Beyond Structured Settlements

NAELA 2013 Annual Meeting

The National Academy of Elder Law Attorneys (NAELA) celebrated its 25th anniversary last week in Atlanta - commemorating its past achievements, analyzing current legal and demographic issues and preparing for future growth and development.

Among many former NAELA Presidents in attendance, Vincent Russo was given the honor and challenge of reviewing NAELA's "25 years in 25 minutes". Russo's historic overview highlighted NAELA's early decision to open its legal membership on a "non-exclusive" basis to create a new breed of attorneys dedicated to community service. NAELA's membership has expanded its focus in recent years to embrace special needs as well as elder law issues.

With more than 4300 members and a strong financial balance sheet, NAELA's resources now include: the NAELA Foundation, multiple publications including the NAELA Journal, Aspirational Professional Standards, a vibrant website featuring a comprehensive library and hosting NAELA's active online community, specific practice sections, state chapters, robust educational conferences and certification programs, multiple annual awards, plus a highly competent staff.

Elder Abuse

NAELA's 2013 Annual Conference agenda offered a diverse educational experience plus 26 exhibitors for more than 250 attendees. One of the featured topics was financial "elder abuse", a serious and under-reported problem with an estimated annual cost exceeding $3 billion in the United States.

Guest speakers addressing financial elder abuse included Mickey Rooney and Tony West. Rooney, the 92 year old actor, testified about elder abuse before a U.S. Senate committee in 2011. Appearing at NAELA's conference via live video, Rooney described how he was victimized and rendered penniless by two of his stepchildren. West, Acting Associate U.S. Attorney General, oversees the U.S. government's efforts to prevent elder abuse.

Additional topics that received multiple presentations at the NAELA conference:

• Skill development - advice for running a successful elder law and/or special needs legal practice.
• How changing demographics are impacting special needs and elder law practice.
• Social media and related Internet technologies.
• Fiduciary responsibilities for attorneys representing special needs individuals.
• Legal updates - for estate planning, special needs and elder law.
• Drawing a line on what constitutes the practice of law.
• The future of long term care.

Structured Settlements and Special Needs Planning 

Patrick Hindert, author of the "Beyond Structured Settlements" blog, spoke at the NAELA conference about the challenges of integrating structured settlements and special needs planning into a collaborative settlement planning profession. Hindert's presentation addressed:

• What is known (and not known) about settlement planning.
• Why structured settlements and settlement planning are strategically important for special needs attorneys.
• New standards and practices that are reshaping settlement planning.
• Public policy issues which will determine the future of settlement planning.
• How special needs attorneys can expand their settlement planning practice.

The Future of Elder and Special Needs Law

To help celebrate NAELA's 25th anniversary, the NAELA Journal is dedicating its 2013 Spring and Fall editions to a two-part symposium on the future of Elder and Special Needs Law. The editors have asked leading U.S. legal authorities "to predict what the law and our practices might look like 25 years from now and the challenges that clients, our society, and we, as Elder and Special Needs Law attorneys, will face."

Congratulations to all NAELA conference participants, especially NAELA President Gregory French and conference Co-Chairpersons Rebecca Morgan and Edwin Boyer, for an outstanding 25th anniversary meeting. Continued success for NAELA and its members in representing and advocating for the rights of elderly and special needs individuals.

For S2KM's reporting about:

• Prior NAELA conferences - see the structured settlement wiki.
• How the Affordable Care Act impacts personal injury settlement planning - see the "Affordable Care Act" - Part 1 and Part 2.

Ohio NAELA 2012 UnProgram

For the past several years, the National Academy of Elder Law Attorneys (NAELA) has featured "UnPrograms" as part of its educational curriculum. Earlier this week, Patrick Hindert, S2KM's primary blog author and a NAELA member, attended the Ohio NAELA 2012 UnProgram as a participant.

What is an UnProgram? NAELA's UnPrograms are moderated group discussions about specific topics. The topics typically are identified in advance and the discussions are informal. The handouts for the NAELA Ohio Chapter's 2012 UnProgram were limited to: a list of topics; suggested "Ground Rules", and a one-page evaluation form.

Compared with traditional conference lectures and panels, NAELA's UnProgram discussions are informal and encourage participation by all attendees.The discussions frequently focus on practice issues or actual cases and result in the exchange of ideas and best practices.

Based upon S2KM's limited experience with UnPrograms, these discussions seem to work best with less than 15 participants per topic. For larger groups, participants select from among multiple discussions which occur simultaneously and require space planning. Although it helps to have a moderator with specific subject matter expertise, subject matter experts inevitably emerge during the discussions. Individual discussions can vary in time allotments.

The agenda for the Ohio NAELA two day UnProgram featured topics suggested in advance by participants:

• Increasing efficiency and profits with technology.
• Cloud computing.
• How to market and expand an Elder Law practice.
• How Elder Law and Special Needs Law differ.
• Using care managers.
• Medicaid issues - planning scenarios; estate recoveries; eligibility issues; appeals process; spend down options; annuities; promissory notes; home exemption.
• Veterans benefit issues - planning priorities; irrevocable trusts; proposed pension legislation.
• Special pensions.
• Structured settlements and settlement planning.

Some of the "Ground Rules" for the Ohio NAELA UnProgram:

• Participants are encouraged to be polite and warned not to interrupt other participants.
• Participants are encouraged to ask any and all appropriate questions.
• Participants can politely decline to answer any questions.
• Discussions about fees and other issues that violate anti-trust law are prohibited.
• All other ideas are welcome and encouraged.
• The moderator is directed to monitor individual input to encourage broad participation.
• Break out sessions are suggested if and when a subset of participants want to discuss a specific subtopic or related topic.
• When participants become disinterested in a discussion topic, they are encouraged to move to another group.
• Groups are not expected to backtrack when new participants are late entering a discussion.
• Individual participants are encouraged to continue discussions during breaks and meals.

Although Ohio NAELA's UnProgram organizers did not attempt to integrate Internet use or Internet resources into the 2012 UnProgram, the UnProgram's informal, horizontal format appears well-suited for both synchronous and asynchronous Internet adaptibility. Private wikis with discussion features could prove especially valuable for organizing, capturing and leveraging the considerable knowledge generated by the Ohio NAELA UnProgram.

Additional resources and information about Internet-based knowledge management (KM):

• For attorneys - see the public wiki and related concept map (with embedded links) S2KM developed with Denham Grey and Barbara Bowen in 2006 introducing web 2.0 for lawyers.
• For structured settlements - see the structured settlement wiki.

Massive Open Online Courses

Although the Internet has already transformed how we communicate, work and interact socially, its impact on formal education has been surprising limited. Parents of college students continue to pay exorbitant costs to enable their sons and daughters to attend colleges and universities where in person (F2F) lectures predominate. Professionals continue to attend expensive in person conferences to obtain continuing education credits.

Massive Open Online Courses (MOOCs) represent a relatively new Internet development with the potential to transform our educational paradigms.

Although the idea of moving classroom instruction and educational content to the web has existed since Al Gore (claims to have) invented the Internet, most educators and educational stakeholders have resisted the idea. More recently, MOOC companies such as Coursera, Udacity, and edX have expanded their participants and appear to be attracting significant investment and generating considerable growth.

S2KM recently became aware of MOOCs during a conversation about knowledge management with Dr. Martha Pollack, Vice Provost for Academic and Budgetary Affairs at the University of Michigan. Dr. Pollack, who previously served as Dean of the School of Information at the University at Michigan, specifically recommended Coursera.

Coursera is a social entrepreneurialship company that currently partners with Princeton University, Stanford University, University of California, Berkeley, University of Michigan, and University of Pennsylvania. Their online courses are free and open to anyone. Patrick Hindert, S2KM's author, has signed up to participate in a six week course taught by Dr. Charles Severance titled "Internet History, Technology and Security" which begins July 23, 2012.

What do MOOCs have to do with structured settlements and settlement planning? Currently nothing - other than to suggest the MOOC movement, if successful, could impact and improve professional as well as academic education. The need for improved education seems especially true for settlement planning on account of its relative complexity, changing legal and financial rules and multi-professional teams.

The Wikipedia entry for "Massive Open Online Courses" identifies several organizing principles for MOOCs including: aggregation; re-mixing; re-purposing; feeding forward; and connectivism. One of the earliest MOOC courses (2008) titled "Connectivism and Connective Knowledge" was taught by George Siemens and Stephen Downes.

Proponents of connectivism, according to Wikipedia, believe it represents a new theory of learning "based on the premise that knowledge exists in the world rather than in the head of an individual." Consequently, one aspect of connectivism is the use of social networks comprised of nodes and connections as a primary metaphor for learning.

As structured settlement and settlement planning leaders contemplate how to improve and grow their related markets, industry stakeholders might benefit from greater knowledge about MOOCs and might consider the following principles of connectivism as set forth in Wikipedia:

• "Learning and knowledge rests in diversity of opinions.
• "Learning is a process of connecting specialized nodes or information sources.
• "Learning may reside in non-human appliances.
• "Capacity to know more is more critical than what is currently known
• "Nurturing and maintaining connections is needed to facilitate continual learning.
• "Ability to see connections between fields, ideas, and concepts is a core skill.
• "Currency (accurate, up-to-date knowledge) is the intent of all connectivist learning activities.
• "Decision-making is itself a learning process. Choosing what to learn and the meaning of incoming information is seen through the lens of a shifting reality. While there is a right answer now, it may be wrong tomorrow due to alterations in the information climate affecting the decision."

For information about structured settlements and knowledge management, see the structured settlement wiki.

Settlement Planning 2012 Conferences

During the past two months, S2KM attended and reviewed three national conferences that featured settlement planning issues:

• ASNP 2012 Annual Meeting
• Risk Settlement Planning Practicum - see also: Structured Settlements and Settlement Planning
• SSP 2012 Annual Meeting
  • Part 1
  • Part 2

 In addition to many technical and product presentations (identified and/or summarized in the above links), what did attendees learn about fundamental settlement planning issues?  And what fundamental issues still need to be addressed more directly at future conferences before settlement planning becomes a recognized profession?

Definitions - Three conference participants offered definitions for "settlement planning" and/or "settlement planner":

• Joseph Tombs - "Settlement planning is a profession helping recipients of settlement proceeds use those proceeds to achieve post-loss goals and transition successfully to post-settlement financial life. Settlement planners represent a blend of several professionals: part tax lawyer, trial lawyer, special needs lawyer, financial planner, annuity specialist, social worker, and medical case worker."
• Timothy Morbach - "Settlement planning requires due diligence and informed consent. In that context, settlement planning provides a framework within which settlement stakeholders are able to craft case-specific terms and conditions, legal documents, financial instruments, plus related work product, to resolve claims and achieve safe harbor reflecting their respective best interests."
• Patrick Hindert - "The primary difference between special needs planning and settlement planning is that special needs planning includes clients whose disabilities result from many causes including but not limited to personal injury or workers compensation accidents."
• Note - "Rule 1: Terminology" in the SSP Standards of Professional Conduct provides multiple definitions related to settlement planning including the following for "settlement planner": "a representative who provides advice and other services to a person participating in the design, negotiation or implementation of a settlement or satisfaction of judgment for the benefit of a person claiming a legal entitlement to an award of damages or other compensation. A settlement planner may represent a plaintiff, a defendant, an insurer, a guardian ad litem, an heir of a claimant, an attorney or another person participating in the settlement process."

Emergent Profession - Several conference speakers who discussed settlement planning from a structured settlement perspective described settlement planning as a larger and more complex successor business and profession:

• Joseph DiGangi - "Today we find our industry at a crossroad. In order to move forward, our only choice is to build great business models around the planning first approach. Settlement planning represents a needs-based consultative business model based on benefits, not products."
• Joseph Tombs - "Selling structures is easy. Expectations are low. Any primate can run quote software. A fixed annuity is one of the most simple financial products in the world. We are building a new profession that requires constant education and practice standards. Settlement planning increases expectations and potential liabilities. The more we study and practice settlement planning, the more we realize its complexity and understand its challenges."
• Charles Schell - "The Claims Management model benefits the settlement planning industry and Settlement Planners should acknowledge the benefits which include product marketing and continued protection of IRC sections 104(a)(2) and 130. Concurrently, defense brokers should recognize the benefits of collaborating, rather than competing, with Settlement Planners. These benefits include access to and trust of the customer, an awareness of financial needs and family issues plus multi-product financial solutions that feature structured settlements and enhance their sale."
• Jack Meligan - "SSP and its members have been promoting the practice of Settlement Planning as a more comprehensive solution for the financial issues facing personal injury victims and their families, and the profession of Settlement Planning as the next evolutionary step for members of the financial and legal communities that serve these injured Americans."
• Patrick Hindert - "The structured settlement business models that seem "normal" today began with a choice that made sense in the late 1970s and early 1980s. They have survived despite changes impacting the justification for that choice. Settlement planning is an emergent system in which many different elements interact. Settlement planning is producing a new business model that is influencing all of its constituent elements including structured settlements."

Multi-Professional - The professional backgrounds of conference participants provides some indication of an emerging community of professional practice and its collective knowledge base:

• Special Needs Attorneys - Michele Fuller, David Lillisand; Kevin Urbatsch; Rene Reixach; Jason Lazarus; Annette Hines; Linda Brown; Vincent Russo; Michael Amoruso; Harry Margolis.
• Tax attorneys - Robert Wood; Jeremy Babener; David Higgins.
• Miscellaneous attorneys - Professor Carl Pierce; Richard Risk; Daniel Hindert; Patrick Hindert; Karen Meyers; Mark Popolizio; Steve Riley.
• Settlement Trustees - Travis Finchum; Frank Maguire; Christi Fried; Wesley Cosgriff; James Creel.
• Financial and insurance professionals - Jack Meligan; Charles Schell; Joseph Tombs; Joseph DiGangi; Mark Wahlstrom; Mal Deener; Timothy Morbach; John Woolway; Robert Noack; Paul Hansen; Major General James W. Comstock; Anthony Prieto; Robert Birney; Jerry Hulick.
• Medicare Set-Aside Specialist - Douglas Shaw.
• Lien Resolution Specialist - Daniel Alverez.
• Note: none of the conferences featured guardian ad litems, life care planners or damage allocators as speakers.

Unanswered Questions - From S2KM's perspective, future settlement planning conferences need to more directly address the following issues:

• How large is the United States settlement planning market?
• Who comprises (and selects) the settlement planning team?
• What criteria and process (e.g. request for proposal) are appropriate for selecting members of the settlement planning team?
• What professional licenses and certifications are applicable?
• What primary laws and regulations apply to settlement planning?
• What work product does each settlement planning team member provide?
• Who integrates their individual work product into a settlement plan - and how?
• When is a settlement plan appropriate?
• What are the standard components of a settlement plan?
• What are the product suitability and disclosure standards for settlement planning?
• What does a settlement plan cost?
• What other metrics (besides cost) are appropriate for evaluating the success of a settlement plan?
• How are settlement planning team members compensated?
• What alternative compensation methods and/or business models would allow settlement planning to become more efficient and/or reduce costs?
• Once implemented, who has responsibility to monitor and/or amend the settlement plan?
• What are the Defendant’s responsibilities and duties in settlement planning?

For professionals and product providers interested in learning more about settlement planning, see:

• The Society of Settlement Planners (SSP) website.
• The Registry of Settlement Planners (RSP) website
• The structured settlement wiki - settlement planning page

ASNP 2012 Annual Meeting

The Academy of Special Needs Planners (ASNP) hosted its Sixth Annual Conference March 8-10, 2012 in Memphis, Tennessee. Consistent with its prior conferences, ASNP and Conference Chairperson Michele Fuller provided an exceptional educational experience featuring preeminent speakers, valuable topics, quality handout materials, plus effective interaction with sponsors and exhibitors.

ASNP is one of three national associations of attorneys, the others being the Special Needs Alliance (SNA) and the National Academy of Elder Law Attorneys (NAELA), whose members engage in special needs planning. The primary difference between special needs planning and settlement planning is that special needs planning includes clients whose disabilities result from many causes including but not limited to personal injury or workers compensation accidents.

One of the highlights of the ASNP conference was a special introductory program titled "Basics of Special Needs Planning" presented by Fuller and two other nationally renowned special needs attorneys, Kevin Urbatsch and David Lillesand. This program addressed the core components of special needs planning (including the role of structured settlements), explained public benefits, and discussed the basics of special need trust (SNT) administration.

Structured settlements were also addressed by other ASNP presenters:

• Rene Reixach - During his presentation titled "Impact Litigation", Reixach highlighted continuing litigation whereby state Medicaid agencies are attempting to disqualify SNTs funded with structured settlements arguing the existence of the secondary market makes structured settlement annuities "saleable" and therefore "countable" as an "available resource".
• Eric Skidmore - Skidmore, a Supervisor in the Office of SSI and Representative Payee Policy at the Social Security Administration (SSA), provided a "Social Security Update" during which he reconfirmed an unpublished SSA position supporting what Reixach reported - i.e. the SSA believes the existence of the secondary market renders structured settlement annuities "available resources" that potentially disqualify special needs trusts beneficiaries from receiving Medicaid.
• Jason Lazarus - Speaking about "Liability MSAs", Lazarus reconfirmed the current cost advantages of funding Medicare Set-Aside arrangements (MSAs) with structured settlement annuities as opposed to cash. His presentation included structured settlement case examples that underscored this cost advantage.

One glaring omission that characterizes most national structured settlement and settlement planning conferences is the surprising lack of attention paid to real life problems and issues experienced by persons with disabilities and their families. The 2012 ASNP conference emphasized these real life problems and issues with three valuable presentations:

• Annette Hines and Linda Brown - Hines and Brown, both special needs attorneys whose families include persons with disabilities, spoke about "Transition Planning" - the change in status for disabled persons from behaving as a student to assuming emergent adult roles in the community. Subtopics discussed: a "Day in My Life" from a parents' perspective; myths about special needs planning; transition agencies; disability support systems; selecting trustees and guardians; role of guardians; personal budgets; housing options including Section 8 qualification and the rent vs.buy decisions; plus group home issues including expense sharing.
• Vincent Russo and Michael Amoruso - Russo and Amoruso presented a series of video vignette interviews of families with disabled persons in their discussion titled "Creating the Right Plan for the Right Situation." Each of the interviews originally appeared on the television show "Family Comes First" for which Russo serves as a host. After the ASNP audience watched each interview, Russo and Amoruso asked questions and offered observations to help ASNP conference attendees learn to differentiate individuals and families on the basis of such issues as: independence; information needs and overloads; life visions; and legal capacity. They emphasized the need to make special needs trusts responsive to specific family situations.
• Harry Margolis and Jerry Hulick - Margolis and Hulick discussed a special needs case study from a financial perspective that emphasized the role of life insurance.  Note: although life insurance companies feature prominently in both the special needs and structured settlement markets, there appears to be almost no overlap among agents distributing their products even though both markets focus on disabled individuals and their families.

Another glaring omission to date at national structured settlement and settlement planning conferences has been the lack of educational inquiry about how the Patient Protection and Affordable Care Act [Affordable Care Act (ACA) - aka Health Care Reform] impacts their customers, their products and their traditional business models. The justification for this educational omission may be the uncertainty resulting from the current constitutional review of the ACA by the United States Supreme Court.

Fortunately, the ASNP has not been paralyzed educationally by this constitutional uncertainty. At the ASNP 2011 Annual Meeting, Cynthia Barrett offered her introductory analysis of how Health Care Reform impacts persons with disabilities. At the ASNP 2012 Annual Meeting, David Lillesand discussed how the prohibition against "pre-existing condition" exclusions mandated by the ACA (already in effect in 22 states) impacts special needs legal practice generally and self-settled (first party) special needs trusts specifically.

In summary, based upon his experience in Florida, where the ACA's prohibition against pre-existing exclusions currently exists, Lillesand believes:

• The need for self-settled (first party) special needs trusts has decreased (except when a beneficiary requires long term institutional care) because the ACA provides better insurance options than Medicaid for many persons with pre-existing medical conditions including personal injury victims.
• Existing self-settled (first party) special needs trusts should be reviewed, in the context of the ACA's prohibition against pre-existing condition exclusions and available medical insurance options, and in many cases terminated.
• Damages for future medical costs in personal injury lawsuits could be reduced assuming the premium costs of newly available insurance premiums become admissible in proving and/or defending damages.

Apropos to transition planning for persons with disabilities and terminating special needs trusts, Travis Finchum, Fuller and Urbatsch spoke about "Trust Transitions" - what to do when your bank trustee doesn't want you anymore or you don't want them? Their subtopics included: "the dark side of pooled trusts"; security of funds managed by individual trustees and pooled trusts; trust protectors; questions to ask potential private professional trustees; fiduciary certification and standards; plus discussion and analysis of trust provisions and revision issues.

To help ASNP attendees improve their legal practice, Steve Riley addressed "Key Strategies for Growing Your Practice and One Sure Fire Way to Kill It". The killer, according to Riley: "Inertia - which is easy; but change is hard" - which is also a good lesson for structured settlement and settlement planning stakeholders.

Congratulations to Chairperson Michele Fuller, the speakers and exhibitors for another outstanding ASNP educational conference. For S2KM's reporting about prior ASNP educational conferences, see the structured settlement wiki.

SSP and NSSTA 2011 Annual Meetings - 6

Both the Society of Settlement Planners (SSP) and the National Structured Settlement Trade Association (NSSTA) featured internet experts as part of their 2011 educational programs.

SSP's speakers, Mark Wahlstrom and Joe Didier, focused primarily on internet marketing and recommended expanded business use of web-based social media tools such as podcasts, blogs, Facebook, Twitter and Linkedin. Wahlstrom offered one especially insightful and negative cultural observation about the structured settlement industry as it attempts to transition from pre-internet to web-based business models, processes and skill sets: "We do not share ideas well in our industry."

NSSTA's speaker, LuAnn Reeb, also discussed internet marketing and social media tools in the context of "business communications today". Her emphasis, however, was more on the importance of learning web-based skill sets and how web-based conversations are replacing traditional one-directional marketing techniques.

How far structured settlement stakeholders must still go to successfully transition their business to the Internet was summed up humorously by one SSP wag who asked speaker Didier at the conclusion of his presentation: "So, are you saying that this Internet thing is really important?"

Assuming the answer is "yes", neither SSP nor NSSTA has articulated any identifiable learning strategy to help members transition from pre-internet to web-based business models, processes and skill sets. At best, their 2011 educational programs will encourage some members to sign-up for Linkedin, Twitter, or Facebook.

S2KM comments and recommendations:

• The structured settlement and settlement planning industries currently function primarily using old (pre-internet) business models, rules, skill sets, tools and culture.
• Web-based business activity introduces new business rules, creates new business models and culture, and requires new skill sets and tools.
• In the words of Kevin Kelly, an internet business pioneer: “as innovation accelerates, abandoning the highly successful in order to escape from its eventual obsolescence becomes the most difficult and yet most essential task.”
• Lectures represent an ineffective teaching method for learning Internet skill sets and tools.
• To help their members accelerate and improve their business transition to the internet, SSP and NSSTA could:
  • Place a greater educational priority on helping members understand the Internet business environment and learn web-based skill sets and tools.
  • Sponsor related workshops utilizing appropriate educational venues. See, for example, The METS Center.
  • Begin utilizing web-based tools (other than email and listserves) to improve committee functions and teach committee members how to collaborate online.
  • Encourage more members to publish, read and subscribe to online blogs, podcasts and wikis.
  • Expand (or create) references in Wikipedia for "structured settlement", "settlement planning" and related vocabulary.
• Advice for structured settlement and settlement planning stakeholders who consider themselves knowledge workers and want to successfully transition their knowledge and work processes to the internet - with or without assistance from SSP and NSSTA:
  • Learn more about web 2.0 and web-based knowledge management (KM).
  • Identify (inventory and/or map) your personal and collaborative (company; industry) knowledge.
  • Learn how to capture your knowledge in formats you can publish and share online (publicly and/or privately).
  • Identify and connect with online knowledge leaders and resources for structured settlements and/or settlement planning.
  • Learn more about web-based organizational concepts such as personal KM, social networks, communities of practice (COPs) and folksonomies.
  • Learn to utilize web-based cultural best practices such as knowledge sharing and continuous learning.

For visual examples of how one company captures structured settlement knowledge, see this Flickr page created by The Settlement Services Group (TSSG). Click on individual diagrams to enlarge.

For complete S2KM reporting about the SSP and NSSTA 2011 annual meetings, see the structured settlement wiki.