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If you are a would-be snowbird, it pays to do some financial planning before you take flight.

According to a study by Merrill Lynch, by age 61, many people say they are free to chose where they most want to live. More than a third of the retirees surveyed said that they have already moved and 27 percent anticipate doing so.

Before you start splitting time between two or more states, you have to consider which one you want to be your primary place of residence – also known as a domicile, says John J. Scroggin, an accredited estate planner and partner with Roswell, Georgia-based law firm Scroggin&Co.

Most investors have one overriding goal: building a sum of money saved that can be used in the future (also known as a nest egg). But some investors who are talented and lucky focus on something else: passing their assets to their heirs.

It’s not as simple as leaving a list of accounts. Steps taken years before your death can help minimize taxes and headaches for those who inherit. The main issues for investors to consider for their heirs include family relationships, estate and gift taxes, insurances, Roth conversions, annuities, and record keeping.

Most small investors don’t need to worry about estate taxes these days, since the first $11.4 million per individual, and $22.8 per married couple, is exempt. Also, assets that are passed down to heirs while the investor is still alive are exempt from taxes below $15,000 per year per recipient.

What Makes a Will Valid?

Much of what we think we know about wills might be from dramatic media portrayal in movies, television, or books. However, these might not always show what is needed to make a valid will, especially when what makes a will valid can vary between states.

So, what exactly makes a will valid, and how can this vary?

In ten years, most middle-income American seniors will not be able to afford the rising cost of independent or assisted living.

A recent analysis in Health Affairs titled “The Forgotten Middle,” took a look at how middle-income seniors will be caught in the middle financially when it comes to long-term care – too wealthy to qualify for Medicaid or subsidized housing, but unable to afford the rising cost of independent or assisted living.

The researchers defined the middle-income group as Americans from the 41st to the 80th percentile in terms of financial resources, using data from the national Health and Retirement Study. They found that in a decade, 80 percent of middle-income seniors will have less than $60,000 a year in income and assets, not including equity in their homes. By conservative estimates, the cost of assisted living and out-of-pocket medical expenses for seniors will be $62,000.

Imagine receiving a phone call that your child is in the hospital thousands of miles away, and the doctors and nurses refuse to provide you with medical information about his or her condition. This is a very real situation that occurs when medical directives are not in place for adult children. Eighteen-year-olds are adults under the eyes of the law. Your son or daughter can vote, get married, make a will, sign a contract, open a bank account and get medical treatment – all without your approval. More importantly, this means that you no longer have the right to speak with your child’s doctors, make medical decisions, pay his/her bills, or access medical records without consent.

This is an ideal time to have a conversation with your child about the responsibilities of becoming an adult, and how to put plans in place to take over if they are unable to make decisions. In case of a medical emergency, the following documents will ensure that your son’s or daughter’s wishes will be carried out by the agent(s) he or she appoints.

Power of Attorney for Heath Care. This is also called a Medical Power of Attorney and Health Care Proxy. This document can be effective immediately or when one becomes incapacitated, thereby granting the appointed agent the right to obtain medical information and to make medical decisions. Without this power of attorney in place, if your college student ends up in the ER, the hospital may refuse to provide you information about your child.

If you are moving to a nursing home and want to protect your home from Medicaid, you might think that transferring your home to your children is a good way to protect it.  Although you don’t typically need to sell your home to qualify for Medicaid coverage of nursing home care, after you die, the state must attempt to recover from your estate whatever benefits it paid for your care if Medicaid had helped cover the cost of the nursing home (this is referred to as “estate recovery”). Transferring your house to your children in order to protect it from estate recovery is not ideal for a number of reasons.

First, transferring your home can make you ineligible for Medicaid for a certain amount of time. The state Medicaid agency looks for transfers made within five years of the Medicaid application and if any transfers were made for less than market value, the state imposes a penalty period in which you are not eligible for benefits.

However, you can typically avoid this penalty when transferring your home to the following:

For years, attorneys, accountants, financial planners, and insurance sale persons have been touting the benefits of long-term care insurance. “Buy in your 50s and you will never have to worry about your future long-term care expenses ever again” was the common refrain. It was sound advice. With the right long-term care policy your problems were solved. Daily benefit rates typically covered the lion’s share of the daily private pay rate preserving assets for much-needed extras and, in many cases, a tidy inheritance for the next generation.

Unfortunately, any aging population, the unexpected popularity of assisted living facilities, and a steady increases in the cost of care has made it all but impossible for insurance companies to continue to provide the promised levels of benefits without increasing premiums. It can be argued that insurance companies should have seen the baby-boomers coming but no one anticipated that so many seniors would prefer to transition to an assisted living facility foregoing the in-home care option. Insurance companies also expected a much higher percentage of customers to cancel coverage. A common theme across all types of elective insurance coverage types. The constant refrain from professional advisers to clients recommending that they retain long-term care insurance at all costs had the unintended effect of making LTC insurance untenable for insurers.

All of these unanticipated and unintended consequences has had a real impact on seniors. In some cases, premiums have as much as doubled in the past two years and Mass Mutual, one of the largest LTC insurance underwriters, is about to ask regulators to authorize an average increase in premiums of 77 percent.

Recently, a lawsuit was filed against the Illinois Department of Human and Family Services over delays in the processing of claims for Medicaid benefits. Although the lawsuit focuses primarily on applications for community Medicaid and health insurance benefits, delays by IDHFS in processing Medicaid claims for long-term care benefits can have a dramatic effect on those seniors requiring assistance to pay for long-term nursing home care.

A quick synopsis of the Medicaid system as it applies to nursing home benefits:

Medicaid (not to be confused with Medicare) is a government program funded by both state and federal resources to help seniors and disabled individuals with limited resources pay for long-term care. Although Medicare will cover short-term stays in a nursing home for rehabilitation and some respite care, Medicare provides no benefit to those seniors that need to move to a nursing home on a permanent basis.

Medicare has terminated your coverage for a physical therapist, nurse or speech therapist.  The health care provider states that you have “plateaued” , ‘have not improved” or require “maintenance services” only.  In addition, the health care provider states that you must pay out of pocket if you want to continue these services.  However, you and your physician opine that you need these services and that they are medically necessary. So what should you do?  Appeal Medicare’s decision.

The initial document you will receive before termination is a “Notice of Medicare Provider Non-Coverage” or a” Generic Notice” from your health care provider.  When you receive this notice, immediately call the Beneficiary and Family-Centered Care Quality Improvement Organization, or BFCC-QIO.  The phone number will be on the notice that you have received.  Fax to them a written opinion by your physician that the services are “medically necessary” and that your health will be jeopardized if services are dis continued.  In addition, have the health provider deliver your records to BFCC-QIO and a copy to you.

The BFCC-QIO must make a decision within 72 hours of receipt of your appeal.  If they agree with you coverage will be continued, if they don’t then you have to pay out of pocket for those services.

Open enrollment for Medicare runs from October 15th to December 7th this year. If you are eligible for Medicare, you are more likely than ever to be the target of Medicare related scams this year. Medicare scammers are smart and they know exactly what types of scenarios, incentives and stories are most likely to ensnare seniors.

Typical scam calls may be about a refund of premiums, the need for a new Medicare card, false offers of free medical services and bogus Medigap plans. No matter the story used, service offered, or purported identity of the caller, the objective is for the scammer to obtain the senior’s Social Security number by slowly extracting as much personal information as possible from their victim.

Here are some important things for seniors to remember about Medicare to help weed out fake callers: