In the past several years, I have seen a growing number of companies that assist people in qualifying for Medicaid benefits.  Sometimes for a flat fee, sometimes on an hourly basis—these companies tell people that they can help them qualify for Medicaid benefits.

I have had a number of clients tell me that the nursing home in which their loved one lives insisted that they use one of these companies.  One former client of mine told me that the staff of the nursing home threatened to kick her loved one out of the nursing home if the client used me to assist her in qualifying her husband for Medicaid.

As a fundamental matter, I can tell you that I have heard the fees these non-attorney companies charge their customers, and the fees are either higher than or equal to the fees I would charge to assist a family in qualifying their loved one for Medicaid.  So, if the fees these companies are charging are equal to or higher than the fees I would charge, a question becomes, are the services these companies are providing equal to or better than the services I am providing?

Well, you can guess that I’m going to say their services are not equal to or better than my services, but if you’ll indulge me, I actually have some good arguments to make in support of my case.

Medicaid is a health payment plan for needy individuals. In order to qualify for Medicaid benefits, an individual must have insufficient income to pay for his care and a very limited amount of assets.

Once a person qualifies for Medicaid, the program will pay for nursing home care, care in an assisted living residence, and long-term care services at home. All of my clients who are seeking to qualify for Medicaid benefits are doing so because of long-term care costs.

Many people mistakenly believe that there are no planning opportunities available to them in order to qualify for Medicaid. They believe that their only option is to spend down their money until they are poor.  But the truth is, there are a great many planning opportunities.  I have often saved tens-of-thousands to hundreds-of-thousands of dollars for my clients.

In the past year, the Supreme Court of New Jersey has held that providing advice to a person on how to qualify for Medicaid is the practice of law. In other words, when I advise people that they can transfer their home to certain family members without jeopardizing their eligibility for Medicaid benefits, I am providing legal advice.  When I establish a Medicaid-complaint annuity for a client in order to qualify his spouse for Medicaid, I am providing legal advice.  Furthermore, when I draft a deed to a client’s home or draft a trust for a client, I am providing legal advice/services to the client.

The good news for me is, I am an attorney, so when I provide legal advice to a client, that is what is expected of me. When a non-attorney company provides this type of advice or these type of services to a customer, they are committing a crime.  The unauthorized practice of law is a criminal act.

Many of these non-attorney companies receive referrals from nursing homes. In fact, clients of mine have told me that the referral to the company was more of a strong arm tactic through which the nursing home almost insisted that the client use the non-attorney company.  Nursing homes want to make money, and there is nothing wrong with that.

I firmly believe that a nursing home should be paid for the services it provides, but when one company pushes you to use another company, you have to ask yourself why the nursing home wants you to use the third-party company to apply for Medicaid. In some instances, the company that does the billing for the nursing home is the company that is handling the Medicaid application for the resident for a fee.

The company literally works for the nursing home, yet they are charging the resident to apply for Medicaid. To whom does the company’s allegiance lie?  To the family who hires the company one time or to the nursing home that continuously refers new business to it?  Lawyers have to work for the client and only the client.

So the key differences between attorneys and non-attorneys are that lawyers can provide legal advice and lawyers work solely for the client.