Beyond Structured Settlements

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.

NSSTA and NASP 2010 Educational Conferences - 3

"Protect and Preserve" or "Improve and Grow".

These polar-opposite imperatives for the structured settlement industry represent S2KM's two strategic lenses for reporting and analyzing simultaneous educational programs this week in Las Vegas sponsored by the National Structured Settlement Trade Association (NSSTA) and the National Association of Settlement Purchasers (NASP).

S2KM's Managing Director, Patrick Hindert, will attend portions of the NSSTA conference (as a NSSTA member and former NSSTA President) and participate in NASP's Friday morning "Industry Analysis" program (as a moderator and speaker). S2KM's continued reporting and commentary about the NSSTA and NASP conferences will appear on this S2KM blog ("Beyond Structured Settlements") as well as S2KM's structured settlement wiki.

NSSTA's strategic mandate is to "protect and preserve".

Question: what exactly does NSSTA want to "protect and preserve"?

The simple answer: Internal Revenue Code sections 104(a) and 130.

More strategically, what NSSTA wants to "protect and preserve" (to the extent possible) are business models and business practices ("good old days") that existed prior to:

• 1986 - Jim Lokey completed the first structured settlement transfer;
• 1991 - Executive Life insolvency;
• 1993 - Congress enacted IRC 468B and introduced qualified settlement funds;
• 1994 - Weil lawsuit settlement permitting structured settlement agents to work directly with claimants and plaintiff attorneys;
• 2001 - Congress adopted IRC 5891 and defined "structured settlement" as well as rules for structured settlement transfers;
• 2010 - Hartford settled the Spencer class action lawsuit (and departed the structured settlement business) following allegations of civil RICO and state fraud violations by Hartford, its agents, brokers and attorneys.

One result of NSSTA's "protect and preserve" mandate has been a "dumbing down" of NSSTA's educational programs - at least from a strategic perspective. Some of NSSTA's technical discussions are excellent. For example, NSSTA's legal committee has re-emerged as a leading structured settlement educational resource. And NSSTA's CSSC certification program continues to receive positive reviews despite low attendance and the lack of a continuing education (CLE) requirement.

NSSTA's primary educational problem is the application of its narrow and political strategic framework ("protect and preserve" as opposed to "improve and grow") for its educational programs. For example, NSSTA never invites knowledge leaders from NASP or SSP (or anyone critical of NSSTA political objectives) to participate in NSSTA's educational programs. For another related example, NSSTA educational programs never provide strategic discussions ("Industry Analysis") with alternative perspectives.

Bottom line: NSSTA's educational programs have fallen behind NASP and SSP who now represent the benchmarks for structured settlement educational excellence. For further S2KM reporting about NSSTA's educational demise, see: S2KM's analysis of NSSTA's 2009 educational program. Unfortunately, NSSTA's announced 2010 educational program looks like "the same old, same old" - at least from S2KM's strategic perspective.

By comparison with NSSTA, NASP will devote three hours of its 2010 educational program this week in Las Vegas specifically to "Structured Settlement Industry Analysis". This portion of the NASP program is subtitled: "How to Improve and Grow the Structured Settlement Industry".

Announced participants for this strategic discussion include industry knowledge experts who are members of NASP, SSP and NSSTA plus Jeremy Babener as an independent writer and analyst. Other participants include: Robin Shapiro, Earl Nesbitt, Matt Bracy, Andrew Savysky, Peter Vodola, Richard Risk, John Darer and Patrick Hindert - and continues prior NASP strategic discussions that featured: Stephen Harris, Jack Meligan and Michael Upchurch among others.

S2P2J Release 48

Publisher Incisive Media has announced October 21, 2010 as the distribution date for Release 48 of "Structured Settlements and Periodic Payment Judgments" (S2P2J). First published in 1986, S2P2J is co-authored and updated semi-annually by Daniel W. Hindert, Joseph J. Dehner and Patrick J. Hindert. Both the National Structured Settlement Trade Association (NSSTA) and the Society of Settlement Planners (SSP) utilize S2P2J as an educational resource for their certification programs.

S2P2J Release 48 Highlights

• How the Spencer v. Hartford and the Macomber v. Travelers class action lawsuit settlements impact structured settlements; and
• More specifically, how these two class action settlements impact structured settlement risk analysis, business strategy, business models, business practices and business standards for various stakeholders and participants:
  • Chapter 4 - Defendants and their attorneys:
    • Whether, when and how to structure
    • Risk and cost analysis
    • Related party transactions
    • Insurance policy issues
    • Financial impact
    • Releases and assignments
    • Multiple defendant cases
  • Chapter 5 - Plaintiffs and their attorneys
    • Settlement planning options and responsibilities
    • Comparing lump sums and periodic payments
    • Investment standards
    • Addressing the risk of non-payment
    • How to control decision making
    • Integrating government benefits
    • Informed consent
  • Chapter 6 - Structured settlement consultants
    • Available resources
    • Products and services
    • Business standards and practices
    • Licensing and certification
    • Agent vs. broker
    • Conflicts of interest
    • Representations and misrepresentations
    • Obligations and potential liabilities
  • Chapter 7 - Structured settlement negotiation strategy
    • Public policy
    • Legal mandates
    • Negotiation guidelines
    • Safe harbors
    • Defense and plaintiff strategies
    • Disclosure and privacy
    • Discovery issues
    • Compensation issues
    • Secondary market issues
    • Minors and incompetents
    • Utilizing 468B funds
    • Drafting settlement documents
    • Court approval
• Release 48 also updates recent developments for:
  • Structured settlement public policy (Chapter 1),
  • 468B settlement funds (Chapter 3) and
  • The secondary market (Chapter 16).

Structured Settlement Public Policy - 1

The Society of Settlement Planners (SSP) has invited Patrick Hindert, Managing Director of S2KM Limited and The Settlement Services Group (TSSG), to organize a discussion about "Structured Settlement Public Policy" for the SSP 2010 Annual Meeting May 3 in Washington, D.C.

For additional information about the SSP and NSSTA 2010 Annual Meetings, see this prior S2KM post.

S2KM's objectives:

• Improve and grow the structured settlement market.
• Promote public discussions about structured settlement public policy. S2KM has previously published a structured settlement public policy wiki featuring Joseph Dehner, Robert Wood and Jeremy Babener.
• Invite and challenge the best and brightest structured settlement knowledge experts to:
  • Attend the SSP 2010 Annual Meeting; and
  • Participate in a public discussion about structured settlement public policy.

Preliminary public policy questions - also posted on S2KM's public policy wiki.

• What is a structured settlement?
  • Google search
  • wikipedia definition
  • transaction diagram
• What does "public policy" mean generally - and specifically for structured settlements?
• Why is public policy important for structured settlements?
• Who and what defines structured settlement public policy?
• What changes have occurred in structured settlement public policy?
  • Before 1982
  • Between 1982 and 2000
  • Since 2001
• Based upon existing structured settlement public policy, what constitutes best business practices, bad business practices and illegal business practices?
• What are the most important structured settlement public policy issues?
• Does structured settlement public policy support:
  • Single claimant IRC section 468B qualified settlement funds?
  • Court-approved structured settlement factoring transactions pursuant to IRC 5891 and state structured settlement protection statutes?
  • Tax exclusions for non-physical injuries as well as physical?
  • Tax credits rather than the current tax exclusion?
• How many structured settlement recipients pay federal income taxes - or gain any financial advantage from the structured settlement tax exclusion?
• Do personal injury victims have a greater propensity to dissipate their financial resources than non-personal injury victims?
• Or, does public policy actually require and promote dissipation by injury victims and other disabled persons? For example, Medicaid asset requirements and resulting asset "pay down" strategies.
• Should the existence of the secondary market disqualify annuities as a funding option for special needs trusts?
• Does the Deficit Reduction Act of 2005 apply to structured settlement annuities?
• Why should structured settlement annuities cost less than lump sum alternatives to fund Medicare set-aside arrangements (MSAs)?
• How has health care reform changed structured settlement public policy?
• Does public policy support expanded use of the Internet for marketing, communication, education and collaboration? If yes, how does the Internet and Internet public policy impact the future of structured settlements?
• How can SSP members and attendees influence structured settlement public policy?
• How can members of NSSTA, SSP, NASP, NAMSAP and NAELA better identify and promote their collaborative public policy knowledge and shared public policy interests?
• Should the structured settlement industry encourage public policy analysis and promote best business practices in the context of public policy?
• Does public policy analysis and promotion of best business practices strengthen or weaken the structured settlement industry?

For additional S2KM reporting about SSP and NSSTA, see:

• S2KM's blog post titled "SSP and NSSTA 2010 Annual Meetings" and
• S2KM's structured settlement wiki.

NAELA Special Needs Summit - 3

This S2KM blog post strategically analyzes the National Academy of Elder Law Attorneys (NAELA) 2010 Special Needs Summit from an Internet-based knowledge management (KM) perspective. The NAELA Special Needs Summit occurred February 25-27 in New Orleans. Prior S2KM blog posts summarized the NAELA Special Needs Summit and analyzed the NAELA Special Needs Summit from a structured settlement perspective.

This S2KM review also considers a March 9, 2010 Web 2.0 webinar for NAELA members by Mark Miller titled "Web 2.0: The Good, the Bad and the Ugly". Miller is Chief Operating Officer of ElderLawAnswers; General Manager of Lawyers Life Network; and Director of Operations and Business Development for the Academy of Special Needs Planners. Miller has more than 15 years experience in sales and business development for web-based service providers.

Positives

• Knowledge resources - Whether the subject is elder law, special needs law or personal injury settlement law, NAELA's membership possesses substantial knowledge resources. Specific to disabled persons, NAELA's knowledge encompasses technical legal knowledge as well as relationship knowledge with disability leaders and disability community stakeholders.
• Knowledge culture - NAELA promotes and prioritizes legal scholarship. Examples include: the NAELA Journal and NAELA's annual writing prize for law students. NAELA promotes and practices knowledge sharing. NAELA's unprograms offer a non-hierarchical and interactive learning alternative to traditional lectures. Compared with traditional lectures, NAELA's unprogram learning model is more comparable with how collaborative learning occurs on the Internet.
• Focus on web 2.0 - NAELA has identified and offered learning resources on web 2.0 and social network technologies. In addition to Mark Miller's March 9, 2010 web 2.0 presentation, NAELA also featured S2KM's web 2.0 for lawyers wiki at its 2008 National Symposium.
• Mark Miller's web 2.0 presentation - Miller's 90 minute web 2.0 presentation was comprehensive. It highlighted many web 2.0 features, tools, and developments and offered advice for NAELA members about blogging; podcasting; web-site design; search engine optimization; news feeds; key word searches; social media; and emerging tools.
• Web 2.0 examples - a growing number of NAELA members, and non-NAELA special needs attorneys, have experimented with web 2.0 tools - especially blogs and podcasts. Examples of special needs and elder law blogs:
  • Harry Margolis
  • David Lillesand
  • Frank Johns
  • Patricia Kefalas
  • John Campbell

Negatives

• Web 2.0 learning disconnect
  • Neither the NAELA Special Needs Summit nor Miller's web 2.0 webinar made any attempt to integrate the web 2.0 medium itself into their learning programs.
  • If "the medium is the message" (to quote Marshall McLuhan), NAELA has not yet processed or responded to that message from a web 2.0 learning perspective.
  • NAELA's conference was typical of almost all professional association education conferences. Learning takes place in multi-purpose hotel meeting rooms with no Internet resources or integration. Laptops are discouraged by the general failure to provide power outlets. With the notable exception of NAELA's unprograms, the speakers lecture with limited audience interaction. Supplemental learning resources include power points, hardcopy handouts or web 1.0 flash disks.
  • Miller's web 2.0 webinar utilized a traditional web 1.0 powerpoint. His extensive presentation was lecture format with limited interactivity and no asynchronous features.
  • Typical of most introductions to the Internet, Miller's web 2.0 webinar focused primarily on identity and marketing - with no discussion about whether and how web 2.0 can enhance and accelerate learning or what learning issues and strategies occur with web 2.0.
  • As one example of a web 2.0 learning issue, many college professors (the paragons of old school learning) are banning laptops from their classroom and view in-class Internet surfing as a distraction. These paragons, however, typically lack any ability to integrate discussions (example: Socratic teaching) or Internet resources into their classroom experience. Their teaching model is a hierarchical lecture which is contrary to how the web 2.0 Internet functions.
  • Teaching web 2.0 using web 1.0 (or predecessor technologies) is akin to trying to teach people to swim or play basketball in a traditional classroom - using hardcopy text with no diagrams - instead of utilizing a swimming pool or a basketball court. After an hour or a semester in the classroom, the students still won't be able to swim or play basketball.
• Role of knowledge management
  • NAELA's members all qualify as knowledge workers. Without specifically studying knowledge management, NAELA has spent 25 years helping its members identify, expand and manage knowledge.
  • The changing Internet medium (currently web 2.0 featuring social network technologies) prioritizes knowledge and how you manage knowledge:
    • Knowledge generally becomes more transferrable and complex.
    • New knowledge tools, systems, networks, teams and leaders emerge.
    • New business models evolve requiring online skill sets and related knowledge services.
  • Unless NAELA and its members study and understand Internet-based knowledge management, how will they successfully transfer their professional knowledge (including relationship knowledge) to web 2.0?
  • And what happens to those professionals and professional associations who are slow (or unable) to successfully transfer their knowledge to the Internet? How will they compete? Who will want (or allow) them to participate on Internet-based knowledge teams and networks?
  • Neither Miller's web 2.0 webinar nor NAELA's first-ever Special Needs Summit discussed knowledge management.
  • How could knowledge management have improved the NAELA Special Needs Summit? As one example, the NAELA Summit made no attempt to define special needs law or to differentiate special needs law from elder law or personal injury settlement law. NAELA could have used (and still could use) various types of knowledge maps to:
    • Define these strategically important knowledge domains and related knowledge boundaries;
    • Identify stakeholders and online learning resources within each community of practice;
    • Highlight transactional events and transferable knowledge opportunities for NAELA members within each knowledge domain.

Unsolicited Recommendations for NAELA

• Continue to study Internet-based knowledge management - focusing on web 2.0 and social network technologies.
• Develop a web 2.0 learning strategy:
  • Utilizing appropriate learning environments, teachers and tools.
  • Introducing participants to online culture, organizational theory and functional skill sets through actual experience.
  • Integrating web 2.0 learning into NAELA's other educational programs.

For Additional Information see:

• Denham Grey's KM wiki
• S2KM prior blog posts
  • Web 2.0 for Lawyers Concept Map - featuring Barbara Bowen
  • Knowledge Management and Structured Settlements

NAELA's Special Needs Summit - 2

This S2KM blog post strategically analyzes the National Academy of Elder Law Attorneys (NAELA) 2010 Special Needs Summit from a structured settlement perspective. A prior S2KM post summarized the NAELA Special Needs Summit. A subsequent S2KM post will strategically analyze the NAELA Special Needs Summit from the perspective of Internet-based knowledge management.

For related S2KM learning resources, see S2KM's public read-only wikis:

• Structured settlement
• Structured settlement public policy
• Web 2.0 for lawyers

From a structured settlement perspective, the strategic business overlap with special needs attorneys encompasses disabled personal injury victims, their families and trial attorneys. Various knowledge leaders, knowledge networks and communities of practice within this strategic business and public domain utilize alternative terminology to describe their businesses without comparative analysis of the terminology itself. Here are some recommended resources to help special needs attorneys understand this growing legal market segment:

• Settlement law - hardcopy textbooks:
  • Robert W. Wood
    • "Taxation of Damage Awards and Settlement Payments"
    • "Qualified Settlement Funds and 468B"
  • Matt Garretson: "Negotiating and Settling Tort Cases"
  • Stuart Zimring, Rebecca Morgan and Bradley Frigon: "Fundamentals of Special Needs Trusts"
• Structured settlement law - Daniel Hindert, Joseph Dehner and Patrick Hindert: "Structured Settlements and Periodic Payment Judgments"
• Settlement consulting - see S2KM's report and analysis of Joseph DiGangi's presentation at the 2009 NSSTA winter meeting.
• Settlement planning - see S2KM's report about the SSP 2009 conference.
• Special needs settlement planning - see S2KM's report about the ASNP 2009 conference and Tim Nay interview.

S2KM regularly attends and publishes reports summarizing and analyzing national educational conferences sponsored by selected professional associations and universities whose speakers and attendees participate within the strategic business overlap of structured settlements and special needs law:

• National Structured Settlement Trade Association (NSSTA)
• Society of Settlement Planners (SSP)
• National Association of Settlement Purchasers (NASP)
• American Association for Justice (AAJ)
• National Academy of Elder Law Attorneys (NAELA)
• Academy of Special Needs Planners (ASNP)
• National Alliance of Medicare Set-Aside Professionals (NAMSAP)
• Stetson Law School - Special Needs Trust conference

Strategic question: from a structured settlement perspective, what was most important about NAELA's first-ever Special Needs Summit? 

Strategic answer: None of the NAELA speakers or unprograms:

• Attempted to define "special needs law" or any of its ancillary legal and business domains.
• Addressed any of the following structured settlement legal priorities and developments - all of which are strategically important for special needs attorneys:
  • IRC sections 104(a), 130, 468B or 5891;
  • Treasury Hearings for IRC 104(a)(2) regulations
  • Treasury 2009-10 Priority Guidance Plan - dropping single claimant 468B.
  • Spencer v. Hartford class action lawsuit - alleging civil RICO violations.
  • Unauthorized practice of law
  • Dissipation studies
  • Single claimant 468B funds
  • Executive Life of New York
  • Secondary structured settlement annuity market:
    • State structured settlement protection statutes.
    • J.G. Wentworth bankruptcy
    • Fresno County factoring cases
    • Rapid Settlements arbitration model
    • California protection statute amendments - including "best interest" definition

Why should special needs attorneys be interested in structured settlement law? This S2KM structured settlement diagram summarizes a complex legal and financial transaction that requires special needs legal knowledge, documentation and representation and also presents business and career opportunities for special needs attorneys:

• IRC 468B qualified settlement funds
• IRC 130 qualified and non-qualified assignments
• Special needs trusts
• Medicare set-aside arrangements
• Structured settlement transfers

Additional S2KM structured settlement resources for special needs attorneys interested in learning more about structured settlement law:

• Market surveys
• Growing the market
• Structured settlements in 2009
• structured settlement wiki
• structured settlement public policy wiki.

S2KM's next blog post will analyze NAELA's Special Needs Summit from an Internet-based knowledge management perspective.

NAELA's Special Needs Summit - 1

More than 25 years following its formation, the 5,000 member National Association of Elder Law Attorneys (NAELA) hosted its first-ever "Special Needs Summit" in New Orleans February 25-27, 2010 acknowledging what many NAELA members have understood for years - special needs law is a separate and fast-growing ancillary component and legal domain strategically related to elder law.

The highlight of NAELA's first Special Needs Summit was NAELA's awarding and honoring Dick Traum as the first recipient of NAELA's Special Needs Leadership Award. Traum is the founder and CEO of Achilles International, a non-profit organization providing community support for athletes with disabilities. Achilles International, with members in more than 70 countries, has recently developed specialized running programs for disabled children and wounded war veterans.

The educational component of NAELA's first Special Needs Summit featured NAELA's extensive knowledge resources and positive knowledge sharing culture. NAELA's educational program complemented, expanded and updated recent annual conferences presented by the Academy of Special Needs Planners (ASNP), the National Association of Medicare Set-aside Professionals (NAMSAP) and Stetson Law School as previously reported by S2KM.

NAELA's educational conferences regularly feature sections or entire programs titled "unprograms". NAELA's unprograms are moderated group discussions about specific topics. NAELA's Special Needs Summit included six separate one hour unprograms with a concluding unprogram wrap-up session. One example of an unprogram in New Orleans was titled "Collaboration Opportunities for Special Needs Attorneys and Financial Planners".

Other topics discussed at NAELA's Special Needs Summit:

• Special needs public policy and legislative issues
• Communicating with the disability community
• Pooled trusts
• Social security applications
• Medicare secondary payer compliance
• National project for state reviews of special needs trusts
• Veterans benefits
• Special needs law case update
• Emergency preparedness
• Independent community housing
• Divorce of parents with a special needs child
• Special education law
• Self-settled third party special needs trusts
• Fair Housing Act
• Serving on a non-profit Board of Directors

Congratulations to NAELA's Special Needs Summit Co-chairs: Joan Lensky Robert, Stephen Dale and Howard Krooks, and NAELA's Program Director, Casey Anderson, for organizing an historic and educational special needs conference.

In a subsequent blog post, S2KM will publish its analysis of the NAELA Special Needs Summit utilizing two strategic perspectives: structured settlement and Internet-based knowledge management.

For prior S2KM reporting about NAELA conferences, see S2KM's structured settlement and web 2.0 for lawyers wikis.

ASNP 2009 Annual Meeting

The Academy of Special Needs Planners (ASNP) hosted its Third Annual Meeting March 6-7, 2009 at the Rancho Bernardo Inn in San Diego, California. Titled "Special Needs Planning in an Era of Change", the program devoted one day of educational discussions to "special needs settlement planning" (SNSP) which ASNP characterized as a "new opportunity" for special needs attorneys.

The ASNP speakers included leading special needs attorneys and plaintiff structured settlement consultants who provided detailed analyses of the following SNSP topics:

• Anatomy of a SNSP Case - Frank Johns, Kevin Urbatsch and Patrick Hindert;
• Structured Settlement Annuities in SNSP Practice - Jack Meligan and Michele Whitmore;
• IRC 468B Qualified Settlement Funds (QSFs) - Jason Lazarus and Richard Risk;
• Integrating SNSP with an Elder Law Practice - Tim Nay and Sandy Conley;
• Medicare Secondary Payer Compliance - Mark Popolizio;
• Lien Resolution Strategies - William Browning, Mark Popolizio and Sylvius von Saucken;
• Marketing to the Trial Bar - Frank Johns, Jason Lazarus, and Kevin Urbatsch.

The SNSP program highlighted three basic issues:

• What is SNSP?
  
• What changes are impacting SNSP?
• What new opportunities does SNSP create for special needs attorneys?

What is SNSP?

Surprisingly, none of the speakers attempted to specifically define SNSP. Hindert recommended web 2.0 knowledge maps, wikis and folksonomies as a strategy for defining and growing SNSP.

Meligan and Whitmore described the related topic of "settlement planning" as both a profession and a process. According to Meligan and Whitmore: "Settlement planning is a profession that helps recipients of settlement proceeds use their proceeds to achieve their post-loss goals and transition successfully into their post-settlement financial lives". Meligan and Whitmore recommended utilizing settlement planning professionals with: credentials; loyalty to plaintiffs; planning approach; and experience. Meligan and Whitmore also described "settlement planning" as part of a three-part process preceded by litigation and followed by financial planning.

von Saucken also described "settlement planning" as a process or "continuum" subject to changing rules that require adjustments in settlement planning prototypes. von Saucken presented a settlement planning timeline:

• Agreement on settlement amount;
• Lien reimbursement;
• Medicare/Medicaid preservation trust;
• Structured settlement paperwork;
• Disbursement.

By comparison, during his recent presentation at the NSSTA 2009 Winter Meeting, Joseph DiGangi defined "settlement consulting" as a four-stage process:

• Analysis
• Planning
• Implementation
• Monitoring

Most of the ASNP presenters identified and addressed "structured settlements" as an essential component of SNSP. As part of his 468B QSF comments, Risk reviewed several structured settlement definitions including the tax definition in IRC section 5891(c)(1). To S2KM's knowledge, Risk thereby becomes the first structured settlement primary market participant to review the IRC section 5891 tax definition for "structured settlement" during a national conference. By comparison, not a single NSSTA or SSP conference speaker has reviewed the IRC Section 5891 definition for "structured settlement" since IRC 5891 was enacted in 2001. Risk also becomes, to S2KM's knowledge, the first conference speaker to link IRC 468B and 5891 which S2KM views as a strategic SNSP construct.

Several ASNP speakers addressed various types of settlement trusts in the context of SNSP. Browning highlighted settlement trust "due diligence" as an increasingly important SNSP issue. Three settlement trust providers, but not one structured settlement annuity provider, exhibited at the SNSP conference.

What changes are impacting SNSP?

ASNP speakers identified and highlighted the following changes impacting SNSP:

• Deficit Reduction Act of 2005 (DRA);
• The Ahlborn Case;
• 468B qualified settlement funds (QSFs);
• Medicare, Medicaid and SCHIP Extension Act of 2007 (MMSEA);
• Recent MSA rules promulgated by CMS;
• The structured settlement secondary market;
• State structured settlement protection statutes;
• Transition of knowledge and knowledge work to the Internet.

Additional changes referenced by ASNP speakers which deserve more detailed analysis in future SNSP discussions:

• Transitional SNSP business models:
  • How the claim management SNSP model differs from the 468B QSF SNSP model; and
  • How to develop multi-professional SNSP teams and knowledge networks.
• How the current financial crisis impacts SNSP;
• Proposed and/or needed SNSP legislative and regulatory changes.

What new opportunities does SNSP create for special needs attorneys?

Traditional special needs legal practice and education have focused on special needs trusts, estate planning, government benefits and probate. As the ASNP conference demonstrated, SNSP encompasses traditional special needs expertise, but also new fields of related legal practice.

Four leading SNSP legal treatises (listed alphabetically by title) define these new fields of SNSP legal practice:

• "Negotiating and Settling Tort Cases" - by Matt Garretson and Guy O. Kornblum;
• "Qualified Settlement Funds and Section 468B" - by Robert W. Wood;
• "Structured Settlements and Periodic Payment Judgments" - by Daniel W. Hindert, Joseph J. Dehner and Patrick J. Hindert;
• "Taxation of Damage Awards and Settlement Payments" - by Robert W. Wood.

The ASNP presentation by speakers Johns, Lazarus and Urbatsch titled "Marketing to the Trial Bar" offered valuable advice for special needs attorneys as well as other SNSP stakeholders. S2KM's structured settlement transaction diagram, developed in 2005 with graphic artist Keith Burtoft, may help special needs attorneys identify other potential SNSP clients and roles. In addition, as S2KM's blog post "Structured Settlement Surveys" demonstrates, further market research would be useful to define and grow the SNSP market.

Congratulations to ASAP and SNSP program Chairperson Tim Nay for the timely and educational SNSP program. Prior S2KM blog posts about ASNP:

• 2008 ASNP Conference;
• 2007 ASNP Conference.

For additional information about settlement consulting, see S2KM's four-part blog series "Settlement Consulting".

Settlement Consulting - 4

This post continues S2KM analysis and commentary about "settlement consulting" as an alternative business model for structured settlements introduced by Joseph DiGangi at the NSSTA 2009 Winter Meeting.

DiGangi characterized structured settlements as a fundamental settlement consulting product and featured structured settlements in a settlement consulting case example.

DiGangi's discussion identified four stages within the settlement consulting process:

• Analysis - including needs assessment;
• Planning;
• Implementation; and
• Monitoring.

DiGangi raised the issue of whether settlement consulting includes "litigation support" services.

Prior S2KM posts about settlement consulting have:

• Reviewed DiGangi's NSSTA presentation;
• Discussed business definitions and boundaries; and
• Outlined settlement consulting history - from a structured settlement perspective.

This S2KM post republishes and analyzes a structured settlement transaction diagram S2KM developed in 2005 with graphic artist Keith Burtoft. The purposes of the transaction diagram:

• Demonstrate the complexity of structured settlements:
  • In the context of settlement consulting; and
  • From the perspective of an injury victim.
• Provide an analytic framework to:
  • Study the role of structured settlements in settlement consulting;
  • Compare alternative structured settlement business models:
    • Settlement consulting (or planning); and
    • Traditional claim management.
  • Discuss the roles, expertise and work product of various settlement consulting stakeholders;
  • Define "due diligence" and discuss potential professional liabilities;
  • Identify settlement consulting legal entities and improve legal documentation;
  • Improve settlement consulting business standards and performance metrics;
  • Highlight the importance of IRC 468B QSFs;
  • Demonstrate linkage between various settlement consulting components: including
    • Primary and secondary structured settlement annuity markets;
    • Structured settlement annuities and settlement trusts;
    • Settlement trusts and the secondary annuity and life markets.
  • Prioritize legislative and regulatory issues and develop lobbying strategies.

In comparison with 468B QSF settlement consulting, traditional structured settlement analysis (the claim management model):

• Focuses more narrowly on the IRC 130 qualified assignment transaction;
• Assumes structured settlement payees are injury victims - as opposed to trustees and custodians;
• Ignores:
  • IRC 468B qualified settlement funds (QSFs);
  • The secondary structured settlement market;
  • Non-qualified structured settlements.
• Attempts to construct planning strategies and solutions as part of the litigation and negotiation process;
• Encourages "early involvement" by plaintiff and defense structured settlement agents who:
  • Represent the same annuity providers;
  • Collaborate to maximize shared annuity sales;
  • Provide similar "value-added" services (including litigation support) to justify commissions;
  • Lack licensing and training to sell non-annuity products;
  • Fail to disclose their conflicts of interest or their compensation-sharing arrangements.
  • Assume, but fail to address, the "best interests" of injury victims and other structured settlement stakeholders.

Settlement consulting occurs, and will continue to occur, in both the claim management (defense) structured settlement model and the settlement planning (468B QSF) structured settlement model.

• S2KM believes the 468B QSF settlement consulting (and/or planning) model is "vastly superior" to the claim management model for the vast number of settlement consulting stakeholders.
• Settlement Consulting Stakeholders:
  • Injury victims and their families;
  • Federal and state governments including regulators;
  • Judges;
  • Mediators;
  • Guardians;
  • Trustees;
  • Custodians;
  • Defendants and their insurers and re-insurers;
  • Plaintiff trial attorneys;
  • Special needs attorneys;
  • Medicare set-aside professionals;
  • Financial and insurance advisers and intermediaries;
  • Life care planners; and
  • Allocators.
• "Vastly superior" should be (and hopefully will be) defined and demonstrated by industry metrics (including time and money metrics) comparing the claim management and settlement planning models and developing the best alternative with continuing improvements.
• S2KM further believes the 468B QSF settlement consulting model will substantially grow the structured settlement market.

For additional S2KM analysis:

• Structured Settlement Surveys
• Structured Settlement Credo
• Settlement Trust Due Diligence
  
• Knowledge Management and Structured Settlements
  

Structured Settlements in 2009 - 1

S2KM's first reporting and analysis for the structured settlement industry in 2009.

Prior S2KM analysis

• The Future of Structured Settlements
• Structured Settlement Transaction Diagram
• Knowledge Management and Structured Settlements
• Structured Settlements in 2008
  • Part 1 - Historic Context
  • Part 2 - Professional Associations
  • Part 3 - Industry Challenges
  • S2P2J Release 44
• Structured Settlements in 2007
• Structured Settlements in 2006
• Structured Settlement History - up to 2005

Preliminary 2009 Calendar

• January 28-30 - NSSTA Winter Meeting in Orlando
• February 7-11 - AAJ and NATLE Winter Meetings in New Orleans
• March 6-7 - ASNP Annual Meeting in San Diego
• March 31-April 5 - NAELA Annual Meeting in Washington D.C.
• April 27-28 - SSP Annual Meeting in Washington D.C.
• April 28 - May 1 - NSSTA Annual Meeting in Washington, D.C.

S2KM 2009 Knowledge Work - by Patrick Hindert, S2KM's Managing Director:

• NSSTA Winter Meeting - Hindert will lead a discussion titled "Web 2.0: How NSSTA Members Can Improve their Online Communication, Learning and Collaboration Skills".
• ASNP Annual Meeting - Hindert will introduce a wiki to support a presentation by Frank Johns, Kevin Urbatsch and Hindert titled "Special Needs Settlement Planning (SNSP) Case Anatomy".
• S2P2J Release 45 - Hindert will help update existing analysis in "Structured Settlement and Periodic Payment Judgments" (S2P2J) about settlement planning due diligence.
• S2KM Blog - structured settlement industry issues S2KM will continue to report and analyze:
  • Transition from
    • Claim management to settlement planning
    • Web 1.0 to web 2.0
  • Impact of the
    
    • Financial crisis - including insolvencies, guarantee funds, investment performance and rating agencies;
    • Obama administration - including new legislation and regulations.
  • Interaction between
    • Insurers (annuities) and banks (trusts, accounts, funds)
    • Primary and secondary markets
    • Structured settlements and government benefits