother), this wife can end up owning the home if the wife outlives them both!
What if the son was not married, but instead, lived with his girlfriend and the mother gifted the home to the couple in her Will? Because the girlfriend is not an “heir” under Florida law, the girlfriend’s portion of interest in the home would be vulnerable to the mother’s creditors.
In both examples, the outcomes were vastly different than the mother’s intentions stated in her Will. Consulting a savvy estate planning attorney before making decisions about your home will avoid unintended results.
10) Pets: Last, but definitely not least, protect your furry family members. If you are absent from home for weeks (e.g., hospitalized due to a fall, COVID-19, etc.), will your pet(s) be taken care of by someone reliable – and to the same extent, you did? Pets are vulnerable and depend entirely upon us to make sure they will be taken care of even in our absence. Obviously, pets are not plants, so taking care of them involves much more than knowing when to water and to feed them.
Our pet’s love goes deep. And each one has a unique personality. Pets are all about routine too. So, a pet will be traumatized not only by your absence but also by changes in routines. You can minimize their trauma by taking proper steps.
Florida law authorizes the creation of Trusts specifically for the care of pets. My Estate Planning practice offers additional legally binding measures for pet care. I also created a comprehensive pet instruction guide for pet parents to fill out so their pets can be cared for seamlessly in the parents’ absence. The manual covers such details as when a dog needs to be walked; the type of litter a cat prefers; their favorite treat – if allowed; when and what flea prevention is applied, etc.
My hope is that you now have ideas on how to be ready to surf the next Coronavirus wave as it hits vulnerable procrastinators like a Tsunami.
A cautionary note as to creating your own EP: Using forms without an attorney might be better than having nothing, but it is far from ideal. Many forms fail to apply Florida laws and do not address individual circumstances that can make a huge technical difference, thus, resulting in unintended results and divisive family disputes (e.g., over heirlooms or over life-prolonging procedures). Regardless of how simple you believe your situation is, inaction or doing an estate plan on your own can end up costing you and your loved ones both financially and emotionally.
By Caroline Emery, Attorney at Law, PLLC
“Planning for LTC with TLC”
Guardianship, Probate, and Estate Planning Attorney
for the Entire Family, Including Pets
Note: the above summarizes Florida law and exceptions often apply, so an estate planning attorney should be consulted for your unique situation.