Litigation over James Brown’s estate has been dragging on for 14 years, but the case took a big step towards resolution when the South Carolina Supreme Court ruled that the woman claiming a spousal share in Mr. Brown’s estate was never legally married to him. 

Mr. Brown, known as the Godfather of Soul, married Tommie Rae Hynie in 2001. At the time, Ms. Hynie did not disclose that she was already married to Javed Ahmed. When Mr. Brown discovered the previous marriage in 2003, Ms. Hynie filed a claim to annul the marriage to Mr. Ahmed on the basis that Mr. Ahmed was already married. Mr. Ahmed did not appear at the annulment hearing, and the court granted the annulment, finding the marriage was void. In 2004, Mr. Brown filed a claim to annul his marriage to Ms. Hynie, but he eventually dropped the annulment proceeding.  He died in 2006 without having the marriage formally annulled and leaving the majority of his estate to a charitable trust. 

Following Mr. Brown’s death, Ms. Hynie filed a claim against the estate, asking for a “spousal share.” Under South Carolina law, spouses can collect one-third of an estate even if the spouse isn’t named in the will. The estate argued that Ms. Hynie was not a surviving spouse because her marriage to Mr. Brown was never valid. Ms. Hynie argued that because her marriage to Mr. Ahmed had been annulled, her marriage to Mr. Brown was valid. 

After the case wended its way through the courts for years, the South Carolina Supreme Court finally determined on June 17, 2020, that Ms. Hynie is not Mr. Brown’s surviving spouse. The court ruled that because at the time Ms. Hynie married Mr. Brown she had not resolved her marriage to Mr. Ahmed, her marriage to Mr. Brown was void under state law. The court noted that Mr. Brown’s trust was intended to be used to create scholarships for children in South Carolina and Georgia and lamented that the protracted litigation has thwarted Mr. Brown’s expressed wishes. Further litigation is possible — including resolving whether James Brown II, the child of Ms. Hynie and Mr. Brown, may inherit a portion of the estate — but experts say the ruling is a major step towards finally settling the affairs of the former “Hardest Working Man in Show Business.”  

To read the case, click here.

To read a New York Times article about the case, click here.  

If you plan to move states, can you take your Medicare or Medicaid plans with you? The answer depends on whether you have original Medicare, Medicare Advantage, or Medicaid. 

Medicare
If you have original Medicare (Plans A and B), you can move anywhere in the country and you should still be covered. Medicare is a federal program, run by the federal government, so it doesn’t matter what state you are in as long as your provider accepts Medicare. Your Medigap plan should also continue to cover you in the new state, but your premiums may change when you move. The exception is if you move to Massachusetts, Minnesota, or Wisconsin because those states have their own specific Medigap plans. 

Both Medicare Part D (prescription drug coverage) and Medicare Advantage plans have defined service areas, which may or may not cover more than one state. If you have Part D or Medicare Advantage, you will need to determine if your new address falls within the plan’s service area. When you move to a new service area, you have a special enrollment period in which to change plans outside of the annual open enrollment period (which runs October 15th through December 7th). If you tell your current plan before you move, your special enrollment period begins the month before you move and continues for two full months after you move. If you tell your plan after you move, your chance to switch plans begins the month you tell your plan, plus two more full months. 

For more information about moving and Medicare plans, click here.  

Medicaid
Medicaid is a joint federal and state program, with each state having its own eligibility rules. This means you cannot keep your Medicaid plan when you move to a new state. Medicaid eligibility depends on your income, your assets, and the level of care you need. If you have Medicaid and are planning to move, you should contact the Medicaid office in the state to which you are moving to find out the eligibility requirements in that state. Before you can apply for benefits in the new state, you need to cancel your benefits in the old state. You should file an application in the new state as soon as possible. Usually, if you qualify for benefits, the benefits will be retroactive up to three months before the date you applied. If you end up having to pay for any health care services out of pocket while you are waiting for your application to be approved, save the receipts since you may be able to get reimbursed. 

For more information about Medicaid, click here.

For more information about Medicare, click here.

A controversial policy that reduces the benefits of military spouses is on the way out. The so-called “widow’s tax” cuts assistance to surviving military spouses who qualify for benefits under two different military benefit programs.

The two programs are:

• The Department of Defense’s Survivor Benefit Plan (SBP), which allows a military retiree to contribute part of their benefit to ensure that family members receive an annuity of up to 55 percent of their retirement pay when they die.  
• The Department of Veterans Affairs’ Dependency and Indemnity Compensation (DIC), which awards around $15,000 a year to survivors of veterans or troops who die of service-related causes.

Under the current policy, even though SBP and DIC are different programs paid for by different federal agencies, spouses who are eligible for both benefits have their SBP payments offset by the DIC money the spouse receives. An estimated 65,000 families are affected by the offset, costing them thousands of dollars in benefits. Military families have been fighting to eliminate the widow’s tax for years, but have not had success until now.

Signed into law in December 2019, the bipartisan FY20 National Defense Authorization Act eliminates the widow’s tax in phases beginning in 2021. SBP recipients will receive one-third of the DIC offset amount in 2021 and two-thirds in 2022. In 2023, spouses can receive both benefits in full. 

For more information about the change, click here.

 

Talking about estate planning is a difficult, emotional topic but it’s essential for every family.

Unless you’re certain your parents have an up-to-date will and a wider plan for what should happen in the event of their passing, you shouldn’t assume everything will be taken care of.

According to a 2017 survey, less than half of Americans have a will. If your mother or father dies intestate – meaning without a will – such a situation could lead to added emotional strain and stress. And it could have financial implications for all their children and/or other family members.

The following eight tips can help you discuss the hard topics thoroughly and respectfully and prepare you for the road ahead.

1. Plan What You Can

Discussing estate planning and all it entails is not something that should happen without any planning. Make a list of topics and questions, then let your parents know what you want to chat about with them.

If possible, set a time and date and choose a private venue that everyone will feel comfortable in. Be aware that you may need to schedule a few conversations as there could be too much to cover in one sitting. Remember to use language that’s respectful and supportive, and to take a breather if emotions run high or the stress becomes overwhelming.

2. Identify Key People

There are several key people you may need to contact for estate planning purposes. Ask your parents for the names and contact details of their:

• Doctors
• Attorney
• Financial planner and/or accountant
• Insurance brokers
• Minister of religion
• Closest friends

3. Address the Topic of a Will

Determine whether there is an existing will in place and whether the document is up to date. If a will was created more than five years ago, check to see if they’d consider reviewing it to ensure it’s a true reflection of their wishes. Establish where they keep the document and confirm who they’ve appointed as the executor/s.  The same goes for any trust that may have been created.

4. Talk About Power of Attorney

Find out whether your parents have appointed someone to manage their financial and other affairs if they become incapacitated. If they haven’t given someone power of attorney, suggest they consider doing so.

5. Discuss End-of-Life Wishes

Even though the subject may be uncomfortable to talk about, you should discuss your parents’ end-of-life wishes with them. Their estate plan will be incomplete without these directives, so it’s important to include them. The form those directives take depend on the state in which you live, and they may include:

• The appointment of a health care proxy who can make medical decisions for your parents if they become incapable of making those decisions themselves. You can obtain the relevant forms from an elder law attorney or from a hospital or nursing home
• A medical or advance directive that explains what sort of care they would like and whether life support should be used to keep them alive or not. These directives can be included in the document that appoints the health care proxy. The directive must refer to the Health Insurance Portability and Accountability Act (HIPAA) when naming the proxy
• A living will contains instructions regarding the withdrawal or termination of life support under specific conditions, such as your parents becoming terminally ill, becoming comatose, or entering a vegetative state
• Physician Orders for Life-Sustaining Treatment (POLST), which provides more explicit directives regarding the type of treatment your parents would or wouldn’t want

6. Ask About Insurance Policies

Talk about the type of insurance policies in place. That includes:

• Health insurance – Medicare or private
• Life insurance
• Home insurance
• Long-term care insurance
• Disability insurance

In some cases, there may be seniors funeral insurance or other policies intended to cover funeral or burial payments. You’ll need to know about these too and have all their details.

If you haven’t already done so, take note of the names and contact details of the insurance brokers. Check where the policy documents are kept, and if possible, make certified copies of them.

7. Request Access to Tax Returns

It can be helpful to know where tax return paperwork is stored. While these documents may not be necessary after death, they could be required if the estate becomes complicated. Confirm where you can find these documents and that they’re all up to date.

8. Discuss All Other Practicalities

In addition to subjects such as power of attorney and insurance, there are several other practicalities you should include in your conversations.

• Make a list of their accounts – financial accounts such as bank and mutual fund, credit accounts, and store accounts
• Check if they are registered organ donors or whether they would consider donating their organs
• Talk about the memorial service they want and whether they want to be buried, cremated, or some other option.

Conclusion

Estate planning conversations are tough no matter how you tackle them. Try your best to be patient with your parents and transparent with other family members about what you’re doing. If you have siblings, invite them to be part of the conversation.

Accept that these talks can take time and avoid placing pressure on those involved to get it all done in a few hours. The smaller details are critical and should not be rushed. Lastly, always consult an attorney if you’re unsure about the legal aspects or implications of any of the points mentioned above.

Ellen Klein is a freelance writer with a background in personal finance and estate planning.  She can be reached at ellen@eklein.me

 

With the coronavirus pandemic responsible for more than a hundred thousand deaths and disrupting life across the United States, the only way for the country to return to normal is an effective vaccine. When a vaccine is available, Medicare will cover the cost. 

Medicare covers vaccines in a variety of ways, depending on the vaccine.  It may be through Medicare Part B, Medicare Part D, or a Medicare Advantage plan if you are enrolled in one. Part B covers vaccines only for certain illnesses: flu, pneumonia, and Hepatitis B (if you are at medium or high risk). Medicare covers 100 percent of the cost of these vaccines if you go to an approved provider, and you do not have to pay a deductible or coinsurance. Medicare Advantage is also required to provide these vaccines at no additional costs. 

Part B also covers vaccines if you are exposed to a dangerous virus or disease, such as rabies or tetanus. In those cases, you will have to pay a deductible and a 20 percent coinsurance. 

Part D covers all other doctor-recommended vaccines, such as the shingles vaccine and the Tdap (tetanus, diphtheria, pertussis) vaccine. How much the vaccine costs will depend on whether you go to a provider who is in-network for your Part D plan. If you get the vaccine in-network, you will have to pay the co-pay amount. If you get the vaccine out-of-network, you may have to pay for the entire vaccine and bill Medicare. Medicare will only pay for the approved cost, which may be less than what you paid. If you have a Medicare Advantage plan that covers prescription drugs, it may cover these vaccines. The cost to you will vary, depending on the plan.  

With regard to COVID-19, the CARES Act provides that if a vaccine becomes available, Medicare is required to cover this vaccine under Part B with no cost sharing. Medicare Advantage plans are required to include the basic coverage offered by Medicare Parts A and B, so this coverage also applies to beneficiaries in Medicare Advantage plans. 

Once you become eligible for Medicare, you will be inundated with offers from insurance companies for Medigap (supplemental insurance) policies. Sorting through these offers can be confusing. Not only are there 12 standardized plans, but there can be huge differences in premiums between companies.

Medicare plans A and B cover only a portion of medical costs. Medigap policies are designed to fill in the “gaps” in coverage. The first step is to figure out what coverage you will need. The government currently has 8 standardized plans each represented by a letter (It used to be 10 plans, but Plans C and F are no longer availble if you became eligible for Medicare after January 1, 2020). For information about what each plan covers, click here. Medicare also publishes a guide to Choosing a Medigap Policy that explains the differences in plan coverage. The following are some other things to consider when looking at plans:

• Plans in Massachusetts, Minnesota, and Wisconsin have some extra options, so if you live in those states, check with the state department of insurance to find out the differences.
• If you regularly see doctors who charge above what Medicare pays, Plan G, which cover excess charges, may be the right plan for you.
• If you regularly travel outside the United States, Plans D, F, G, M, and N include coverage for this.
• If you have a chronic condition with high medical bills, Plan K or L may work best. Both pay only a portion of covered expenses, but have a yearly out-of-pocket cap on medical expenses. Once you reach the cap, the policy pays 100 percent of all further medical services.

Note that Medigap plans that cover the Medicare Part B deductible (Plans C and F in most states) are longer able to be sold to most people who turn 65 or who become eligible for Medicare after January 1, 2020. If you bought a Medigap Plan C or F before January 1, 2020, you can keep that plan and your benefits won’t change. 

Once you've decided what type of coverage you need, the next step is to decide which company to buy from. To find a list of companies that sell plans in your state, go to Medigap Policy Finder.

Each plan covers the same medical services, but premiums can vary significantly from company to company. The companies use three different methods to set premiums: attained age, issue age, or community.

• Attained-age policies set the premium based on your age, so the premium automatically increases as you get older. Before buying an attained age policy, check with the insurance company to get the premium costs for the next age increments, so you'll know the level of increases to expect each year.
• Issue-age policies set the premium at the age you first buy the policy. The premium will never be higher than the amount the company is charging new buyers at the same age. For example, suppose you buy the policy at age 65. In five years, the premium will be the amount the company is charging new 65-year-old buyers. While your premiums may increase, the increases may not be large because the company will keep premiums lower to attract new buyers.
• Community policies charge the same price to everyone in your area regardless of your age. The premiums go up only when the insurance company raises premiums on all policies of the same type. These increases are regulated by state insurance departments.

While the premiums on an attained-age policy may be lower at first, it is generally better to buy an issue-age or community policy, which may be more expensive at first but doesn't increase as much over time.

Following are some other things to keep in mind when choosing a policy:

• Look for a company that has arranged to file Medigap claims automatically. Companies that offer automatic filing of claims with Medicare can save time and effort.
• It is a good idea to purchase from a financially sound company. Make certain that the insurer is rated in the top two categories by one of the services that rates insurance companies, such as A.M. Best or Weiss.
• Contact your state insurance department to find out if the insurance company has any complaints filed against it.

For more information about Medigap, click here.

The coronavirus pandemic has had a devastating impact on the elderly, particularly those in nursing homes and other long-term care facilities. This has raised questions about how the virus has influenced the costs and provision of long-term care insurance, which covers care in facilities and sometimes at home as well. 

If you have a long-term care insurance policy, you may wonder how it is affected by the pandemic. If you don’t have a policy, you may wonder if the pandemic will make it more difficult to get one. An article by US News and World Report, examines issues with long-term care insurance that have arisen in the last few months, including the following:

• Qualifying for insurance. It is already more difficult to qualify for long-term care insurance the older you get. Because older individuals are at a higher risk for coronavirus, this can affect your long-term care application as well. Some insurers have been limiting applicants’ ages or putting additional restrictions on applicants who have been in contact with the virus. If you had a positive COVID-19 test, you may have to wait for three to six months before qualifying for insurance. These policies vary by company. 
• Premiums. Insurers can’t raise rates for customers due to individual circumstances. To raise rates, insurers must obtain approval from the state and raise them for the entire group. However, if you are considered high risk due to exposure to coronavirus, you may not qualify for the best rates when you first apply for long-term care insurance. 
• Moving out of a nursing home. If you have a policy and want to move out of a nursing home, you will need to check what your policy will pay for. Some policies pay for long-term care in a variety of settings, including home care, but others are more restrictive. On the plus side, you may be able to use your policy to reserve your bed, allowing you to keep your nursing home spot.
• Home care. If you have a policy that was paying for home care, there may also be changes. Some home care workers are charging more for work during the pandemic, which could exceed your policy coverage. Another change may be to the number of people entering your home. You may want family to provide care, rather than an outside home health care worker. Unfortunately, most long-term care policies don’t pay for family members to provide care. However, if you aren’t using the insurance to pay for care, your coverage may last longer–depending on the policy. 

There are lots of uncertainties regarding long-term care, insurance, and coronavirus. To read the full US News and World Report article about what we do know, click here.

For more information about long-term care insurance, click here. 

 

Medigap policies that supplement Medicare’s basic coverage can cost vastly different amounts, depending on the company selling the policy, according to a new study. The findings highlight the importance of shopping around before purchasing a policy. 

When you first become eligible for Medicare, you may purchase a Medigap policy from a private insurer to supplement Medicare's coverage and plug some or virtually all of Medicare’s coverage gaps. You can currently choose one of eight Medigap plans that are identified by letters A, B, D, G, K, L, M, and N (If you were eligible for Medicare before January 1, 2020, but not enrolled, you may also be able to purchase Plans C and F, but those plans  are no longer available to people who are newly eligible for Medicare). Each plan package offers a different menu of benefits, allowing purchasers to choose the combination that is right for them. 

While federal law requires that insurers must offer the same benefits for each lettered plan–each plan G offered by one insurer must cover the same benefits as plan G offered by another insurer–insurers set their own prices for each plan. This means that the price of each plan varies considerably depending on the insurance company. 

The American Association for Medicare Supplement Insurance compared costs of plans in the top 10 metro areas and found huge cost differences. Using the most popular plan–Plan G–for comparison, the association found that in Dallas the lowest price for a 65-year-old woman to purchase a plan was $99 a month while the highest price was $381 a month. This is a yearly difference of more than $3,000 for the exact same plan. 

The association also found that no one company consistently offered the lowest or highest price. In their study, investigators discovered that 13 different companies had either the lowest or highest price. This means you can’t rely on just one company to always have the better price. 

When looking for a Medigap policy, make sure to get quotes from several insurance companies. In addition, if you are going through a broker, check with two or more brokers because one broker might not represent every insurer. It can be hard work to shop around, but the price savings can be worth it.

For more information on choosing a Medigap policy, click here.