Circa 2018 was a busy year for elders.
New rules came in, old rules went out, and courts issued opinions that shocked. Here are just a few of the changes.
Investors beware, again. The Department of Labor rule that required financial professionals to put their client’s best interests first was blown dead by the Fifth Circuit Court of Appeals in March 2018.
The SEC has now picked up the ball and is running with it.
Not to be outdone, the DOL is reportedly planning to address the fiduciary rule again in 2019. Rumors are that the SEC and DOL are working together and that a somewhat friendlier fiduciary rule will eventually as be adopted. Keep your fingers crossed that the new rule will be powerful enough to punish those few bad advisors who churn their client’s investment accounts solely to earn commissions.
Arbitration in nursing home contracts continues to be a hot topic. In 2017 the rule restricting arbitration in nursing homes was reversed, and in 2018 the US Supreme Court handed down a decision that scuttled a state law and allowed a nursing home arbitration to move forward. There are 3 more arbitration cases on the SCOTUS docket for this term.
On the home front, in 2018 the Texas Supreme Court actually held that someone who was not a party to an arbitration agreement could not be forced to arbitrate. Stay tuned.
VA pension benefits got a huge overhaul in 2018.
In September the VA issued a final rule, with an effective date of October 18, 2018, that makes it more difficult for a veteran or a surviving spouse to qualify for pension benefits.
Some background: the pension benefits program is based on the applicant’s needs, so to qualify for the program his or her assets and income must be severely limited. The new rule sets a maximum net worth and makes changes as to how assets are counted. There is also, for the first time, a penalty if the applicant transfers any assets in the 36 months before making the application.
Texas Medicaid applicants, in the meantime, got some welcome news.
Medicaid is also a means-tested benefit, and it is often challenging for an applicant who has assets in a qualified retirement plan, like an IRA, to qualify. This year, for the first time, Texas Health and Human Services is taking the position that if the applicant has a QRP and has reached the point where he or she is receiving the required mandatory distribution, then the IRA is considered exempt as an asset.
That is a very favorable change in the law.
Another happy moment – the Texas DMV finally issued its TOD forms VTR-121, VTR-122 and VTR-262.
Translated that means you can now designate a beneficiary who will inherit your car when you die, and no formal probate action in a court is necessary.
It seems like the 3 branches of government are competing to see which can be more active.
2019, here we come.
Virginia Hammerle, Managing Attorney for Hammerle Finley Law Firm, has been recognized from 2012-2018 as a Super Lawyer, a Thompson Reuters Publication. See hammerle.com for her blog and newsletter sign-up. This column does not constitute legal advice.