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The need for elder law planning increases post-election

Now that the election is over, what might the future hold for elder law planning? We may see some old proposals with regard to government programs revisited, and lots of conversation about tax and spending cuts. While we don’t know exactly what we can expect, one thing we know for sure is that this election reinforces the need for long-term care planning for all seniors and their loved ones.
 
Below is a look at what we may see in the months and years ahead, and opportunities that exist for elder law attorneys.

Government eligibility programs post-election

Earlier this year, House Republicans, led by Speaker Paul Ryan, released a policy paper on health care reform. The paper outlined an alternative to the Affordable Care Act (arguing for its repeal), and dedicated a large portion to Medicaid reform. Their idea is to create either a block grant or a per capita cap on Medicaid, which would set a limit on how much to reimburse states per enrollee. The per capita model would not account for changes in the costs per enrollee beyond the growth limit, which would be set below the projected rates of growth under current law. Under a block grant, states would be given a set amount of Medicaid funding based in part on the state’s current Medicaid spending, rather than setting a per enrollee cost.

While the cap could control federal spending on Medicaid and give states additional flexibility, it will also provide states with an incentive to reduce Medicaid payment rates and restrict benefits. Enrollee with high costs could be prevented from qualifying or saddled with high premiums or cost sharing that is unaffordable.

Currently, Medicaid matches what a state pays out for Medicaid benefits. A Medicaid beneficiary does have a share of cost, but it is limited to their income, less certain exclusions (and can vary with the Medicaid program that person is enrolled in). The per capita cap could allow states to charge much higher costs and in effect restrict enrollees from receiving benefits who need it the most.

The Urban Institute, which has analyzed Medicaid block grants and per capita proposals, notes in an article published by Forbes.com  that such policies would reduce states’ authority to make policy decisions over their own programs while threatening benefits that low-income people often need but can’t afford. In addition, block grants would favor states with higher incomes since they spend more on Medicaid and would therefore get more money allotted by way of a larger block grant.

While per capita caps or block grants will save the federal government money, several negative consequences could occur: 1) Millions of current Medicaid enrollees will lose their benefits. 2) Millions of Medicaid applicants will be denied eligibility and will have no way to pay for care or to obtain insurance. 3) States will have increased expenses to make up the difference from funding they would have received from the federal government.

Medicaid block grants are nothing new. They have been proposed several times over the past 20+ years but never implemented.

Repeal of the Affordable Care Act

Trump was very vocal about his desire to repeal the Affordable Care Act (ACA) during his campaign. House Republicans also made it their first principle in their policy paper.

The Congressional Budget Office (CBO) released its report on the Budgetary and Economic Effects of Repealing the Affordable Care Act last June. In the most favorable projections (including the budgetary effects of macroeconomic feedback and taking into account the impact on federal revenues and direct spending), repealing the ACA would increase federal budget deficits by $137 billion over a 10-year period. Approximately 24 million U.S. residents would be uninsured, and 14 million fewer people would have access to Medicaid.

If the Affordable Care Act is repealed, new health care reform laws may bring greater opportunities for our clients if more innovative means for obtaining Medicaid and/or insurance are embraced.

Improvements for Veterans

Congress has held numerous hearings and called VA officials in to testify several times over the last several months. There has been negative press about how applications for benefits are processed, long waiting lines for care, fraud, and more.
Trump made VA reform part of his campaign platform and published a 10 point plan to reform the Department of Veterans Affairs. His vision includes ensuring Veterans get the care they need “wherever and whenever they need it.” He also discusses addressing Veterans’ “invisible wounds” and investing in post-active duty success, along with better meeting the needs of female Veterans. Trump’s vision also includes firing corrupt and incompetent VA executives and employees and modernizing the VA and how care is delivered.

If implemented, Trump’s plan will greatly improve how Veterans receive care. We don’t know how pension benefits will be impacted, as the VA has yet to publish their final rules. But it is encouraging to see a President who is committed to taking care of our Veterans.

Social Security and Medicare

Throughout his campaign, Trump repeatedly stated he would leave Social Security and Medicare untouched. However, House Republicans have been trying for many years to place a cap on the government’s share of Medicare. This would result in large increases in premiums for seniors and limit Social Security benefits by raising the retirement age, among other changes.

According to an article on Forbes.com, Trump has proposed a $6.2 trillion tax cut – bigger than any tax cut since Reagan’s in 1981. This plan, according to the article, would increase the national debt by $7 trillion over the next decade. While Congress may not approve a tax cut this large, there will most likely be tax cuts that will have to be paid for. It is possible that Social Security and Medicare will be targets of those cuts, but we will have to wait and see.

Opportunities ahead

The need to advise clients about planning opportunities hasn’t changed, and will only increase if changes to the law are made.

Whenever potential law changes are explored or implemented, the need for solid legal advice increases and the same is true here. Much will be made in the press about potential cuts and who will fall victim to those cuts. Now more than ever clients need solid legal advice about long-term care planning options.

Expand your brand in your community.

Many residents in your community will be looking for guidance in these uncertain times. This is your chance to be a thought leader in your community by educating members of your community about what could be coming, how to contact their local representative to express their opinion, and then keeping them informed of new legislation as it comes up.
 
Referral sources will also be looking to you for guidance and information. You can host an event this month to provide an update on the current state of affairs and what to look for in the coming months.

Become the “go to” attorney on Social Security retirement benefits.

As we face potential significant tax cuts, clients will have questions about their retirement benefits: When to take them, whether to claim a spouse’s benefits and when they can do so, as well as what opportunities exist for a disabled child.

Encourage wartime Veterans to plan now rather than waiting.

We know changes to the pension eligibility rules are coming that will most likely include a lookback and penalty period. Rather than waiting until the Veteran has a medical need, Veterans can proactively plan now for the possibility of needing care in the future and qualify for VA pension.

Incorporate a care-based approach to planning.

Clients need to make choices about how to find and pay for long-term care now and in the future, with or without Medicaid. By consulting with a professional in your community who is familiar with care options and what they cost, you can better advise clients on how to plan for the cost of long term care.

Knowledgeable elder law attorneys are needed more now than ever.

We could be facing changes in government eligibility programs that haven’t been seen before. Now more than ever clients and referral sources need the guidance of elder law attorneys to help them understand the changing landscape and what options are available. This is a great time to be an elder law attorney to serve as a guide to many who will need help.
 
Far more opportunities will present themselves as we share thoughts and ideas with one another, and as time passes and we learn more about the President’s agenda, and that of Congress.

To Be Continued...

The potential effects of the election on elder law continue beyond this post. This months' Final Friday update will be a "special edition" focused on the election and what we might see in the coming months. We have extended the time of the webinar from 30 minutes to one hour so we have time to cover not only the election and what might happen in the area of elder law planning going forward, but also other news from around the country.

Post-Election Special Edition:
Final Friday Update Webinar

Friday, November 18, 2016 at 12:00 p.m. ET

→ YES! Save me a seat ←

Final Friday Update is a monthly webinar to keep ElderCounsel members on top of hot news topics and cases. Due to the uniqueness of the election this month, we have opened registration to everyone. Spread the word and invite colleagues to join us.
 

ElderCounsel provides education, document drafting software, and support to elder law attorneys across the country. If you would like more information about our services contact us online or give us a call at 888.789.9908, option 3. 
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