Tag: #EstatePlanningLawyer

Reset Reset font size. Increase Font Size Increase font size.

Law Office Of Stephen J. Silverberg, PC

Stephen J. Silverberg, Esq., and Scott B. Silverberg  Named To 2025 Edition of Best Lawyers® In Elder Law

Posted on

For the eleventh consecutive year, Stephen J. Silverberg, based on extensive peer review, is listed in the 2025 Edition of The Best Lawyers in America® in the practice area of Elder Law.

Scott B. Silverberg is listed in the 2025 edition of The Best Lawyers in America in the practice areas of Elder Law and Trusts and Estates for the first time.

Over 23 million votes were analyzed for the 2025 edition of The Best Lawyers in America®, which resulted in more than 80,000 leading lawyers included in the milestone 31st edition.

Stephen holds the AV® Preeminent (5 out of 5) rating, the highest possible designation from Martindale-Hubbell, and has been on the Super Lawyer New York metro list since 2007.

Stephen J. Silverberg is a nationally recognized leader in estate and tax planning, estate and trust administration, asset preservation planning, and Elder Law. He has served as the President of the National Academy of Elder Law Attorneys (NAELA). In 2003 he was honored as a NAELA Fellow, the highest honor given by NAELA to attorneys who focus on Elder Law, who have made exceptional contributions to meeting the needs of older Americans and who have demonstrated commitment to the Academy. Silverberg has also served as a founder, president and member of the New York State chapter of NAELA. 

He has been designated as a Certified Elder Law Attorney (CELA) by the National Elder Law Foundation, authorized by the American Bar Association. To receive this designation, applicants must pass a stringent written examination and substantial independent peer review. Since its inception in 1993, fewer than 520 attorneys have earned the CELA designation. Silverberg is a Hartwick College and Brooklyn Law School graduate and has been a member of the New York and Florida Bars for over forty years.

Scott B. Silverberg is the Immediate Past President of the New York Chapter of the National Academy of Elder Law Attorneys (NAELA) and a member of the National Board of Directors of NAELA. He also serves as a member of the Board of Directors of the Elder Law Practicum of national NAELA. As a New York State Bar Association member, Scott serves as Vice-Chair of the Practice Management Committee of the Elder Law and Special Needs Section Executive Committee. Previously, he chaired the Technology Committee.

In 2022, Scott became a member of The Estate Planning Council of Nassau County, a member chapter of the National Association of Estate Planners and Councils (NAEPC).

Scott earned an LLM (Master of Laws) in Elder Law from the Stetson University School of Law, a leader in special needs planning. He is the only attorney in New York who holds this degree. He graduated from Fordham Law School (JD, 2013) and holds a Bachelor of Science from the internationally renowned Cornell University School of Industrial and Labor Relations.

The Law Office of Stephen J. Silverberg, PC, represents clients in estate planning, tax, estate administration, asset preservation planning, Elder Law, and related issues. The Law Office of Stephen J. Silverberg, PC is at 185 Roslyn Road, Roslyn Heights, NY 11577, 516-307-1236 and www.sjslawpc.com.


Reset Reset font size. Increase Font Size Increase font size.

What is the Purpose of a Promissory Note in Medicaid Planning?

Posted on

Medicaid planning is often a complex process aimed at preserving a person’s assets while qualifying for Medicaid benefits. Finding a way to pay for long-term care costs without depleting all your hard-earned assets is a key part of Medicaid planning.

One strategy for protecting assets and qualifying for Medicaid that has gained attention in recent years is the use of promissory notes. This article will provide an explanation of promissory notes in the context of Medicaid planning, including their purpose, legality, implications, and considerations. Note that not all states allow promissory notes.

What Are Promissory Notes?

A promissory note is a legally binding document that outlines the terms of a loan agreement between two parties: the lender (creditor) and the borrower (debtor). It includes details such as the loan amount, interest rate, repayment schedule, and any other relevant terms and conditions. Promissory notes are commonly used in various financial transactions, including loans between individuals, businesses, and financial institutions.

Promissory Notes in Medicaid Planning

Medicaid is a public assistance program that assists individuals with limited income and resources in obtaining health insurance. It also serves as the primary way for millions of seniors in the United States to pay for long-term care services.

To qualify for Medicaid in most states, you must have no more than $2,000 in so-called “countable” assets to your name. Typically, five years before you apply, you may “spend down” your excess assets to bring them under this $2,000 threshold. Transferring assets within this five-year window of applying for Medicaid can otherwise result in a penalty period during which you may not be able to receive benefits.

Of course, not everyone plans this far ahead, as many people do not expect they will need long-term care. A Medicaid applicant may use a promissory note to transfer assets to other individuals, such as their children, while still complying with Medicaid eligibility requirements. By transferring assets through a promissory note, they can effectively reduce their countable assets, thereby helping them meet Medicaid’s asset limit criteria.

How Do Promissory Notes Work in Medicaid Planning?

A person seeking Medicaid benefits might opt to transfer some of their assets to a family member, typically a child, in exchange for a promissory note. Assets can also be transferred to a trust. The beneficiaries of a person’s trust are often their children.

When the assets are transferred, a legally binding promissory note is created. The promissory note lays out the terms of the loan, including the principal amount, interest rate, repayment schedule, and other relevant information.

The borrower agrees to repay the loan according to the terms outlined in the promissory note, usually through regular installment payments over a specified period.

By transferring assets by way of a loan and creating a promissory note for the loan, the person seeking Medicaid benefits effectively reduces their countable assets, potentially qualifying them for Medicaid coverage.

Legal Considerations

Though promissory notes can be a valuable tool in Medicaid planning, it’s important to ensure compliance with state and federal laws and regulations. As mentioned, Medicaid has strict rules regarding asset transfers and eligibility. Improper use of promissory notes could result in penalties or loss of benefits.

Key legal considerations include the following:

  • Fair Market Value: The terms of the promissory note, including the loan amount and interest rate, should reflect fair market value to avoid scrutiny from Medicaid authorities.
  • Payments: Payments on the loan must be made in equal amounts during the term of the loan with no deferral of payments and no balloon payments. (A balloon payment is a large payment made at the end of a loan’s term, after making much smaller payments along the way.)
  • Term of the Loan: The term (length of time) of the loan must not last longer than the anticipated life of the lender.
  • Debt Cancellation: The debt cannot be cancelled upon the lender’s death.
  • Arm’s Length Transaction: The transaction should be conducted as an “arm’s length” transaction, meaning it should be carried out as if the parties were unrelated and dealing with each other at arm’s length.
  • Look-Back Period: As stated above, Medicaid has a look-back period during which asset transfers are subject to scrutiny. In most states, the look-back period is five years. Any transfers made within this period may affect Medicaid eligibility, so it’s essential to plan accordingly.
  • State-Specific Regulations: Medicaid rules vary from state to state, so it’s crucial to consult with an experienced attorney familiar with Medicaid regulations in your state to ensure compliance.

Benefits of Using Promissory Notes in Medicaid Planning

Promissory notes offer several potential benefits in Medicaid planning, including the following:

  • Asset Preservation: By transferring assets through a promissory note, individuals can preserve their wealth while still qualifying for Medicaid benefits to cover long-term care expenses.
  • Control: The lender retains control over the repayment schedule and can customize the terms of the promissory note to suit their needs.
  • Family Involvement: Promissory notes provide an opportunity for family members to participate in Medicaid planning and contribute to the financial well-being of their loved ones.

Risks of Using Promissory Notes in Medicaid Planning

When considering the benefits of using promissory notes in Medicaid planning you should also consider the risks, which could include the following:

  • Regulatory Scrutiny: Improperly structured promissory notes may attract scrutiny from Medicaid authorities, potentially resulting in penalties or disqualification from benefits.
  • Complexity: Medicaid planning involving promissory notes can be complex and requires careful consideration of legal and financial implications.
  • Tax Implications: Transferring assets through promissory notes may have tax implications for the lender and the borrower, so it’s essential to seek professional tax advice.

Will a Promissory Note Work for Your Medicaid Planning?

Promissory notes can be a valuable tool in your Medicaid planning process. They could allow you to transfer assets while maintaining Medicaid eligibility. However, it’s crucial to navigate this strategy carefully, ensuring compliance with applicable laws and regulations.

Call our office to talk further about gaining acceptance into the Medicaid program. We can help you determine whether including a promissory note in your planning will work for your situation. We can also walk you through other benefits that may be available to you and help you understand how you can qualify for coverage.

Reset Reset font size. Increase Font Size Increase font size.

When Decoration Day Became Memorial Day, and Why It Still Matters  

Posted on

Memorial Day is a topic I return to every May because it is important to honor the Americans who gave their lives in service to our great nation. It’s a national holiday with a somber and respectful history, and we need, especially now, to keep that in mind.

Our activities on Memorial Day should include remembering and honoring the lives and sacrifices of our veterans—and their families.

For me, this last weekend of May will always be Decoration Day.

Decoration Day began in 1868 when General John A. Logan called for a holiday to honor the soldiers who died in the Civil War. Women placed flowers on the graves of their husbands, sons, and brothers. On the first Decoration Day, 5,000 people helped decorate the graves of the over 20,000 soldiers buried in Arlington National Cemetery – both Union and Confederate soldiers.

Similar ceremonies inspired the event in cities around the country. Soldiers would decorate the graves of fallen comrades with flags, wreaths, and flowers. By 1890, every Union state had a Decoration Day.

After World War I, the purpose of Decoration Day expanded to honor all soldiers who died in all American wars. It was considered a day of civic duty to honor the dead and remember why they gave their lives.

In 1971, Congress declared a national holiday on the last Monday in May.

Some civic groups and veterans’ groups continue to honor our servicemen and women by taking the time to attend ceremonies and decorate the graves of soldiers. Flags should be flown at half-mast until noon on Memorial day and a national moment of silence takes place at 3:00 pm.

Here on Long Island, we have two large military cemeteries – Long Island National Cemetery in Farmingdale and Calverton National Cemetery. We have a large population of veterans and families who know all too well the impact of the ultimate sacrifice their loved ones made for their country.

As the years and wars have come and gone, Decoration Day became Memorial Day. Unlike Veterans Day, which honors all who serve, the traditions of Memorial Day honor those who gave their lives in service to our nation.

I encourage you to find out where your town’s wreath ceremony is taking place and take the time to show your support. On Long Island, ceremonies take place at town halls, fire departments and other civic centers. Your presence will be appreciated.

                                                            #             #             #

Reset Reset font size. Increase Font Size Increase font size.

Hand of a senior woman reaching to place tomatoes on checkout conveyer belt at supermarket

Social Security Administration Releases Final Rule Omitting Food from In-Kind Support and Maintenance Calculation for SSI      

Posted on

The most important takeaway from the Social Security Administration’s rule change is that any purchases of food for Supplemental Security Income recipients from Special Needs Trusts and families will not decrease the SSI payment. The new rule was approved on March 27 and effective September 30, 2024.

This new ruling makes Special Needs Trusts (SNTs) even better for those who depend on SSI benefits.

Food will no longer be considered in the calculation of In-Kind Support and Maintenance (ISM). The definition of income will be changed to align with this, which will make it far less cumbersome to administer and more accessible for the general public to understand. The goal is to improve the equitable treatment of food assistance within the SSI program.

The SSA traditionally included in-kind receipt of food in its ISM calculations because food assistance helps people meet a basic need, but the rule needed to be revised for several reasons. One is to make policies easier to understand, and another is to promote equity by treating food assistance equally, regardless of the source. The goal is not to harm an already vulnerable population when receiving food assistance.

SSI recipients historically have low income and resources, facing barriers across a wide range of social and economic outcomes. Disabled individuals are more likely to be food insecure, and this will remove barriers to receiving informal food assistance from friends, family, and community networks of support.

SSI recipients will still be asked about their food sources to determine specific values about other benefits, including shelter, as part of their maintenance calculations.

For disabled family members who depend on SSI benefits, this makes a Special Needs Trust even more valuable. When trust assets are used to buy food, they will not be countable against the recipient’s SSI benefits.

Please contact the office if you have questions about the impact of the rule change.

Source: Federal Register (March 27, 2024) Social Security Administration Final Rule

Reset Reset font size. Increase Font Size Increase font size.

NAELA News Article on QLACs Is Top Pick for 2023

Posted on

This past year, I’ve enjoyed contributing articles to prestigious professional journals, including one of our field’s most respected publications, NAELA News, by the National Academy of Elder Law Attorneys. With great pride, I announce that my article, “SECURE 2.0 Opens the Door for Qualified Longevity Annuity Contracts (QLACs),” has been recognized as the most-read article in NAELA News for 2023!

A Qualified Longevity Annuity Contract is an annuity purchased from an insurance company with a portion of the assets of an IRA. Before SECURE 2.0, the maximum premium was set very low, limiting the benefit of the QLAC.

SECURE 2.0 removed the percent limitation and raised the maximum premium to $200,000, making the QLAC a viable planning strategy. A QLAC allows an individual to defer distribution from a QLAC until age 85. Since the QLAC is structured as a Medicaid Qualified Annuity, it is not a resource for Medicaid purposes, even in states that count an IRA as an available resource. Also, if there is a surviving spouse and the account holder dies before payments begin or the balance of the annuity, they take priority over any state Medicaid recovery.

Click here to read the full article. If you have any questions, please feel free to contact me at sjs@sjslawpc.com.

Thank you to my colleagues at NAELA, who share my passion for an admittedly complex area of the law – and our shared commitment to improving the lives of our clients.

Here’s to a year filled with health, happiness, and innovative estate planning!

Reset Reset font size. Increase Font Size Increase font size.

Seniors Beware – Medicare (dis)Advantage Plans – Part Two.

Posted on

If you’re not worried about your Medicare Advantage plan, a recent article from The Washington Post, “Hospitals and doctors are fed up with Medicare Advantage,” might motivate you to check on your Medicare plan before the open enrollment period ends – next Thursday, December 7.

While Medicare Advantage plans have about 31 million members (nearly half of all Medicare enrollees), many doctors and hospitals have had their fill and refuse to accept the plans – even from companies like United Healthcare and Humana.

Consumer policy representatives say today’s pushback has changed as doctors and hospitals become more vocal about their frustration with the insurance companies’ cost-control efforts.

In Louisville, Baptist Health, which runs nine hospitals, clinics, and physician groups, says it will cut ties with Advantage plans from UnitedHealthcare and WellCare Health Plans starting in January unless they can come to terms. The plans “routinely deny or delay approval or payment for medical care recommended by your physician” was the message to patients from Baptist Health. Those are strong words from one institution to another.

Baptist’s medical group of 1,500 doctors and other providers left the Humana network in September.

Scripps Health in San Diego said they accept no Medicare Advantage plans because “revenue doesn’t cover the cost of patient care.”

Last year, the Health and Human Services Department’s inspector general published a study finding some Advantage plans improperly denied covered care coverage created under Medicare’s new rules. The Biden administration’s new rules, set to take effect in January, are in part a response to the OIG report.

Virtually all Medicare Advantage enrollees are in plans requiring the insurer to sign off in advance for at least some of the care. The insurance sector says the process ensures treatments are coordinated and appropriate. In 2021, Medicare Advantage participants submitted over 30 million requests for approvals, according to the KFF, an independent, healthy policy research, polling, and journalism organization. 11% of those denied filed appeals. Upon final determination, the review organization reversed 85% of the denials.

Bottom line: doctors and hospitals have many complaints about original Medicare, but approvals and claim denials are much more limited.

Make an informed choice about your healthcare by researching original Medicare and Medicare Advantage. 

Reset Reset font size. Increase Font Size Increase font size.

Seniors Beware – Medicare Advantage Plans – Part 1

Posted on

Seniors who sign up for a Medicare Advantage plan may find themselves in a world of trouble – the complete opposite of what they expected.

Once you turn 65, you are eligible to sign up for health coverage under Medicare. You can choose traditional Medicare (Parts A, B, and D) or Medicare Advantage (Part C).

Traditional Medicare is administered by the federal government while Medicare Advantage allows insurance companies to manage their policies. The insurance companies spend enormous amounts on marketing Medicare Advantage plans. Ad campaigns focus on how your out-of-pocket spending will be much smaller with an Advantage plan than with original Medicare. Last year, the Center for Medicare and Medicaid Services (CMS – the government agency that administers Medicare and Medicaid) found the television advertising for Medicare Advantage to be misleading and confusing. This year, CMS imposed severe restrictions on how Medicare Advantage plans are marketed.

The better choice is to go with traditional Medicare and purchase a Medigap policy. Here’s why.

With traditional Medicare, you can see any doctor who accepts Medicare, but Medicare Advantage plans limit your healthcare providers to a specific network of hospitals, doctors, and pharmacies. Go out of network, and your costs could skyrocket.

Provider networks for Advantage plans can change from one year to the next. So just when you’ve finally found a doctor you like one year, they can be out of network the following year.

Other benefits heavily marketed to seniors include supplemental benefits, like dental coverage, fitness club benefits, and meal delivery services. But to qualify for some benefits, you need a documented medical condition justifying your ability to receive them. If you have diabetes, for instance, you may qualify for meal delivery services. But if you don’t, you’re paying for something you can’t use.

Most Medicare Advantage programs require prior authorizations for many services. Medicare doesn’t have this requirement. You are paying more for an additional level of stress, which could lead to delayed essential treatment or diagnosis because of this extra step.

What if your local hospital system doesn’t accept your Advantage plan? Many hospital systems are dumping Medicaid Advantage because of high prior authorization denial rates and slow insurer payments. Last year, Mayo Clinic dropped Advantage plans in certain states, and Scripps recently notified patients it’s terminating many Medicare Advantage contracts. The Hospital for Special Surgery and Memorial Sloan Kettering do not participate in Medicare Advantage.

Do your research before you make this critical decision. It could affect not only your wallet but your health.

Reference: The Motley Fool “4 Pitfalls You Might Encounter With a Medicare Advantage Plan”

Reset Reset font size. Increase Font Size Increase font size.

Are You One Medical Crisis Away from Losing Control of Your Life?

Posted on

If nothing else has you calling our office to ensure your Power of Attorney and Power of Attorney for Healthcare documents are in order, this recent article from The Washington Post will do it.

It is the story of an 80-year-old retired pilot driving his Ford Mustang convertible into a gas station. Someone thought he looked very distressed and called 911. He was placed in the responding ambulance and taken to the hospital, where doctors said he had suffered a stroke.

Most people do not realize the appointment of a guardian is a request to strip the incapacitated individual of their civil rights to manage their affairs. The United States Constitution requires a full court proceeding is necessary as Section 1 of the 14th Amendment to the Constitution provides in part:

No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Because he lived alone and there was no evidence of family, when he didn’t improve, hospital officials went to court and told the judge he needed a guardian. The judge agreed, and the formerly independent man lost his civil rights and many freedoms, including the right to vote, how to spend his money, and where to live.

More than a million Americans are in guardianship, many of whom are elderly. Despite many horror stories, there seems to be no end to the abuse. Excessive billing, missing funds, and disposition of personal possessions occur with no penalty.

As America continues to age, there’s a little more focus on this arrangement, especially in Florida, where so many seniors go to retire. Florida has 2 million residents aged 75 or older – more than the population of 14 other states. They move to Florida from different parts of the country, away from families, and when they show up in emergency rooms, they are vulnerable.

What happened to the pilot? His family in Pennsylvania began searching for him. After his stroke, he couldn’t tell anyone to call his family, and it’s not clear how hard the hospital tried to reach any relatives. He lived alone, had never married, or had children, but he had a niece who he had regularly visited with other family members in the Philadelphia region.  

When he was finally ready to be discharged from the hospital, a staff member of the Orlando hospital signed a petition to the court stating the pilot had no one to take care of his finances or medical decisions. He ended up in a nursing home.

The attorney hired by the hospital made a recommendation for a guardian. The attorney for the hospital was the guardian’s attorney. There is no rule in Florida prohibiting an attorney from representing both the hospital and the guardian recommended by the hospital in the same case.

It’s a long, ugly story where no one responded to the family’s search for their uncle, the court delayed responding to the niece’s query about her uncle’s whereabouts, and the real estate agents undersold the home by more than $100,000. The pilot died two days after Florida declined to pursue a criminal investigation despite a preponderance of evidence of fraud, intent to deceive, and elder abuse.

Takeaways for seniors and their children:

Regular check-ins – by phone, online video chats, and in-person visits, are the best way to keep an eye on family members. Even an estranged family member deserves some regular contact – no matter how grouchy they are.

Estate planning documents are necessary. Everyone, especially seniors living alone, should have their estate planning documents prepared long before they expect to need them. We never know when a stroke or heart attack will happen. These are the important documents everyone should have:

  • Durable Financial Power of Attorney – you appoint a person you know and trust to manage your money, pay bills, and manage your household.
  • Healthcare Power of Attorney – names a person you know to make medical decisions on your behalf.
  • Last Will and Testament – A Will directs the distributions of your property to your beneficiaries. It also names an executor, who is legally responsible for marshaling your assets and paying any debts, taxes, and expenses. The executor is also responsible for making sure the beneficiaries receive their legacies.
  • Trusts – can hold assets in case of incapacity, when only the named trustee will have access to funds and as much or as little discretion as you wish to use the funds.
  • HIPAA Release – The Release names an individual(s) who can discuss your medical issues with your medical team. Federal law prohibits medical professionals from discussing and accessing your medical records and history without the Release.
  • DNR – Do Not Resuscitate – declares your wish not to have CPR performed in the event of a heart attack.
  • MOLST (Medical Orders for Life-Sustaining Treatment) – a medical order form signed by a doctor or nurse practitioner to tell others the patient’s wishes for life-sustaining treatment. It is the only document used to document DNR and Do Not Intubate (DNI) orders in a non-hospital setting. Most states allow MOLSTs, but the form may vary from state to state.
  • Living Will – A Living Will is a document expressing your wishes if you cannot communicate your wishes yourself. In an end-of-life situation, i.e., if you are in a persistent vegetative state or have a terminal illness, the Living Will expresses your wishes regarding everything from painkillers, artificial nutrition and hydration, dialysis, organ donation, and life-prolonging treatments.

If you don’t have these documents in order, call our office to get things started to protect yourself and your family.

                                                            #             #             #

Reference: The Washington Post (November 4, 2023) “The retired pilot went into the hospital. Then his life went into a tailspin.”

Reset Reset font size. Increase Font Size Increase font size.

The IRS Offers Tax Prep Software – Free – Is it For You?

Posted on

It’s been a long time coming, but next year, for the first time, some taxpayers will have a new filing option: a free tax prep software program created by the IRS and named “Direct File.”

The roll-out will be slow. Direct File will be available only in thirteen states, including New York. Note that the IRS warns that it’s not suited for all taxpayers. You’ll need a special invitation to use Direct File in the first cohort. The IRS expects to send the invitations around mid-February.

If all goes well with the early filers, the program will slowly open up to more users. The goal is to have the program available to anyone who wants to use it in the thirteen states by the tax deadline in April 2024.

The IRS created Direct File following research reflecting potential users’ preference to use an IRS program only if it can process federal and state returns. For the first year, Direct File will be available only to taxpayers in the nine states without a state income tax, plus four states that agreed to work with the IRS to integrate Direct File with their state websites to file tax returns. New York, Massachusetts, Arizona, and California are among the states participating in the program.

The IRS says it’s open to any state willing to participate and expects more states to join if the 2024 filing season is a success.

There are limitations to be aware of. You can’t itemize deductions, which over 10% of taxpayers still do. Also, only certain tax credits and forms of income will be allowed. You won’t be eligible to use the software if you claim a credit for child-care expenses or have interest income above $1,500. And self-employment income isn’t listed as one type to be processed, which means freelancers and gig workers are not eligible.

Direct File will process three major tax credits: Earned Income Credit, Child Tax Credit, and Credit for Other Dependents. It will also let users deduct teacher’s expenses and student loan interest. But that’s it, at least for now.

There are options if you aren’t eligible for Direct File but are searching for a way to file your taxes for free. You can complete your taxes and submit them electronically or on paper. People with an annual income below $73,000 can get free access to some commercial tax software through the Free File program. Older adults and those with an annual income below $63,000 can have volunteers prepare taxes free at Volunteer Income Tax Assistance programs supported by the IRS nationwide.

Because only 3% of Americans use the Free File program, even though 70 percent of Americans are eligible, it will be interesting to see how Direct File does.

We are taking a wait and see position on this. New software of any kind is subject to unexpected glitches, given the complexity of the tax laws. We recommend waiting until the completion of the first tax year of Direct File to see its success. While we’re always excited about new technology, we will wait and see.

Reference: The Washington Post (October 17, 2023) “IRS to offer a new option to file your tax return”

Reset Reset font size. Increase Font Size Increase font size.

Don’t Make These Medicare Mistakes

Posted on

Medicare can be complicated and mistakes can be expensive. Knowing the pitfalls in advance can make a big difference for seniors.

Here’s an example of what can go wrong. A 66 year old actor from California enrolled in a Medicare Advantage plan. After receiving a prostate cancer diagnosis last year, he learned the specialists he wanted to see weren’t in his United Healthcare HMO’s limited network. He faced delays getting tests and treatment.

Worse, when he tried to get access to more doctors by switching to traditional Medicare. Worried about the steep out-of-pocket costs, he tried to get a fill-in policy known as a Medigap plan. He was denied because of his diagnosis.

Medicare beneficiaries don’t know they have a right to purchase a Medigap policy only at certain times and if they don’t get them at the correct time, they may not be able to purchase them at a later date.

Medicare’s open enrollment period started October 15 and runs until December 7. This is the time when beneficiaries can pick new plans for next year. This includes traditional Medicare or Medicare Advantage plans, private insurance benefits.

Ads for Medicare Advantage plans promise all kinds of benefits such as dental and vision coverage and generous financial terms. But consumer advocates warn seniors to be careful about the limits of Medicare Advantage plans.

Here are five of the biggest pitfalls:

Medigap or Medicare supplement insurance doesn’t have the same rules as most health insurance. Medigap insurance companies can reject applicants or charge more based on medical conditions. The best time to get Medigap is when you join Medicare, when you have a six-month window and insurers can’t turn you down or charge you more because of your health conditions. There are other “protected window” times, but you might not be able to get a policy outside of those times.

Medicare Advantage plans can have limited access to doctors and hospitals. The plans, especially health maintenance or HMOs, can have limited networks, which means you can’t go to the doctors or hospitals you want. As for the directories of in-network doctors on the insurance companies’ websites, be careful. They can be wildly inaccurate. Call the insurer and be specific about what plan you are discussing and what doctors and hospitals you want.

Medicare Advantage plans can sometimes delay or block access to treatment. This is downright frightening. A recent government investigation found beneficiaries were denied services that should have been covered. You may need to get approval from the insurer before getting surgery, or a referral from a primary care doctor before you can see a specialist. When seniors start using the more expensive care, this is when the limitations of the Medicare Advantage plans become evident.

Will your drug coverage be sufficient? Drug coverage can come in through a stand-alone Part D plan, or part of your Medicare Advantage plan. This is something you’ll want to review every year. You may also want to go to the insurer’s website to look at restrictions on access.

Is the advice you’re getting legitimate? Ads selling Medicare Advantage programs can be deceptive, featuring Medicare card photos and a toll-free hotline that may look official but isn’t the federal government’s office. Be careful, as websites are often tied to particular insurance companies or insurance agencies incentivized to promote certain plans, regardless of whether they are the right fit for you.

Call us if you have questions. Every year we prepare a guide to Medicare that answers many questions about Medicare and how to determine the best plan for you. You can pick it up at the office, or we can send it to you by email. We aren’t selling anything – we understand how confusing Medicare can be, and we’re here to help.

Reference: The Wall Street Journal (Oct. 15, 2023) “The Big Mistakes People Make in Medicare—and How to Avoid Them”