Court Opinion

ID: 2770255
Source: CourtListenerOpinion
Date Created: 2015-01-15 17:03:05.158315+00
Date Added: 2024-06-11T10:47:12.931564
License: Public Domain

Supreme Court of Florida
                                   ____________

                                   No. SC14-211
                                   ____________

           THE FLORIDA BAR RE: ADVISORY OPINION—
         MEDICAID PLANNING ACTIVITIES BY NONLAWYERS.

                                 [January 15, 2015]

PER CURIAM.

      Pursuant to Rule Regulating the Florida Bar 10-9.1, the Florida Bar Elder

Law Section’s Unlicensed Practice of Law Subcommittee petitioned the Florida

Bar’s Standing Committee on the Unlicensed Practice of Law (Standing

Committee) for an advisory opinion on whether it constitutes the unlicensed

practice of law for a nonlawyer to engage in the following Medicaid planning

activities leading up to the Medicaid application: (1) drafting of personal service

contracts; (2) preparation and execution of qualified income trusts; or (3) rendering

legal advice regarding the implementation of Florida law to obtain Medicaid

benefits. As required under rule 10-9.1(f), the Standing Committee provided

notice of and held a public hearing to address these issues where it considered

written and live testimony. The Standing Committee subsequently filed a
proposed advisory opinion in this Court. We have jurisdiction to review the

proposed advisory opinion pursuant to rule 10-9.1(g) of the Rules Regulating the

Florida Bar and article V, section 15 of the Florida Constitution.

      After the proposed advisory opinion was filed, interested parties were

permitted to file briefs in support of or in opposition to the proposed advisory

opinion. After considering the proposed opinion and the briefs of the interested

parties, the Court directed the Standing Committee to file a revised proposed

advisory opinion with certain clarifications regarding the activities of nonlawyer

staff of the Florida Department of Children and Families in relation to their duty to

assist the public in the Medicaid application process. The revised proposed

advisory opinion is hereby approved and is set forth in the appendix to this

opinion.1 As provided in Rule Regulating the Florida Bar 10-9.1(g)(4), the

advisory opinion shall have the force and effect of an order of this Court and shall

be published accordingly.

      It is so ordered.

LABARGA, C.J., and PARIENTE, LEWIS, QUINCE, CANADY, POLSTON,
and PERRY, JJ., concur.

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION, AND
IF FILED, DETERMINED.

      1. References to the transcript of the live testimony heard by the Standing
Committee at the public hearing and to written testimony and other materials
considered by the Standing Committee have been deleted. Other minor editorial
changes have also been made.
                                        -2-
Original Proceeding – The Florida Bar Re: Advisory Opinion – Medicaid Planning
Activities by Nonlawyers

C.C. Abbott, Chair, Standing Committee on the Unlicensed Practice of Law,
Tallahassee, Florida; Carsandra Denyce Buie, Past Chair, Standing Committee on
the Unlicensed Practice of Law, Tallahassee, Florida; Lori S. Holcomb, and Jeffrey
Todd Picker, The Florida Bar, Tallahassee, Florida, on behalf of the Standing
Committee on the Unlicensed Practice of Law; Jana McConnaughhay, Chair, Elder
Law Section of The Florida Bar, Tallahassee, Florida; John Sanders Clardy, III,
Past Chair, Elder Law Section of the Florida Bar, Clardy Law Firm, P.A., Crystal
River, Florida; and Robert M. Sondak of Cohen, Chase, Hoffman & Schimmel,
P.A., Miami, Florida, on behalf of the Elder Law Section of The Florida Bar;

      for Petitioner

Cindy Leann Huddleston and Anne Lisa Swerlick, Tallahassee, Florida, on behalf
of Florida Legal Services, Inc., and Valory Toni Greenfield, Miami, Florida, on
behalf of Florida Legal Services, Inc.; Anthony L. Turbeville, Lakeland, Florida,
pro se; and Stephen Michael Masterson, Tallahassee, Florida, on behalf of William
D. Burns,

      Responding with comments

                                       -3-
                            APPENDIX

                       THE FLORIDA BAR
                  STANDING COMMITTEE ON THE
                  UNLICENSED PRACTICE OF LAW

FAO #2011-4, MEDICAID PLANNING ACTIVITIES BY NONLAWYERS
_______________________________________________________________/

              REVISED PROPOSED ADVISORY OPINION

                          October 14, 2014

                                -4-
                                 INTRODUCTION

      Pursuant to rule 10-9 of the Rules Regulating The Florida Bar, The Florida

Bar’s Elder Law Section UPL Subcommittee petitioned the Standing Committee

on Unlicensed Practice of Law (Standing Committee) for an advisory opinion on

certain activities of nonlawyer Medicaid planners.

      The petitioner requested an advisory opinion on whether it constitutes the

unlicensed practice of law for a nonlawyer to engage in the following Medicaid

planning activities leading up to the Medicaid application: (1) drafting of personal

service contracts; (2) preparation and execution of qualified income trusts; or (3)

rendering legal advice regarding the implementation of Florida law to obtain

Medicaid benefits. The preparation of the application for Medicaid benefits was

not considered as federal law authorizes nonlawyer assistance in the application

process.1

      Pursuant to Rule 10-9.1(f) of the Rules Regulating The Florida Bar, public

notice of the hearing was provided on The Florida Bar’s website, in The Florida

Bar News, and in the Tampa Bay Times. The Standing Committee held a public

hearing on February 22, 2013.

      Testifying on behalf of the petitioner was Twyla Sketchley, Chair of the

Elder Law Section of The Florida Bar, and John Frazier, Chair of the Unlicensed

      1. 42 C.F.R. § 435.908.
                                        -5-
Practice of Law Subcommittee of the Elder Law Section of The Florida Bar. In

addition to the petitioner, the Standing Committee received testimony from

Carolyn Norton; Peggy Crabbe; Jack Rosenkranz, an attorney; Emma Hemness, an

attorney; Gerald Hemness, an attorney; Amy O’Rourke; Jeff Brown, an attorney;

and Sonja Kobrin.

      In addition to the testimony presented at the hearing, the Standing

Committee received written testimony which has been filed with this Court. Most

of the testimony was from attorneys practicing in the area of elder law and

Medicaid planning, and, by and large, reflected the opinion that a formal advisory

opinion is needed to protect the public.

                                      DISCUSSION

      In June 2008, the Standing Committee considered a request for direction

regarding the activities of nonlawyer Medicaid planners as a result of UPL

complaints being investigated by The Florida Bar. The Standing Committee voted

to provide the following direction:

             The following activities of nonlawyer Medicaid planners
             would constitute the unlicensed practice of law:
             establishing irrevocable trusts, establishing qualified
             income trusts, and hiring an attorney to review, prepare,
             or modify documents for customers if payment to the
             attorney was through the company. The committee voted
             that the following activities would have to be determined
             on a case-by-case basis: restructuring assets, counseling
             customers on the best way to get Medicaid approval, and
             advertising as an “elder counselor.” The committee
                                           -6-
                voted that the hiring of an attorney to review, prepare, or
                modify documents for customers if there was a direct
                relationship with the attorney and payment was made
                directly to the attorney would not be the unlicensed
                practice of law.

      This direction was also provided to the Elder Law Section in May 2009. So

while the issue of nonlawyer Medicaid planning came before the Standing

Committee previously, this is the first request for a formal advisory opinion.

      The issue of the activities of the Florida Department of Children and

Families (DCF) staff was not part of the earlier direction provided by the Standing

Committee or the request for a formal advisory opinion or this opinion.

Nonlawyer DCF staff are government employees responsible for assisting in the

application process. DCF staff have an affirmative duty to tell a Medicaid

applicant about Medicaid trusts and other eligibility laws and policies governing

the structuring of income and assets when relevant to the applicant’s facts and

financial situation. When performed by DCF staff, these activities are not the

unlicensed practice of law. They will allow each applicant, and the applicant’s

attorney, the ability to choose the course of action for qualifying for assistance that

best suits the applicant.

      Each Medicaid planning activity posed by the petitioner will be addressed

individually.

                             Drafting of Personal Service Contracts

                                           -7-
      A personal service contract is one of the strategies used by Medicaid

applicants to spend down assets so that their countable assets are within the

allowable asset limit provided by law for Medicaid eligibility. It is a contract for

personal care services between the Medicaid applicant and a caregiver, often an

adult child, for services that are not provided by the nursing home or assisted living

facility. As one witness noted, Florida law only requires nursing homes to give a

little over two hours of care per day per resident, which leaves almost twenty-two

hours of the day that the resident is not getting personal hands-on care. The

personal service contract provides for care during that other time.

      There are both legal and tax ramifications if a personal service contract is

not done properly. One witness testified that one of his clients had a nonlawyer

service draft a personal service contract that was rejected by Medicaid, which

resulted in the client not receiving Medicaid benefits for several months, costing

the client thousands of dollars. Another witness testified about a client who

engaged a nonlawyer Medicaid planning service and was advised by the service

that a personal service contract was needed and the contract that was prepared

called for her son, who lived 12 hours away by car and visited her 2-3 times per

year, to provide 26-27 hours of care per week. The family is open to charges for

Medicaid fraud and the client is no longer eligible for Medicaid benefits.

                                         -8-
      The payment for services under a personal service contract is based on the

resident’s life expectancy and is made to the caregiver in a lump sum payment up

front. The payment for services under a personal service contract is treated by the

Internal Revenue Service as a taxable event for the caregiver. Without proper

advice and planning, this may result in a huge tax liability. The Standing

Committee received testimony about nonlawyer Medicaid planners not properly

advising of this potential tax liability. This testimony demonstrates that the

improper drafting of a personal service contract and improper tax advice and

planning causes public harm.

      The preparation of a contract is the practice of law. In The Florida Bar v.

Sperry, 140 So. 2d 587, 597 (Fla. 1962), vacated on other grounds, 373 U.S. 379

(1963), the Court held that “the practice of law also includes the giving of legal

advice and counsel to others as to their rights and obligations under the law and the

preparation of legal instruments, including contracts, by which legal rights are

either obtained, secured or given away, although such matters may not then or ever

be the subject of proceedings in a court.” A personal service contract is a contract

which imposes duties and obligations on both parties to the contract. The

caregiver agrees to provide a certain amount of care and specified services per

week in exchange for payment for that care and services. When a nonlawyer

Medicaid planner drafts a personal service contract the nonlawyer is practicing

                                         -9-
law. It is the opinion of the Standing Committee that a nonlawyer’s drafting of a

personal service contract constitutes the unlicensed practice of law.

                  Preparation and Execution of Qualified Income Trusts

      If a Medicaid applicant’s gross monthly income exceeds a certain amount, a

properly drafted Qualified Income Trust must be established and a Qualified

Income Trust checking account must be opened at a bank in order for the applicant

to qualify for Medicaid. The income trust checking account must be funded each

month with the income that exceeds the acceptable limit in order for the recipient

to obtain Medicaid benefits. If a Qualified Income Trust is not properly

established or properly funded each month, then the Medicaid applicant will not be

eligible for Medicaid.

      The Standing Committee received testimony about a nonlawyer improperly

preparing a Qualified Income Trust resulting in Medicaid benefits being denied,

which cost the client several months at the nursing home. In another case, a

nonlawyer incorrectly advised the client regarding the funding of a Qualified

Income Trust, resulting in the client being denied Medicaid benefits. The client

had a $7,000 bill from the nursing home that she was unable to pay. In other

testimony, a nonlawyer improperly executed an irrevocable trust form to qualify

the client for veterans benefits. This strategy failed to allow the client to qualify

for Medicaid benefits and caused a lengthy disqualification of Medicaid benefits.

                                         - 10 -
      The Court, in The Florida Bar re: Advisory Opinion–Nonlawyer Preparation

of Living Trusts, 613 So. 2d 426 (Fla. 1992) (hereinafter “Living Trust case”),

held that the assembly, drafting, execution, and funding of a living trust constitutes

the practice of law, as does determining the need for a living trust and identifying

the type of living trust most appropriate for the client. The same would be true for

a Qualified Income Trust. A living trust is a legal document affecting an

individual’s important legal rights. A Qualified Income Trust is also a legal

document affecting an individual’s important legal rights. In order to protect those

rights, the person preparing either type of trust must have a knowledge of the law

greater than that possessed by the average citizen. It is therefore the opinion of the

Standing Committee that a nonlawyer’s determination of whether a Qualified

Income Trust is necessary as well as the assembly, execution and funding of the

trust constitutes the unlicensed practice of law.

      While the Court held that the preparation of a trust constitutes the unlicensed

practice of law, the Court also found that gathering the necessary information for

the living trust does not constitute the practice of law, and nonlawyers may

properly perform this activity. It is the opinion of the Standing Committee that this

limited exception is not applicable here.

      The holding allowing the gathering of information in the Living Trust case

was based on the Court’s holding in In re: The Joint Petition of The Florida Bar

                                        - 11 -
and Raymond, James and Associates, Inc., 215 So. 2d 613 (Fla. 1968). Raymond,

James dealt with the activities of securities brokers, a regulated industry. The

parties entered into a stipulation, approved by the Court, which set forth activities

that constituted the unlicensed practice of law and activities that were authorized.

In the context of the case, the Court held that “Raymond, James and Associates,

Inc., its officers, agents and employees properly may . . . [s]olicit specific facts

about customers’ or prospective customers’ assets.” Id. at 614. The holding did

not allow for the gathering of any information, it allowed for the gathering of facts

about a customer’s assets, an activity a licensed securities broker would need to be

able to perform to conduct the business of selling securities.

      Similarly, in the Living Trust case, many of the nonlawyers involved in the

sale of a living trust were licensed life insurance agents. The life insurance agents

sought to “ ‘preserve permissible existing rights (and duties) for qualified,

regulated, non-lawyer insurance agents to participate in their proper roles in the

creating of a living trust.’ ” Living Trust, 613 So. 2d at 428. The Court held that

the opinion was “consistent with the ‘existing rights’ of life insurance agents. Life

insurance agents may properly sell life insurance that will fund a living trust and

may offer advice on funding the trust from a financial standpoint.” Id. Clearly, a

life insurance agent would have to be able to gather facts about a person’s assets to

perform these activities.

                                         - 12 -
      When read in context, it is the opinion of the Standing Committee that the

information a nonlawyer may gather is limited to information about the customer’s

assets when such information is necessary for the nonlawyer to conduct a business

for which they are licensed and regulated. Support for this can be found in the

Court’s holding in The Florida Bar v. American Senior Citizens Alliance, Inc., 689
So. 2d 255 (Fla. 1997). The nonlawyers in American Senior Citizens Alliance

were in the business of selling living trusts. They used high pressure sales tactics

and targeted the elderly. They also used the Court’s holding regarding gathering

information in the Living Trust case to justify their activities. The Court disagreed

and found the reliance on that language “an unreasonable interpretation of the

phrase ‘gathering the necessary information.’ ” Id. at 259.

      Allowing nonlawyer Medicaid planners to gather information for the

preparation of a Qualified Income Trust would also be an unreasonable

interpretation of the phrase. The testimony revealed that nonlawyer Medicaid

planners are essentially unregulated, as there are no licensing, education, or

advertising requirements. Unlike the securities brokers in Raymond, James and

Associates, Inc. or the life insurance agents in the Living Trust case, if the

                                         - 13 -
nonlawyer cannot prepare the Qualified Income Trust, there is no legitimate reason

for the nonlawyer to gather information about the customer’s assets.2

      Consequently, it is the opinion of the Standing Committee that a

nonlawyer’s preparation, execution, funding of, and determination of the need for a

Qualified Income Trust constitutes the unlicensed practice of law. This includes

the gathering of information for the Qualified Income Trust.

        Rendering Legal Advice Regarding the Implementation of Florida Law to
                          Obtain Medicaid Benefits

      Medicaid eligibility, as part of Medicaid planning, involves a highly

technical set of federal and state statutes and regulations, which in Florida is well

over 3,000 pages. Medicaid planning involves: (1) the assessment of all facts

relevant to a client’s situation, including personal, financial, familial, and

       2. The preparation of the Medicaid application is not the unlicensed practice
of law as it is authorized by federal law. Therefore, the preparation of the
application was not part of the question presented to the Standing Committee. To
the extent that it is necessary for a nonlawyer to gather information about an
individual’s assets to complete the application, that activity would also be
authorized. In addition, to the extent a federal or state statute or regulation allows
a government employee to assist in the application process, the conduct is
authorized and not the unlicensed practice of law. As noted earlier, nonlawyer
DCF staff are government employees responsible for assisting in the application
process. DCF staff has an affirmative duty to tell a Medicaid applicant about
Medicaid trusts and other eligibility laws and policies governing the structuring of
income and assets when relevant to the applicant’s facts and financial situation.
When performed by DCF staff, these activities are not the unlicensed practice of
law. They will allow each applicant, and the applicant’s attorney, the ability to
choose the course of action for qualifying for assistance that best suits the
applicant.
                                          - 14 -
historical; (2) application of those particular facts to the laws governing Medicaid;

(3) developing a plan to structure or spend those assets in compliance with those

laws or planning to reverse actions already taken to correct potentially

unauthorized activity to minimize negative legal consequences; (4) drafting legal

documents to execute the plan; and (5) assisting the client in correctly executing a

particular plan.

      Medicaid planning includes making sure the applicant will meet the asset

and income test for Medicaid eligibility. An unmarried Medicaid applicant can

own no more than $2,000 in “countable” assets. Typical countable assets include

bank accounts, stocks, bonds, annuities, and some types of life insurance. The two

primary non-countable assets are the homestead and one automobile. For married

applicants, if both spouses are applying for Medicaid, there is a $3,000 asset limit.

If only one spouse is applying for Medicaid, the nursing home resident may only

have $2,000 in assets, and the community spouse can have up to $113,640 in

countable assets. Federal and Florida law allow certain options to ensure that the

spouse of the Medicaid applicant is not impoverished in attempting to obtain

Medicaid benefits for an ill spouse. Some of the strategies used to spend down

assets include: (1) the use of a personal service contract; (2) the use of a special

needs irrevocable pooled trust; (3) the use of a Medicaid qualifying annuity; (4) the

purchase of income producing property; (5) the purchase of a homestead; (6)

                                         - 15 -
gifting; (7) the purchase of other exempt assets; (8) repairs to the homestead; (9)

payment of debts and expenses; (10) the purchase of an irrevocable funeral service

or cremation contract; (11) a burial savings account; and (12) the purchase of an

automobile.

      Proper Medicaid planning involves providing advice on the purchase and

titling of exempt assets and the transfer of countable assets in excess of $2,000 to

the community spouse. Legal strategies to protect excess assets of the community

spouse include: (1) assignment of rights to support (spousal refusal); (2) the use of

a promissory note; and (3) a Medicaid qualifying annuity.

      The Court, in Sperry, developed the following test to determine whether an

activity constitutes the practice of law:

              [I]n determining whether the giving of advice and
              counsel and the performance of services in legal matters
              for compensation constitute the practice of law it is safe
              to follow the rule that if the giving of [the] advice and
              performance of [the] services affect important rights of a
              person under the law, and if the reasonable protection of
              the rights and property of those advised and served
              requires that the persons giving such advice possess legal
              skill and a knowledge of the law greater than that
              possessed by the average citizen, then the giving of such
              advice and the performance of such services by one for
              another as a course of conduct constitute the practice of
              law.

Sperry, 140 So. 2d at 591.

                                            - 16 -
      Assessing the facts relevant to a client’s situation, applying those facts to the

laws governing Medicaid, developing a plan to structure or spend the client’s

assets in compliance with those laws, and drafting legal documents to execute the

plan, would constitute the practice of law under the Sperry test. It is the opinion of

the Standing Committee that when a nonlawyer engages in these activities or

renders legal advice regarding the implementation of Florida law to obtain

Medicaid benefits the nonlawyer is engaged in the unlicensed practice of law. This

includes advising an individual on which legal strategy or strategies under federal

or Florida law are appropriate given the individual’s factual circumstances.

                          ATTORNEY INVOLVEMENT

      Some nonlawyer Medicaid planning companies claim to have relationships

with lawyers who draft the legal documents for the company’s clients. Testimony

indicated that this sometimes occurred with the client never meeting with or

speaking to the attorney or only briefly speaking to the attorney. Other companies

advertise that they use a team of professionals, including an attorney, to assist the

client. Having a lawyer draft legal documents for the company’s clients would still

be an unlicensed practice of law problem for the company under Nonlawyer

Preparation of Living Trusts, and American Senior Citizens Alliance. It is the

opinion of the Standing Committee that unless the client establishes an

independent attorney-client relationship with the attorney, payment from the client

                                        - 17 -
is directly to the attorney, and the initial determination that the particular legal

document or Medicaid planning strategy is appropriate for the client given the

client’s particular factual circumstances is the determination of the attorney, then

the company would be engaged in the unlicensed practice of law.

                      THE FLORIDA BAR V. BRUMBAUGH

      Two of the activities presented to the Standing Committee involve the

preparation of documents – the personal service contract and the Qualified Income

Trust. When discussing the preparation of documents, the Court often looks to The

Florida Bar v. Brumbaugh, 355 So. 2d 1186 (Fla. 1978). For the following reasons

the Standing Committee is of the opinion that Brumbaugh should not be used as

justification to allow the sale of a personal service contract kit or Qualified Income

Trust kit in Medicaid eligibility matters.

      Marilyn Brumbaugh operated a secretarial service where she offered to do

typing services for various do-it-yourself legal matters. She also sold legal forms

and kits. Following the holdings of other states, the Court held that a nonlawyer

may sell legal kits and general information containing forms and may complete the

forms with information provided by the individual in writing. In so holding, the

Court noted that

             Although there is a danger that some published material
             might give false or misleading information, . . . [w]e
             must assume that our citizens will generally use such
             publications for what they are worth in the preparation of
                                         - 18 -
               their cases, and further assume that most persons will not
               rely on these materials in the same way they would rely
               on the advice of an attorney or other persons holding
               themselves out as having expertise in the area. The
               tendency of persons seeking legal assistance to place
               their trust in the individual purporting to have expertise
               in the area necessitates this Court’s regulation of such
               attorney-client relationships. . . .

Id. at 1193.

      Although Brumbaugh found that nonlawyers could sell forms and kits and

complete them with information provided in writing by the customer, the facts

showed that Ms. Brumbaugh went beyond the mere typing of the forms. As found

by the Court, her customers relied on her to properly prepare the necessary forms,

she advised clients as to various remedies available to them or otherwise assisted

them in preparing the necessary forms, she inquired into or answered questions of

her clients to determine which forms would be necessary and advised how to best

fill out the forms. Because she placed herself in a position of reliance and gave her

customers advice, the Court held that Ms. Brumbaugh was engaged in the

unlicensed practice of law.

      Brumbaugh was decided in 1978, a time when the legal information in

question was disseminated in print, not on the internet. While the Court could

assume “that our citizens will generally use such publications for what they are

worth . . . and further assume that most persons will not rely on these materials . .

.,” the same cannot be said to be true now. Id. Included in the written testimony
                                         - 19 -
are website screen shots from various nonlawyer Medicaid planning companies.

Some companies indicated that attorneys are not necessary for Medicaid planning,

while others hold themselves out as Medicaid “experts” or “specialists” at the same

time they state how complex and tricky the Medicaid rules and regulations are.3

The nonlawyer companies are placing themselves in a position where the customer

will not only rely on their information and expertise, but will also trust that the

information and services they are receiving are true and correct. Clearly, the

nonlawyers are putting themselves in a position of reliance and the consuming

public has no reason to believe otherwise.

      The use of the internet, the complexity of Medicaid planning and the harm

that can result from nonlawyers giving improper advice, more fully discussed

below, leads the Standing Committee to the conclusion that the use of legal kits

and forms should not be allowed in this area. Although allowed since 1978,

whether an activity is the unlicensed practice of law must be viewed in light of the

circumstances of each case. “[A]ny attempt to formulate a lasting, all

       3. The Court has held that it constitutes the unlicensed practice of law for a
nonlawyer to advertise that his or her company specializes in legal areas as this
implies expertise in the legal field. The Florida Bar v. Davide, 702 So. 2d 184
(Fla. 1997). Consequently, it is the opinion of the Standing Committee that to the
extent that a nonlawyer advertises that he or she is a Medicaid expert or specialist
or in such fashion as to induce reliance on the nonlawyer to assist the individual
with their Medicaid planning, the nonlawyer is engaged in the unlicensed practice
of law.
                                        - 20 -
encompassing definition of ‘practice of law’ is doomed to failure ‘for the reason

that under our system of jurisprudence such practice must necessarily change with

the everchanging business and social order.’ ” Id. at 1191-92 (citations omitted).

The changes that have taken place since 1978, especially the use of the internet,

necessitate a change under the circumstances present here.

                   HARM AND THE POTENTIAL FOR HARM

      As noted earlier, the testimony revealed that nonlawyer Medicaid planners

are essentially unregulated, as there are no licensing, education, or advertising

requirements. Because of this lack of regulation, nonlawyer Medicaid planners

include a disbarred Florida lawyer, an individual who lost his securities license for

fraudulent practice, and a life insurance agent who was convicted of two felonies

and lost his insurance license.

      Testimony described the type of harm caused by nonlawyer Medicaid

planners which includes denial of Medicaid eligibility, exploitation, catastrophic or

severe tax liability, and the purchase of inappropriate financial products

threatening or destroying clients’ life savings. The potential for public harm is

even greater when the nonlawyers put themselves in a position of reliance and

advising the customer as to the proper course of action to take. In order to protect

the public from harm, it is the opinion of the Standing Committee that the activities

                                        - 21 -
described herein constitute the unlicensed practice of law and should not be

authorized.

                                   CONCLUSION

      It is the opinion of the Standing Committee that it constitutes the unlicensed

practice of law for a nonlawyer to draft a personal service contract and to

determine the need for, prepare, and execute a Qualified Income Trust including

gathering the information necessary to complete the trust. Moreover, a nonlawyer

should not be authorized to sell personal service or Qualified Income Trust forms

or kits in the area of Medicaid planning.

      It is also the opinion of the Standing Committee that it constitutes the

unlicensed practice of law for a nonlawyer to 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 and

restructuring assets and the need for a personal service contract or Qualified

Income Trust.

      It is the position of the Standing Committee that a nonlawyer’s preparation

of the Medicaid application itself would not constitute the unlicensed practice of

law as it is authorized by federal law. As noted earlier, it is also not the unlicensed

practice of law for DCF staff to tell Medicaid applicants about Medicaid trusts and

other eligibility laws and policies governing the structuring of income and assets

                                        - 22 -
when relevant to the applicant’s facts and financial situation. This proposed

advisory opinion is the Standing Committee on Unlicensed Practice of Law’s

interpretation of the law.

                                      Respectfully Submitted,

                                        /s/ C.C. Abbott by Jeffrey T. Picker
                                      C.C. Abbott, Chair
                                      Standing Committee on
                                      Unlicensed Practice of Law
                                      The Florida Bar
                                      651 E. Jefferson Street
                                      Tallahassee, FL 32399-2300
                                      (850) 561-5840
                                      Fla. Bar No. 467065
                                      Primary Email: upl@flabar.org

                                        /s/ Jeffrey T. Picker
                                      Jeffrey T. Picker
                                      Fla. Bar No. 12793
                                        /s/ Lori S. Holcomb
                                      Lori S. Holcomb
                                      Fla. Bar No. 501018
                                      The Florida Bar
                                      651 East Jefferson Street
                                      Tallahassee, Florida 32399-2300
                                      (850) 561-5840
                                      Primary Email: jpicker@flabar.org
                                      Secondary Email: upl@flabar.org

                                       - 23 -