A. You are correct that hiding assets - whether in an effort to avoid paying income tax or in an effort to get Medicaid - is illegal and unethical.  And people who do this - including elders such as the 83-year old man you mention above, should get what's coming to them legally.  However, there is a HUGE difference between hiding assets, which is clearly against the law, and legally protecting your assets using legitimate legal and ethical asset protection strategies.  Just as there are hundreds of legal ways to minimize your income taxes and maximize your income tax deductions, there are dozens of legal and ethical Medicaid asset protection strategies that Elder Law attorneys such as myself help people employ every day.

The USA Today story you mentioned involves an 83-year-old Florida man, Bernard Kramer, who pleaded guilty to hiding at least $1.1 million from the IRS in Swiss and Israeli bank accounts, and evading U.S. taxes for more than 25 years. According to the article, Kramer pleaded guilty to conspiracy and agreed to cooperate with government investigators and pay a civil penalty of $588,042 along with past due taxes. He potentially faces a maximum eight-year prison term at a Manhattan federal court sentencing set for Feb. 6, 2015. Kramer is the latest of dozens of wealthy Americans prosecuted for allegedly avoiding taxes on income held in accounts overseas. The crackdown is in large part due to the introduction of Foreign Account Tax Compliance Act (FATCA), which requires foreign banks to disclose American accounts holding over $50,000.

"Hiding" Assets vs. Medicaid Asset Protection

Millions of people are enrolled in Medicaid and use it to cover the cost of long-term care. However, the program is also the victim of fraud. According to the Virginia Attorney General's Office, as much as 10% of all health-care expenses are the result of fraudulent claims.

Some seniors do attempt to "hide assets" to qualify for Medicaid; but this is absolutely illegal and can result in criminal and civil fraud charges being brought against the seniors and anyone who assists the senior in this type of illegal behavior.

Those who attempt to "hide" assets to become eligible for Medicaid should heed this wise advice quoted from Forbes: "Asset protection should only be done by a professional who is skilled in the area, and those who rely on financial planners or other non-attorneys for asset protection planning are likely to be sadly disappointed."

Ethical Medicaid Planning

As you can see, "hiding assets" in order to qualify for Medicaid is illegal criminal behavior. However, it is extremely prudent to legally protect your assets in an effort to qualify for Medicaid nursing home benefits when needed.

Using an experience Elder Law attorney to help you do  Medicaid planning is not about "hiding" assets or "cheating" or "gaming" the system; it is about preserving a client's dignity and self-worth in the face of our unfair and arbitrary American health insurance system.

Our Discriminatory Health Insurance System

Our American health insurance system essentially discriminates against people suffering from certain types of chronic illnesses, i.e., chronic illnesses that routinely result in the need for long-term "custodial" care, such as: Alzheimer's disease and other types of dementias; Parkinson's disease and other types of degenerative disorders of the central nervous system; Huntington's disease, ALS (big in the news these days because of the "ice-bucket challenge") and other progressive neurodegenerative disorders; and many genetic disorders such as Multiple Sclerosis, Muscular Dystrophy, and Cystic Fibrosis.  So Americans suffering the misfortune of one of these horrible diseases must also suffer the misfortune of having the "wrong" disease according to our American health insurance system.  Is it an ethical social policy that arbitrarily distinguishes among these different types of illnesses?  Is it an ethical social policy that provides full coverage for most illnesses - whether chronic or acute - but forces Americans with certain chronic conditions (many of them elders) to become impoverished in order to gain access to the long-term care necessitated by their particular type of chronic illness?  Is it any surprise that clients suffering the "wrong type" of chronic illness look for legal ways to preserve the efforts of their lifetime in order to protect themselves and their families from having to go broke under this unfair and arbitrary social policy?

The answer is no, and in fact Congress accepts the realities of Ethical Medicaid Planning through: laws that partially protect spouses of nursing home residents; laws that allow Medicaid Asset Protection via the purchase of Long-Term Care Insurance "Partnership Policies": laws that allow the exemption of certain types of assets; and a myriad of other laws that, when properly understood and navigated with the help of an experienced Elder Law attorney, permit individuals to qualify for Medicaid while still protecting significant assets from the devastating expenses of long-term care.

For more details, please read about Ethical Medicaid Planning on our Website.

If you or a loved one become a client of the Farr Law Firm, you may rest assured that everything that we do is absolutely, unquestionably, 100% legal and ethical. Don't ever hide your assets and don't make the mistake of attempting to "protect" your assets on your own. Make the wise choice and call the Fairfax and Fredericksburg Medicaid Asset Protection Law Firm of Evan H. Farr, P.C. at 703-691-1888 in Fairfax or 540-479-1435 in Fredericksburg to make an appointment for a no-cost introductory consultation.

Dear Commander Bun Bun,

My husband recently turned 65 and received his Medicare card. I noticed that the ID number on the card is the same as his Social Security number (SSN). My husband can be quite forgetful and scatter-brained at times. My son told me that once at the gym he left his wallet in a locker and didn't even lock it up. Is there a way to request a card without his SSN? How can he protect himself from identify theft if his wallet and Medicare card got stolen?

Thanks,

Betty B. Kafful

-----

Dear Betty,

Many people are surprised to learn that the ID number on their Medicare card is actually their SSN. The reason for this is that the card is more than an identifier--it is also a health insurance card that needs to be used at doctor's offices and hospitals for Medicare to pay for services.

Throughout our lives, we're warned not to carry our SSN around with us, because if it gets lost or stolen, the result could be identity theft. This is why, for years, consumer advocates have called for a new form of Medicare identification.

The Centers for Medicare & Medicaid Services (CMS), which administers Medicare, also acknowledges the problem, but will not make the change because it would cost the federal government an estimated $255 to $317 million to fix it.

Other government health systems, like the Department of Veterans Affairs and Department of Defense, have already begun using ID numbers that are different from SSNs, but no one knows when Medicare will follow suit.

Since change doesn't seem to be in the "cards" anytime soon, below are some tips to protect your Medicare card:

• AARP suggests that you simply don't carry your Medicare card at all, because most healthcare providers already have their patients in their electronic systems and know how to bill you. You will, however, need your actual Medicare card with you the first time you visit a new health care provider, who will likely want to make a photocopy of it for their files.
• The Privacy Rights Clearing House, a national consumer resource on identity theft, recommends that you make a photocopy of your card and cut it down to wallet size and cut out the last four digits of your SSN, or take a black marker and cross them out, and carry that instead.
• It is a good practice to check your quarterly Medicare summary notices, and report any services or supplies you did not receive. If you spot anything suspicious or wrong, call the Inspector General's fraud hotline at 800-447-8477.

If your husband's Medicare card does happen to get lost or stolen, he can replace it by calling Social Security at 800-772-1213. He can also apply for a new card online at ssa.gov/medicarecard or go to your local Social Security office.

If you need help identifying Medicare fraud, see this helpful online resource from CMS.

Hop this is helpful,