Source: http://marshallelder.blogspot.com/2016_07_01_archive.html
Timestamp: 2017-04-28 00:28:29
Document Index: 760916716

Matched Legal Cases: ['§ 1396', '§ 1396', '§ 316', '§ 327', '§ 5603', '§ 5602', '§ 5602', '§ 5602', '§ 5454']

Marshall Elder and Estate Planning Blog: July 2016
Pennsylvania has about 80,000 nursing home residents. Their care
is provided by approximately 700 long term care facilities. These residents are among our most
vulnerable citizens. They are reliant on the protections provided by government regulation and inspections
of the facilities. Most nursing homes are regulated by both federal and state
agencies. In Pennsylvania, the Department of Health (DoH) serves as the “state
survey agency” for the federal government to assess whether the homes meet the
federal standards. DoH is thus responsible for overseeing and inspecting nursing
homes to ensure that the facilities are meeting federal and state standards and complaints are investigated and
resolved. Last year the Pennsylvania Attorney General’s office filed a
lawsuit against a nursing home chain alleging in part that due to
under-staffing the 25 facility chain had failed to meet the basic needs of its residents.
One result of that still pending lawsuit
was a request from the Secretary of Health that the Pennsylvania Auditor General
conduct an audit of DoH performance. That audit
report has now been released to the public. The audit covered the period
January 1, 2014, through October 31, 2015.
As noted in its Executive summary, the performance audit
presents 13 findings, which are focused on three issue areas 1) resident quality
of life/care, 2) complaint processing, and 3) sanctions. It also addresses the status
of prior audit recommendations from audits conducted in the late 1990s and
The report offers 23 recommendations to improve how the DoH regulates
Pennsylvania’s nursing homes. These results were discussed with DoH
representatives and its response is included.
The report notes weak enforcement
of staffing requirements as a key problem. Pennsylvania regulations governing
nursing homes require that nursing homes provide at least 2.7 hours of direct
nursing care, per resident, per day. The Auditor General found that DoH lacked
the requisite policies and procedures to guide its staff to ensure that nursing
homes met this regulatory requirement.
In his cover letter to Governor Tom
Wolf, Auditor General Eugene DePasquale explains that: Owing to this lack of
procedural standardization, when we reviewed a selection of DoH completed
nursing home staffing-level reviews, we found practices varied among field
offices. For example, data was
frequently self-reported by the facility with little to no supporting documentation obtained to verify the claimed
figures. Of greater concern, we found
instances where nursing homes failed to meet the state’s minimum standard, yet
because DoH used an informal practice of averaging time over a week, the
deficiency was not cited. Additionally,
we found that despite DoH possessing regulatory authority, which allows it to
order an increase to a nursing home’s nurse-staffing levels, DoH has never used
Our research also indicated
that the state’s minimum standard of 2.7 hours of direct nursing care, per
resident, per day, might be too low. Pennsylvania set this threshold in 1999,
and given the evolution of clinical services provided by nursing homes, this
requirement may need to be revised. DoH has acknowledged the issues and findings presented in the
performance audit, and management will be starting a corrective action plan to
implement the report's recommendations.
Further Reading: Auditor
criticizes Pennsylvania nursing home oversight on staffing, complaints &
Medicaid Income Allowance Increase for Spouses of Nursing Home Residents When a nursing home resident is receiving Medicaid long-term
care benefits, most of their income must be paid to the nursing home each month
and applied to the cost of their care. This is sometimes referred to as the
resident's "patient pay liability." But, if the nursing home resident is married, this patient
pay liability may be impacted by community spouse income protections found in
federal and state law. The non-institutionalized "community spouse" is entitled to retain a certain minimum
level of income called the Monthly Maintenance Needs Allowance (MMNA). If the
community spouse's own income is insufficient to provide this allowance, income
can be diverted to the community spouse from the institutionalized spouse. The MMNA is set at 150% of the federal poverty level for a family of two plus
an excess shelter allowance, if applicable. The Pennsylvania MMNA is adjusted
on July 1st of each year to keep up with inflation adjustments to the poverty
In January 2016 the Department of Health and Human Services announced that the
2016 federal poverty guideline for a family of two is $16,020. (It’s higher if you
live in Hawaii or Alaska). This means that effective July 1, 2016 Pennsylvania
is required to increase the community spouse minimum MMNA to $2,002.50 per
month ($24,030/12=$2,002.50). See, 2016
SSI and Spousal Impoverishment Standards.
Pennsylvania usually “rounds
up” amounts under one dollar which makes the allowance $2,003 per month. This figure
has been confirmed by PA Department of Human Services in Policy
Clarification PMN-18024-468.
A standard monthly
shelter allowance is built into the minimum MMNA. The actual MMNA allowance can
be higher than the minimum if the community spouse has high housing cost and is
entitled to an “excess shelter allowance.” The MMNA can also be increased in situations where the
community spouse can show “exceptional circumstances resulting in significant
financial duress.” 42
U.S.C. § 1396r-5(d)(2)(B). Several Pennsylvania appellate court cases have
dealt with the issue of whether a community spouse has such exceptional
circumstances. See Davis
v. DPW (776 A.2nd 1026 (Pa.Cmwlth. 2001) and Kuznick
v. DPW (5A.3d 832) (Pa.Cmwlth. 2010). The MMNA can also be increased by judicial court-ordered
support under 42
U.S.C. § 1396r-5(d)(5). An increase in the MMNA via judicial order does not
require a showing of “exceptional circumstances resulting in significant
financial duress.” The minimum income allowance rules are part of the federally
mandated “spousal impoverishment” protections that were enacted in 1988 to
limit the potential for impoverishment of spouses of nursing home
residents. Understanding the spousal protections is critical to
preserving your financial security if your husband or wife needs expensive long term
care. It may be necessary to combine the spousal protections with other
planning options to achieve the best results. Contact an experienced elder law
attorney for assistance. If you reside in Pennsylvania, you can contact Marshall, Parker and Weber
(1-800-401-4552) for more information. Posted by
Pennsylvania Hosting National Adult Protective Services Conference Pennsylvania is hosting this year’s Annual National
31 at the Loews Hotel in Philadelphia.The theme is “Protect, Prevent, Empower.” The conference will
feature many of the nation’s leading adult protective services professionals who will share their ideas, expertise and creative approaches. This national
conference comes at a time when elder abuse and elder justice has been the subject of growing
attention in the Commonwealth. In 2014, a 38-member Task Force convened by the PA Supreme
Court issued a 284-page report with 130 recommendations to enhance the way
Pennsylvania elders interact with the state court system and are protected in
cases involving abuse, neglect, guardianship and other
matters. That report is available here. The Task Force report has spurred local attempts to improve and better coordinate efforts to curb elder abuse. The upcoming NAPSA conference details, including the
conference brochure and registration information are available here: http://www.napsa-now.org/about-napsa/annual-conference. Posted by
PA Changes Law on Powers of Attorney and Other Probate Code Matters
On July 8, 2016 the Governor signed Senate
Bill 1104 (SB 1104) into law as Act 79. SB 1104 makes broad ranging
amendments to Title 20 (Decedents, Estates and Fiduciaries) of the Pennsylvania
Consolidated Statutes. Included are a number of changes to Pennsylvania laws
regarding powers of attorney. It is likely that another bill dealing with powers of
attorney will also be enacted in the near future. House
Bill 665 (HB 665) deals mainly with commercial powers of attorney and also addresses
the subject of acknowledgments by lawyers. [Update: On September 26, 2016 HB 665 was approved by the Legislature and sent to the Governor for signature].
Among the changes the two bills:  Make modifications regarding the authority of an agent
under a power of attorney to make gifts and to disclaim interest in property;  Move some provisions related to health care powers from
Chapter 56 to Chapter 54;
 Clarify the relationship between agent and guardian and
mandate that guardianship determinations address the extent to which an agent’s
authority remains in effect;  Exempt commercial powers of attorney from certain requirements
(HB 665);
 Address the subject of notarization of a power of attorney
based on a lawyer’s acknowledgment (HB 665);
 Add Chapter 76 (Powers of Appointment) to the Probate Code
and repeal the current provisions relating to powers of appointment;  Provide direction as to which procedures are to be used in
determining title to a decedent’s real estate interests;  Stipulate that by accepting appointment by the register of
wills, the personal representative submits to the jurisdiction of the Orphans’
Court of the county where letters testamentary or letters of administration are
granted relating to the personal representative’s duties;  Expand the provision on continuation of a business to
include partnerships, limited liability companies or other entities and provide
for the compensation of a personal representative managing, supervising or
engaging in the operation of the entity or business;  Amend the Uniform Trust Act, Chapter 77 of the Probate
Code, as it deals with representation of parties in interest relative to a
judicial proceeding involving a trust matter; non-judicial resolution of a
trust matter; certification of representation; division of trusts with court
approval; resignation of a trustee; the duty to inform and report thereby
allowing a current beneficiary to nominate a person to received required
notices; and limitations of actions against a trustee; and,  Codify the Charitable Instruments Act of 1971 as Chapter
79 in the Probate Code and repeal Act 23 of 1971, known as the Charitable
Instruments Act of 1971.
SB 1104 is based in large part on a Joint State Government
Commission (JSGC) report issued on June 10, 2010 entitled “The
Probate, Estates and Fiduciaries Code: Proposed Amendments to Title 20 of the
Pennsylvania Consolidated Statutes.” The JSGC report contains the advisory
committee’s official comments explaining some of the amendments contained in SB
1104. These comments may be used in determining legislative intent. The above JSGC report did not address SB 1104’s changes to
Chapters 54 and 56 regarding powers of attorney. [The JSGC made recommendations
regarding powers of attorneys in another report issued prior to the enactment
of Act 95 in 2014: See: Powers
of Attorney: Proposed Amendments to the Probate, Estates and Fiduciaries Code
(March 2010).] Many of the recent changes to Pennsylvania law on powers of
attorney are based on the Uniform
Power of Attorney Act which, along with its comments, may also be of
interpretive assistance. The power of attorney amendments in SB
1104, along with the changes in HB
665 regarding acknowledgment and exemption of commercial powers of attorney,
can be viewed as technical corrections and clarifications to Act 95. Many
substantive power of attorney changes requested by interest groups were
deferred to future legislation. This brief overview is focused on the power of attorney (POA)
changes to Chapters 54 and 56 that will result from the enactment of SB 1104
and HB 665. The reader is referred to the JSGC report for more detail on the
changes that emanated from it (with the understanding that JSGC recommended
provisions may have been modified during the legislative process). Chapter
Chapter 54 deals with advance health care directives
including health care powers of attorney. After Act 95, some provisions related
to health care still remained in Chapter 56 which deals mainly with financial
issues. SB 1104 cleans this up by moving those health care related provisions
from Chapter 56 to Chapter 54. Perhaps more significantly, it modifies the law
regarding the relationship between a guardian and a health care agent. Section 5422
(Definitions) Section
5422 is amended to move the following definitions to Chapter 54: (4) Admission to a
medical, nursing, residential or similar facility, or entering into agreements
for the individual's care.
(5) Making anatomical
gifts, or after the death of the individual, disposing of the remains or
consenting to autopsies.
Section 5454(d) is amended to provide that a guardian may
revoke a health care power of attorney only if authorized by the court. This
provides consistency with the change made to Section 5460(a) as discussed
below. Previously the law allowed a guardian to terminate a health care power
of attorney without any court authorization. Section 5456(a)
Authority of health care agent.
This amendment makes it clear that a health care agent’s
authority will normally include the power to authorize admission to a medical,
nursing, residential or similar facility, or to enter into agreements for the
principal's care. (These are the powers that have been moved from Chapter 56 to
Chapter 54). Section 5460(a)
Section 5460(a) is amended to mandate that in issuing a guardianship
order a court shall determine the extent to which any health care agent's
authority to act remains in effect. A provision in prior law that authorized a
guardian to revoke or amend a health care power of attorney has been deleted. [Jeff’s comment: Where
appropriate a guardianship order should probably also address the authority of
any representative appointed in a living will – Section 5447 refers to such representatives
as health care agents. The amended section 5460(a) does not directly address
situations where a health care representative has been designated by the
principal under Section 5461 or where a default health care representative has been
acting under that section.]
Chapter 56 of Title 20 deals with powers of attorney other
than advance health care directives. Chapter
56 is changed by both bills. Section 5601(b)(3). Execution
Section 5601(b)(3) of Title 20 is amended by both SB 1104
and HB 665.
The bills amend Section 5601(b)(3) to provide that a person
who is signing a POA for a principal on behalf of and at the direction of the
principal can no longer sign by mark. HB 665 attempts to clarify the law regarding situations
where a lawyer is the individual taking the acknowledgment of a POA. It
addresses a perceived conflict between Chapter 56 and the notary law. The HB
665 amendment states that an attorney taking an acknowledgment of a POA does
not have to be a subscribing witness to the document. To the contrary, the
lawyer taking the acknowledgment may not then also act as one of the two
required witnesses. The notary law contains a short form (57 PA.C.S. § 316(2.1))
for certification that could be read to imply that the lawyer who takes the
acknowledgment must also be a subscribing witness to the document. HB 665
negates that implication and clarifies that the lawyer may acknowledge the POA
document even though the lawyer is not one of the subscribing witnesses. In
addition to the change in Section 5601(b)(3) HB 665 makes a conforming change
to the short form in Section 316(2.1) of
Title 57 which deletes the reference to the lawyer being a subscribing
witness. [Jeff’s
comment. The principal’s signature must be
acknowledged before a notary public or other individual authorized by law to
Section 5601(b)(3)(i). An acknowledgment
may be taken by a lawyer who is a member of the bar of the Supreme Court of
Pennsylvania if the document is thereafter certified to an officer authorized
to administer oaths. (See 42 PA.C.S. § 327(A)).
signature must also be witnessed by two individuals. Section 5601(b)(3)(ii) provides
that a witness shall not be the notary public or other person authorized by law
to take acknowledgments before whom the power of attorney is acknowledged. The lawyer may not
serve in the dual role of taking the acknowledgment and serving as a witness. If
a notary is not available, the lawyer may take the acknowledgment (and then
later certify), but may not also be one of the two required witnesses. Two other
witnesses are required. This prohibition
may be inconvenient for lawyers. Prior to Act 95 lawyers would sometimes both
witness and acknowledge the principal’s signature (and have the document
notarized at a later time). This was particularly helpful for lawyers in solo
practice and where the POA was signed as part of a home or nursing home visit.
It reduced the number of people who needed to be involved. But the law opts for
protection of the principal over convenience for the lawyer. If the notary is
not present and the lawyer is taking the acknowledgment, there must be two
other qualified witnesses. To qualify a
witness must be (1) 18 years of age or older, (2) not be the individual who
signed the power of attorney on behalf of and at the direction of the principal,
(3) not be the agent designated in the power of attorney; (4) not be the notary
public or other person authorized by law to take acknowledgments before whom
the power of attorney is acknowledged. Note that it appears that in many
situations a spouse or child of the principal could be qualified to serve as a
witness. Query: must the witnesses be present when the principal signs the
POA? Section 5601(e). Limitations on Applicability Generally Section 5601(e.1) exempts certain business oriented power of
attorneys from the formalities required by Section 5601 subsections (b)(3), (c)
and (d) and section 5601.3 (relating to agent's duties). This means that the
POA requirements regarding execution, notice, and acknowledgment, and the
provisions specifying an agent’s duties do not apply. Section 5601(e.1.1) of HB 665 clarifies and expands the
exemption. Section 5601(e.2) of HB 665 restates the exemption of health
care and mental health care powers of attorney from the requirements of subsections
(b)(3)(i), (c) and (d) and section 5601.3. The clarification and expansion of the Section 5601(e)
exemptions apply retroactively to January 1, 2015. Section
5601.4 (c), (d) and (e). Gifts Section 5601.4 deals with the grant of powers that require a
specific grant of authority. These
are sometimes referred to as “hot powers.” This key section of the law (for
elder law attorneys) sets out the limitations regarding an agent’s authority to
make gifts. Section 5601.4 (a) sets out the general rule:
(a) General rule.--An agent under a power of attorney may do the following on
behalf of the principal or with the principal's property only if the power of
attorney expressly grants the agent the authority and exercise of the authority
is not otherwise prohibited by another agreement or instrument to which the
authority or property is subject: . . .
Under Act 95, Section
5601.4(d) was one sentence which read: (d) Gifts.--Unless the power of attorney
otherwise provides, a grant of authority to make a gift is subject to section
5603(a.1) (relating to implementation of power of attorney).
SB 1104 creates a much expanded Section 5601.4(d). Under SB
1104 section 5601.4(d) now applies clearly to both limited and unlimited gifts.
The amendment also adds clarifying language regarding disclaimers. SB 1104 moves the provisions relating to limited gifts
from Sections 5602 and 5603(a) to new section 5601.4(d)(1). Section
5601.4(d)(1) states that unless the power of attorney otherwise provides the power
to make limited gifts or other language in a power of attorney granting general
authority with respect to gifts authorizes the agent only to act in accordance
with the limits set out by the section. Those limitations are tied to the
annual gift tax exclusion amount per donee. Section 5601.4(d)(2) specifies that an agent may make a gift
of the principal’s property only as the agent determines is consistent with the
principal's objectives if actually known by the agent and, if unknown, as the
agent determines is consistent with the principal's best interest based on all
(i) The value and
nature of the principal's property.
(ii) The principal's
foreseeable obligations and need for maintenance.
(iii) Minimization of
taxes, including income, estate, inheritance, generation-skipping transfer and
(iv) Eligibility for
a benefit, program or assistance under a statute or regulation.
(v) The principal's
personal history of making or joining in making gifts.
Section 5601.4(d)(3) states that the phrase “a gift for the
benefit of a person” [the phrase is used in the limited gifts section –
5601.4(d)(1)] includes gifts to a trust, to a minor under UTMA, and to a tuition
savings account or prepaid tuition plan. [Jeff’s
comment: Note that a transfer to an ABLE account (Act 17 of 2016) is not
specifically addressed.] 5601.4 (d.1) deals with disclaimers. Section 5601.4(d.1)(1) provides a statutory
interpretation for the grant of the power to disclaim; Section 5601.4(d.1)(2)
makes the disclaimer authority subject to the same standards that apply to
other hot powers. [Jeff’s comment: Prior to Act 95 disclaimers were included under Sections
5602 and 5603 (short form powers). Act 95 moved disclaimers to the gift section
5601.4 where it became a “hot power” that requires an express grant of
authority. The definition of disclaimers that formerly appeared in Section 5603
was deleted by Act 95. It was felt that a definition of the term was needed and
thus SB 1104 re-creates a statutory definition in Section 5601(d).] SB 1104 amends sections 5601.4 (c) and (e) to incorporate
references to the new section 5601.4 (d)(1) which deals with disclaimers. Sections 5602 and 5603. Form of power of attorney.
Section 5602 sets out “short form” statutory powers that can
be incorporated into a power of attorney and (unless otherwise provided) are
defined in Section 5603. The general rule remains the same as in Act 95: 5602(a) Specification
of powers.--A principal may, by inclusion of the language quoted in any of the
following paragraphs or by inclusion of other language showing a similar intent
on the part of the principal, empower an agent to do any or all of the
following . . .. [Jeff’s comment: “language
showing a similar intent” is a wide doorway – are the powers enumerated by
Section 5602(a) granted when there is a general grant of authority without any
express reference to Section 5602? This question appears to be answered
affirmatively by Section 5601.4: “(c)
Scope of authority.--Subject to subsections (a), (b), (d), (d.1) and (e), if a
power of attorney grants to an agent authority to do all acts that a principal
is authorized to perform, the agent has all of the powers which may be
incorporated by reference pursuant to section 5602(a).”] SB 1104 deletes “limited gifting” from the short form powers
listed in Sections 5602 and 5603 since “limited gifting” has been moved to Section
5601.4. Also deleted are the health care related powers that have been moved to
Chapter 54: “To authorize my admission to a medical, nursing, residential or
similar facility and to enter into agreements for my care"; "To
authorize medical and surgical procedures"; and "To make an
anatomical gift of all or part of my body." The terminology of Section 5603 (d) (“power to claim an
elective share”) is slightly modified in regard to persons who are
incapacitated. Section 5603 (r) is expanded to clarify that the power to “handle
interests in estates and trusts” includes the power to receive on behalf of the
principal all notices and reports required by section 7780.3 (relating to duty
to inform and report) or permitted by section 7785(a) (relating to limitation
of action against trustee).
Two important statutory short powers are added to section
5602 and defined in section 5603:
(24) "To operate
a business or entity."
(25) "To provide
for personal and family maintenance." The family maintenance provision seems particularly worthy
of consideration by elder law attorneys who often concerned with the support
and maintenance of a community spouse or disabled child. This short form power
is defined in section 5603 as follows: (u.3) Power to provide for personal and family
maintenance.--
(1) A power "to provide for personal and
family maintenance" shall mean that the agent may provide for the health,
education, maintenance and support, in order to maintain the customary standard
of living of the principal's spouse and the following individuals, whether
living when the power of attorney is executed or later born:
(ii) Other individuals legally entitled to be
supported by the principal.
(iii) The individuals whom the principal has
customarily supported and intends to support.
(2) In acting under this subsection, the agent
(i) Take into account the long-term needs of the
(ii) Consider any independent means available to
those individuals apart from the support provided by the principal.
(3) Authority with respect to personal and family
maintenance is in addition to and not limited by authority that an agent may or
may not have with respect to gifts under this chapter.
[Jeff’s Comment: It appears that a general grant of
“authority to do all acts that a principal is authorized to perform” is
sufficient to authorize an agent to provide for “personal and family
maintenance.” See discussion above Section 5601.4(c)]
Section 5604 (c) Relation of agent to court-appointed
Prior law specified that if a principal was adjudicated an
incapacitated person the guardian had the same power to revoke or amend the
power of attorney that the principal would have had if he were not an
incapacitated person. SB 1104 amends this section to delete the guardian’s
statutory power to revoke or amend a POA. Instead, it provides that in its
guardianship order and determination of a person's incapacity, the court shall
determine whether and the extent to which the incapacitated person's durable
power of attorney remains in effect.
[Jeff’s Comment:
Lawyers will need to deal with the issue of the continuing effectiveness of a
power of attorney in guardianship proceedings and proposed orders.] Section 5610. Account.
SB 1104 adds a sentence to this section that states that
when an agent files an account of his administration “[t]he court may assess
the costs of the accounting proceeding as it deems appropriate, including the
costs of preparing and filing the account.”
SB 1104 adds a new section to Chapter 56 that states that
the meaning and effect of a power of attorney is determined by the law of the
jurisdiction indicated in the power of attorney and, in the absence of an
indication of jurisdiction, by the law of the jurisdiction in which the power
of attorney is executed.
This new section provides that venue of any matter
pertaining to the exercise of a power by an agent acting under a power of
attorney shall be in the county in which the principal is domiciled, a resident
or residing in a long-term care facility.
A court having jurisdiction may decline to exercise
jurisdiction if at any time it determines that a court of another county or
state is a more appropriate forum. If a court declines to exercise
jurisdiction, it shall either dismiss the proceeding or stay the proceeding
upon condition that a proceeding be promptly commenced in another county or
state. A court may impose any other condition that it deems appropriate.
SB 1104 specifies that nothing in this act shall be
construed to limit the effectiveness of powers of attorney in effect prior to
its effective date. With the following exceptions, the act takes effect and
applies to all powers of attorney executed on or after January 1, 2017. · The
amendment or addition of 20 Pa.C.S. §§ 5603(r) and (u.4), 5610, 5613 and 5614
shall apply to all powers of attorney executed before, on or after the effective
date. · The
shall apply to all powers of attorney executed before, on or after the
effective date of this paragraph.
provision in a power of attorney incorporating by reference a power under 20 PA
C.S. § 5602(a)(8), (9) or (23) prior to the repeal of 20 Pa.C.S § 5602(a)(8),
(9) or (23) shall be governed by the respective paragraph of § 5602(a) as if no
repeal occurred.
amendment of 20 PA.C.S. § 5454(D) [a guardian may revoke a health care power of
attorney only if authorized by the court] takes effect immediately. When enacted, HB 665 will take effect immediately.
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