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Commonly Used Terms in Elder Law

Advance Directives

The term advance directive is commonly used to refer to documents such as Powers of Attorney, Health Care Proxies and Living Wills. In an advance directive a person can appoint another to act for them if they cannot and specify the type of action or care they wish to receive. They must be signed while the person making the directive is of sound mind, understands the meaning and consequences of the document and able to communicate his or her wishes. In order for these documents to be effective these documents must be signed in accordance with state law.

Durable Power of Attorney

A power of attorney is a written legal document wherein one person (the principal) gives another (the agent) the authorization to act for them. It can be very broad or very specific. It is revocable by the principal during his life and terminates upon his death. The power is durable if the document states that the power survives the incapacity of the principal.

Health Care Proxy

A health care proxy is a written document wherein one person authorizes another to make health care decisions for the principal if he is unable.

Living Will

A living will is a written document wherein a person declares his or her wishes regarding the type of medical treatment he does or does not want. It is a guide and instructions to one’s health care agent and medical care providers. It may state that one does not want medical procedures to futilely prolong dying. It can include a Do Not Resuscitate Order. (DNR)

Last Will and Testament

A last will and testament is a legal instrument wherein a person, the testator, makes a disposition of his or her property to take effect upon death. It is revocable during the person’s lifetime. The testator can also appoint someone to act as executor of his estate. The executor is the person who handles the estate after the death of the testator.

Life Estate

A life estate is a type of interest in property, usually real property, whereby the life estate holder is entitled to use or live in the property of another for the remainder of his or her life. It terminates on the death of life estate holder.

Guardian

A guardian is a person appointed by the court to manage the property of another and/or make personal and health care decisions for that person when it is determined by the court that he is unable to do so for himself. A guardianship proceeding may be necessary when a person becomes incapacitated and does not have a Durable Power of Attorney and Health Care Proxy. A guardianship proceeding may be commenced in Surrogate’s Court under Article 17A of the Surrogate Court Procedure Act (SCPA) for mentally retarded and developmentally disabled persons or in the Supreme Court under Article 81 of the Mental Hygiene Law (MHL) for individuals who need aid with personal needs or property management.

Lien

A lien is a security interest in or encumbrance on property. A mortgage is a type of lien on real property. In certain situations, a lien can be placed against the estate or upon the home at the time of death of a Medicaid recipient or his or her spouse.

Medicare

Medicare is a Federal health insurance program for people age 65 or older, certain people with disabilities and people with end-stage renal disease. Medicare has two parts -- Part A for hospital insurance, and Part B for medical insurance. The recently enacted Medicare Part D is insurance for prescription drug coverage. Everyone with Medicare is eligible for this coverage. Medicare coverage for nursing home care is severely limited.

Medicaid

Medicaid is a joint federal and state program to assist low income persons in attaining and paying for a comprehensive range of medical care and services including nursing home care. The program is administered by local Departments of Social Services. Eligibility is based on financial need. Medicaid can be available for home care as well as nursing home care. There are complex rules concerning the disclosure and treatment of income, assets, transfers, ineligibility periods, and liens. This area of law has recently been changed drastically and is still undergoing major changes. It is a particularly complex area that should always be discussed with a knowledgeable and experienced attorney.

Spousal Refusal

A spousal refusal is declaration by one spouse that he or she refuses to pay for the other spouse’s medical care despite a legal obligation to do so. It is filed with a Medicaid application and is necessary in order for the applicant spouse to qualify for Medicaid while allowing the refusing spouse to keep more resources than he or she would otherwise be entitled to. Medicaid has a right to seek a contribution and reimbursement from the refusing spouse for the cost of care for the applicant spouse.

Trust

A trust is a legal entity in which property is held by one person, the trustee, with the intention that it is to be used for the benefit of another, the beneficiary. The trustee must administer the trust property pursuant to the terms of the trust. The person who creates the trust is known as the grantor or settlor. The grantor, trustee and beneficiary can be the same person. There are various types of trusts to accomplish many things.

An inter vivos trust is created while the grantor is alive. Testamentary trusts are created in a Will. A revocable trust is one whose terms can be amended or revoked. Irrevocable trusts cannot be amended.

Trusts commonly referred to as living trusts are revocable trusts created during the lifetime of the grantor often used to avoid probate and for ease of management property. Although they are more difficult to contest, it is still possible to do so in a special proceeding.

Supplemental needs trusts, also known as special needs trusts, are used to protect the assets of a person with a disability and enable them to maintain governmental benefits to which they may be entitled. There are several types of supplemental needs trusts.

Pooled trusts are a type of supplemental needs trust wherein the assets or income of a disabled person are pooled with the assets and income of other disabled individuals and held by a charitable organization. In this type of trust the charitable organization acts as the trustee and manages the disabled person’s deposits in a separate account within the trust. All disbursements are made by the organization at their discretion solely for the benefit of the disabled individual. Upon the death of the disabled individual any balance in the account remains in the trust to further the goals of the charitable organization and other beneficiaries of the trust. This type of trust is generally used to enable a disabled person to preserve his or her monthly income for items other than those provided by governmental benefits such as Medicaid.

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445 Broad Hollow Road, Suite 205
Melville, NY 11747
Phone: (631) 249-1976
Fax: (631) 982-1476

Melville, New York attorney, Joan S. Arbiter, helps families and individuals throughout Nassau County, Suffolk County, and the New York Metro Area to resolve legal issues in the areas of elder law, Medicaid planning, estate planning, probate, and real estate. Long Island communities she serves include Amityville, Commack, Dix Hills, Farmingdale, Hauppauge, Hempstead, Huntington, Babylon, Levittown, Massapequa, Melville, Mineola, Plainview, and Woodbury.