Medicaid Planning and Applications by Non-Lawyers, A Risky Proposition

By Joshua Berkley

Hello everyone, Josh Berkley here.

I ran across this interesting (and disturbing) article on Folks, be aware that there are non-attorneys out there offering to help people apply and qualify for Medicaid – as you can see in this article discussing the company “Advanta,” this can be problematic. In this instance, Advanta took money from people to help with applying for Medicaid, and often performed no services at all. While there are bad eggs in every profession, family law attorneys are subject to oversight by the Bar Association in their state. The non-lawyers offering advice are subject to no oversight or regulation at all.

As the article points out, some of those offering to help people qualify for Medicaid are only having them spend down everything they have without offering any strategies to preserve assets.  

One interviewee in the article noted that attorneys were much more costly than non-lawyer Medicaid advisors. If the circumstances weren’t so serious, that would be laughable. When looking at cost, you can’t just consider the legal fee for creating a Medicaid plan and submitting the application – you must consider the amount that can be saved for the applicant, the applicant’s spouse, and the applicant’s heirs. At a minimum, the applicant and their family are entitled to be advised as to the most advantageous way to spend down the applicant’s assets (spoiler alert – it isn’t just to privately pay the nursing home until the assets are exhausted). In so doing, the fees paid to a qualified Elder Law attorney can save thousands, and often tens of thousands, of dollars. This is especially true when Medicaid Planning is done well in advance of the need for a nursing home.

It’s also important to know that non-attorneys can’t draft the various legal documents that Elder Law attorneys may use to effectuate the best financial outcomes for Medicaid applicants. Documents such as Irrevocable Trusts are often used in planning for the potential (or imminent) need for Medicaid, but non-lawyers are not permitted to draft those for clients.

To protect consumers in New Jersey, their legislature is cracking down on non-lawyer Medicaid advisors and proposing a law that would prohibit non-attorneys from charging to assist with applying for Medicaid.

The article sums up the issue quite well by quoting the proposed legislation:

“The proposed bill introduced last week would require nursing homes to specifically tell residents and their families that ‘relying on a non-attorney service might expose you and your family to unnecessary financial risk.’ It continued, ‘There are non-attorney agencies and companies which may offer to prepare and submit a Medicaid application. These entities are not permitted to give legal advice or to implement legal strategies that may best protect your interests, and they are not obligated to advise you of your rights.'”

If you or a loved one is concerned about protecting assets while still qualifying for Medicaid, please be sure to contact a duly qualified Elder Law attorney for assistance. If you have questions, our office is always ready to help.

Thanks for reading!

About the Author
Josh Berkley is an attorney and owner at Berkley Oliver PLLC who helps individuals implement plans to protect their assets and their loved ones. Josh focuses his practice in the areas of Estate Planning, Probate, and Elder Law.  From assisting young parents in making a plan to provide for their children, to helping senior clients qualify for Medicaid, Josh works with clients to create estate plans and life plans tailored to each person’s specific goals. He also helps clients with a wide variety of important legal documents such Wills, Trusts, Powers of Attorney, Healthcare Surrogate Designations, and Living Wills. If you have any questions regarding this article, contact Josh here.