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Recent Changes to Visitation Rules in Long Term Care Facilities

In March of this year, the Centers for Medicare and Medicaid Services (CMS), the federal agency that regulates nursing homes, issued strict rules regarding visitors to nursing homes in order to prevent the spread of COVID-19. At that time, CMS mandated that all nursing homes restrict visitation to only essential healthcare personnel, except in “compassionate care” situations, which was then defined as “end of life” situations. Assisted living facilities, though not directly regulated by CMS, essentially followed the same protocols with guidance provided at the state level. For months, residents of nursing homes and assisted living facilities were almost entirely cut off from contact with the outside world.

Recently, however, restrictions have begun to be lifted. Effective October 17, 2020, and consistent with CMS guidance, the Minnesota Department of Health issued new regulations for nursing homes and skilled nursing facilities that greatly expanded visitation rights for residents and their loved ones. The regulations recognized the profound adverse effect of social isolation on residents and the important impact that family and caregiver visits can have on the overall health and wellbeing of residents.

The new guidance says that long term care facilities should facilitate both indoor and outdoor visits with residents so long as visitors adhere to the “core principles” of COVID-19 infection prevention (wearing masks, using hand-sanitizer, and keeping six-feet apart, etc.), and so long as the facility meets two additional criteria: (1) there have been no new COVID-19 cases at the facility in the last 14 days, and (2) the rate of community spread in the surrounding county is sufficiently low. This last factor is determined by the county’s test positivity rate for the last 14 days. This information is available on the MN Department of Health’s website. MDH releases COVID-19 statistics weekly, so to determine the applicable county positivity rate you take the average of rates for the last two weeks for your county. If the 14-day average test positivity rate is less than 5%, which is considered “low”, visits should be allowed. If the rate is between 5% and 10% (“medium risk”), visits should still be allowed but additional restrictions may be imposed by the facility. If the rate is above 10% (“high risk”), then visits are restricted to only “essential caregivers” and for “compassionate care situations.” MDH has expanded the definition of “compassionate care situations” beyond just end of life situations to now include situations where a resident may be experiencing other forms of acute emotional distress. MDH also encourages but does not require facilities to establish an “essential caregivers” program to allow each resident to designate at least one person as “essential” who would be permitted to visit them even when visitation is restricted due to high test positivity rates or other reasons.

With COVID-19 cases surging yet again, many long term care facilities will likely begin restricting visitation due to high test positivity rates in their counties. For example, several counties now exceed the 10% test positivity rate, including Beltrami, Big Stone, Chisago, Hubbard, Kandiyohi, Mahnomen, Marshall, Morrison, Nobles, Roseau, Stearns, Todd, and others. And if this trend continues as predicted, many more counties will join this list. Therefore, unless you are deemed an “essential caregiver” for your loved one, or if your loved one meets the criteria for “compassionate care,” you may lose the right to visit your loved one in their long term care facility quite soon. This reality underscores the importance of continuing to remain vigilant against the community spread of this disease so that our most vulnerable community members can stay safe and maintain a level of contact with family and friends to stay mentally, emotionally, and physically healthy.

Why Life Estates May No Longer Protect Farmland: In re Schmalz

If you own farmland, chances are you’ve heard about life estates. Maybe your land is already set up in a life estate, or maybe your neighbor has land in a life estate. Or, maybe you’ve been advised to create a life estate to protect your farmland from nursing home costs by someone you know. But this summer, the Minnesota Supreme Court handed down a decision that significantly changes the landscape for the owners of a life estate and may make life estates less effective than before.

First, what is a life estate? A life estate divides real property into two parts across time. A deed gives a gift of a future interest in the land, often to children or other heirs, and then reserves ownership in the land for the life of the current owner (or, in some cases, for the joint lives of two co-owners). The current owners, called the “life tenants,” continue to own the property and receive all the rent as before, but when they die their interest automatically transfers to the owners of the future interest, known as the “remainder persons.” This transfer at death qualifies for a step up in tax basis under the tax code as well, meaning if the land is sold at death no capital gains tax is owed.

Why are life estates important for long term care planning? Medical Assistance (MA), the program that pays for long term care costs in Minnesota (also known as Medicaid), has historically treated life estate property as unavailable to the applicant and their spouse. Because a life estate is considered unmarketable (would you want to buy an interest in property that could extinguish at any moment when the life tenant dies?), state guidance provided that the value of a life estate interest did not count toward an applicant or their spouse’s asset limit. So, an individual or married couple could continue to own farmland in a life estate and qualify for (MA) benefits. In addition, the life estate interest could be transferred to the healthy spouse so that all the rent payments could be retained by them instead of having to be spent on care.

But a new Minnesota Supreme Court case, In re Esther Schmalz, may have changed all that. In this case, Esther and Marvin Schmalz owned farmland in Renville County and transferred the land to their children, retaining a life estate interest for their joint lives. Esther went into a nursing home, and Marvin applied for MA benefits. Renville County initially determined that the value of the life estate interest counted against Marvin’s community spouse asset limit making Esther ineligible for benefits. They appealed their case all the way to the Minnesota Court of Appeals where the court sided with Esther and Marvin, holding that Minnesota law requires the county to disregard the value of life estate property. The Minnesota Department of Human Services appealed this determination, and the Minnesota Supreme Court reversed the decision of the lower court, holding that Minnesota statutes require the county to count a life estate interest owned by the non-MA spouse against that spouse’s community spouse asset limit.

What might this mean going forward? We know that if the non-applicant spouse (i.e. the healthy spouse) owns a life estate interest at the time of application, the value of the life estate will be counted against that spouse’s asset limit, which at present is $128,640. The applicant spouse will not qualify for MA if their spouse’s total assets exceed this limit. Could the non-MA spouse transfer their life estate interest to the MA-spouse and qualify? Perhaps, but consider that the owner of the life estate interest holds all rights to income from the property, which means that any rental income would have to be spent on nursing home care in most cases.

Life estates were already falling out of favor with Elder Law attorneys since the law changed on August 1, 2003 to allow the state to put an MA lien on the life tenant’s interest in life estate property when they die. (Prior to that date, there could be no estate recovery on life estates because, technically, a life estate ceases to exist on the death of the life tenant.) Since this new court ruling, life estates no longer protect the income from farmland for the non-MA spouse. Life estates may no longer offer much promise as a planning tool for the future.

If you currently own valuable real estate, like farmland, in a life estate arrangement, consider speaking to a licensed attorney with experience in MA planning to advise you about alternative options to protect your assets from the cost of long term care.

How and Why I Provide Client-Centered Legal Services

The other day, a new client said to me that before she called me she had spoken to a few other attorneys who provide similar services, but she decided to work with me for the simple reason that I called her back. The other law firms she called would only let her speak to a legal assistant and before she could even talk to the attorney she thought she might hire, she had to fill out a 20-page form and then wait for an appointment, all without knowing whether this was a person she wanted to work with or how much she could expect to pay.

“I hired you because you called me back.”

A typical estate plan can cost anywhere from $800 to $4,000 or more depending on the client’s needs and the attorney they are working with. This is a huge investment! But my experience with other firms is similar to my clients: They want to give you the service they want to give you, not the service you want to pay for. My client’s experience with other firms was not unusual. Most firms want to get all the information about you first and then decide if they want to work with you, and they don’t typically give you an opportunity to do the same.

All lawyers care about their clients. We’re all in this business to provide our clients peace of mind, to solve clients’ legal problems, and to leave them feeling satisfied. But not all lawyers know how to do this in practice. They focus on efficiencies that make sense to them, not necessarily to you. They know they need clients, but they don’t deliver client-centered legal services.

What are client-centered legal services? Authors Aaron Street, Sam Glover, Stephanie Everett, and Marshall Lichty in a recent book define client-centered legal services as the creation of a “client experience that shows that you care about [the client], that you understand who they are and what they need, and that you [the lawyer] are the right person to take care of them.” This involves making adjustments in four key areas:

Pricing,

Accessibility,

Communication, and

Feedback.

Here’s what this means for my practice and my clients.

First, my clients always know what something is going to cost. I frequently offer flat-fee options for estate planning and basic business documents, meaning that you will pay X and receive Y. That way, you know upfront what something is going to cost. When I offer my hourly rate, I provide an estimate so that there are no surprises going forward, and I keep fees as part of the conversation going forward to make sure the client is comfortable with what they’re spending. Even before you hire me, you’ll know what you can expect to spend on this major investment.

Second, I meet clients where they’re at. No driving downtown and dealing with confusing parking and traffic situations or meeting your lawyer at a stuffy office. I’m happy to meet clients at their business or home instead. And to make sure everyone feels safe during the pandemic, I’m primarily meeting clients by video conference or phone, which is not only safer but also saves everyone a lot of travel time and headache.

Third, I communicate with clients directly. When you call, you’ll never get a legal assistant or some other gatekeeper. I offer a 15-minute free consultation so that you can get to know me first before you hire me. I gather as much information as I can from our phone call and I only ask you to provide additional documents if it is absolutely necessary to achieve your goals. My job is to make this process as painless as possible so that you can stop worrying about your legal issue.

Finally, I will ask for your feedback. I want to know if the services I’m providing to you meet with your expectations (and hopefully exceed them!). And if they don’t meet your expectations, I want to know how I can do better. Client-centered services are about constantly improving my processes to better meet your needs and the needs of folks like you. If I can do better, I want you to tell me how.

Will the Nursing Home or County Take My House?

As an attorney practicing in elder law one of the most common questions I get is this: If I or my spouse need nursing home care, will the nursing home take our house? Or, similarly, if I or my spouse need assisted living care or memory care, will the county or state take our house? This is understandably a scary thought. Everyone’s home feels special and sacred, full of memories, and the result of a lifetime of working and saving to make your home just right or to finally get the mortgage paid in full.

So, will they take your home if you need long term care? The simple answer is: No. They can’t “take” your home. But could your home be subjected to a lien in the future? Yes, it could.

To begin with, no skilled nursing facility, assisted living facility, memory care facility, or other long-term care provider has the power to “take” your home or put a lien on it. Only the government has the power to do that. When you or your spouse needs care, you pay the care provider until you are able to qualify for Medical Assistance, and then Medical Assistance pays the care provider on your behalf. Medical Assistance is a state-run program administered at the county level. The county keeps a tab on how much money is expended by them on your behalf for Medical Assistance benefits. Ultimately, it is the county that has the power to attach a lien to your home to collect the value of the benefits paid on your behalf or on behalf of your spouse.

When you apply for Medical Assistance, the house you or your spouse lives in is treated as an excluded asset, which means that it is not counted toward your asset limit and you can keep the house as long as you or your spouse continues to reside there. But when you both die, the county will have a claim against the estate of the surviving spouse to collect the value of Medical Assistance benefits paid on behalf of either spouse. In other words, the county cannot collect any money from you or your estate or put a lien on your house until after you and your spouse are deceased.

So, where does this idea come from that the county or nursing home can take your house? Well, there are a couple of instances where this can become an issue. First, consider what happens when a single person goes into a nursing home or where both spouses go into a nursing home. Can they still protect the house? The answer is: No. They have a six-month grace period and then the house has to be put up for sale. Does the county take the proceeds from the sale of the house? No. Again, as long as the Medical Assistance recipient or their spouse is still living, the county cannot take anything. But the proceeds from the house sale will have to be spent on nursing home care, which may be why many people think the nursing home “takes” the house. If neither spouse is capable of residing in the home, the home generally has to be sold and the proceeds spent on care.

Second, a lot of people try to leave the home to their children when they die. But when a single person or the surviving spouse dies, the county can put a lien on the house to collect the balance of Medical Assistance benefits paid on behalf of the deceased person or their spouse. In most cases, the children who inherit the house will have to pay off this lien before they can transfer the title to the house into their names. And in most cases, this means selling the house to pay off the lien. Again, the county doesn’t “take” the house, but they force a sale of the house to collect the Medical Assistance estate recovery claim.

Are there ways to protect the home from having to be sold to either pay for care or pay a Medical Assistance estate recovery claim at death? Yes, there are! And you should talk to an experienced elder law attorney for advice on how to protect your home as soon as you anticipate the need for long term care.

Call for a free 15-minute consultation today!

So you want to form a Public Benefit Corporation...

The selection and formation of an entity for your business is a huge topic, but historically at least we could organize that discussion into two sections: for-profit and non-profit business entities. You might be somewhat familiar with the distinction — a for-profit company aims to make the most money for its owners or shareholders whereas a non-profit company aims to do the most good for the most people without ever turning a profit. For a long time, people wondered whether there might be something in between — a for-profit model that incorporates doing good into its bottom line. Enter the public benefit corporation.

Minnesota’s public benefit corporation law went into effect in 2015. Since then, a Minnesota company can elect to be treated as a public benefit corporation in its articles of incorporation and bylaws. The law establishes two basic types of public benefit corporations, a “general benefit corporation” (GBC) that does not have to specifically name a beneficial purpose and a “specific benefit corporation”(SBC) that declares a special beneficial purpose in its articles and bylaws. How do you know if a company is a GBC or SBC? It’s in the name. Public benefit corporations are required to include either “general benefit corporation” or “specific benefit corporation” or the abbreviations GBC or SBC in their names.

So, what difference does GBC or SBC status make to the corporation? As with any corporation, shareholders can sue the corporation for failing to deliver on its promises, and in the case of a GBC or SBC, shareholders can also sue the corporation for failing to pursue or create a general or specific public benefit. Persons other than shareholders, like members of the general public or constituencies intended to be helped by the corporation, cannot sue the corporation for failing to provide promised benefits, however. And unlike non-profit corporations, GBCs and SBCs still must pay taxes.

Why become a public benefit corporation? For businesses that want to create benefits besides profits through their business activities, becoming a public benefit corporation may shield the company’s management from shareholder claims that the company is focused more on its social mission than maximizing profits. The inclusion of a public benefit mandate in the corporation’s founding documents can also help guide its management toward putting people and not just profits first. And it could be a good public relations move to help draw business to the company from customers who share the company’s values.

If you’re interested in forming a Minnesota public benefit corporation or have more questions, contact me.

Where does your Facebook Account go when you die?

As an estate planning attorney, I’m used to talking with clients about how to dispose of their assets when they die. The types of assets I’m usually talking about are real estate, cars, bank accounts, retirement accounts, investments, and maybe heirlooms — things we can generally assign a dollar amount to. But what we usually don’t talk about are the assets that you probably use and think about almost every day, every time you sit at your computer or pick up your phone. I’m talking about social media accounts, email accounts, digital password managers. I’m talking about websites you go to almost every single day that hold some of your most valued possessions — your passwords, your personal data, your public or private writings, your photos. Each of us today is our own content creator, blasting out new posts, creating new emails, and generating new website profiles on an almost daily basis. But where does that stuff go when you die?

Just a few years ago, there was really no good answer to this question. When people died, their social media pages lingered on, some becoming makeshift memorials and others becoming eerie reminders of the person who once was, like the occasional birthday reminder I still receive each year for a college friend who passed away several years ago. But recently, websites have taken a more proactive role in addressing this issue. In a recent PCMag article, author Eric Ravenscraft provides instructions on how to add a trusted person to convert your social media and email accounts to legacy or memorial accounts and to make sure that the right person can access your passwords so that you don’t become “the guy who locked cryptocurrency exchange customers out of $250 million after his death because only he knew the password.”

I recently went through this process with my own accounts. I use a password manager to organize all of my passwords in one easy-to-access place. I only have to memorize one password and it unlocks access to all of my other passwords, making it easier for me to have more effective (and harder to remember) passwords for better internet security. (There are lots of options out there, including Keeper, 1Password, Dashlane, and LastPass, to name a few — I highly recommend you get one if you don’t have one.) Turns out, it was easy to add an emergency contact to my account just by clicking “Emergency Access” in the menu bar and entering the email address of the people I trusted to manage my passwords in case something happens to me.

I also added a “legacy contact” to my Facebook profile. You can find these settings by going to your Facebook page and clicking the down arrow in the upper-righthand corner, and then click “settings.” Under general settings, you’ll find the “memorialization settings,” where you can select one of your Facebook friends to manage your account when you die. You can also ask that Facebook delete your profile upon your death.

And if you use Google for email, you can set up Inactive Account settings. This allows you to give another person access to your Google account (which may include not just email, but your calendar, photos, contacts, and anything else you may have saved in one of Google’s many apps) when you haven’t logged into your account after a certain period of time. You can also limit that person’s access to only certain Google content, and you can designate up to 10 people. You can also set up an auto-responder message when your account goes inactive.

Think about what other websites you use frequently and whether someone would be able to access that website if they needed to in case of emergency or death. Some websites, including LinkedIn and Instagram, have their own policies about how to deactivate the accounts of deceased people, while others (like Twitter) are still in the process of figuring this out. Also, think about what information people would need to have about you that is only stored on the web. Are you into trading stocks online? Do you have cryptocurrency investments? Is your bank online and you don’t get paper statements? How will your survivors know how to find these assets? Save your family the headache of trying to hack into your email accounts or phone to locate all your financial assets and make sure they have some way to get at that information, whether it’s a digital or paper password keeper or some other method that will work for you and them.

Prepare Your Business and Estate Plan for COVID-19

The global coronavirus pandemic has turned our world upside down. It is the only thing anyone is talking, writing, or thinking about, and with good reason. We are all vulnerable and we are being told that most of us will contract the virus, it is only a question of when. Postponing illness through social distancing and self-quarantine are essential to ensure that those who do get sick can receive care when they need it. But being under quarantine, for many of us, has become a time to think about the things that matter most to us and also a time reflect on life’s fragility.

So, if you have been putting off thinking about your personal estate plan, now is a good time to think about it. And if you own a business, think about what would happen if you become sick. Who will manage your business or personal affairs if you need to be hospitalized? What will happen to your assets if you pass away, and who will be in charge of administering your estate or running your business? These are important questions that feel particularly salient in this tumultuous time.

Even though we’re under quarantine, that does not mean you have to postpone making changes to your business or estate planning documents. Much of the work can be done by phone or video conference. And many essential documents, like trusts or contracts, do not require special witnessing or notarization. For documents that require notarization, Minnesota law authorizes the use of remote notaries who can electronically notarize your documents using a video conferencing service on your computer, tablet, or smartphone. As of right now, will signings still require two witnesses to be in the physical presence of the testator, but the witnesses can still maintain a safe 6-foot distance from the testator and each other. And the Minnesota State Bar Association is working on proposed legislation to lift this requirement as well.

In uncertain times like these, it can help tremendously to take proactive steps to feel in control. There is little we can control in this moment, but one thing you can do to get some peace of mind is to make sure there is a plan in place if you become sick. Make sure you have a health care directive so that someone you trust can make healthcare decisions for you in case you’re unable to do so. Make sure you have a power of attorney so that someone can access your accounts in case you need to be hospitalized or quarantined for a long period of time. Make a plan for who would manage your assets or take care of your children or pets if you were to pass away. Taking these proactive steps will help you feel ready to face whatever comes next.

Attorney Kate Z. Graham featured in The Farmer Magazine

Attorney Kate Z. Graham was recently featured in an issue of The Farmer Magazine. The article by Janet Kubat Willette is titled “Challenges about for farmland access, transitions” and features the voices of other important contributors to this field, including Fred Kirschenmann of the Leopold Center and Stone Barns Center, and Susan Stokes formerly of Farmers Legal Action and the Minnesota Department of Agriculture and now at Lind Jensen Sullivan & Peterson. From the article:

“In the ideal situation, the farm owner identifies one or two farming heirs. The farm is incorporated with the heirs purchasing shares of the business. The real estate is held separately and leased to the operation so the farm owner can continue to draw income from the land. The transfer occurs gradually over 10 to 15 years.

Too often, Graham said, there is only a promise to the farming heir, with nothing in writing so when the farm owners die, the land is split equally among the children. Planning needs to take place much earlier than most people think.”

Read the full article here.

Attorney Kate Z. Graham featured in Minneapolis Star Tribune

Attorney Kate Z. Graham was featured in the Business Section of the Sunday, November 10 edition of the Minneapolis Star Tribune newspaper. The story featured excerpts from an interview with Kate by reporter Adam Belz. In it, Kate discussed her work assisting farmers with their succession and generational transfer plans, as well as some of the challenges and opportunities she sees in this important work.

From the article, “The relationship that farmers have with their land is extraordinary. It’s a beautiful way to understand our connection to the earth in a very tangible way. I hope that people can get interested in these issues even if they’re city people, because I think hanging onto that understanding of our connectedness to land is something that as modern urban people we don’t get to experience most of the time.”

Read the whole article here.

Elder Law Basics Series: Medicaid Eligibility

In a prior post in the Elder Law Basics post, I explained the difference between Medicaid and Medicare. For elder law purposes, the main distinction is that Medicaid pays for long term care services whereas Medicare provides traditional health insurance and only pays for short-term nursing home stays. In this post, I’m going to address what makes a person eligible for Medicaid, or as we call it in Minnesota, “Medical Assistance.”

First, it’s important to understand that there is a distinction between income-based Medical Assistance (MA) for low-income adults and MA for long term care (MA-LTC). Qualifying low-income adults and children may receive health insurance benefits through MA and there is no asset limit to qualify. But if you have a disability and need a nursing facility level of care either in a skilled nursing facility, assisted living facility, or at home, then income-based MA will not cover what you need. In that case, you need MA-LTC or what is referred to as a “waiver program.”

MA-LTC covers long term care services, which are skilled nursing services offered in a traditional nursing home setting. “Waiver programs” cover the same services, but in a community-based setting, such as assisted living facilities, memory care facilities, or at home. There are several different waiver programs offered in Minnesota for various needs, including the Community Access for Disability Inclusion (CADI) waiver for persons with disabilities under age 65 and the Elderly Waiver (EW) for disabled persons 65 and up. The financial eligibility rules for MA-LTC and all waiver programs are substantially the same even though each program is designed for people with different needs.

For MA-LTC and all waiver programs, there is an asset limit for both the person receiving benefits and their spouse, if they are married. For the person receiving benefits, the asset limit is $3,000. This figure has not changed in many years, and seems unlikely to change soon. For the person’s spouse, they are limited to $126,420, but unlike the MA recipient’s asset limit, the spousal asset limit is adjusted annually for inflation. Certain assets do not count toward either spouse’s asset limit, including their primary residence, one vehicle, and personal belongings (like clothing, electronics, furniture, etc.). All other property, however, does count toward the asset limit, including retirement accounts (IRAs, 401(k)s), most trust accounts, and all other real estate (farmland, cabins, etc.).

In addition, the MA recipient’s income is calculated and contributed toward the cost of their care, with certain limited exceptions, such as a personal needs allowance ($102 per month), and in some cases additional income may be given to the spouse to cover excess housing costs. The income calculation for waiver programs can be quite complicated, and some people may not qualify for a waiver program if their income exceeds their care costs. But the spouse of an MA recipient is not required to contribute their income for the MA recipient’s care, in other words, there is no “spousal income deeming” for MA. This makes possible certain asset protection strategies such as planning with Medicaid-compliant annuities.

In addition to the basic financial eligibility requirements, the MA applicant must meet additional criteria based on their needs. For example, they must require a nursing home level of care, which means they typically must be evaluated by a public health nurse as part of what is called the MNChoices Assessment. And for MA-LTC or MA-EW, they must be 65 and older; or, for CADI they must be under 65.

These are just the most basic elements of eligibility and because every person’s situation is different, even though you or your loved one may meet these basic criteria, there may be other considerations before you or your loved one should apply. For example, you may be ineligible for benefits if the applicant or their spouse gifted assets within the last five years. There are also special asset limit rules for families that own small businesses or farms. If you are looking for more information about qualifying for MA, please contact me to discuss your situation.

Chemical Spills on the Farm and CERCLA

While many farmers are moving away from reliance on chemical fertilizers and pesticides, most farmers still depend on synthetic chemicals to boost soil fertility and combat weeds. For example, most corn and soybean farmers in the Midwest apply anhydrous ammonia to soils in the spring and fall to add the nitrogen to their soils that plants need to grow. Farmers depend on anhydrous ammonia because it contains more nitrogen than alternative sources, it is easy to obtain from their suppliers, it can be applied many weeks before planting, and it’s generally the least expensive source of nitrogen.

But anhydrous ammonia has a number of drawbacks, including the fact that it must be stored as a pressurized liquid and it requires special equipment to transport and apply the chemical, which when released as a gas can be harmful to people. In fact, the federal government lists anhydrous ammonia as an “extremely hazardous substance.” If there is a spill or “release” of an extremely hazardous substance, the person in charge is required to immediately report the spill or face stiff penalties, including fines of over $57,000.

Because most farmers and farm cooperatives deal with these chemicals at some point, it’s important to know what you must do if a spill occurs and to communicate that information to everyone you work with. The Comprehensive Environmental Response, Compensation and Liability Act (or CERCLA) requires a person in charge of a farm or other facility to immediately report a spill of any hazardous substance. The most important thing to remember is that, if a spill occurs, you must call the National Response Center immediately. How soon is “immediately?” Within 15 minutes, according to EPA policy. If you fail to call the National Response Center within 15 minutes of discovering the spill, the EPA will most likely bring civil penalty claims against you for as much as $57,317 per incident. The maximum penalty amount is adjusted annually for inflation. Note that calling 911 or other first responders is not sufficient to satisfy the legal requirement. Rather, your first call must be to the National Response Center (NRC). The NRC will coordinate any local response.

Are there exceptions to calling the NRC within 15 minutes? Not really. The only exception is if you are physically unable to make the call, such as where all phone lines are down or where no one is physically able to reach a phone. Since most of us have cell phones in our pockets at all times, there usually will not be an excuse to not make the call.

In addition, if you store anhydrous ammonia on your farm or at your business in quantities in excess of 500 pounds, you may also be subject to additional requirements under the Emergency Planning & Community Right to Know Act (EPCRA) and Section 112(r) of the Clear Air Act (CAA). These laws require you to report inventory of extremely hazardous substances to state and local authorities, to implement a chemical accident program, and submit a Risk Management Plan to EPA, among other things.

If you have questions about whether your farm or business is complying with federal regulations or is adequately prepared in the event of an accident, please contact me and I’d be happy to help.

Save the Date: Farmland Access Summit Oct. 21

We know that farmland is changing hands rapidly, and there are many factors at play that are accelerating this trend. The farming generation is aging and farmers are ready to retire. Current economic trends are pushing some farmers into an early retirement or causing them to sell land to satisfy creditors. Land is also changing hands through inheritance. Even so, most beginning farmers report that access to farmland is the biggest hurdle they face to success. But if farmland is to remain in farming we certainly need beginning farmers to keep working farms operational. And we want to make farmland accessible to anyone who wants to farm, not just those with the easiest access to capital.

But how do we accomplish these goals? That’s a question that the Farmland Access Summit and its participants will be looking to answer together. If you’re interested in these issues, you may want to save the following date: October 21, 2019. The Summit is sponsored by Renewing the Countryside and is being organized by a group of people representing a variety of organizations and professionals who work with farmers and in farm transitions, including me. The Summit will take place in Red Wing, MN, the day before the National Farmland Viability Conference begins. And if you have the chance to stay for that conference as well, it should be a great educational and networking experience for professionals who work with farmers and in agribusiness. The National Farmland Viability Conference is held only every other year in a different location each time, and this year Red Wing, Minnesota had the honor of being chosen. Registration for the Farmland Viability Conference is already open, with details on speakers and topics to come.

So, watch this space for more details as we firm up the slate of speakers and topics for the Farmland Access Summit.

Help for Farmers Facing Flood Damage and Financial Stress

Just last fall we were talking about the record number of farm bankruptcies due to low crop prices. Now, many farmers are suffering losses due to widespread floods throughout the Midwest caused by heavy snow and rain, and a significant number of farmers have lost their barns when the heavy snow caused the roofs to collapse. Farming is a business that is heavily depending on the weather, which is never easy to predict and impossible to control. Most farmers are familiar with risk management tools like crop insurance and diversification, but what do you do when everything goes wrong at once? This seems to be the question on the minds of many.

Fortunately, there is help. The following is a list of resources available to assist farmers facing these and many other challenges this spring, as compiled by the Minnesota Farmers Union:

• Minnesota Department of Agriculture disaster recovery loan program. On March 19, 2019, the Rural Finance Authority Board issued a Disaster Declaration for Minnesota, which allows farmers to access this special loan program. The funds are available to farmers for expenses not covered by insurance.

• University of Minnesota Extension has advice on how to safely handle damaged agricultural buildings.

• Minnesota Farm and Rural Helpline provides free, confidential counseling for farmers experience stress, anxiety, depression, or suicidal thoughts. The helpline is available 24/7 at 833-600-2670 x 1. Ted Matthews, a mental health counselor for farmers can be reached at 320-266-2390. Or, you can text “MN” to 741 741 to receive immediate assistance.

• Mobile Crisis Team provides in-person, fast, short-term counseling for people experience a crisis or emergency. Each county in Minnesota has a different phone number to call.

• Minnesota Department of Public Safety has a list of resources available for disaster assistance for farmers, including links to financial and technical assistance available through MDA, USDA, and Extension.

My Spouse Needs Nursing Home Care -- Do We Need to Divorce?

When I am asked about nursing home care for married people, one of the questions that almost always comes up is this: “Do we have to get divorced?” Or, in a similar vein: “Should we get divorced?”

There is a misconception about long-term care that has been around for a long time, which is that a married couple should or must get divorced when one spouse needs care. It’s like an urban legend that just won’t die. And it adds unnecessary stress in a situation that is already very stressful for families. So, let me put it to rest once a for all:

No, you don’t need to get divorced.

And, most people shouldn’t get divorced.

Here’s why: If you need to rely on Medical Assistance (also known as “Medicaid”) to help pay for long-term care in a nursing home, assisted living facility, or at home, the program requires the ill spouse to spend their assets down to just $3,000. But the program also provides for a community spouse asset allowance that is much greater than that. This year, the community spouse asset allowance is $126,420, and the figure is adjusted annually based on the rate of inflation.

In addition, there are certain benefits to staying married. For example, the well spouse can remain living in the marital home, and the home will not be counted toward either spouse’s asset limit. The well spouse may also receive an additional income allocation from the income of the ill spouse if the well spouse’s income is too low, which is helpful in situations where the ill spouse was the primary earner and may be receiving a larger amount in pension or social security income. The well spouse may also be allowed to keep additional income producing assets if their income falls below a certain minimum threshold. Moreover, the program allows married couples to annuitize assets, converting available assets to an income stream for the well spouse, and the well spouse’s income is not required to be spent on care costs. So, for all these reasons, staying married is often more advantageous than getting divorced.

So, why does the myth that people have to get divorced persist? It may be because in some unique situations, divorce is the best option. For example, in a second marriage where the couple signed a prenuptial agreement, a divorce may provide for an appropriate redistribution of assets that better protects and provides for the well spouse. But these cases are generally rare and require the advice of a knowledgeable attorney to determine if divorce is appropriate. In most cases, divorce is simply not the best option.

If you or someone you knows is in this situation and is wondering what to do, contact an experienced elder law attorney for advice.

What Is Elder Law?

When I introduce myself as an attorney practicing elder law, the next question I usually get is, “what is that?” Recently, someone asked, “what’s the difference between ‘elder law’ and ‘estate planning?’ Isn’t it the same thing?”

Although there is certainly some overlap between the disciplines of estate planning and elder law, the two are not the same. In this post, I’ll briefly summarize the differences and why those differences are important.

Elder Law is Interdisciplinary

Instead of focusing on a field within the practice of law, elder law takes as its focus the whole person. Traditionally, elder law is a practice that crosses disciplinary boundaries. For example, an elder law attorney may have experience with estate planning, health care law, landlord/tenant law, real estate law, and personal injury. That’s because an elder client may present with a number of issues, such as a person who is injured in an assisted living facility, has issues with the facility’s housing agreement, and also has trouble paying for care. These issues cross over into personal injury law, housing law, and health care law. Not all elder law attorneys practice in all of these disciplines, and some may focus in a certain area, but often an elder law attorney has some familiarity with all of these issues and can help the individual client navigate similarly complex situations. By focusing on a client population instead of an abstract discipline, elder law attorneys gain skills and experience in the challenges that face this population and how best to assist clients who are similarly situated. With these unique skills, an elder law attorney can provide superior service to seniors and their families.

Estate Planning, Plus

In my practice, I sometimes think of elder law as “estate planning, plus” or “estate planning 2.0.” Increasingly, traditional estate plans are being complicated by the high cost and unpredictability of long term care. In part, this is due to demographic changes, like the fact that aging “baby boomers” are greatly increasing the number of people in need of long term care. And in part the change is due to the ever increasing cost of care. The average cost of nursing home care in Minnesota is over $7,000 a month, and for memory care it can be twice that. Estimates indicate that around half of all people will require long term care services, which means more and more people need to factor long term care costs into their retirement planning and estate plans.

A traditional estate planning attorney primarily deals with wills and trusts and is concerned mainly with minimizing the cost of transferring assets at death, which might include tax planning or probate avoidance. But a traditional estate planning attorney may not understand the impact that an illness requiring long term care may have on a client’s intentions to pass assets on to the next generation, and may not know how to leverage the resources available to minimize the financial impact of necessary care. That’s where an elder law attorney can make a difference. For a client who is concerned about the impact that the need for long-term care may have on their business succession plan or their wealth transfer objectives, an elder law attorney can provide invaluable guidance.

Peace of Mind

An elder law attorney can provide their clients with a sense of assurance that, if long term care is anticipated, all necessary care will be provided without totally derailing the clients’ other objectives, such as providing for a spouse or disabled child, or leaving a legacy for the next generation. When faced with a diagnosis like dementia or Parkinson’s, clients often fear that they will lose everything they own or will have to divorce their spouse. The elder law attorney can help the client in this situation to develop a plan to ensure that their quality of life will not suffer even though their cost of care increases dramatically. An elder law attorney can help clients navigate the maze of complicated healthcare programs, rules, and regulations, and provide guidance on care and housing alternatives to meet a client’s goal to age in place as long as possible. With the tools that an elder law attorney can provide, clients can feel empowered to take back control of the process and make a plan that suits them.

If you’re interested in talking with an elder law attorney to find out more, please contact me or someone at my firm, Fafinski Mark & Johnson, PA, for assistance.

New Year's Resolutions for Your Estate Plan

The beginning of a new year is an invitation to review what you’ve accomplished the prior year and to think about what things you might like to accomplish this year. As your make your 2019 New Years Resolutions, I’d like to suggest that you take some time this year to think about your estate plan.

If you don’t have a plan yet… consider making one! Keep in mind that just because you haven’t done any formal planning doesn’t mean you don’t have a plan. Without your own plan, the government will make decisions for you. State laws govern what happens to your assets when you pass away, and in some cases state laws govern who makes decisions for you if you need help doing so. But these default rules are set aside if you make your own plans and turn those plans into legal documents. So, if you don’t yet have a plan, make a resolution in 2019 to sit down with an estate planning attorney and discuss your wishes and make a plan. If nothing else, make sure you get a health care directive if you don’t already have one.

If you already have an estate plan… consider reviewing it to make sure it’s still consistent with your wishes. Ask yourself whether there have been any major life changes since you last did your estate planning documents. Have you moved? Has a spouse, child, or other beneficiary or person named in your documents passed away? Have minor children reached adulthood? Did you give or loan money to a beneficiary, and you want that beneficiary’s share reduced to reflect that? Were you or your spouse diagnosed with a long-term, serious illness that may require long-term care? Was a beneficiary diagnosed with a permanent disability? Have you acquired real estate? Do your assets now total more than $3 million? Did you or a beneficiary go through a divorce? Do your documents simply not make sense to you anymore? If you answered “yes” to any of these questions, you should talk to an estate planning attorney about whether your documents need to be updated or changed.

Estate planning doesn’t have to be expensive or complicated, and knowing that you have a plan in place provides significant peace of mind for both you and your family. Contact me or one of our estate planning attorneys at FMJ to discuss options for your estate plan in the new year.

Happy new year!