Helping with Medicaid Planning Could Be ‘Unauthorized’

by Jackie Bedard

Early last year, the Florida Supreme Court ruled to restrict what non-lawyers can do in assisting clients in planning activities. A financial planner and insurance agent later asked the U.S. Supreme Court to review and overturn that decision, but his petition was denied. And so, Florida’s ruling stands, specifically prohibiting non-attorneys from several acts, including drafting care agreements, drafting qualified income trusts and rendering legal advice.

Similar rulings are expected to continue across the country, state-by-state. View the ruling online at:

Potential Harms
The proposal for the Florida ruling came from a bar committee, which worked on the issue for months, according to the Orlando Sentinel. Testimony in a committee document described the potential harms caused by non-attorney Medicaid planners, including denial of eligibility, exploitation, “catastrophic or severe” tax liabilities and buying inappropriate financial products threatening or destroying a client’s life savings.

The committee, known as the Standing Committee on the Unlicensed Practice of Law, addressed non-lawyers drafting qualified income trusts, which are used when a client’s monthly income exceeds Medicaid’s income limit. The excess money must go into trust accounts for clients to qualify for benefits.

The committee cited examples of non-lawyers preparing such trusts and giving incorrect advice, which led to Medicaid coverage being denied.

The committee also pointed to non-lawyers providing legal advice about how to structure assets to qualify for Medicaid.

“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,” the proposal said.

Costly Care
A single room in a private nursing facility can cost thousands of dollars every month. That can quickly wipe out most people’s life savings. The largest threat to the portfolio may be paying for nursing home care. This level of care must be paid for with your qualified assets before you can become eligible for Medicaid. In most cases, a basic irrevocable trust cannot protect these assets from disqualifying your client from receiving Medicaid benefits.

While there are some vehicles to help protect assets (i.e. long-term care insurance and specialized Medicaid asset protection trusts), many people remain unaware they exist. It’s important to work with a qualified attorney with knowledge of elder law issues such as Medicaid planning, long-term care insurance, and veterans aid and attendance benefits.


Bedard, an elder law attorney with Carolina Family Estate Planning, can be reached at 919-443-3035 or