Worried about how to pay for her husband’s nursing care, 84-year-old Carolyn Norton trusted that a financial adviser could help her qualify for Medicaid.
Just over a year ago, she sank $25,000 into a life insurance policy the adviser said could help her meet the guidelines for Medicaid, a government-sponsored insurance program for the poor.
She shouldn’t have listened, her attorney said.
Norton would’ve qualified for Medicaid even without the man’s advice, and she’ll probably lose money on the life insurance policy he sold her, attorney Jill Burzynski said.
“I have legal documents that were not explained to me and now do not help me in my present situation,” Norton told a Florida Bar committee Friday.
The Florida Bar’s Unlicensed Practice of Law committee met at the Sheraton Tampa East Hotel on Friday to hear about the growing Medicaid planning industry. Professionals in the industry help people qualify for Medicaid benefits even if their assets exceed Medicaid’s income or asset limitations.
Several elder law attorneys blasted the phenomenon, though, claiming these Medicaid planners often have no formal training and are unregulated. Worse yet, they frequently create legal documents that should be left to lawyers, the attorneys testified Friday.
Some non-attorney Medicaid planners, for example, are creating complicated documents called “personal services contracts,” said elder law attorney John Frazier of Largo. These documents can help someone qualify for Medicaid benefits by reducing their reportable assets.
Elder law attorneys urged the Bar committee to create clear rules saying when a non-attorney Medicaid planner has crossed the line into the practice of law. By the end of Friday’s hearing, the Bar committee agreed to do so. If the Florida Supreme Court ratifies those rules, violating them could be a criminal offense, said elder law attorney Twyla Sketchley of Tallahassee.
Not surprisingly, some Medicaid planning firms don’t want additional regulation. And they accuse elder law attorneys of trying to prevent other professionals from competing against them.
A Lantana firm called V.I.P. Care Management argued that very few victims have complained to the Florida Bar about receiving faulty advice from Medicaid planning firms. Several elder law attorneys admitted that the Bar gets few such complaints, but they said it is because seniors often don’t realize they’ve been duped or they’re afraid to come forward.
Jeff Brown, an attorney who works with V.I.P., sees it differently.
“There aren’t many complaints, and I’ll tell you why,” Brown said. “It’s because there are not many problems.”