Using a Special Needs Trust to Ensure Your Settlement Does Not Affect Public Benefits

Using a Special Needs Trust to Ensure Your Settlement Does Not Affect Public Benefits

In Wisconsin, Medicaid (sometimes also called Medical Assistance) covers 1 in 9 adults and 1 in 3 children; in fact, 16% of the Wisconsin population gets its health care coverage through Medicaid.  Unlike the similar sounding Medicare, Medicaid is a means tested, needs-based health care coverage program, which means there are various income and asset limits that determine a person’s, or his/her family’s, eligibility.

By virtue of being a means tested program, Medicaid eligibility can be affected by receipt of funds, such as a personal injury settlement, if proper steps are not taken.  For example, to qualify for Medicaid, a single person can have no more than $2,000 in total countable assets.  If that Medicaid recipient receives a personal injury settlement of $25,000, he or she is going to be above the asset limit and at risk to lose Medicaid coverage.  Considering the exorbitant cost of medical procedures and medications, the loss of Medicaid coverage, or any needs-based benefits, can be devastating.

No injury victim should face the choice of being fully and fairly compensated for his or her injuries versus keeping his or her health care coverage.  Such a harsh outcome can be avoided by transferring the settlement funds to a properly drafted “special needs trust.”  Under normal rules, if a Medicaid recipient gives away or transfers assets to someone else, or to a trust, this results in disqualification from Medicaid (a penalty period).  A special needs trust is a type of trust that is specifically allowed under the Medicaid rules as an exception to the asset transfer rule.  A Medicaid recipient can transfer assets to a special needs trust without disqualification, and the recipient will no longer be over the asset limit.  Although the injury victim no longer has access to the funds, the trustee of the special needs trust can make distributions for his or her benefit, and there will be no loss of public benefits.

For example, our hypothetical accident victim, Courtney, receives a $25,000 settlement but is on Medicaid and Social Security Income (SSI), which are public benefits with asset limits.  Courtney wants to save this money for a car (a non-countable asset) or other items but is not sure what she would like to purchase.  If she is going to stay on public benefits, she only has ten days to report that she has received the money, and then will receive a notice that her benefits will be terminated.  Instead, Courtney’s attorney creates a special needs trust for Courtney, naming her mother as the trustee.  Courtney transfers the $25,000 to the trust without any disqualification for public benefits.  Later, Courtney decides she wants to buy a car with the settlement proceeds.  The car is bought and paid for by the special needs trust; the funds to buy the car come directly from the special needs trust, not Courtney.  Courtney gets her car and continues to receive Medicaid and SSI.

It is important to remember that Medicaid and SSI are just a couple examples of means tested/needs-based public benefits that could be affected by receipt of personal injury settlement funds.  This all serves to highlight the risk of going it alone following an accident or injury, as well as the need to hire a skilled attorney.  To be sure, when the insurance adjuster is pressuring you to settle your claim, the insurance company is not going to care whether the settlement will cause you to lose your public benefits.

 

What Do I Do Now That I Have Been in a Motor Vehicle Accident?

What Do I Do Now That I Have Been in a Motor Vehicle Accident?

When you head out on the road, a motor vehicle accident is the last thing you want to happen. However, if you fall victim to a motor vehicle accident on account of another driver’s negligence, you do not want to do anything to jeopardize receiving full compensation for your injuries and damages.

The first thing you want to do is address the immediate medical needs of yourself and others. If you, a friend or family member are able, get the names and contact information from potential witnesses and take photographs of the scene and vehicle damage. Responding officers will likely want statements. Following the incident, be sure to contact the responding agency and request copies of all reports, 911 calls, dash cam video, body cam video, photographs, statements and any other evidence that may have been gathered from the scene of the accident. Depending on the location, street camera surveillance may be available as well. Some of this evidence, especially body cam video, may be discarded shortly after the accident. Therefore, it is critical you request this information promptly. In reviewing the reports and your statement, if you believe there are errors or omissions, bring this to the attention of the responsible agency as soon as possible.

Contacting your insurance company promptly is important as well. Immediately review your most recent insurance declarations. If you have what is referred to as underinsured or uninsured motor vehicle coverage (UIM/UM), your insurance company may provide coverage for injuries and damages you sustained as part of the accident if the negligent party has insufficient insurance coverage or no coverage at all. Your insurance company will also need to be notified to address the property damage to your motor vehicle.

You will also most likely be contacted soon after the collision by the other driver’s insurer. His or her company will likely want to abruptly resolve matters with you for an amount that may be far less than the true value of your loss. If your accident occurred in the State of Wisconsin, you have 3 years from the date of the accident to bring a lawsuit. Therefore, there is no immediate need to settle your claim within days or weeks of the accident. What may seem like an expected ache or pain that you feel will go away in days or weeks, could be a far more serious (even permanent) soft tissue injury. Waiting to more fully assess the extent of your injuries and damages is vital to being fully compensated.

The other driver’s insurance company will also likely want you to give a statement that is recorded. This insurance company does not represent you and does not have your best interests in mind. This statement could be used against you later. You have no obligation to give a statement to the other driver’s insurer. If you do give a statement, you are entitled to a copy of the statement and we recommend securing one as soon as possible.

If you are involved in a motor vehicle collision, the attorneys at Anderson O’Brien are here to help. We have decades of experience representing those injured in motor vehicle accidents to ensure that they are protected. We are only a call away.

 

Children Moving Out?  Make Sure They are Still Insured

Children Moving Out? Make Sure They are Still Insured

Often families with teenage drivers living at home do not have those teenage drivers listed as named insureds on the auto insurance policy.  Frequently, Mom and Dad are the named insureds on the insurance policy and all the vehicles are listed, and the teenagers qualify for coverage by virtue of being related to Mom and Dad and living in their home.  This type of familial relationship coverage for the teenage drivers usually has a special term of art in the insurance policy, such as “resident relative,” “member of same household” or “resident of your household.”

While each insurance company defines their terms differently, generally speaking, this type of familial coverage means that drivers who are living with their parents qualify for insurance coverage even though they are not the “named insureds” on the auto insurance policy.  This type of coverage is usually defined as a person related by blood (or adoption) to the named insured and living with the named insured; some insurers may limit this category to minor children only, but others may include adult children as well.

The reason this topic is being raised, is that sole reliance on resident relative coverage can create potential problems when that child moves away from home (goes to college or armed forces) or splits time between two homes (divorced parents).  Hopefully, a hypothetical will illustrate.

Billy is a hypothetical 18-year-old high school senior living with Mom and Dad.  The family has a hypothetical auto insurance policy that lists Mom and Dad as the named insureds and covers both of the family vehicles.  While Billy is not a named insured on the policy, by virtue of being related by blood to Mom and Dad and living in the same household with them, he qualifies as a resident relative insured, even as an 18-year-old.

Billy graduates from high school and goes off to college in another city; he is no longer living with Mom and Dad, nor is he listed as a named insured under any other auto insurance policy.  While at college, Billy gets injured in a terrible auto wreck while riding in a friend’s car.  Unfortunately, the at‑fault driver does not have sufficient insurance (or worse, no insurance at all) to cover Billy’s extensive injuries and damages.  However, Billy and his parents think that Billy should have underinsured motorist coverage available to him under Mom and Dad’s auto policy.

The problem is, Billy may no longer qualify as an insured under Mom and Dad’s auto policy.  Billy was never a named insured, the crash did not involve Mom and Dad’s cars, and Billy may no longer qualify as a resident relative.  Because Billy was not living with Mom and Dad at the time of the car crash, he may not qualify as a resident relative anymore.  Whether Billy qualifies for coverage under Mom and Dad’s policy will depend on the policy’s definition of resident relative and Billy’s precise living situation at the time of the wreck.  Had Billy completely moved out or did he leave his furniture and personal belongings at home?  Where was he getting his mail, or what was his voting address?  Regardless of the facts, by virtue of no longer living under the same roof with Mom and Dad at the time of the wreck, the insurance company will likely argue that Billy does not qualify as an insured.

You and your family, can avoid being left in this limbo by making sure your children who are leaving and not getting their own auto insurance are specifically listed as named insureds on your auto policies.  That way, if they are injured in a car wreck, they can have the benefits and protection of the uninsured and underinsured (if underinsured was purchased, and it should be purchased) coverage.

 

Who Pays Medical Bills Before a Settlement?

Who Pays Medical Bills Before a Settlement?

If you are involved in a motor vehicle accident, you probably have many questions, including questions about how your medical bills will be paid. If you were injured in a motor vehicle accident due to the negligence of another person, you may recover your medical bills through a lawsuit. However, it may be months or even years before you receive a settlement or judgment from the negligent driver and his or her insurance company. In the meantime, you need to ensure that your medical bills are covered. How those bills are paid will ultimately affect your recovery.

The first place you will want to look for insurance coverage for medical bills is your own automobile policy. Many drivers are unaware that their automobile policy may carry a certain amount of coverage for medical bills arising from an automobile accident. This amount is usually minimal, but every bit helps. If you reach a settlement with the negligent driver’s insurer, your automobile insurer generally is not entitled to be refunded for the medical bills it paid unless and until you are made whole by the settlement – meaning that you are fully compensated for all elements of damage. In most cases, a negotiated reduction is reached to avoid a separate mini-trial on this issue.

The next place you will want to look for medical coverage is your own health insurance. If you have health insurance through an employer-sponsored plan that is fully-funded by the employer, you may have to pay that health plan back all of the amount it paid for your medical bills regardless of whether you are made whole. These plans, referred to as self-funded ERISA plans, are governed by federal law, which preempts state law concepts such as the made whole doctrine. Some of these plans, however, are insured by a third party. An experienced lawyer will know to research the plan to determine whether it is insured or self-funded and whether arguments can be made in an effort to reduce the amount you are required to refund the plan from your settlement.

Finally, if you are insured through Medicare, the federal government has established a specific formula to calculate the amount that must be refunded. That formula is based on the amount of the settlement or judgment and the amount of legal fees and costs associated with achieving it.

Before resolving any case, it is always important to know what your payback obligations are to third parties that paid for medical bills related to the accident. Having an experienced lawyer involved gives you the benefit of determining what these payback obligations are and how to negotiate reductions where possible to account for the time and effort you and your counsel spent to recover from the negligent party.

 

Steps to Preserve Your Claim in a Premises Liability Case

Steps to Preserve Your Claim in a Premises Liability Case

Anderson O’Brien handles many claims involving individuals who injure themselves after falling or tripping due to ice or some other unsafe condition or obstacle. These types of cases are called premises liability cases. They occur frequently, especially during Wisconsin’s difficult winters involving ice and snow. March is a particularly hazardous month with all of the freezing and thawing that takes place, resulting in the accumulation of ice. Many of these incidents result in very serious injuries requiring surgery, necessitating the insertion of plates and screws into someone’s ankle, leg or hip. These cases can be difficult to prove, as it is necessary to establish that the property owner was negligent and/or, in some cases, that they violated Wisconsin’s Safe Place Statute.

However, while serious injuries may result from a slip and fall, it can be difficult to preserve the very evidence you need to prove your case. Several steps must be taken to effectively preserve your evidence and to pursue your claims. The following consists of some of the steps that are important for you to take if you intend to pursue a premises liability claim.

1. Provide Notice of the Incident Immediately.
Proper documentation in premises liability cases is crucial. Providing notice immediately to the owner or manager of the property is something that absolutely must be done in order to pursue your claim. The purpose of immediate notice is that it puts the owner or manager of the property on notice so that it provides credibility to your claim that the trip and fall actually occurred at the time and location you said it did. The restaurant, store, gas station, or manager of the facility where you fell also should generate a written incident report which can later be used to prove your claim. Additionally, providing immediate notice to the owner or manager on site will cause that person to investigate and to observe for themselves if there are, in fact, icy conditions or other dangerous conditions which exist, and they can be a witness that you can use to establish your claim. It also provides the manager with notice that they should take measures to render the premises safer, such as placing salt on the ice upon which you fell, and that can also be used as evidence against the property owner.

2. Take as Many Photographs as You Can.
Documenting the scene of the incident through photographs is invaluable and can literally make or break your case. The condition of what you tripped or fell on can change almost instantly. (For example, water or liquids can be cleaned up by the property owner; ice and snow conditions on a sidewalk or inside a building can melt. Other unsafe conditions can be fixed and repaired within a short period after the incident.) Therefore, if you do not take photographs to establish the condition at the time you fell, it may be very difficult to give an accurate verbal description to the insurance company or to a jury of what it is you fell on, what time you fell, and where you fell. Certainly, you may not be able to think about taking photographs at the time that you sustained a serious injury. However, you need to do whatever you can to take pictures. If you need to, ask someone else to take pictures with your phone immediately or have a friend or relative go back to the location as soon as they can after you fall. Photographs are the single most critical piece of evidence in many slip and fall claims.

3. If Possible, Obtain Information About Other Witnesses.
In many slip and fall cases, if you do not have direct video surveillance saved by the business where the incident took place, the claim may essentially boil down to “he said, she said” evidence. The insurance company may argue that you did not even fall on the date or time that you said you did. If you obtain the contact information of all witnesses who observed the incident or saw you lying on the ground after you were injured, this will give greater credibility to your claim. You will also then have contact information for these witnesses who can testify as to the conditions where you fell at that exact moment.

4. Seek Medical Treatment if Necessary.
If you are injured in a slip and fall incident and you need medical care, you should do so immediately and go to the emergency room rather than waiting for an appointment with your doctor several days later. The significance of this is twofold. First, the doctors can examine you and take x-rays to get you the proper care you need immediately to get you on the road to recovery. You should follow all of your doctor’s advice and show up to all of your appointments. Secondly, the fact that you slipped and fell will be reported in your medical records and if you go to the emergency room, this will help establish the date, time, and location of when this incident actually occurred. Be specific with your doctors about the details surrounding this injury. When you pursue a claim against the insurance company and have to testify, sometimes several years later after the fall, the documentation in your medical records will prove invaluable in establishing your claims.

5. Contact an Attorney.
It is important to contact an attorney right away if you intend to pursue a potential premises liability claim. There are important time limits and notice provisions under the law that must be satisfied in order to pursue a claim against property owners or insurance companies. The legal requirements of notice will differ based upon where you fell (i.e., for a government entity, you must give notice of the injury within 120 days). Evidence must be preserved, investigations and contact with witnesses must be made. Anderson O’Brien has the experience and expertise to handle these types of cases. We take the burden off of you to develop your case from the very beginning. We offer free initial consultations to evaluate potential premises liability claims.

Following the above steps in a premises liability claim, or any personal injury claim, will greatly assist your attorney in representing you to obtain the best results possible.

 

Governmental Immunity and the Known Danger Exception

Governmental Immunity and the Known Danger Exception

The governmental immunity statute grants immunity to governments and their officers from certain lawsuits related to intentional wrongful and discretionary acts. Governmental immunity laws trace their origins back to British common law and the idea that the King could do no wrong. Section 893.80 of the Wisconsin Statutes sets forth the general principles of governmental immunity in Wisconsin, including notice requirements, immunity for intentional and discretionary acts, and limits on damages. This article briefly describes governmental immunity and discusses a recent Wisconsin Supreme Court case that applies one of the exceptions to governmental immunity.

Wisconsin courts have described the purpose of the governmental immunity statute in the following terms: “the purpose of immunity provisions is to ensure that courts are not called upon to pass judgment on policy decisions made by members of coordinate branches of government in the context of tort actions, because such actions furnish an inadequate crucible for testing the merits of social, political, or economic decisions.”[1] More simply put, governmental immunity is embodied in the doctrine of separation of powers which divides government responsibilities into distinct branches to limit any one branch from exercising the core functions of another.

There are four narrow exceptions to governmental immunity that have been established in Wisconsin case law. These exceptions allow units of government, or their officers or employees, to be held liable for an action or inaction undertaken in the scope of employment. The exceptions are intended to balance “the need of public officers to perform their functions freely [and] the right of an aggrieved party to seek redress.”

One these exemptions is referred to as the “known danger” exception. It applies in situations in which dangerous circumstances give rise to a ministerial duty to act. Meaning there is no governmental immunity for negligently responding to known dangers that create absolute, certain, and imperative duties.

In January 2019, the Wisconsin Supreme Court reviewed a tragic case where a young girl drowned at a summer camp while under the supervision of the City of New Berlin. The young girl’s parents filed the lawsuit claiming that New Berlin’s camp staff were negligent because the girl did not receive a swim test and was allowed to enter the pool anyway. Specifically, the girl’s parents alerted camp staff to the fact that the girl could not swim, and the camp staff told them that all campers would be provided with a swim test and limited to appropriate areas of the aquatic area accordingly. The camp staff did not provide a swim test and allowed the girl to enter the pool rather than restricting the girl to the splash pad area. New Berlin argued that governmental immunity barred the lawsuit. The Wisconsin Supreme Court determined that New Berlin was not entitled to immunity because the “known danger” exception applied. Writing for the Court, Justice Shirley Abrahamson explained that “the danger to which [the young girl] was exposed at the Aquatic Center as an eight-year-old non-swimmer was compelling and self-evident.”

Despite their best efforts to serve and protect the public, at times, some governmental entities have been proven to be negligent in their duties. If you believe you have a claim against a governmental entity, you must act quickly. Wisconsin requires that the governmental entity being sued be provided with notice of the claim or injury within 120 days after the happening of the event giving rise to the claim.[2] The purpose of this notice is to afford governmental authorities an opportunity to investigate a claim promptly.[3] If you are considering making a claim against a governmental entity or one of its officers, you should contact an attorney right away.

[1] Kara B. v. Dane Cnty., 198 Wis. 2d 24, 55 , 542 N.W.2d 777 (Ct. App. 1995) , aff’d, 205 Wis. 2d 140 , 555 N.W.2d 630 (1996) (quoting Gordon v. Milwaukee Cnty., 125 Wis. 2d 62, 66 , 370 N.W.2d 803 (Ct. App. 1985)

[2] Wis. Stat. § 893.80(1d)(a).

[3] Elkhorn Area Sch. Dist. v. East Troy Cmty. Sch. Dist., 110 Wis. 2d 1, 327 N.W.2d 206 (Ct. App. 1982).

 

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