Texas Estate Planning

What's the Difference Between Medicaid, Medicare, SSI, and SSDI?

If you need assistance paying for long-term care, then you need to look into Medicaid, not Medicare. But if you need health insurance, then it’s a Medicare application you’ll be submitting. And although SSI (Supplemental Security Income) refers to a specific type of program, it’s only a one letter difference from SSDI (Social Security Disability Insurance) which is a completely different benefit program for people with various types of disabilities. 

And when you look into the details of each program, it only gets more complex. So let’s break it down…

There are over one-hundred programs administered under the umbrella of Medicaid out there to help you receive the appropriate health care, insurance, and assistance that you deserve. Because of the sheer number of programs, it can be difficult to find the one best-suited for your needs. Each program has different requirements, guidelines, and limitations. 

Each program is guided by laws that change each year, if not more often, and vary from state to state, depending on the program. It can be quite helpful to get counsel from a licensed attorney in your area who stays up to date on the laws that specifically deal with the program you are applying to. The Attorneys at our Firm stay up to date through consistent continued learning experiences offered specifically for this purpose, and they ensure that every member of the team is made aware of updates and changes in the law so that we can better serve the needs of our community. 

To help you in your search for the program that best fits you and your family’s needs, here is a very quick rundown of 4 common programs that are easy to confuse: 

 

1. Medicaid: 
   • Health coverage (which is legal entitlement to payment or reimbursement for your health care costs)
   • Funded and administered jointly by the state and federal governments. This means that each state has different laws regarding Medicaid.
   • Income and asset limit 
   • Available to low-income: 
     1. Adults
     2. Children
     3. Pregnant women
     4. Elderly adults 
     5. People with disabilities 
   • Can be used for: 
     1. Long-term care 
     2. Inpatient and outpatient hospital services
     3. Physician services
     4. Lab and x-ray services
     5. Home health services 
2. Medicare: 
   • Health insurance 
   • Administered by the federal government 
   • Eligibility is based on: 
     1. Age (65 or older) 
     2. Certain younger people with disabilities 
     3. People with End-Stage Renal Disease 
   • There are various Medicare plans based on your eligibility and needs. 
3. SSI (Supplemental Security Income): 
   • Supplemental monthly income 
   • Eligibility is based on:
     1.  income and asset limits 
     2. disability
     3. Age 
        • Adults: 65+, or blind, or have a disability 
        • Children: under 18 and have physical or mental condition(s) that very seriously limits their daily activities for a period of 12 months
4. SSDI (Social Security Disability Insurance): 
   1. Supplemental monthly income 
   2. Means-tested based on disability and recent work history 
      1. Includes income and asset limits 
   3. Same medical requirements as SSI 

 

Hopefully that helps give you a better picture of where to start in your search for the programs that you or your loved ones might need. Remember that each state has their own set of laws regarding benefit programs and a licensed attorney with an understanding of these programs can be a helpful resource in navigating the application process. 

Ard Law Firm, PLLC is located in the Greater Houston Area, off I-45 south on the way to Galveston, but is able to serve all of Texas. Over the last decade, we’ve focused on Medicaid to help people transition into long-term care without large financial burdens.

We work with our clients to get their information together in order to apply for the benefits they deserve, and if obstacles come up along the way we work together to overcome them. Whether that means drafting legal documents, conducting research, or even arguing appeals, we walk with you on your journey, every step of the way.

What is National Healthcare Decisions Day?

“Healthcare decisions,” might sound like some far-off bridge you’ll cross when you get to it, but the reality is that our health is unpredictable. We really don’t know when healthcare decisions will need to be made or if someone else will need to be making them for us. 

Over the last few years, people are seeing the importance of getting a plan in place that will protect them, their family, and their assets. Scenarios in which we’re unable to make our own healthcare decisions are not easy to think about, but they are important to discuss with people that you know and trust, the people that will most likely have to make those difficult healthcare decisions on your behalf. 

National Healthcare Decision Day (NHDD) was founded in 2008 by Virginia-based health care lawyer, Nathan Kottkamp, because he saw the pitfalls in our healthcare system that occur when people fail to discuss their healthcare wishes or have a plan in place. He chose April 16th to remind us that even though it’s tax season, there are some other human experiences we can be certain to face. 

But National Healthcare Decision Day goes far beyond our “last wishes.” It is about making sure someone knows what we value so that they can confidently make decisions for us if the need ever arises. It can be daunting to think about someone else having the final say in our health care, but imagine being the one making those decisions and not having the slightest clue of what the person in the hospital needs or wants. 

 

Give your loved ones the confidence that they’re making the right decision.
Not only is it important to communicate your wishes to your friends and family, it is often necessary to outline them in a legally binding document (or two). An Advance Directive, often referred to as a “Machines or No Machines Document,” is a legal document in which you explicitly state what type of medical care you’d like under certain circumstances. 

But it’s impossible to predict exactly what your circumstances are going to be, so take April 16, National Healthcare Decisions Day, to have these conversations with the folks who need to know. Check out The Conversation Project’s “Conversation-Starter” guides on their website. The Conversation Project recommends discussing what you value in your life in order to better understand what to prioritize in the event that you become incapacitated. These broader conversations help prepare your loved ones for unpredictable medical events, as opposed to only discussing very specific circumstances that might not ever occur. 

Another legally binding document that can be helpful in ensuring you receive the care you desire is called a “Medical Power of Attorney.” If you don’t have this document in place, then your state will defer to their laws which dictate who will make your medical decisions in the event that you become incapacitated. For instance, if you’re married, more often than not, your spouse will be the one to speak on your behalf. Getting a Medical Power of Attorney not only allows you to name whomever you wish to speak on your behalf, but also allows you to name alternates in the event that your initial agent is not able to act at the time or in the place you might need them to. 

 

Celebrate National Healthcare Decisions Day– start the conversation with your loved ones.
For healthcare decisions, it can be very beneficial to have your wishes in legally enforceable documents because doctors often prefer to take every measure possible in order to keep you alive. And while this is a noble stance for doctors to take, there are certain circumstances in which this approach may be distressing for you and your loved ones. 

Celebrating National Healthcare Decision Day with honest conversations about your values can bring peace of mind to you and your loved ones. It might be difficult to begin such a conversation, but it pales in comparison to the difficulty of making healthcare decisions for someone else without any directions. 

What Do People Think About Government-Paid Long-Term Care?

About 50% of adults say that assistance for older adults should be funded by Medicare and Medicaid, according to an Associated Press-NORC Center poll.

MSN’s recent article entitled “Bipartisan support for policies to pay long-term care costs: Poll” says that 75% of adults surveyed say long-term care should be funded through Medicare Advantage or supplemental insurance programs. Close to two-thirds of respondents also said they’d support a government-administered insurance program, government funding for low-income people to receive long-term care at home and Social Security earnings credit or tax breaks for those providing long-term care to a senior.

Overall, 66% of respondents said they think it’s the federal government's responsibility to make sure all people in the U.S. have health insurance coverage, with 73% of people aged 18-49 likely to support vs. 53% of those aged 50 and older.

Republican and Democratic responses were about the same, according to the poll.

About the same number of Republicans and Democrats favor nontaxable funds to pay for long-term care insurance—about 70%. The largest party difference was about the option for low-income people to receive government-funded, long-term care in their homes. Roughly 84% of Democrats supported this, compared to 55% of Republicans.

Overall public satisfaction with the U.S. healthcare system is low. Just 12% think the government is handling healthcare very or extremely well. When asked about healthcare specifics, 74% of adults said the U.S. handles prescription medication costs or mental healthcare "not too/not at all well," and 70% said the same about mental healthcare.

The survey found that whites had a more negative view of the U.S. healthcare system compared to black and Hispanic adult respondents. When looking at healthcare for older adults, 56% of white adults think it is not too/not at all handled well, with 49% of Hispanic adults and 44% of black adults responding the same.

The poll consisted of 1,505 interviews between July 28 and August 1, with a 3.6% margin of error.

Reference: MSN (Sep. 12, 2022) “Bipartisan support for policies to pay long-term care costs: Poll”

Forbes’s article entitled “Should “Do Not Resuscitate” Be Part Of Your Estate Plan?” explains the difference between a health care proxy and a DNR.
A health care proxy is a legal document that lets you name an agent to make health care decisions for you. It is used if you’re unable to make those decisions for yourself. When you were again able to communicate, you’d go back to making your decisions for yourself. The ability to create a health care proxy is governed by your state’s laws. Every state’s laws are different.
Ask an experienced estate planning attorney how to comply with your state’s law in creating these directives. He or she will know about health care institutions and whether they will give authority to the documents you created. If they won’t, your named agent would have to go to court to enforce them.
You can also supplement your state’s directives with additional guidance.
Some states’ directives require a set series of instructions for your agent. For instance, it may include questions as to whether you want life sustaining treatment and medically administered nutrition and hydration. Other states contain language that is broader. They allow the agent more latitude to decide end-of-life decisions. This language usually includes the intention that you want to be taken off life support, if you have a terminal illness or injury and your death is imminent.
A DNR is a medical order informing health care workers that they are not to revive you. It is a document that you put in place with your physician. Some states have also adopted MOLST forms (Medical Orders for Life Sustaining Treatment) to address other situations, like intubation, ventilation and dialysis. These documents require a thorough discussion between the patient and the health care provider. They are typically part of end of life care, when a person has an advanced stage terminal illness.
If you’re relatively healthy, you want to be treated – and resuscitated – if you have a heart attack. There may be a time when you need a DNR, but most likely it’s not now. If and when that time comes, you’ll need to have a talk with your doctor about a DNR.
However, you should speak with your estate planning attorney about your health care proxy, especially if you don’t have one. Whether it’s during the coronavirus pandemic or not, a health care proxy is a critical part of a complete estate plan.
Reference: Forbes (May 28, 2020) “Should “Do Not Resuscitate” Be Part Of Your Estate Plan?”

Make Your Retirement Dreams Come True

Moving from general concepts to specific retirement activities you think you’ll want to do during retirement, can help you do a better job of saving and planning, advises U.S. News & World Report in the article “Will You be Able to Afford the Lifestyle of Your Dreams in Retirement?” Increased longevity has made retirement a time to begin anew. This requires a different mindset. Regardless of your retirement dreams, you’ll need more funding for a longer retirement. 

Here are some pointers to help get retirement savings on track:

What do you want to do? Vague goals like travel may not motivate your savings. However, if you’ve identified the cost of living in Paris for six months, you’ve got a real concrete goal to work toward. That provides more motivation and helps avoid impulse spending. Get specific: write down what you want to do and start researching what it will cost.

Do a test drive first. If your spouse wants to live in an RV full time, that’s great as long as you do. However, don’t sell the house before testing it out. Try renting an RV and living in it for at least a month. The same is true for living in a house in the woods. Sounds great—but if you’re a city dweller, how will you feel after a few months of living in an isolated spot?

Think about how long you want to work. Many people today work into their late 60s and early 70s. If they have a desk job, and they have reached a certain level of success, there may not need to be a cut-off date for retirement. What about taking more time off for vacations or working part time? Recent studies have shown that working even a few more years, can have a major impact on the quality of your full retirement.

Do the math. Once you have some concrete plans in place, run the numbers. Consider how you might make the money you have last longer. Look at housing prices, if downsizing to a less expensive area is on your list. If you plan on travelling, do you have to stay in five-star hotels, or could you be content with Road Scholar, formerly known as Elderhostels?

Remember to include health care costs. You’ll need to include the cost of medical expenses, including Medicare premiums, deductibles, copays and coinsurance, among other costs. This is especially true, if one or both spouses have any chronic conditions.

Now, what’s your savings plan? Once you have all this information, you’ll be able to determine how much you need to save, each year and each month. When you combine all your retirement income sources, do you have enough to sustain your retirement dreams? Or do you need to adjust your savings?

Reference: U.S. News & World Report (Dec. 19, 2018) “Will You be Able to Afford the Lifestyle of Your Dreams in Retirement?”

The Retirement Money Question: How Much?

This is the question everyone wants to have answered as they save, work and plan for their retirement: How much money will I need, when I finally stop working and retire? The typical approach of asking what percentage of your final salary you’ll need is not quite right, says The Wall Street Journal in the article “How Much Money Will You Really Spend in Retirement? Probably a Lot More Than You Think.” 

This is a complex question and one that requires more knowledge than most people have, even professionals. Just imagine the data you need:

• The cost of health care 
• How much health care you’ll need
• The health of Social Security
• The rate of inflation
• Your risk tolerance level
• How you want to spend your time during retirement

Try figuring this out on your own. How can you know all or any of these items? 

To better understand how people approach this question, hundreds of people were invited to a research lab and asked how much of their salary they thought they would need in retirement. The answer most people gave was about 70%. The people were then asked how they got to that number. The answer, not surprisingly, was they had heard it somewhere.

To dig in deeper, another group of participants was asked specific questions about how they wanted to enjoy their time during retirement. Based on this information, the cost of these activities was calculated and then a calculation was done to find out what percentage of their salary they would need to support the type of life they imagined they would have in retirement.

The answer was 130%. That meant their savings rates would have to double for a successful retirement.

How is this possible? Working is cheap. You’re not spending a lot because you’re busy working. The company pays for your health insurance, life insurance and there’s even a breakroom stocked with great coffee and snacks. 

When you retire, you’re spending money you would not be spending while you are working. Two big vacations a year, recreational activities and dining out more all add up quickly. So how can you plan successfully for the retirement lifestyle you want? 

Think (realistically) about the costs of the activities you have in mind and get as detailed as you can. Once you know how much you want to spend, add them up. Use a spreadsheet or a notepad, but this exercise will give you more information than the simple conventional wisdom of 70%.

Now that you know how much money your dream retirement will require, start to plan what you need to do to get there or adjust your dream retirement. Work backwards to figure out how much risk you are comfortable with your investment portfolios and how much cutting back you’re willing to do in your pre-retirement life for your dream retirement. It’s better to know, years in advance, than to be brought up short and have your retirement dreams come crashing down.

Reference: The Wall Street Journal (Sep. 3, 2018) “How Much Money Will You Really Spend in Retirement? Probably a Lot More Than You Think”

Older Americans and the ACA Replacement

The non-partisan Congressional Budget Office recently released its evaluation of the impact of the proposed American Health Care Act, the congressional replacement for the Affordable Care Act proposed by House Republicans and backed by President Trump.

Proponents of the bill dispute some of the findings of the CBO, such as that it will lead to 24 million more people without health insurance. Nevertheless, they are pleased that the non-partisan evaluation found that eventually health insurance premiums would drop by 10%.

How the bill would do that, however, is a concern for older Americans as The New York Times explains in "No Magic in How G.O.P. Plan Lowers Premiums: It Pushes Out Older Americans."

The AHCA would allow health insurers to charge older people considerably more for insurance than they are currently allowed to charge. It would also offer a smaller subsidy for many people to help pay for that insurance.

Many Americans between the ages of 50 to 64 would potentially pay much more out of pocket to maintain health insurance coverage. However,  since many could not do so, they would eventually stop purchasing insurance.

What would be the likely result?

Insurance pools would be dominated by younger people who are cheaper to cover and thus their premiums would go down.

This could also be a concern for the viability of Medicare,  since presumably people between 50 to 64 who could not afford insurance, would join Medicare with more health problems in need of treatment than they do now.

Reference: The New York Times (March 14, 2017) "No Magic in How G.O.P. Plan Lowers Premiums: It Pushes Out Older Americans."

Can the Wealthy Achieve Immortality?

Cheating death and becoming immortal has long been a desire for some people. Actually doing so was once thought to be impossible. However, medical science has advanced so much in the last 100 years that some people think immortality could eventually be possible.

Funding endeavors to defeat death and aging is a pet project of several Silicon Valley billionaires. However, the process of cell division and regeneration in humans would seem to make it unlikely that immortality will be achieved within our lifetimes.

What is possible is that wealthy people can expect to live a lot longer than previous generations of humans as discussed by Financial Advisor in “Want To Live Forever?”

Many wealthy people are in fact creating comprehensive health and longevity plans. Their wealth allows them to take advantage of elite health care concierge plans and the latest advancements in medical science in the hopes of prolonging their lives.

The advancements the wealthy are funding will most likely trickle down to those less wealthy eventually, making it so everyone lives much longer. However, as actually becoming immortal is so far off for humans, no one should think they can prolong their lives for so long that they do not need to get an estate plan.

We all are going to pass away, and we should all still plan for what happens when we do.

Reference: Financial Advisor (July 1, 2016) “Want To Live Forever?”          

The Hoopla over HIPAA

We tend to avoid the doctor or hospitals unless we absolutely need one. Besides the germs and bad hospital food, there’s all that confusing paperwork to deal with. But eventually you or a loved one will need to visit the doctor or hospital for your health – and you may encounter some legal red tape that makes matters even stickier.

Sometimes the red tape is simply hospital policy gone too far. Regardless, navigating the maze requires doing your homework ahead of time. For example, what do you know about HIPAA?

HIPAA is the “Health Insurance Portability and Accountability Act of 1997.” The title of a recent article in the New Old Age Blog of The New York Times summarizes the issue well: “A Privacy Law Often Misinterpreted.”

One purpose of the law is to ensure the privacy of medical data. Nevertheless, this doesn’t mean the hospital is intended to protect the privacy of the patient from their loved ones, especially when that loved one is present during an examination! In fact, HIPAA does not prevent health care providers from sharing relevant information regarding a patient with their family members, unless the patient objects.

The original article is a worthy and enlightening read, whether you are a patient, a family member or even a medical professional. Apparently, there is a lot of misinformation leading to misinterpretation when it comes to HIPAA.

Bottom line: make sure you have up-to-date Advance Health Directives that specifically provide your designated agents with current and future access to all of your medical information, verbal and written, with specific authority to execute HIPAA releases on your behalf.

Reference: The New York Times – The New Old Age Blog (March 27, 2013) “A Privacy Law Often Misinterpreted”