In This Issue
Message from the Partners
Five Facts You Should Know About Medicaid
Tax Tip: Long Term Care Insurance
Massachusetts Appeals Court Case Highlights Need to Review Irrevocable Trusts
Meet Our Staff
Quick Links
To Contact Us
Samuel Sayward & Baler 
 858 Washington Street, Suite 202
Dedham, MA 02026
Phone: (781) 708-0115
Toll Free: (866) 323-3440
Fax: (781) 461-0916
News from
Samuel, Sayward & Baler LLC

January 2010

newsMessage from the Partners
Dear Clients and Friends,
We are pleased to welcome you to the first quarterly newsletter of Samuel, Sayward & Baler LLC. Our goal is to provide you with pertinent legal and financial information and insight into recent changes in the law. 
Since 1990, our firm has focused its practice in the areas of estate planning, estate settlement, and elder law. Should you need an attorney in another area of practice, we welcome the opportunity to provide a referral.  We take pride in being a valuable resource for our clients and their families.  Please don't hesitate to call us.
Our first newsletter includes an article written by Suzanne titled "Five Facts You Should Know About Medicaid." This article has been featured in the Dedham Times and other area newspapers.
We will be contributing a monthly column to the local press to help keep the community updated and informed on some of the most important legal issues affecting families today. Understanding Medicaid is just one of the many misunderstood topics we will address in order to raise awareness about the laws and how they may affect you now and in the future. Our featured article includes links to important state and federal resources.
Our financial section will provide tips for individuals, families, and businesses. This issue features a tax tip regarding long term care insurance.
We have also included an article highlighting a recent Massachusetts Appeals Court case that we hope will inform you about the challenges of using irrevocable, income only trusts for long term care planning.  If you have created one of these trusts as part of a long term care plan, now is a good time to have the trust reviewed. 
You'll also find a brief introduction to our staff members who work closely with us every day to help us provide our clients with the excellent service they expect from our firm. 
As you may know, Congress ended its 2009 session without addressing the federal estate tax situation.  For now, there is no federal estate tax for estates of individuals who die in 2010.  With repeal of the federal estate tax also comes the repeal of the automatic step-up in basis for inherited assets.  This has been replaced by complex carry-over basis rules.  While these changes are significant, there is much speculation that Congress will reinstate the federal estate tax as it was in 2009, retroactive to January 1, 2010.   If Congress does not act, the federal estate tax will return on January 1, 2011, and will affect estates with a value of $1 million or more.  For more information about these changes and updates, please visit our website at

We appreciate any feedback you may have on how we can continually improve our newsletter to bring you the information you need.  We also welcome new subscribers so please feel free to send us email addresses or forward this newsletter to a friend.
Best wishes for a Happy New Year,
Steven Joshua Samuel
Suzanne Sayward
Maria Baler
Five Facts You Should Know About Medicaid
By Attorney Suzanne Sayward
With the cost of nursing homes rising each year, you're not alone if you're worried about affording long-term quality care should you need it. There's good reason to be concerned: In Massachusetts, the average monthly cost of a nursing home is around $10,000, which is a significant financial burden to most families.  
moneyKnowing what resources are available to pay for nursing home care will help reduce some of that worry. For starters, it is important to understand that health insurance does not pay for or contribute to the cost of long-term care in a nursing home. The cost can be paid three different ways: you can pay with your own money, access benefits under a long-term care insurance policy, or access public Medicaid benefits, sometimes called MassHealth in Massachusetts.
Medicaid is a federal- and state-funded program that covers residents who are unable to pay for their own medical expenses. Here are five facts to know about long-term nursing home care costs and Medicaid:
  1. Even though Medicaid is a federal program, the eligibility rules vary widely from state to state. Don't assume that because a friend with similar income and assets qualified for Medicaid benefits in Rhode Island, you will qualify for Medicaid benefits in Massachusetts.  Federal law sets certain eligibility criteria but allows states a fairly wide latitude to impose their own rules within the federal guidelines.   In addition, states may apply for a waiver from the federal government to be excused from complying with certain criteria. 
  2. Medicaid will only pay for the cost of long-term care in a nursing home for individuals who are both medically and financially eligible.  Not everyone who is struggling to privately pay for nursing home care will qualify for Medicaid. In order to be eligible for Medicaid benefits in Massachusetts a single individual may not have more than $2,000 of so-called countable assets.  A person's countable assets include bank accounts, retirement assets, investments, deferred annuities and real estate other than a primary residence.   Non-countable assets include a home, business property and tangible personal property such as furniture and clothing.
  3. Even though your home is a non-countable asset, this does not mean it is protected from liability for your long-term care costs.  An individual may become eligible for Medicaid to pay for the cost of long-term nursing home care even though he or she owns a home.  However, in most cases, Medicaid will place a lien against the Medicaid recipient's home and, upon that person's death, will seek re-payment for Medicaid benefits paid on behalf of the recipient during his or her lifetime.  The Medicaid recipient's children or other heirs may be forced to sell the home to pay the Medicaid lien after the recipient's death.
  4. If you give assets away to anyone other than your spouse, you may be ineligible for Medicaid benefits.   Under the federal law that went into effect in February of 2006, a person who gives money or assets to someone other than his or her spouse during the five-year period prior to applying for long-term Medicaid benefits will be ineligible to receive benefits for a certain period of time because of the gift. The length of the ineligibility period is measured by the value of what was given away.  A gift of $50,000 will result in a longer period of ineligibility than a gift of $10,000.  However, the caveat under the 2006 law is the period of ineligibility does not begin until the person reduces countable assets to $2,000.
  5. Even though the eligibility rules for long-term Medicaid have become more stringent in recent years, the law still allows for certain protections for the spouse of a nursing home resident.   In addition to keeping the home, a spouse of a nursing home resident may keep an additional amount of countable assets.  This amount changes each January. This year, for example, the amount is $109,560.   A spouse at home may also be entitled to receive some or all of the income payable to the nursing home spouse. 
Careful planning will help ensure you will be able to pay for the care you may need, or to access the public resources that are available.   An experienced elder law attorney can educate you on the laws that are relevant to your particular situation, can help you plan for the future, or can assist if an unexpected crisis occurs. Educating yourself about available resources is also important.  Here are some websites to visit:
  • The Massachusetts Chapter of the National Academy of Elder Attorneys (MassNAELA) 
  • The National Academy of Elder Attorneys (NAELA)
  • Centers for Medicare and Medicaid Services
    1-800-633-4227, Detailed information on Medicare and Medicaid, including information on initiatives, coverage and how to protect yourself from fraud
    1-617- 558-0202 or 1-800-CARE-FOR, a consumer-focused website developed for the people who will use or need information about the continuum of long term care services and facilities available across Massachusetts.
  • Massachusetts Health and Human Services

Attorney Suzanne Sayward served as the 2009 president of the Massachusetts Chapter of the National Academy of Elder Law Attorneys (MassNAELA).

Tax Tip: Long Term Care Insurance
savingsYou may be able to deduct all or part of the Long Term Care Insurance (LTCI) premiums you pay for yourself, your spouse, or a dependent, but only if the policy was purchased before January 1, 1997, and meets requirements in accordance with the state in which it was issued. If you purchased an LTCI policy after January 1, 1997, the premium is deductible only if the policy is qualified under the following IRS criteria. 
      • Is guaranteed renewable
      • Does not have a cash surrender value
      • Does not pay for expenses reimbursable by Medicare
      • Meets other consumer protection and IRS rules

The amount of your deduction can vary greatly. If you pay the premium personally, you may deduct only the amount in excess of the 7.5% adjusted gross income (AGI) and only if you itemize. Also, deductible amounts vary by age. For example, in 2009, the deductible ranged from $320 at age 40 to $3,980 at age 71.  If you pay through a business, you may be able to deduct the full amount of the premium, depending on whether you are an owner or employee and whether the business files as a Sub-Chapter C or S corporation.       
To learn more about whether you qualify, visit and click on the Articles section.  As always, consult a qualified tax professional or financial advisor before reaching conclusions about your situation.

Massachusetts Appeals Court Case Highlights Need to Review Irrevocable Trusts
If you have an irrevocable, income only trust (IIOT) for Medicaid planning, you may want to consult with your attorney in light of the recent decision by the Massachusetts Appeals Court:  the case of Doherty v. Director of the Office of Medicaid. 
Doherty created an irrevocable trust that allowed her to receive income from the trust each year; however, the trust stated that none of the principal was to be distributed to her. Her home and other assets were transferred to the trust, and eventually she entered a nursing home and applied for Medicaid benefits.
Medicaid denied Doherty's application for benefits on the basis the assets of the trust could be used to pay for nursing home care, and therefore she was ineligible for benefits.  The court agreed with Medicaid, finding that although one section of the trust stated distributions of the principal could not be paid to Doherty, other sections of the trust seemed to allow the trustees to use the assets for her benefit, if necessary, or distribute the principal to her. Under the Medicaid regulations, these powers made the trust assets accessible to Doherty and disqualified her from receiving Medicaid benefits.
Although the Court did stress in its decision that a properly structured irrevocable trust can protect assets from having to be spent on nursing home care, the Doherty decision shows that Medicaid will scrutinize trusts carefully and challenge them if they have an opportunity to do so. 
The various inconsistencies in the Doherty trust resulted in the trust assets not being properly protected.  If you have created an irrevocable trust for Medicaid planning purposes, the trust should be reviewed in light of this decision.
Meet Our Staff  
new image
Pictured from left to right are:
Janine Cronin, Jennifer Harlow, Karen Margeson
Karen Margeson has been with the firm since 1996 and works full time as a paralegal for Attorney Sayward.  Karen assists Attorney Sayward's clients with trust funding, finalizing estate plan documents, Medicaid applications, real estate matters and estate settlement matters. She can be reached at or at 781/461-1020 ext 218.
Janine Cronin has been with the firm since 2003.   Janine schedules all appointments for Attorneys Sayward and Baler.   Janine assists clients of Attorney Baler and Attorney Sayward with trust funding, finalizing estate plan documents, Medicaid applications, real estate matters and estate settlement matters.  Janine can be reached at or at 781/461-1020 ext 217.
Jennifer Harlow joined the firm in 2008 and works for Samuel, Sayward & Baler LLC part time while pursuing her college degree.  Jen answers the phone, directs client calls, and greets clients who come to our office.  Jen can assist you if you need copies of documents from your file, or if you would like to update your contact information with us.  Jen can be reached at or at 781/461-1020 ext 200.