Florida Elder Law & Estate Planning Blog

Don’t Take Florida Medicaid Planning Advice From Non-Lawyers

In recent years there has been a proliferation of individuals who refer to themselves as “Medicaid planners” but who are not licensed to practice law. They claim to have the expertise to help clients become eligible for Medicaid nursing home benefits. Their fees are generally less than fees charged by experienced attorneys.

With the annual cost of a semi-private room in a Florida nursing home now topping $100,000, it is no surprise that desperate individuals seek out these so-called Medicaid planners. However, relying on a non-lawyer for Medicaid legal advice can be disastrous. It may cost far more in the long run than it saves, or even result in denial of the very benefits for which you would otherwise be eligible. Moreover, under Florida law, the non-lawyer who advises you is actually committing a third-degree felony!


Medicaid Planning Involves More Than Filling In The Blanks On An Application


It is always wise to consult a licensed elder law attorney familiar with Medicaid planning law. He/she will have the experience and in-depth knowledge to help you secure your rightful benefits before you “spend down” and lose everything.

Keep in mind that this kind of planning is complex and encompasses far more than filling in the blanks on an application. The attorney must be familiar with scores of federal and state laws and monitor them continuously, since they change frequently. Your financial and family circumstances must be analyzed in their totality and in detail. Your assets and income,  your family’s assets and income, and history of transfers must be reviewed. Protecting your home and your spouse, if there is one, must be addressed. In almost all cases, it will be necessary to draft or revise complex estate planning documents. Your attorney must consider the tax implications of any potential steps, and make sure such steps are taken at the right time and in the right order. And because the majority of Medicaid planning clients are under the gun, facing the prospect of paying enormous amounts out of pocket to a facility, time is of the essence. The bureaucracy does not move quickly, but if your attorney knows the ins and outs of the process,  Medicaid eligibility can be achieved as quickly as possible.

Also keep in mind this critical point: Even if someone advises you that he/she can make you Medicaid eligible, that doesn’t mean it is advisable. It must make sound economic sense for the applicant and family.


Risks of Using a Non-Attorney For Medicaid Planning


Here are some instances of faulty advice we have seen non-lawyers furnish to clients, and the unfortunate consequences that resulted:

  • Outright denial of benefits because of a poorly prepared application.


  • Allegations of fraud lodged against the applicant because the law was not followed scrupulously.


  • Clients advised to purchase financial products that paid a fee to the Medicaid planner but were clearly inappropriate for the client. One example is an 85-year-old man we met with who had been advised to purchase a single-payment annuity.


  • Cashing in large retirement accounts to become Medicaid eligible, when the life expectancy of the client does not justify it. Although this might attain the goal of becoming Medicaid eligible, the negative tax consequences far exceeded the value of the benefits.  That’s like cutting off your finger to cure a hangnail!


  • Putting an adult child on the deed to supposedly protect the home from Medicaid recovery. An advisor who knows the law knows that the home is an exempt asset and not subject to Medicaid recovery when left to a constitutional heir at law. Deeding it to a child creates a gift and triggers a penalty for eligibility.


  • Failing to address the needs of the nursing home resident’s well spouse, and update the well spouse’s documents accordingly. We know of a case in which a woman needed nursing home care. The non-lawyer the family consulted never advised them to examine her husband’s legal documents. When he later developed dementia and could not manage his own affairs, his incapacitated wife was still listed as the only person authorized to make his financial and health care decisions.


Florida Supreme Court’s Opinion


Don’t just take it from us that using a non-lawyer for Medicaid planning is a bad idea. The Florida Supreme Court has weighed in on the issue, finding that only licensed attorneys may undertake key aspects of Medicaid planning. Non-lawyers may not:

  • Draft a personal service contract.


  • Determine the need for, and prepare and execute a Qualified Income Trust, including gathering the information necessary to complete the trust.


  • Sell personal service contract or Qualified Income Trust forms or kits in the area of Medicaid planning.


  • Render legal advice regarding the implementation of Florida law to obtain Medicaid benefits. This includes advising an individual on the appropriate legal strategies available for spending down, restructuring assets, and the need for a personal service contract or Qualified Income Trust.


The Supreme Court’s advisory opinion also takes aim at non-lawyer Medicaid planners who say they collaborate with attorneys, and have their attorneys draft documents for their clients. The Supreme Court has ruled that an independent attorney-client relationship must be established between the client and the lawyer. It is not sufficient for a non-lawyer Medicaid planner to submit a client’s information to an attorney. Additionally, payment must be made by the client directly to the attorney. The initial determination that a particular legal document or Medicaid planning strategy is appropriate for the client must come from the attorney, not the non-lawyer Medicaid planner.

You can have confidence that the attorneys of The Karp Law Firm will provide you with sound advice. If you need help securing long-term care Medicaid benefits, call the Karp Law Firm at (561) 625-1100 to schedule a consultation with one of our experienced Medicaid planning attorneys.