Oregon State Bar Bulletin — MAY 2011

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Keys to a Happy Retirement

Oregon lawyer Susan Elwood’s1 elderly mother wasn’t formally diagnosed with Alzheimer’s disease until last summer.

But 10 months earlier, Elwood had become concerned that her mother’s already significant memory and cognition problems might result in her being financially exploited.

“This 80-year-old guy at her apartment complex started hitting on her, monopolizing her time,” says Elwood. “We felt like he was trying to keep her away from us. Then I found a brokerage statement for him in her apartment. I came in and said, ‘Mom, remember [your lawyer] said for me to take over?’ In a whirlwind six hours, I got all her financial stuff boxed up and out of there.”

“It scared me,” says Elwood, who had her mother’s power of attorney but hadn’t exercised it. “It made me realize how vulnerable she was.”

Had Elwood been dealing with these issues in another state, she might have consulted a multidisciplinary practice instead of her mother’s attorney and, separately, a senior-housing referral agency. But Oregon currently has no multidisciplinary elder law practices. And some people would like to keep it that way, arguing that they create ethical issues, are not cost-effective for attorneys or clients and don’t provide better services than elder law lawyers who refer clients out for nonlegal services.

“Any elder-law attorney who has been in practice any amount of time already is in a ‘multidisciplinary practice,’” says Portland elder-law lawyer Tim Nay. “We know who provides good care.”

History of Elder Law and Multidisciplinary Practice
Nay opened the first private elder-law practice in the Northwest in 1984. Three years later, he became the first president of the National Academy of Elder Law Attorneys.

“My job is just the most wonderful calling,” says Nay, who was a licensed clinical social worker before he graduated from Willamette University College of Law in 1984. “To be able to serve people when they are going through the worst crises of their lives, helping them sort through issues, do planning. After a day’s work, I have made a difference in a client’s life. That’s why I won’t retire until I can’t do it anymore.”

But, as some elder law specialists frankly acknowledge, the economic rewards of serving aging baby boomers and their parents also is a draw.

For example, Vanderbilt University Law School graduate Tim Takacs told his alumni magazine that he was motivated to specialize in elder law, in 1990, in part because he saw it on a list of “hot” new practice areas.

Takacs, who practices in the Nashville area, is the founder of the Arizona-based Life Care Planning Law Firms Association, the chief proponent of multidisciplinary elder-law practices.

In 1999, the American Bar Association’s Commission on Multidisciplinary Practice recommended that the association amend its model rules to permit lawyers to deliver legal services through multidisciplinary practices (MDPs).

“An MDP would hold itself out to the public as providing nonlegal and legal services — an arrangement by which a law firm joins with other professional firms and directly or indirectly shares profits,” Thomas K. Elden, then a senior assistant attorney general, said in a 2000 Bulletin article, “Multidisciplinary Practice or Millennium Disaster?”

Elden, who successfully prosecuted Oregon lawyers involved in selling trusts, was critical of the concept, which the ABA rejected in 2000.

Then, says Elden, in 2001 “The Enron scandal broke, showing an enormous failure of oversight by accounting firms and their lawyers.”

“The strong push for multidisciplinary practice withered,” says Elden, who recently retired from the Oregon Department of Justice. “Personally, I was glad to see it.”

Withered, but didn’t die, because in 2006, Nashville’s Takacs founded the Life Care Planning Law Firms Association.

The association, whose website currently lists 92 members in 29 states plus the District of Columbia, is made up of lawyers whose staffs include nonlegal professionals like nurses, geriatric care managers, insurance specialists and financial planners.

“Life Care Planning,” says the association, “is an innovative and holistic approach to elder law that helps families respond to the challenges created by long-term illness or disability before, during and after the elder’s transition to long-term care.”

“While traditional elder law focuses on saving the elder’s money to pass on to the next generation,” the association asserts, “Life Care Planning focuses on using the elder’s money for the elder’s benefit. The goal is to maximize quality of life and independence while preserving family wealth to the greatest extent possible.”

To which Nay says, in effect, hooey.

“The idea that having a social worker on your staff means providing the best expertise for the nonlegal part of your practice is ludicrous,” he says.

“Very few National Academy of Elder Law Attorneys members choose to spend the money on Takacs’ program,” Nay concludes. “I don’t know of anyone in Oregon who is interested in it.”

Multidisciplinary Firms and Oregon’s Ethical Rules
That assessment aside, Takacs’ association is trying to enlist members in Oregon: a 1.5-day life-care planning “Fundamentals & Practice Program” is scheduled for June 24-25 in Portland.

But, while the program will cover such topics as “‘Four fundamental factors that threaten traditional elder law practice’; ‘The business case: pros and cons of the elder-centered law practice’; ‘Finding and hiring your elder-centered law practice team’; and ‘Will you make the transition?: three truths about your competition,’ it doesn’t address whether lawyers in Oregon can adopt the multidisciplinary practice model and still be in compliance with this state’s Rules of Professional Conduct.

“I’m not really familiar with the life-care plan concept, although I have heard of it,” says the chairperson of the Oregon State Bar’s Elder Law Section, Brian Haggerty of Newport. “The first issue that occurs to me is, ‘I thought lawyers are not supposed to associate in firms with nonlawyers.’”

Oregon State Bar General Counsel Helen Hierschbiel says there are “ethical implications” in lawyers employing nonlawyer professionals.

“There are conflict issues that can arise,” she says, “advertising issues, fee-sharing issues.”

Hierschbiel cites RCP 1.7(a)(2), which provides that a current conflict of interest exists if “there is a significant risk that the representation of one or more clients will be materially limited by…a personal interest of the lawyer...”

For advertising, the relevant rule is RPC 7.1, which generally provides that any communication about a lawyer may not be false or misleading.

Finally, and perhaps most crucially, Hierschbiel cites RPC 5.4 (Professional Independence of a Lawyer). Under that rule, says Hierschbiel, lawyers can work directly with other professionals. They just can’t let nonlawyers direct or control their judgment or share legal fees with them. So a lawyer or law firm could hire nonlegal professionals, such as nurses, insurance specialists and the like, but those employees could not own a piece of the law firm, hold a position in the firm that would allow them to control or direct the lawyer’s judgment or share any legal fees.

RPC 5.4 is largely identical to the comparable ABA Model Rule.

Pamela Carlson, executive director of the Life Care Planning Law Firms Association, says that it is her understanding that “If the rules allow you to hire a nurse and pay that person a salary, then the life care planning model would be in keeping with the Oregon rules. Life Care Planning Law Firms’ elder care coordinators do not own any part of the firms and do not direct the legal work or share fees.”

But Elden remains unconvinced.

“Lawyers who have had a second profession often make great lawyers because they bring that rich expertise to bear in their thinking and analysis of problems,” Elden says of lawyers like Nay, whom he doesn’t know. “That is different from multidisciplinary practice, which is promoting two professions at once. What drives multidisciplinary practice is economics, either for an individual or a firm.”

“The minute you combine some disciplines with a legal practice, you invite ethical questions and issues,” says Elden, who spent his last 18 years at the Oregon Department of Justice in the Financial Fraud and Consumer Protection Section. “My advice — free to anyone contemplating grafting nonlegal work into your estate planning practice — is ‘don’t do it.’ If you want to make more money, market yourself better, do a better job at what you do and do more estate planning.”

Making and Spending Money
Whether multi-disciplinary practices actually make their lawyers more money is difficult to say.

Nay, for one, is skeptical.

“Takacs’ firm is one of the very few in the country that can afford this concept,” says Nay, who practices with five other lawyers as Nay & Friedenberg in Portland. “I’ve talked to hundreds of elder law attorneys, and they can’t afford it. I can’t think of any Oregon firms that are big enough, except us and maybe (Wesley) Fitzwater and (Donna) Meyer in Clackamas and The Elder Law Firm in Portland.”

Nay also says that he is “not a big fan” of the multidisciplinary model for the sole practitioner.

“If you’re a solo with one assistant, one client could occupy you fulltime,” he says. “Supervising an allied, nonlegal professional on staff could be overwhelming.”

Whether multidisciplinary law firms achieve the Life Care Planning Law Firms Association’s stated purpose of “using the elder’s money for the elder’s benefit” also is open to debate.

In a 2003 article still being distributed to bar associations nationwide, the association’s founder, Takacs, used language that suggests the goal may be separating the elderly client from his money.

“In order to convince the client to retain our Life Care Plan services,” Takacs wrote, “the first meeting (as we call it) is carefully structured.... 1. We describe the problem (‘the long-term care system is a maze;’ ‘the nursing home will take all of Dad’s money.’) 2. We present a vision of the solution centered on the firm’s expertise... 3. We introduce the concept of the Life Care Plan... At the conclusion of the first meeting, we ‘close’ – that is, we quote a fixed fee for the Life Care Plan and ask the client for payment.”

While Nay says he heard a “$25,000 figure from a client who had been to a ‘life-care planning’ attorney for help with long-term care protection several years ago,” the association’s executive director, Carlson, says that “To my knowledge, there is not a standard fee.”

But, regardless of what fees are charged, the association’s president, Stephen Spano, says the concept actually does save elders and their families money.

For example, Spano, who has a multidisciplinary elder-law firm in the Boston area, told the Bulletin about an elderly client with cognitive problems who his firm’s multidisciplinary team placed in an alternative living facility instead of a nursing home.

“He has more visitors, and is being doted over by the female residents,” Spano said. “And it costs less than a nursing home, so his beneficiaries are going to be very happy: they’ll get more money.”

Providing the Best Services
Spano says that he’s convinced the multidisciplinary model provides elderly clients and their families with the best services.

“Tim (Takacs) is a visionary,” says Spano. “Nobody knows more about life-care planning than Tim.”

“The goal of life-care planning,” Spano explains, “is to get people earlier and help families earlier. It’s truly holistic since it helps families through the entire maze. The nursing home is the most expensive place people can think of to go; it’s also the place no one wants to go. The question is: how do we use the money that’s available now to provide the best possible care? People don’t think of us (multidisciplinary firms) as a hub, but we are. The system is so fragmented now, people don’t know where to go. People walk in and say, ‘We’re here to protect the house.’ Not really. What they mean is, ‘We’re here to protect Mom and Dad.’

But Nay says that elderly moms and dads, and their families, are being protected in Oregon without the multidisciplinary model.

“The starting place for describing elder law is a cross between law and social work,” says Nay, who earned master’s degrees in psychology and clinical social work before he went to law school with the initial goal of doing divorce mediation. “I just happen to be a lawyer and a social worker.”

“When the elder law movement began in the ’80s,” says Nay, “it was described as a cross because so many clients had received diagnoses of Alzheimer’s, Parkinson’s, Lou Gehrig’s, and were going through the crises of their lives. Many had never seen a lawyer in their lifetimes.”

“There’s a huge benefit in coming to an elder law attorney,” he says. “Next to the treating physician, the lawyer is the most important specialist in the elder’s and his spouse’s lives. Families don’t know whom to trust. That’s why they come to you: you give them unbiased information.”

But, he acknowledges, “For so many of the issues and current problems that come into an elder law lawyer’s office, legal solutions aren’t the answer. Probably more than in any other area of law, our clients need referrals and information. It’s a huge part of any elder law attorney’s practice to refer to caregivers, facilities, doctor and nondoctor specialists, homemaking/housekeeping, respite care and support groups.”

When lawyer Susan Elwood’s mother’s mental faculties really began to fail in summer 2009, Elwood saw the attorney who had drawn up her parents’ wills and trust, took a class offered by a local hospital, read up on the subject and consulted Adult Living Alternatives, a Portland-based resource. (Another company that helps seniors and their families find housing options, Choice Advisory Services, is run by OSB member Meredith Williamson; see sidebar story. Choice also refers clients to real estate agents and financial planners for advice in those areas.)

For Elwood, her mother’s decline was an unwelcome – but familiar – development.

“Dad had dementia,” she says. “Never to the point where he had to move, but by end of his life Mom had to have a lot of help bathing him, etc. It’s so hard for the persons with dementia. They know something is wrong, especially in its middle stages. We’d already lived through it with Dad, and to see if start happening with Mom was a bummer.”

“My mom was a smart woman,” Elwood continues. “That’s one of the things that made it so hard. She always knew her own mind. She was married almost 50 years. Five years ago, she would have seen through this guy (the elderly man whom Elwood and her siblings feared might exploit their mother financially). Now you can use logic and everything else and she’ll insist that she’s correct.”

Elwood says she was happy with the options her family pursued to deal with her mother’s assets and to obtain appropriate care.

“Her attorney knows a lot,” she says. “She seemed quite familiar with what families have to go through and what’s involved: elder law seems like the main, if not the only, legal work she does. We used her to make sure everything was in proper form. She also cleaned up some stuff to avoid negative tax consequences and probate.”

The specialized Alzheimer’s care facility the senior housing resource suggested also seems to be working out well.

“It’s designed for people with memory problems; the staff comes around to their rooms and rounds them up,” says Elwood. “Every time I call, Mom’s not in her room: she’s out doing something.”

As for whether Oregon families dealing with elder care issues in the future will have the option of handling everything through one, multidisciplinary firm, the Elder Law Section’s Haggerty says, “It will be interesting to see what happens.”


1 Elwood’s real name has been changed to protect her family’s privacy.

Janine Robben has been a member of the Oregon State Bar since 1980 and is a frequent contributor to the Bulletin. She is legal director of the Oregon Crime Victims Law Center.

© 2011 Janine Robben

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