Doug Josephson Interview on End of Life Matters #135

Josh is joined by client Doug Josephson as they explore the important matters surrounding end-of-life planning. These issues are not only crucial for your loved ones but also for your own peace of mind. In this episode, we’ll provide valuable insights and practical advice to help you navigate this complex landscape with confidence. Doug is a client of Keystone Financial Services and is not being compensated for sharing his opinion and experience with our firm.

Instagram: https://www.instagram.com/keystonefin/
Twitter: https://twitter.com/Keystone_Fin?advisorid=33004651
Contact Josh Nelson: https://www.keystonefinancial.com
Contact Jeremy Busch: https//www.keystonefinancial.com
Podcast Editing: Tim Leaman/info.primegen@gmail.com

Chapters

• 0:00 Intro
• 7:04 Hiring a Consultantant/Lawyer
• 10:39 Keeping records
• 16:35 The Bridge Period
• 25:55 Overall

Transcript

Wiser Financial Advisor – Doug Josephson Interview on End of Life Matters

Hi Everyone, and welcome to the Wiser Financial advisor show with Josh Nelson where we get real, we get honest and we get clear about the financial world and your money. This is Josh Nelson, Certified Financial Planner, founder and CEO of Keystone Financial Services. Let the financial fun begin!

Recently I had the opportunity to sit down with Doug Josephson, who has been through end of life matters with his mother, who died in 2022. Doug was her medical and financial Power of Attorney when she became ill, and he was the executor of her estate when she passed away. 

Josh: Welcome Doug, thank you for being here.

Doug: Thank you for having me.

Josh: Like many of our clients, you came from the technology sector. Please give us a little background on you. 

Doug: Well, I grew up in the Midwest and went to the University of Iowa in Electrical Engineering, then ended up at a high tech firm here in Fort Collins, Colorado. My wife's in the medical field and when I went through this process as an executor, I learned a lot. And it's great that you reached out so that I could tell my story and hopefully help some other people. 

Josh: Absolutely. A lot of our clients are going through this or will be going through this. Our average age of client right now is about 58. So if their parents are still living, they're probably getting close to needing some help, either physically or financially or otherwise. So in 2019, right? Talk about what was happening with your mom.

Doug: My mom lived in rural Illinois, a little town called Monmouth, south of the Quad Cities area, about an hour. And after my dad passed away, she had been living there independently. She was always a walker; she walked a lot, but started having difficulty walking and some balance problems, but continued to live at home. So in January of 2019, I got a call from one of her friends who said, “She fell and we had to take her to the hospital.”

I flew back to Monmouth and picked her up. I packed up in a single day, and then we drove back to Colorado, and I moved her into an assisted living facility. I had a wonderful person who's a licensed clinical social worker that helped us. She worked in a doctor's office here in town, and was quite helpful in knowing what we should look at for facilities that would be good for my mom. 

It's difficult. Planning for this in advance helps because sometimes there is a wait list, or you can't get into the facility that you want, or there can be some complications. 

Josh:  So that must have been pretty stressful, right? 

Doug: Yes. For sure. And she was still cognitively intact. We managed to get out for a few fun events and go to the Symphony in Fort Collins and Denver—but then COVID hit.

Josh: That was especially tough on people in long term care facilities.

Doug:  So she came out of the only environment she had been in for 60 years where she had this huge friend network and stuff. And we sort of ripped her out by the roots and drove her across the country and parked her in this room, and because of COVID, it got to the point where they were stuck in their rooms. Meals were delivered to the room. They were very concerned with transmission in senior living facilities. They had a nurse practitioner who would come once a week and check in on people at the facility, which was great. But it was very hard for my mom to understand what was going on sometimes, and it's incredibly frustrating to be so close yet so far away. She might as well have been on the moon although she was literally 5 miles from my house. Very difficult.  

Josh: That must have been tough, I'm sure. For both of you.

Doug: When I talked to her on the phone, she was scattered. And there was a learning process of learning to diagnose by FaceTime, “What's her mental state?” and observe what's your interaction like with her while you're interacting with her so that you can also know what's going on. We were talking every day and she continued to have some decline and got to a point in early 2021where she needed to go to the hospital. 

They had hazard warnings up on the trailers and stuff, and that was a little personally scary, right? And then you're worried about your parent also. She was admitted under what they call observation for a few days. So this is another one of those big steps off the Grand Staircase, right? With Medicare, you can be admitted under observation, and the doctor will make a determination. There wasn't anything technically wrong with her, but she was having this event. Is it a mental illness event? Is it physical? Is it a combination of both of those things? It's difficult to discern, and if you're admitted under observation, you would think that you're admitted in the hospital, but you're not in the hospital, really. You're being charged for what the hospital's doing for you, but it's not what Medicare considers to be hospital.

Josh: For Medicare purposes.

Doug: They come to you and say, “Hey, you need to sign these things.” You sign away this stuff. I found this out literally looking at stuff online at 3:00 or 4:00 in the morning. My friend who is a social worker and my sister-in-law who's OT says, “This is an issue that people don't know very much about.” And it was fortunate that for us during COVID, administration had passed a waiver to allow people to be covered under this status during COVID, but it was a special exception and it was very close to ending at that time. They ended up extending it. We got very fortunate that we didn't end up having $20,000 bills to pay.

Josh: Yeah, that would add up pretty quickly.

Doug: She was in the hospital for a few days. And then there was a struggle with trying to find a spot for her to go into full nursing care. I ended up getting her in the facility that I thought was the best, and it ended up being  a good place for her. When you have a loved one go in a facility, be aware of this concept of observational status. It's not some clear thing that must be addressed in the hospital. She went in once and then came out and then went right back, which is very bad for the hospital in terms of Medicare. They don't like return visitors coming back.

Josh: So meanwhile, you're the power of attorney, right? You were acting as healthcare power of attorney as well as financial power of attorney. Had you been wearing that hat before, or was she managing all of her own stuff?

Doug: Yes, she was, up until the time she fell. She was always very independent. My dad died suddenly of a heart attack in 1994. He had a dental practice, and she had to close down his practice and do everything with the estate to maintain records. She put everything into a trust, which ended up being quite complicated. She had put personal property in the trust, and the trust was misnamed with her legal name.

Josh: Yes, we hear that a lot.

Doug: There was this whole untwisting of everything. I was trying to sell her car eventually. And that became problematic because it was held in the trust but it wasn't how the car was registered with the State where she resided previously. And I'm trying to settle in another State. I'm not a lawyer, obviously, but I recommend everyone consult somebody who is, and make sure that your estate planning is lined up so that you are truly making things easy for your loved ones. Also revisit those documents as things happen in life.

Josh: So, up until you put on these power of attorney hats, were you privy to all her information? Or did you suddenly end up in this role?

Doug: She told me where the secret location of the key was with the fire safe that she pulled out of my dad's office. She had all her information in there and I had a rough idea of things. I didn't know how much money she had or what investments. Fortunately, since I'm a client of Keystone and my brothers are also financially successful, we didn't have a lot of concern about being able to take care of her. But with things like Medicaid, you have to spend down her assets first. And so it was a real education to go through that whole process. 

I became healthcare power attorney because I was local. It's fairly straightforward in the State of Colorado. If you have another state of residence, it may be more complicated. Please consult a professional. Another issue around that is that often things do have to be notarized physically. At the time, Keystone helped us with notarization virtually, because there were, again, some relaxations in COVID. But executing legal documents in that sort of situation, it's good to have that stuff done up front. We were able to put it together and we had all of us listed as powers of attorney. My two brothers were in succession of each other, if one could not fulfill the duties of a situation.

Josh: We see you were first in line.

Doug: Because, as my brother put it, I was first to the ball. I just literally got on a plane within 4 hours and pulled her out of there two days later. I think she thought she was going to come back someday, but also, I knew that it was right. She was not coming back to her residence. And we had a great time driving back to Colorado together.

Josh: And so at the time, just a practical standpoint, you packed up all of her stuff? 

Doug: One of my other brothers took that on, which is a lot of effort. He was also responsible for selling the house. We did clean out the house and work on that together. He spent like a whole week there, going through things. She fortunately was not a hoarder or a pack rat and had done that already. So that was a huge help. One thing about that is if you're considering Medicaid, which is something that we ended up applying for eventually, people need to be aware that you have to spend down your assets before they will consider putting someone on Medicaid.

Josh: For long term care purposes, right? 

Doug. Yeah. And so we had a unique situation because she was in rural Illinois. We were putting this house on the market during the height of COVID. It's hard to sell a house in that situation. We were getting lowballed by tons of people. So, a very difficult situation there as well. 

As far as costs, assisted living might be $5000 for a month. Skilled nursing care might be $10,000 or $11,000 a month at the time. So we had to get the house sold or pay for her. And we started paying for her between all three of us and had that set up with the facility. But people need to know it’s important to keep meticulous records of everything. 

We knew eventually her house was going to sell, and then she would have a big bucket of money from the house sale to be used to pay for her care. Well, we wanted to be reimbursed for what we had done to pay for her from Medicare. To do so, you have to provide documentation of everything that happened. I was very careful to get records of all this stuff. When I eventually applied for Medicaid for her, which was in 2022, it ended up being 95 pages of documents to the State of Colorado. I tracked all that in a wealth management system that has that legal category where I could put everything that I did for her. Then we could use her proceeds from the house to pay ourselves back because the government is worried that you're playing a shell game with money and assets. 

Josh: Yeah. Elder fraud is a big deal. You want to be sure that people are not getting taken advantage of.

Doug: Yeah, that happens a lot too. And a lot of times people think that Medicare covers long term care. That's not necessarily the case. It  will cover a limited amount of long term care after somebody's been admitted in the hospital. 

Josh: But only for rehab like a skilled nursing facility. I think it's maybe 14 days or something. In some cases it’s surprisingly short.

Doug: Yeah, the way it works is if you apply for Medicaid, they're gonna ask you what you have as far as assets and incomes. You have to disclose everything. And there are Medicaid investigators that are quite good at their job. There is a look back period.

Josh: So it's endlessly frustrating when you are competent and you are being aboveboard and you are taking care of your family member, that you realize why they have to be careful.

Doug: Yeah, absolutely. You have to jump through a lot of hoops to satisfy that. So eventually, she did qualify for Medicaid for about the last five or six months of her life, which is quite a benefit. Another thing that I would mention about Medicaid, it will depend on the State where you reside as to whether or not they'll come after family members for reimbursing the State that's paying for the Medicaid. So depending on your State of residence, you may be on the hook to pay $11,000 a month. In the state of Colorado, that was not the case. Of course we would have paid for her to have care. 

Josh: Yeah, it’s important to understand the rules of the game and stay organized, right? Follow the rules and be organized. And then I assume in her situation, she didn't have any long term care insurance or other coverage. Sometimes that plays in. 

So, shifting gears here, she passed in 2022, correct? So, bring us up to that point where you're taking off the Power of Attorney hat, and you're putting on the executor hat, or personal representative as it’s sometimes called.

Doug: In skilled nursing care, she continued to decline and had some cognitive issues. That was difficult to see, but we could still interact with her. My brothers were out here quite a bit visiting, to see her and keep her engaged. And so we had set up all the Power of Attorney stuff, both financially and for healthcare while she was mentally competent. I was the primary person and my brothers were the backups. She had some money in checking accounts and things like that, credit cards, all those sort of things.

Josh: And you're managing all that. You're paying all the bills.

Doug: Paying all the bills, dealing with everything. When somebody dies, that Power of Attorney that you have for the bank goes away. You don't have access to that anymore and it's all shut down. That was a surprise to me. 

These documents have to be executed when the person is of sound mind. With banks a lot of times you have to use their POA forms. Those forms enabled me to take care of her financial matters and also her healthcare matters, to make decisions for her on her care and everything. You can put in any kind of instruction that you want. But that all expires at death. 

When she passed away in November of ‘22, I had to go through a bunch of pushups to get access to her money. In the State of Colorado, you can file a form if the estate is less than a certain amount, $50,000 I think. The form says to the bank, you must give this person this money. You just walk in there and they give you the money. So that ended up being relatively straightforward. Just know that there may be a bridge period when you are serving as an executor where you're needing to fill in with your own funds to cover bills for your deceased.

Josh: Again, keep good records because you might have to reimburse yourself at some point, right? So, before she had passed, on the average week, how many hours a week do you think you were spending on managing your mom’s finances or healthcare?

Doug: Maybe on the order of five hours a week that either my wife or I were visiting her when we could after COVID calmed down. And then financially. 

Josh: Then after she passed, now you've got the executor hat on and you're trying to handle all the affairs. What was that like? What are some things along the way that you didn't know that you wish you would have known?

Doug: The biggest surprise, I think, was the POA expiring because I can't just use her account or write checks for her anymore.

Josh: Yeah, they probably froze the account temporarily, right? 

Doug:  Yeah, and they signed out quickly because the Social Security Administration knows right away as soon as somebody dies.

Josh: They find out. What I've heard is it's the Funeral Home that informs Social Security. We've seen that happen where if someone received a Social Security payment after the date of death, Social Security has the ability to yank the money back from the account.

Doug: Exactly. And another key thing was that I kept her phone number. She had a landline. We were closing down accounts, and my son had an old phone, so I had her number ported to his cell phone.  That turned out to be absolutely critical, because the IRS wants to confirm who you are when you're trying to do things. She never did anything electronically. Her lawyer did everything for filing her taxes. But of course, I'm living in another State and I'm having to identify myself to the IRS, electronically. I have her Social Security number, and fortunately, because I had her phone number, I was able to persist through that. But I had many trials with the IRS, trying to ensure that her taxes were properly taken care of. 

Josh: Keeping the phone number is advice that we've gotten from a lot of people. Yes, these days everything is 2-factor authentication, and so you don't want to be too eager to shut down that cell phone, right?

Doug: Yes, people think, “I just need to get rid of these things now.” Never shut all these things down. Be careful. It's much better to spend $100 or $200 to keep somebody's accounts open for a while and transition them to some other way that you can get access to them. That's super important. With e-mail access, to remove e-mail passwords, I had all that already in my toolbox, so that was a good thing. 

Josh; So, you're handling all the taxes, paying out final bills, trying to settle the estate. From the time she passed how much time until things were wrapped up with all that? 

Doug: It was probably six months, which I think is probably pretty good for most people.

Josh: That is pretty good, in my experience that is pretty quick. It can be a lot longer than that; it could be multiple years for some people. And in some cases, people don't necessarily agree to take it on. They just find out. This is encouragement for people to have these discussions with their loved ones ahead of time, so they know. In a lot of cases, our client comes in and says, “Mom just passed, and I found out I'm the executor.” It’s all of a sudden, and they knew nothing about anything. They’re thrust into all of this. A lot of people will step up, of course, especially in family situations. But  they don't necessarily have a lot of details, so they do a lot of chasing and treasure hunting to figure it all out.

Doug: My mom had served as executor for her cousin and for her mother, so at least there was a hint given us, that she’d done these things and where the key was to all the records and the trust was pay on death. And where her accounts were and in what bank. She at least had good records and so I think it's particularly important if you have a family member who is in cognitive decline, to be sure you have access and you know where everything's at. That's the benefit of having Keystone as an advisor firm, for example. They have that information for you and can access it upon death, and help whoever is executing the estate. But if you don't have that, you definitely want to be conscious of that, particularly in cases of dementia or cognitive decline.

Josh: Those are tough situations. And yeah, certainly stay organized. And if you have experts that are involved, say if she had worked with an advisor, get in contact with them, whether an attorney, a tax person or Certified Financial Planner. All those people can help and usually are very willing in this business. 

Doug: The lawyer was very helpful to us selling the house and had done her taxes previously and all that. 

Josh: So overall, you got things wrapped up in six months, but there probably were still some straggler items after that. Are there any particular things that you looked back and wished you  would have known?

Dough: One huge epiphany is that she went through Hospice, and I think people think that when you enter Hospice, that means you’re going to die very soon. But that's not the case at all. For example, Jimmy Carter has been in Hospice for over a year, right? She was in Hospice, and then she was off Hospice. They have the concept of palliative care with Hospice, which is to make sure they're as comfortable as possible and that their wishes are executed as they wished them to be executed for their healthcare. Hospice was super helpful. So we had Pathways Hospice here in Northern Colorado. They were a godsend for us, taking care of her and ensuring that she was as pain-free as she could be during her transition.

Josh:. Yes. Be aware of Hospice and use that as a resource. They're incredibly accommodating when pivoting to that other grief process, which is tough. Obviously, we've been talking mostly about the business end of things, but during the grief process, you had some resources there, too, that you were able to lean on. 

Doug: My wife was an amazing support to me and she's done a lot of grief work through our church where during COVID, she was helping people who lost spouses and started a number of grief groups. She was a great help to me and to my mom. When my father passed suddenly of a heart attack, I always described it through the eyes of an engineer, and my engineer friends listening will appreciate this. You have sort of the infinite step function which is this thing that goes to Infinity on the X axis. Mom’s was much more steady with these steps down over time. On a graph, there's this time that goes by. But the area under that curve is the same, although the impact that it has on you is spread out over time instead of being this sudden shock. In some ways, there's relief that she's not suffering anymore. But you're sad for not having interaction with her. And so I would definitely say, take advantage of resources. Hospice is a good resource. They have grief counseling you can take advantage of after a loved one passes and they will continue to reach out to you even a year later and offer their help. 

There's a great resource in Northern Colorado: Doctor Alan Wolfe Center for Life Loss and Transition. He's written a number of books that are great resources for people in the process of mourning and grieving. It's a process and you can continue to go through that process over time and you know you'll have these grief bursts. Accept those when they come and remember the goodness too. And hopefully that helps uplift you to remember you had all these great times. So, definitely don't minimize the grief that you will feel. And if you need help processing that, please get some help.

Josh: And then the grief cycle is not clean, right?

Doug: It's not exactly sequential. You can go back. With anger, sadness, it's not like when you go past that, it never comes up again. I was just back to my 40th high school reunion, and I did go down to my parents’ graves. I've never been able to go there and not just be a mess and really upset. I went back a beautiful day on Sunday this past weekend to visit them and just hang out. I felt some peace and it was a very good thing. I hope that happens for everybody to get through.

Josh: My parents both turned 80 this year and on some level I know they won't be here forever. There will be a time. And having to go through that often can be confusing if you don't have somebody to help from a business standpoint. It definitely makes sense to pull together a team to get through that, right? 

Doug: Yeah. Many people helped us through this process. There’s an incredible network of people out there that can help you. 

Josh: Thank you. Thanks for sharing your story. 

Doug: Thank you.

Josh: If anybody needs assistance, whether you're a client or not, if you just need resources, certainly use us as a resource. We can point you in the right direction if nothing else. We're not attorneys. We don't do your estate documents. But if you haven't yet done so, get all your ducks in a row and get organized. This is the time to do it because you don't know when those things will be needed and you do want to make things as easy as possible on the folks that will be managing stuff for you. 

Thank you so much for tuning in. As always, we want to hear feedback. So e-mail me at josh@keystonefinancial.com with any feedback you may have, especially if you have any topics or things that you want addressed in the future. Also help us get the word out by doing two things. Number one, rate us five stars on whichever service or directory that you're pulling this up on, whether Apple or Google, whatever it is. Number two, if you would subscribe, that helps us out as well and it also helps you out because it gives you the updates when new episodes come out. Thank you so much. I appreciate you taking the time to be with me, and God bless.

The opinions voiced in this episode of the Wiser Financial Advisor with host Josh Nelson are for general information only and not intended to provide specific advice or recommendations for any individual. To determine what may be appropriate for you, consult your attorney, accountant, financial or tax advisor prior to investing. Investment advisory services offered by Keystone Financial Services, an SEC registered investment advisor.