Understanding the Differences Between Estate Planning and Elder Law
by Don Drake, Connelly Law Offices, Ltd.
"For as long as I have been in practice, there has been confusion about estate planning and elder law," stated professional fiduciary and certified elder law Attorney RJ Connelly III. "When you begin to plan for your future, specifically about financial affairs and health care needs, the question arises about the difference and similarities between estate planning and elder law, and understandably so. And there are good reasons why since many tie the two types of law together because they are usually handled at the same time."
"This occurs because many people wait until they are close to retirement age to start their estate planning process. When an older person creates an estate plan, they may also need elder law counseling. To better understand the two areas of the legal field, we will look at their solutions, the questions they answer, and how they can work together as we age."
"The main goal of estate planning is to choose legal documents to determine what will happen to you and your assets once you have passed away or become incapacitated," said Attorney Connelly. At our office, we help clients make important decisions around these concerns." These decisions include:
Who will make medical and financial decisions if an individual cannot do so?
Who is allowed access to the medical records?
How assets are distributed after the individual passes.
Who will care for minor children if an individual becomes incapacitated or die?
Who will manage money for the minor children if the individual is no longer able?
How to handle the funeral arrangements and burial.
Let's look a bit further at some documents.
Durable Powers of Attorney - Using a general durable power of attorney document, you can name a person, or persons, to make financial decisions on your behalf if you can no longer do so. Expressing your end-of-life wishes requires designating a person to make healthcare decisions for you by completing a healthcare directive.
HIPAA Form - Completing a Health Insurance Portability and Accountability Act (HIPAA) form will allow your healthcare providers to share your medical records with those listed on your HIPAA form.
Wills and Trusts - In your will, you can name the beneficiaries of your estate and a guardian to care for any minor children you may have at the time of your death. You can also name a conservator to manage the money you leave for their benefit. Some people create a trust, or trusts, to hold their assets during their lifetime and after death. They then sign a pour-over will that moves assets into their trust(s) upon death. You can leave instructions concerning your funeral or memorial service and what you want to happen to your remains in your will or a separate document.
"Estate planning focuses primarily on what happens after a person dies, while elder law focuses on a person’s last years or months," stated Attorney Connelly. "This can include planning long-term care and applying for government assistance, such as Medicaid, Medicare, and veterans’ benefits. Using elder law tools and strategies, an elder law attorney can help you find ways to preserve your assets while preparing to apply for benefits."
"Like estate planning, starting the elder law planning process well in advance is best," continued Attorney Connelly. "To qualify for benefits, such as Medicaid, you may have to sell or transfer ownership of some assets years before applying for benefits. Gifting or transferring assets from your name must be done according to government requirements, so applying for benefits can be complicated. Seeking an elder law attorney with experience and an understanding of the law can make the difference between receiving benefits quickly or not at all. And remember, each state may have different laws around Medicaid eligibility."
"Since seniors are at a greater risk for discrimination, neglect, and abuse, elder law attorneys can help seniors and their family members recognize their rights being violated and take legal action to counter and remedy the situation."
Tying Estate Planning and Elder Law Together
"It is best to start your estate planning process as soon as possible since the decisions involved could come at any time due to an accident or an illness," said Attorney Connelly. "Planning for end-of-life care and its benefits may come later in life, but preparing well in advance lets you legally reduce assets for an extended period to qualify for benefits like Medicaid."
"Even younger families just starting their estate planning process may look at elder law planning simultaneously for senior family members’ needs. Some estate planning tools, such as trusts, are often used when helping a parent plan for Medicaid and other government benefits for long-term care expenses. An attorney experienced in estate planning and elder law can advise you in these areas and help you navigate complicated processes."