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Your Caregiving Questions Answered: Legal Matters

Charles P. Sabatino weighs in on financial dilemmas

Adviser assisting senior couple

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Get your caregiving legal questions answered.

Below are answers from Charles P. Sabatino, a member of the AARP Caregiving Advisory Panel, to questions submitted by visitors to the Caregiving Resource Center. This page will continue to be updated with new questions and answers. Have a query or conundrum? Ask the AARP Caregiving Advisory Panel.

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Editor's Note: These answers present general information in response to brief factual scenarios and do not provide legal advice or substitute for the advice of an attorney. Every person's circumstances are different and laws vary from state to state. If you need legal advice or other expert assistance, seek the services of an attorney or other competent professional.

Q: My stepmother has been in rehabilitation at a long-term care facility for 30 days and she's not improving. She will be admitted to a nursing home soon. My name is on her house and her checking account. She has other assets but they are limited. Will her house need to be sold right away to pay for the nursing home?

A: If your stepmom is initially covered by Medicare in the nursing home, the home is irrelevant while Medicare pays. But Medicare covers a very limited number of days in nursing home care. The status of the home becomes an issue under Medicaid, so that is what I assume you are concerned about.

Under Medicaid, there are more than 50 different answers depending on which state or territory you live in. Most states permit you to keep the home as an exempt asset if you have an intent to return home, but many states exempt the home only for a limited period of months, regardless of your intent. Even if exempt, the home may be subject to estate recovery after your stepmom's death. The state is entitled to recover the nursing home payments they made under Medicaid from the estate. There are many complexities to these rules, and often ways to preserve or transfer all or some of the value of the home, but it requires review of your stepmom's circumstances by a lawyer experienced in Medicaid.

Q: My mom refuses medical/hospital service when her heart rate goes dangerously high. If my mom should die due to heart rate anomaly, can I be held legally responsible for her death?

A: It's not likely. To be held responsible, at least three essential facts would have to be present. One, you would have had to assume the role of caregiver with responsibility for your mother's health. That creates a duty of care, but whether you have taken on that duty and the extent of that duty depends upon the unique fact of each situation.

Second, you would have had to violate that duty of care by failing to get your mother the care she needs.

Third, your mother would have to lack the capacity to make her own decisions or be unable to make her own decisions because of undue influence exercised by you. If your mother has the capacity to make medical decisions and clearly makes her own decision to refuse, then there is nothing you can do, even as her caregiver. She has a legal right to make an unwise decision. The responsibility for the consequences would be hers, not yours.

Q: I was a caregiver for my mother until she died. Am I entitled to any compensation from her estate, besides what is stated in her will? My sister did nothing to care for my mother and I feel it's only fair that I be compensated.

A: While your mother was alive, she could have entered a formal care contract with you and paid you then, or revised her will and estate plan to leave you a larger share of the estate. If there were a care contract that was still unpaid at her death, you might have a possibility of asserting a contractual debt, but that is typically an uphill battle. Absent that, it's too late. There may be a moral case to be compensated but not much of a legal one. Your only hope now is that your sister agree to give you some of her share of the estate out of the goodness of her own heart.

Q: I quit my job to care for my mother full time. Since I'm dependent on her now, I want her to help me out financially when she dies. She's fine with this but my brother is against it and claims I'm exerting "undue influence." Is there anything I can do?

A: If your mother wants you to benefit financially from her estate after her death in repayment for your caregiving during her life, it's her decision and hers alone, assuming she has the capacity to make financial decisions. If she lacks that capacity, your options are limited. "Undue influence" is different from diminished capacity, and it could be an issue if you had used your relationship with your mother to pressure her into making a particular decision. It's more than mere persuasion; it's unfair persuasion, more similar to fraud and duress legally.

An ideal first step, if your brother can be persuaded, is to bring everyone together with a neutral professional adviser, such as a geriatric care manager, to review your mom's needs, options for meeting them, the extent of responsibility each child is willing to assume, and the personal and financial needs of each person. Transparency and openness in decision making with your mother may not make your brother agreeable, but it is the best medicine to prevent legal disputes later on.

Q: My mother, who lives in another state, is showing signs of dementia. She's often confused and mixes me up with my father. I'm her only child … how can I become her legal guardian so I can manage her affairs and pay her bills?

A: Becoming one's guardian (or conservator as it is called in some states) requires the filing of a legal petition in the appropriate local court. The proceedings are complicated enough to require the help of legal counsel as a practical matter. Your mother will also have a right to legal counsel, and the proceedings may involve an investigation of her circumstances, an assessment of her mental capacity, and a court hearing. If you are appointed as her guardian, you will have to handle her affairs under the supervision of the court and file regular accountings with the court. It all adds up to an expensive and cumbersome form of financial management, intended to protect the interests of the incapacitated person.

That is why the authorization of a trusted family member to handle one's affairs under a financial power of attorney is usually the preferred strategy, but that arrangement must be set up while one's parent still has the capacity to understand the nature and consequences of setting up a power of attorney, and of course, there must be a trustworthy person available whom the parent wishes to appoint.

Q: We want to hire someone to help out with our parents for a few days a week. Since we're hiring an individual directly rather than through an agency, we don't know how to go about setting up the person properly for tax withdrawals, employment taxes, workers comp or other insurance issues that might be needed if the person is injured at our parent's house. How can we find out about setting this up?

A: The IRS publishes a guide that will walk you through the process — Publication 926, Household Employer's Tax Guide, available for free download on their website, www.IRS.gov.

Q: My dad is 92 and lives in another state. Before my mom passed away two years ago, we had hired a caregiver for her through an agency. While visiting my dad recently, I found a marriage license between my dad and the caregiver! She promised to take care of him if he leaves her his pension and anything else upon his death. They don't live together. Is there anything we can do as a family?

A: Digging deeper into these facts could lead to very different conclusions. At one extreme this could be a case of criminal exploitation by a caregiver. At the other, this could be a case of honest affection and a willing and voluntary decision by your father to marry the woman. And, there are many possible stories somewhere in the middle. Can your dad confirm that he willingly married? Has he actually changed his assets and estate plan to benefit the caregiver? You should report your suspicions to the local Adult Protective Services agency. They have authority to investigate and take action if they confirm facts indicating abuse or exploitation.

You didn't say anything about your father's mental capacity. If your father appears to lack the capacity to manage his financial or personal affairs, you might want to have him assessed, if possible, ideally by a multidisciplinary geriatric center. Check with local hospitals or university medical centers for one. His primary care physician can be helpful, too. If you believe he lacks capacity and is being exploited, you can seek a court-appointed guardian or conservator, but that will involve legal expenses, court proceedings, and an investigation of the facts. However, an appointed guardian may be able to recover lost property and even seek annulment of a marriage, if fraudulent.

Q: I help take care of both of my parents. We spoke with an elder lawyer about a caregiver contract, but we did not like her approach. Can we, as a family, draw up a contract, have it notarized and have our tax advisers set up all the guidelines? Will this stand up to Medicaid?

A: More often than not, a contract set up in that way will not stand up to Medicaid scrutiny. Medicaid looks at personal care contracts with family members with a very skeptical eye, and the complicated rules states have created for approving them range from impossible to reasonable, depending on where you live. Elder law attorneys can differ like night and day, so if you did not have a good experience with one, consider trying one more time. Generally, a certified elder law attorney (CELA) is a safer bet. You can find one through the National Academy of Elder Law Attorneys Website.

Q: I would like to get a third-party guardian for my father, who is disabled with a head injury. My mother died several years ago and I was his power of attorney until he made my daughter his durable power of attorney (DPOA). She is now trying to evict me so his home can be sold without his knowledge. (He's in an assisted living facility). How can I assure his best interests are truly being looked after?

A: The family dynamics here are obviously quite complicated, and there are a number of gaps that need to be filled in. Does your father still have the capacity to make any financial or personal decisions? What is the reason your daughter wants to sell the home? Besides the home, what other financial assets and income are being managed by your daughter? How does your financial and personal situation fit into all this?

If there is any opportunity to bring everyone together with a neutral professional adviser such as a lawyer, social worker or geriatric care manager, that would be an ideal first step. If the interpersonal barriers can't be overcome, and there is a real question about whether your daughter is fulfilling her fiduciary obligations to act in your father's best interests, then you should report your concerns to your local Adult Protective Services agency. They have authority to investigate and take action if they confirm facts indicating abuse or exploitation. The last resort is to go to court to seek appointment of a guardian or conservator and demand an accounting from your daughter, the fiduciary. However, you will need the help of a lawyer to do this, and you have to understand that a guardianship proceeding can be costly, time-consuming and emotionally trying.

Q: Although my older sister and I serve as powers of attorney for our mom and are listed on the advanced health care directive, my younger sister does not want to adhere to the consensus of her other siblings. She wants my mom to leave Hawaii and move in with her in California. We think it's best for her to stay in Hawaii. Can she override our decision … and if so, can she also override the decisions we make under the advanced health directive?

A: I am assuming that your mom clearly lacks the capacity to make financial or health care decisions now, so that the power of attorney and health care advance directive are actually in effect. In that case, no, your younger sister cannot override your decisions without going to court to challenge your authority for good cause. If, despite this, she were to "kidnap" your mother from Hawaii to California, you should contact the Adult Protective Services in the community in which she is then physically present. They have authority to investigate and take action against your sister if they confirm facts indicating abuse or exploitation. It would also be advisable under those circumstances to consult an attorney, because there are other civil and criminal actions that may be appropriate, including seeking court appointment as her guardian.

Q: An elder law firm in my area said they could expedite getting my mom on Medicaid for $5,000. Do you think this is a good idea?

A: There are not enough facts presented to answer your question. But here are a few things to think about. First and foremost, what does your mom want? Medicaid planning for your mom has to be your mom's decision. An attorney hired to do Medicaid planning must represent her, not you, unless you are authorized to act for your mom as her authorized agent under a power of attorney, or as her court appointed guardian or conservator. If you are authorized to act for her, you still need to be guided by what your mom would likely want if she could speak for herself. What would be her likely goals at this stage of her life?

As you probably know, Medicaid kicks in only after her assets are nearly exhausted and her income insufficient to pay for long-term care. There are some legal ways to shelter, transfer, or convert certain assets, but you have to ask what the purpose is of preserving assets? Does it benefit your mom, or does it only benefit you? Also, what is the extent of her financial assets, and to what extent can assets actually be preserved under complicated Medicaid rules?

An expense of $5,000 may be a lot or a little compared to the amount that can realistically be preserved. And, what risks are there? Medicaid rules are not always clear, and they are subject to change. Mistakes of judgment in transferring or converting assets can result in loss of eligibility of Medicaid coverage. Only rely on a lawyer who has substantial experience in Medicaid planning.

Q: My uncle, who has not given anyone power of attorney, is living in an assisted living home. He's allowing a young woman who works there to take him out on her days off. He pays for meals and shopping. I have no legal way of stopping this. Is there anything I can do?

A: You would have to dig much deeper down into the facts to make a fair assessment of what's going on. On the one hand, these outings may be the high point of his life right now, and the companionship and social activity may be worth every penny he spends. On the other hand, you may see a manipulative ne'er-do-well seeking to financially and personally exploit your uncle. Or, it may be something in between.

If you have a reasonable suspicion that it is exploitation, then you should certainly express your concern to the management of the facility, for it would most certainly violate employee conduct standards. You can also report your suspicions to the local Adult Protective Services agency. Your identity as reporter will be kept confidential. They have authority to investigate and take action if they confirm facts indicating abuse or exploitation.

Charles P. Sabatino, J.D., is the director of the American Bar Association's Commission on Law and Aging in Washington, D.C.

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