Bullet: Book Review--Harley
Wednesday, September 26, 2007
LTC Comment: Sixteen
years ago, if you'd told me I'd write a review praising and recommending
a book by Harley Gordon, I'd have said "no way," but here
goes, after the ***news.***
*** THE SAVAGE TRUTH.
Terry Savage, best-selling author and Chicago Sun-Times
nationally syndicated financial columnist, holds forth on long-term care
planning and insurance in her September 24 column titled "Long-Term
Care Insurance a Good Hedge: Don't
Put it Off Too Long" at http://www.suntimes.com/business/savage/571125,CST-FIN-50Terry24.article.
*** NEW WEBSITE FOR LTCI PRODUCERS.
Check out www.yourltcsuccess.com,
a new resource provided by Jesse Slome and the American Association for
Long-Term Care Insurance. You'll
find free sales tools, short educational audios, information on next
year's "National LTC Producers Summit," and much more.
If you appreciate this content, join the AALTCI.
The dues are nominal and helpful materials like these don't
invent themselves. They
come from the kind of dedication and passion you share and they need
your support. ***
*** MOSES AUDIO.
And speaking of short educational audios at www.yourltcsuccess.com,
Slome recorded an interview with me this week and the next day it was
"on the air." Check
it out at http://www.yourltcsuccess.com/audios/.
While you're at it, listen to five minutes of Marsh's Steve Cain
explaining "Tips on Tax Advantaged LTCi" or LTCI
Partners' Lauren Johnson describing "Why the LTCI Sale is Easier
Today." There's much
more audio info already and far more coming.
Download this stuff for drive time listening on your MP3.
Isn't the technology great (when it works)? ***
LTC BULLET: BOOK
REVIEW--HARLEY GORDON'S LATEST
LTC Comment: I
first met Harley Gordon at the second annual NAELA (National Academy of
Elder Law Attorneys) conference in San Diego in 1991.
The Public Broadcasting System program "Frontline"
planned to follow me around that meeting and expose the practice and
practitioners of Medicaid planning.
But an ever-charismatic Gordon swept the young PBS producer off
her feet. Next thing I knew
the show was as much about Harley's vision of elder law as it was about
my critique of Medicaid planning.
After that, Harley and I butted heads for several
years. We debated at
conferences. We critiqued
each other in print. We
argued vehemently in person. But
somehow, over time, mutual respect, common interests, and shared goals
emerged from this relationship. Nowadays,
Harley's Corporation for Long-Term Care Certification is a powerhouse
for responsible LTC planning AND a corporate member of the Center for
Long-Term Care Reform. Furthermore, I'm about to tell you why you should buy his new
book. We've come a long
way, my friend!
But don't buy the book on my say so; buy it on its
merits, recounted below. I'll
close with a little tweak reminiscent of a time when we disagreed on
more things, and much more fervently at that.
The book is:
Harley Gordon, In Sickness & in Health:
Your Sickness--Your Family's Health, Financial Strategies
Press, West Bridgewater, Massachusetts, 2007.
learn more or to place an order for the book, go to www.harleygordon.net
or call toll-free: 866-257-5215.
The book's sub-title is a good summary of its
content and approach. To
wit: "How to Discuss
and Create a Plan for Long-Term care and the Consequences to Your Family
and Finances if You Don't."
Or, as a promotional piece about the volume puts
it: "This is not a
book about ENDLESS STATISTICS telling you about the risk of needing
care; it's about the emotional, physical and financial consequences of
ENDLESS CARE." In
other words, the focus is on consequences, rather than--or in addition
Besides the obligatory content describing long-term
care, explaining Medicaid, and recounting why private insurance is the
best plan, chapters also cover "Understanding the Consequences of
Needing Long-Term Care," "Choosing a Long-Term Care
Professional," and what to do if you don't qualify for LTC
As always, I paid special attention to the chapter
on "Medicaid." Gordon
describes Medicaid eligibility and explains the program's purpose.
He gives examples of two inappropriate Medicaid planning
advertisements. Then he
explains some of the downsides of relying on Medicaid or Medicaid
planning. For example:
"Since Medicaid's long-term care benefits
typically only cover care in a skilled nursing facility, the attorney's
advice will focus on nursing-home care."
"Medicaid is not free:
Transferring qualified funds (assets held in tax-deferred
accounts) creates an immediate tax liability."
"Medicaid planning can protect assets . . .
[but] Lawyers cannot protect income."
"In short, Medicaid planning is
counterproductive to a plan to protect the emotional and physical
well-being of a family and the retirement portfolio on which it will
depend." (p. 103)
So far so, good but then Gordon says:
"Some professionals in the long-term care
insurance industry believe Medicaid should never be used when a person
has any assets or a home." Why
did I feel like I was wearing a bulls-eye when I read that?
Actually, I don't go so far. I think Medicaid is perfectly appropriate for people who meet
the prescribed income and asset guidelines, including the generous
spousal impoverishment protections we fought for and won in the Medicare
Catastrophic Coverage Act of 1988.
As long as they don't use Medicaid planning to evade estate
recovery, Medicaid works for such people exactly as it should, as a
temporary loan to avoid financial devastation.
Where Medicaid planning is not appropriate is when
it takes advantage of loopholes and elasticities in the law to protect
income and assets far beyond the letter and the intent of the law--no
matter how great the need or desirable the purpose.
And cleverly dodging estate recovery turns Medicaid into free
inheritance insurance for heirs.
Why such "tough love"? Because Medicaid can't survive as the LTC payor for everyone.
It can't be used to insulate people's businesses or protect large
home equities and also provide quality long-term care for people who
have no other resources. The
proof of that is in the history of Medicaid LTC and its dismal
reputation for problems of access, quality, reimbursement,
discrimination and institutional bias.
But other than this one point, on which we can agree amicably to disagree, I recommend Harley Gordon's new book unreservedly. Buy it for yourself. And use it to open the eyes of prospects and clients who might otherwise remain behind the veil of denial.