It’s All in the Plan

by Alyssa Quintero on Mon, 2007-10-01 09:16

How to start long-term financial planning

ALS is a disease that can be devastating financially as well as physically. In the first of a two-part series, we look at steps to take in the early stages of ALS.

One of the first moves to make following an ALS diagnosisis is to review your family’s long-term financial situation and put a new plan into place.

Be proactive, and do your research. You may have to dig for information, but the key is to get going right away. Here are some tips to get you started and ensure you get top-notch advice:

If you’re still working …

Know your employee benefits package inside and out. It’s not fun, but the more you know, the better.

Meet with your company’s human resource representative to discuss your benefits package, including disability insurance, health insurance coverage options, retirement pension and savings plans, group life insurance plans, investments, etc.

Sharon Luker, a certified financial planner who specializes in long-term care planning in Plano, Texas, advised, “Don’t give up any policies when you leave a company because you can no longer work. Hold onto them, and don’t let things lapse, like life insurance.”

Tammy Brown and family

Don’t let insurance jargon overwhelm you. Ask questions about disability insurance such as:

  • Do I have short-term and long-term disability insurance?
  • How much of my salary will be covered by the insurance?
  • How long will I receive the short-term and long-term insurance?
  • Am I entitled to any other company benefits?

For example, Tammy Brown, a mother of two young children in Thida, Ark., was employed by Wal-Mart for 15 years prior to her December 2004 diagnosis of ALS. Although she didn’t plan to leave work, she investigated her short-term and long-term disability benefits, and contacted the personnel office multiple times.

Brown, 35, took the three months allotted for her short-term disability, and returned to work for a year before leaving on long-term disability, which pays 50 percent of her salary. She provided the insurance company with an official diagnosis from her physician before being approved.

“I had a lot of questions [about my benefits plan], and I didn’t know as much as I thought I did,” Brown explained.

Depending upon the company, long-term disability insurance remains in effect for a predetermined period of time, possibly until the person retires. In Brown’s case, she’ll have the insurance until age 62.

She also converted her group life insurance into a policy, paying a $268 monthly premium, and rolled her retirement savings plan into a 401(k). Brown recommends that people ask questions to determine if they can increase the group life insurance coverage if they’re still working.

Because she’s covered by her husband’s health insurance, Brown uses Medicare as the secondary insurance, picking up what private insurance doesn’t cover.

Overcoming challenges

Roger Surfus of Shell Knob, Mo., received a diagnosis of ALS in November 2005. Employed by the Boeing Company, Surfus studied his company’s employee disability benefits package, health insurance coverage and retirement pension funds a month before receiving his official diagnosis.

He’d attended numerous independent and Boeing-sponsored financial planning seminars, and searched aggressively for information on the company’s internal Web sites.

“Unfortunately, due to size of my company and the reduced size of our HR department, most of the correspondence was done electronically,” Surfus, 59, explained.

Even though his disability benefits, retirement pension and savings plan were in order, Surfus still hit a roadblock.

“Sorting out health insurance took several months and was not an easy nor pleasant experience, further complicated by my early loss of speech,” he said. “I struggled and was frustrated to tears for over six months with a COBRA retirement health care insurance program that wasn’t compatible with Medicare.”

Surfus sent several Medicare Explanation of Benefits forms along with a formal appeal letter to the first COBRA insurance he’d selected. His wife spent long hours on the phone, and Surfus finally located a supplemental health care coverage compatible with Medicare.

“Be sure you understand all of the details included in your company-provided health care insurance plan options,” added Surfus, who retired in July 2006. “No one in my company’s HR department advised us of this [potential] problem.”

Locating help

An elder-law attorney and/or financial planner can help you wade through confusing insurance policies, and federal benefits programs. Although it costs up-front, it can pay big dividends in the long run, saving both money and frustration.

Look for an elder-law attorney in your state who specializes in disability-planning issues, including long-term disability insurance, Social Security and Medicare, as well as long-term care issues and Medicaid (which will be discussed in an upcoming issue).

Judith Grimaldi, a certified elder-law attorney in Brooklyn, N.Y., who’s worked with ALS clients, explained, “An elder law attorney can help you determine appropriate planning techniques, and help you operate from a position of wisdom not panic.”

The National Academy of Elder Law Attorneys offers a searchable state directory of member attorneys, including those who are certified elder-law attorneys (CELA).

Before hiring an attorney, focus on these areas:

  • Make sure the attorney specializes in your area(s) of need (i.e., disability planning).
  • Check the attorney’s credentials – how long has he or she been in practice?
  • Find out if there’s a fee for the first consultation (varies widely).
  • Ask how fees are computed, and get an up-front estimate for your casework.
  • Find out what information to bring to your first meeting.

Ann Krause, a NAELA representative, said first-time consultation fees can range from free to $850, depending upon the attorney and the extent of your case.

Prior to the first meeting, make copies of pertinent legal and financial documents – the more information the attorney has, the more options he or she may provide.

In addition, you can consult a certified financial planner who specializes in disability-planning issues. The Financial Planning Association offers a searchable database (by state and specialty).

Financial planning fees vary (hourly or flat fees), so get an estimate. Sharon Luker, a certified financial planner, says hourly rates range from $100 to $200. For a full plan, fees typically range from $500 to $2,500. Some planners charge a fixed fee that includes subsequent visits as well as the plan.

Low-cost assistance

Your local MDA office may be able to point you toward additional resources.

For example, an elder-law attorney and a certified financial planner volunteer their services at the monthly clinic at the MDA/ALS Center at Methodist Neurological Institute in Houston.

Other national services include, which helps low- and moderate-income people find free legal aid programs in their communities (via a state database). The American Bar Association also offers a consumer guide to finding free legal help (by state), including federally funded legal services and pro bono programs.

In addition, contact your State Health Insurance Assistance Program , which offers free one-on-one counseling and assistance to people with Medicare and their families. You can find a SHIP program and counselors in your area; SHIP programs offer telephone assistance, and public education programs.

(202) 479-1200

Center for Medicare Advocacy
(860) 456-7790
(800) 333-4636

Elder Law Answers
(866) 267-0947

Medicare Rights Center
(202) 544-5561

Alyssa Quintero
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