Beyond Structured Settlements

Past Reporting - NASP

Historical S2KM reporting about National Association of Settlement Purchaser (NASP) Conferences which previously appeared on the structured settlement wiki.

NASP

• 2006 NASP Conference
• Part 1 - speakers and topics
• Part 2 - structured settlement market overview and how the primary market views factoring
• 2007 NASP Conference
• Part 1 - educational program wiki
• Part 2 - primary market transfer issues
• Part 3 - primary market panel discussion
• 2008 NASP Conference
• Part 1 - primary market panel discussion questions
• Part 2 - primary market panel participants
• Part 3 - how to improve and grow the market
• 2009 NASP Conference
• Part 1 - a listing of educational issues and participants;
• Part 2 - a summary of the educational discussions;
• Part 3 - a closer look at the strategic discussions.
• 2010 NASP Conference
• Part 1 - industry issues
• Part 2 - discussion topics
• Part 3 - "protect and preserve" vs. "improve and grow"
• Part 4 - strategic questions
• 2011 NASP Conference
• Part 1 - summary
• Part 2 - criticism of S2KM reporting
• 2012 NASP Conference
• Part 1 - speakers and topics
• Part 2 - industry issues
• Part 3 - presentation summaries
• 2013 NASP Conference
• Part 1 - speakers and topics
• Part 2 - discussion of issues
• 2014 NASP Conference
• 2015 NASP Conference

S2P2J Release 61

The United States structured settlement industry has been in existence for more than 40 years and continues to expand its scope, complexity and importance within the context of personal injury settlement planning. The industry consists of both a primary and secondary market and includes "off-shore" funding products. Certain structured settlement products utilizing periodic payments provide tax advantages. With increasing frequency, structured settlement products are being integrated with other financial and insurance products and government benefits into personal injury settlement plans utilizing 468B Qualified Settlement Funds and consisting of settlement trusts, special needs trusts, and Medicare set-aside arrangements.

Since it was first published in 1986, "Structured Settlements and Periodic Payment Judgments" (S2P2J), has provided professionals and other stakeholders involved with structured settlements an authoritative reference guide, consisting of 16 chapters with extensive footnotes and Appendix documents, to help them understand issues and fashion settlements and judgments utilizing periodic payments. Both the National Structured Settlement Trade Association (NSSTA) and the Society of Settlement Planners (SSP) have utilized S2P2J as an educational resource for their certification programs.

Co-authored and updated semi-annually by Daniel W. Hindert, Joseph J. Dehner and Patrick J. Hindert, S2P2J features an online version as well as the traditional hardcopy. Online S2P2J includes a search feature and download capability plus link features to access individual book sections, appendices, footnotes, cases and statutes.

Publisher Law Journal Press anticipates a March 2017 distribution date for hardcopy supplements for S2P2J Release 61 with online S2P2J subscribers receiving their update simultaneously with no additional subscription charge. Competent professionals confronted by structured settlement issues should have access to an up-to-date copy (or the online version) of this indispensable source book.

Release 61 Highlights - Release 61 will feature new, updated and/or expanded sections addressing the following structured settlement topics among others:

• Ezell v. Lexington Ins. Co. - Although the Complaint in this class action lawsuit was only recently filed, Release 61summarizes the Complaint and considers the plaintiffs' allegations from the perspective of "the best protection for the defense against the risk of future claims by claimants that they were misled in understanding how the 'cost' was calculated..." S2P2J's recommendation (with sample Appendix documentation): "[D]isclose the material elements of how the agreed amount will be allocated to acquire the funding vehicle and put a long-term obigor in place. Full disclosure of such elements would eliminate any basis for a later claim that a settling claimant was misled when agreeing to a structured settlement."
• Special Needs Trust (SNT) Fairness Act - Among NSSTA's strategies for growing the structured settlement market, the importance of special needs (SN) attorneys is receiving greater recognition and priority. With the enactment of the SNT Fairness Act in December 2016, the growth potential for both SNTs and structured settlements has expanded. Prior to December 2016, an injured person who received settlement funds could not create his/her own SNT. Only a parent, grandparent, guardian or court could establish a first party SNT. With this new legislation, persons with disabilities can create their own SNT unless they are mentally or legally incompetent to do so. Release 61 integrates coverage of the SNT Fairness Act into S2P2J's broader coverage of structured settlements and government benefits including Medicaid, Medicare, Veterans Benefits, Federally Assisted Housing, the Affordable Care Act and ABLE Accounts.
• Contract Rights - Although a structured settlement results in a contractual obligation to make periodic payments, a party that is released from liability need not become contractually obligated for the future payments. Release 61 summarizes and discusses Nutt v. United States, a 2016 case brought by an ELNY shortfall victim. The case provides an example of how the wording of a structured settlement agreement determines whether a claimant has enforceable rights against a specific defendant, separate from the life insurance company that issued the annuity. The Court of Appeals affirmed a trial court's holding finding the language of the 1985 settlement agreement required the United States only to purchase annuities to fund future periodic payments and did not require the Government to make or guarantee the payments.
• Off-Shore Companies - The increase in popularity of non-qualified assignments has resulted in efforts by some companies to offer what appear to be qualified assignments funded by companies located outside the United States. They sometimes purchase factoring rights to structured settlement payments and use these rights to offer higher effective interest rates than traditional annuity-financed structured settlements. Sales materials supporting these transactions sometimes maintain that these arrangements offer the same level of benefits and protection as traditional structured settlements. Release 61 expands prior S2P2J discussions of the substantial risks to parties entering into such agreements with offshore companies including risks for the professionals who recommend such transactions.
• Settlement Documentation - Once the terms of a structured settlement have been determined, all required closing documents must be drafted in a manner which fulfills each client's financial expectations and protects each client's legal interests. Skill is required to avoid mistakes and to anticipate potential future issues that could impact periodic payments. S2P2J devotes an entire chapter to "case closing" including issues arising after case closing. Release 61 highlights recent cases detailing the consequences of problematic settlement documentation followed by a divorce, bankruptcy, unanticipated death sequences or disputed estates.
• ELNY Class Action - Release 61 includes a summary update for a class action (Kelly v. Ringler) brought on behalf of ELNY shortfall victims which remains unresolved after a Federal District Court in Oregon denied dismissal of claims based on negligence and on certain Oregon and Alaskan statutory provisions, while granting dismissal of a claim that defendants had a continuing duty to inform the plaintiffs that their annuity stream from ELNY was threatened because of its declining financial condition. A similar class action against structured settlement broker EPS was settled in 2015. Note: this paragraph was edited on February 16, 2017.
• Secondary Market Updates - Until 2016, almost all secondary market case law developments related to transfers under state protection statutes. In 2016, the federal Consumer Financial Protection Bureau (CFPB) filed Complaints against two structured settlement factoring companies, J.G. Wentworth and Access Funding. Release 61 updates and extends S2P2J earlier coverage of CFPB involvement in these cases and its potential jurisdiction to protect recipients of factoring transactions. Additional secondary market topics addressed in Release 61 include: Brenston case follow-up; anti-assignment provisions; commutations vs. transfers; case law defining "best interest" and proscription of split payments under some state protection statutes; continuing litigation involving arbitration clauses; plus expanded discussion of securitization including risks and issues with "re-cycled" structured settlements.

Previous recent S2P2J releases have highlighted and addressed the following structured settlement related developments and market growth opportunities:

• Updated Structured Settlement History Chart.
• Updated analysis of changes impacting primary market structured settlement business practices.
• Background coverage of the Consumer Financial Protection Bureau's civil investigation of J.G. Wentworth.
• Historical context for Washington Post reporting about abusive secondary market business practices in Maryland.
• Case examples for various tax concepts, provided by Professor Ken Melani of the University of Notre Dame, who teaches the tax section of NSSTA's CSSC program.
• Duties of settlement trustees under the Uniform Prudent Investors Act plus factors settlement trustees must consider when making investments.
• Analysis of NSSTA's recent marketing surveys of claims executives, claims professionals and plaintiff attorneys.
• Summary of a recent California lawsuit warning of potential malpractice dangers for plaintiff attorneys who are: 1) uninformed; 2) lack competent advisors; and/or 3) act carelessly; with regards to structured settlement issues.
• Expanded discussion of "product suitability" and how it impacts structured settlement and settlement planning professionals.
• Wrongful Convictions Tax Relief Act of 2015.
• Court decisions analyzing "safe harbor" annuity rules under the Deficit Reduction Act of 2005 when annuities are used to preserve Medicaid eligibility.
• New cases where courts have identified questions to help judges determine whether proposed transfers of future payment rights meet the "best interest" test under various state Structured Settlement Protection Acts.
• Non-qualified assignment issues - including tax and security issues raised by off-shore assignment companies.
• Expanded coverage of Workers Compensation and Liability MSAs.
• Summary and discussion of recent PLR for indexed annuities and commutation riders.
• Introduction to ABLE Accounts.
• Practice tips for minimizing the risk of an IRS settlement challenge.
• Updated summary of lessons learned from the Executive Life Insurance of New York (ELNY) insolvency.
• Periodic payment reinsurance as an alternative means of funding structured settlements.

Also Note: all three S2P2J co-authors will appear on the same panel March 2 at the SSP 2017 Annual Conference in Las Vegas to lead a discussion titled "Current Developments in the Structured Settlement Industry."

Interview with SSP President Joe Tombs

Joe Tombs is currently completing the first year of a two-year term as President of the Society of Settlement Planners (SSP). SSP's 2017 Annual Conference is scheduled for March 1-3 in Las Vegas. As Tombs prepares for this event, he agreed to answer a few S2KM questions about SSP's current status and future direction. In a prior S2KM blog post, Tombs responded to the AIG Class Action Lawsuit - stating SSP is "neutral" and that SSP, as an association, has decided as a matter of policy to abandon taking any “political” positions.

S2KM: Joe, thank you for agreeing to this interview. To further clarify SSP's new "no political positions" policy, you have also stated that SSP is now neutral about single-claimant 468B Qualified Settlement Funds - one of the most contentious issues within the primary structured settlement market during the past several years. Just to confirm, are you saying the SSP, as an association, no longer supports and/or will no longer advocate for single-claimant 468B QSFs?

TOMBS: That is correct. Our refusal to take a position should not be misunderstood to imply anything about our individual members. The SSP has been a zealous advocate of the single-claimant QSF in the past and I doubt any of our members have changed their opinions on the subject. We are not asking our members to suppress or to modify their own beliefs.

S2KM: What about factoring which arguably represents the most divisive political issue within the structured settlement market? If SSP is neutral, how do you explain SSP's current membership policy which to use your own words "is open to anyone interested in comprehensive settlement planning as long as they are not engaged in factoring". Doesn't SSP's membership policy itself represent a "political position"?

TOMBS: The SSP does not have an opinion on factoring. Several years ago, we held a conference in which many participants from factoring companies attended and participated. Their presence at our meeting annoyed some SSP members and a special meeting of members was called to address this issue. At that meeting, the membership voted almost unanimously to close off new membership to those applicants who were active in the factoring industry. We also decided not to expel the very few of our members who had drifted into factoring. Our individual members' views on factoring are varied and generally quite negative, but the reason factoring representatives are excluded from membership centers on the fact that we want to focus on planning at the time of settlement. (Tombs' emphasis). My personal opinion is that there is nothing wrong with a person who ethically engages in factoring, but that the world would be a net better place if factoring did not exist.

S2KM: What do you consider to be your most significant accomplishments during your first term as SSP President?

TOMBS: Recognizing we still have more than six weeks left to achieve first year objectives, I am especially proud of four accomplishments: 1) SSP has substantially expanded its membership; 2) we have re-focused on professional settlement planning as our primary Mission and purpose; 3) we have pretty much put to bed the idea that we oppose the National Structured Settlement Trade Association (NSSTA); and 4) we have developed a new set of Professional Practice Standards which we will introduce during our 2017 Annual Conference.

S2KM: How large is SSP and where are you finding new members?

TOMBS: I anticipate we will meet our goal of having 300 members by the time of our 2017 Annual Meeting. Many of our new members are trust officers, financial planners, special needs trust attorneys and staff from settlement planning practices. The new face of the SSP is truly the new faces at the SSP and the different perspectives they bring are propelling us forward in an exciting new direction.

S2KM: Have structured settlement annuity providers supported the concept of "comprehensive settlement planning"? If not, why not?

TOMBS: I don't think most structured settlement annuity providers understand the significance of settlement planning - or how it differs and/or relates to structured settlements. They are just beginning to wake up to the concept and realize how important and how effective the settlement planning model can be. My experience has shown that whenever a plaintiff attorney sees and understands the settlement planning model, they will never again be satisfied with a structured settlement broker who only offers one product. Think about what happened to flip phone providers when smart phones hit the market. I predict the same thing will happen with settlement planning. If structured settlement annuity providers wait too long to transition, trust companies will have captured first mover advantage.

S2KM: At one time, the term "settlement planner" was viewed by many structured settlement stakeholders as an inflated synonym for "plaintiff broker". How would you differentiate a professional settlement planner from a structured settlement consultant?

TOMBS: Until recently, that view was entirely accurate. A plaintiff broker would simply order new business cards with the new title ("Settlement Planner") proudly displayed. Today, however, that transition creates changes in expectations, applicable standards of care, and required levels of disclosure. A structured settlement consultant approaches an engagement with a product in mind. By comparison, a settlement planner (with access to multiple products) first gathers information about the goals of the injury victims and his/her family, analyzes the data, works out a written plan, and implements the plan. A settlement planner does not play the role of a structured settlement broker, if at all, until the last step.

S2KM: What is a "comprehensive settlement plan" and how does it differ from a "structured settlement"?

TOMBS: A structured settlement is a product. A "comprehensive settlement plan" is a blueprint. It is a written document that contains a summary of the detailed analysis of the client's situation, capacities, goals, priorities, needs, and resources - and the strategies and products that will best help that client use the settlement proceeds to successfully transition into a post-settlement life in a way that allows them to accomplish their highest priority goals. The settlement planner uses the plan to guide the injury victim through the settlement process. Many of my settlement plans do not include structured settlements, but most do.

S2KM: What role(s) do you see for structured settlement annuities in settlement planning?

TOMBS: Structured settlements provide tax-free guaranteed cash flows that can be matched to the exact time that the cash flow is projected to be needed. It is a valuable tool in a settlement planner's toolbox. Carpenters love their hammers, but I would never hire a carpenter who showed up to work with only a hammer.

S2KM: What is SSP's current relationship with NSSTA and what would you like it to be?

TOMBS: Most of the SSP members who produce structured settlements are also members of NSSTA. The SSP's past opposition to a few of NSSTA's political positions has frayed the relationship despite great strides to mend the fences by both sides. Today, the SSP leadership fully supports NSSTA and its Mission to preserve and protect structured settlements. I believe the two organizations are symbiotic - if one does better, so does the other.

S2KM: How are SSP and NSSTA different from SSP's perspective? Do we need two associations or should their efforts be combined?

TOMBS: SSP and NSSTA are two very different organizations with completely different Missions. We share a common ancestry, but we have evolved into separate species. The difference, which is evident in our names, is not subtle, semantic, or political. Today, most of our members, sponsors and seminar attendees do not even sell structured settlement annuities. Let that fact settle in for a minute and you will begin to comprehend the extent to which the SSP and settlement planning have evolved.

S2KM: What is the scope of SSP's new "Professional Practice Standards"? Will they Replace SSP's current "Standards of Professional Conduct"? If not, how are they different?

TOMBS: At our 2017 Annual Meeting, we will announce and release practice standards that will define settlement planning and authoritatively set out the scope of the practice of settlement planning. Don't expect something complicated. SSP's Professional Practice Standards will be simple, profound statements. They will be different from a Code of Ethics or our Code of Professional Conduct. Our current Code of Professional Conduct is too structured settlement centric and is currently under review by an SSP committee. I suspect it will receive major modifications soon.

S2KM: What is the current status of the Registered Settlement Planner (RSP) Program? How many professionals currently possess the RSP designation?

TOMBS: The RSP designation is administered by a separate Board. The number of RSP designees is small - probably just over twenty. The program was dormant for a long time and has now been freshly updated with several students enrolled.

S2KM: Looking ahead to your second term as SSP President, what are SSP's greatest challenges?

TOMBS: We can't grow the number of professional settlement planners fast enough to keep up with market demand. This forces us to focus on two goals - increasing our membership and increasing the professionalism of our craft. We are making progress on both fronts, but we simply cannot go far enough or fast enough to meet the demand. Another great challenge is that we face resistance from entrenched businesses that actively try to slow us down to allow them to catch up.

S2KM: Joe, thank you for taking time to participate in this interview. Congratulations for your progress with SSP and best of luck for another outstanding SSP educational conference March 1-3 in Las Vegas.

SSP/ASNP 2016 Annual Conferences

Joint overlapping educational conferences hosted by the Society of Settlement Planners (SSP) and the Academy of Special Needs Planners (ASNP) March 9-12, 2016 in Tucson, Arizona provided S2KM and other attendees an opportunity to evaluate the current status of structured settlements within the larger, more complex personal injury settlement planning market. The SSP conference also transferred association leadership from Neil Johnson to Joe Tombs with Tombs promising to maintain Johnson's leadership direction and to "pull SSP back completely from structured settlement politics."

Among S2KM's conference conclusions: Many personal injury settlement planners characterize structured settlements as a strategic product, and recognize new marketing opportunities for structured settlements resulting from recent legislation such as the Affordable Care Act and the ABLE Act . The traditional and collective structured settlement industry should similarly embrace an important opportunity to grow its premium volume in this larger, more complex, more dynamic market than it has in the past by more effectively:

• Analyzing the evolving personal injury settlement and special needs planning markets;
• Addressing concerns and issues about structured settlements identified by plaintiff and special needs attorneys; and
• Re-positioning structured settlements from a single product sale to the core component of an integrated settlement solution.

SSP TOPICS AND SPEAKERS

• Introduction - Neil Johnson
• Comprehensive Settlement Planning - Joe Tombs; Charly Schell; Joe DiGangi; Tim Denehy
• Rules that Apply to Insurance Brokers - David Childers; Jeremy Babener
• The Grillo Case - Craig and Josephine (Grillo) Sullivan
• The Mraz Case - Mark Wilson and Patrick Hindert
• Sudden Money - John Darer
• Alternative Products - Martha Hunt; John Arendt; James Creel; Chris Shumate; Michael Upchurch; Rick Miller.
• Medicare Compliance, Entitlement Planning and Lien Resolution Issues - Anthony Prieto
• Joint ASNP/SSP Session - Structured Settlements and Special Needs Trusts - Frank Johns; Joe Tombs; Jack Meligan.
• ELNY and Factoring Industry Lawsuits - Edward Stone
• Small Business Legal Strategies - Paul Valentine
• Missed Tax Opportunities at Settlement - Jeremy Babener
• Foreign Assignment Companies - Jeremy Babener
• NSSTA's Survey of Plaintiff Attorneys - Patrick Hindert
• SSP President's Statement - Joe Tombs

ASNP TOPICS AND SPEAKERS

• ABCs of Public Benefits - David Lillesand
• ABCs of Special Needs and Settlement Planning - Kevin Urbatsch and Michele Fuller
• Keynote: "Raising Special Kids" - Maureen Beyers & Michael Farrell
• SSI Update - David Lillesand
• SNTs and Retirement Benefits - Melanie Marmion
• Recent Trends in Special Needs Planning - Blaine Brockman
• Joint ASNP/SSP Session - Structured Settlements and Special Needs Trusts - Frank Johns; Joe Tombs; Jack Meligan.
• "Tricky Issues" in SNT Administration - Travis Finchum; Herb Thomas and Daniel Cutter.
• Ask the Experts Panel - Kevin Urbatsch (Moderator)

DISCLAIMERS: Because of overlapping conference schedules, S2KM was able to attend only three ASNP presentations but did receive and has reviewed all ASNP conference handouts. S2KM's Managing Director, Patrick Hindert, testified as an expert witness in the Mraz case concerning structured settlement and QSF issues on behalf of Adriana and Addison Mraz.

S2KM COMMENTS AND RECOMMENDATIONS

SSP Leadership

• In his closing message as SSP President, Neil Johnson continued to emphasize several positive themes including industry unification and increasing collaboration between SSP and NSSTA. Among Johnson's proposed solutions for industry unity: 1) recognizing and accepting product diversity; 2) focusing on client and customer service; 3) identifying and pursuing permanent shared interests without necessarily agreeing on all issues; 4) engaging all perspectives to discuss industry problems and issues; 5) improving relationships among stakeholder groups; 6) promoting and practicing settlement planning not settlement selling.
• Newly elected SSP President Joe Tombs promised to "maintain the direction of Neil Johnson's leadership and even accelerate it in every way possible." He identified the following "main themes" for SSP going forward: "to pull completely back from structured settlement “politics”, redouble our efforts at educating our members and promoting a Code of Ethics, and a membership push to quadruple our high water mark for number of members. We intend to actively encourage our members who sell structured settlement to join and to become actively engaged in NSSTA. We will continue to offer a hand of friendship and cooperation in their agenda although we will be decidedly apolitical. We will also make no attempt no manage our member’s opinions or their expressions of their opinions."
• As for structured settlements, Tombs stated: "we intend to emphasize comprehensive settlement planning which will have the natural result of de-emphasizing structured settlement annuities to some extent as we move alternatives including trusts, taxable annuities, investment accounts, etc. closer to the forefront. We will be increasingly product-neutral and more advice-driven and client-need-focused in the future." Note: despite Tombs' assertion, and perhaps somewhat counter intuitively, multiple SSP conference speakers maintained that settlement trust sales, in particular, have actually increased their sales of structured settlement annuities.
• Tombs also promised "to intensify [SSP's] efforts to stave off any further “infiltration" of our society by factoring companies and their employees. We will want to remain abreast of the goings on in that market as we have always attempted, but as a practical matter we are cutting off any new members or sponsors from that side of things."

Marketing Feedback - NSSTA Survey of Plaintiff Attorneys

• During 2014, the National Structured Settlement Trade Association (NSSTA) commissioned a three-part Structured Settlement Survey project, conducted by CLM Advisors, and previously reviewed by S2KM, of senior claims executives (Part 1), claims professionals (Part 2) and plaintiff attorneys (Part 3).
• Although NSSTA has made reports of all three surveys available to its members, and featured presentations about Part 1 and Part 2 at previous NSSTA educational conferences, NSSTA has not yet featured its Part 3 survey of plaintiff attorneys as an educational conference presentation. NSSTA has also prioritized "rejuvenating defense programs" as one of three preliminary "Growth Initiatives" with no equivalent current Growth Initiative focused specifically on plaintiff attorneys or personal injury settlement planning.
• As one SSP conference presentation, S2KM's Managing Director, Patrick Hindert, discussed S2KM's analysis of NSSTA's Part 3 Structured Settlement Survey which, in S2KM's opinion, provides valuable insights for improving structured settlement marketing and expanding and accelerating structured settlement premium growth. For example:
  1. Only 4% of the responding plaintiff attorneys viewed structured settlement consultants as adding value for negotiations and/or case evaluations separate from, or in addition to, their knowledge of structured settlements.
  2. 35% stated that structured settlement consultants fail to deliver value because they are concerned with structuring as much of a settlement as possible.
  3. 52% contact a structured settlement broker one week (possibly less) prior to a mediation.
  4. 38% make contact only after a case settles.
  5. Less than 25% are likely to have a client sign a letter acknowledging that they were exposed to the opportunity to structure a portion of their settlement before opting for an all cash settlement.
  6. Although 89% believe they "have adequate knowledge of structured settlements so that [they are] able to recognize when they would be in the best interest of an injured party...", only 28% said they suggest a structured settlement for cases involving Medicare set-asides (MSAs).
  7. Only 26% have ever structured their fees.

Settlement Planning - A Special Needs Perspective

• Most presentations by special needs attorneys at structured settlement conferences focus exclusively on special needs trusts. As one result, many structured settlement professionals fail to understand the broad and expanding scope of special needs planning - or how it impacts, overlaps with and differs from personal injury settlement planning. A similar misconception exists among special needs attorneys many of whom identify financial and insurance settlement planners exclusively with structured settlements. The title of the one joint SSP/ASNP presentation in Tucson ("Structured Settlements and Special Needs Trusts") re-enforced this misconception. Fortunately and positively, the actual presentation discussion, moderated my Jack Meligan and featuring Frank Johns and Joe Tombs, addressed a broader agenda.
• Separately, both the ASNP and SSP conferences featured multiple presentations which captured the expanding expertise of their respective members. For structured settlement professionals, S2KM found ASNP's two "Pre-Session" presentations ("The ABCs of Public Benefits" by David Lillesand and "The ABCs of Special Needs and Settlement Planning" by Kevin Urbatsch and Michele Fuller) especially informative. Also recommended for structured settlement professionals seeking a more comprehensive understanding of special needs planning: Blaine Brockman's presentation ("Recent Trends in Special Needs Planning"),
• Urbatsch and Fuller speak and write frequently about personal injury settlement planning and are recognized as leading national settlement planning experts among special needs attorneys. Their settlement planning presentations frequently discuss structured settlement "issues" - often with negative connotations and without rebuttal or explanations from structured settlement experts. What follows are structured settlement "issues" Urbatsch and Fuller identified in Tucson. In S2KM's experience: 1) many special needs attorneys agree with these issues; and 2) structured settlement proponents need to proactively respond to these issues - or risk continuing/increasing loss of potential annuity premium:
  • "Income stream is inflexible and cannot respond to emergency or major cash needs;
  • "High initial fees;
  • "Investment returns nearly always lower than what a diversified portolio would produce;
  • "Big ticket items, such as a home, cannot be easily acquired;
  • "Unscrupulous settlement planning brokers over-structuring because of high commission;
  • "Little regulatory oversight over industry – no fiduciary responsibility or licensing required to sell;
  • "Misleading statements about flexibility;
  • "How it fits into Plaintiff’s overall financial plan?

The Grillo Case

• The Grillo case, which establishes potential legal liability for plaintiff attorneys who do not advise their clients about structured settlements, was the subject of an SSP conference presentation by Craig and Josephine (Grillo) Sullivan. The Sullivans shared the remarkable life story of their daughter, Christina, the Foundation she inspired and the Texas State Statutory amendment her case helped to enact.
• For structured settlement brokers and settlement planners, the Grillo case provides a logical starting point for discussing structured settlements with plaintiff attorneys. As a point of comparison, consider response #5 above under "Marketing Feedback - NSSTA Survey of Plaintiff Attorneys."
• Another important settlement planning "takeaway" from the Sullivans' SSP presentation: both Craig and Josephine emphasized the value of Christina's original life care plan which served as a care management "roadmap" throughout Christina's life accurately predicting future needs and developments which the Sullivans would not otherwise have anticipated.
• This important observation, provided by the only care givers to appear as speakers at the combined SSP/ASNP conferences highlights an important settlement planning issue: Why do other settlement planning professionals ignore life care planners - especially considering their strategic role defining "future needs" for personal injury damage analysis, as well as future expense allocations for Medicare set-asides and Affordable Care Act coverage? For examples:
  • As leading nurse life care planner Wendie Howland stated in this 2014 S2KM interview: "I have never been asked to review a settlement plan to see how well it matches my recommendations."
  • The Urbatsch/Fuller presentation summarized above which identified multiple professionals for the "Settlement Planning Team", omitted life care planners.
  • "Comprehensive" settlement plans S2KM has reviewed typically don't include any life care plan, or other document, providing a detailed "needs analysis".
  • With the exception of the National Alliance of Medicare Set-Aside Professionals (NAMSAP), a majority of whose members are life care planners, none of the many structured settlement or settlement planning conferences S2KM has attended during the past several years has offered specific presentations addressing the topic of "needs analysis" - or, with rare exceptions, featured a life care planner as presenter.
  • Key related issues: 1) what does "needs analysis" mean in the settlement planning context? Who is qualified, if not life care planners, to provide "needs analysis" for settlement planning? What is the relationship between a life care plan prepared for trial (damage analysis) and a life care plan for settlement planning? Who, besides a life care planner, is qualified to transpose one to the other?

The Mraz Case

• The traditional objective and responsibility for plaintiff attorneys in personal injury cases has been to obtain the largest amount of compensation for their clients whether by judgment or settlement. By this standard, the law firm Lief, Cabraser, Heimann & Bernstein was notably successful in obtaining a $55 million verdict and subsequent $24 million settlement in 2009 against Chrysler in the Mraz wrongful death case.
• Settlement planning, in general, and structured settlements, more specifically, however, prioritize an additional set of objectives and responsibilities for plaintiff attorneys. As a result, when the Lief, Cabraser law firm failed to obtain a structured settlement for Addison Mraz, the minor daughter of the deceased, after her mother, Adriana Mraz, allegedly requested Lief, Cabraser to obtain a structured settlement on Addison's behalf, Adriana brought a lawsuit alleging Lief, Cabraser attorneys breached the duty of care they owed to Addison.
• On December 22, 2015, among other findings, a California trial court jury determined Lief, Cabraser attorneys did not breach the standard of care or any fiduciary duty they owed Addison Mraz. Nevertheless, unrelated to damages associated to the loss of the structured settlement, the jury awarded Addison Mraz $400,000 of fees and costs she previously paid to Lief, Cabraser. The case is currently on appeal.
• Mark Wilson, the attorney who represented Adriana and Addison Mraz in their lawsuit against Lief, Cabraser, was a featured speaker at the SSP conference. Based upon the Marz case, and regardless of what occurs on appeal, Wilson highlighted the following structured settlement responsibilities as potential duties of care for plaintiff attorneys and recommended that structured settlement professionals and settlement planners utilize CLE programs to educate plaintiff attorneys about their potential liabilities. Plaintiff attorneys should:
  • Educate themselves about structured settlement issues including how to avoid constructive receipt as well as the appropriate utilization of QSFs and non-qualified assignments.
  • Recommend competent structured settlement professionals to clients (and retain them for advice) prior to settlement negotiations.
  • Insert appropriate language in term sheets and/or settlement agreements to preserve clients' structured settlement options.
  • If and when necessary, know how to correct mistakes to preserve or re-establish their clients' structured settlement options.

Plaintiff Broker Diversification

• The most successful plaintiff structured settlement brokers appear to be diversifying their products and services. It works, according to SSP speaker Anthony Prieto, "because it changes the conversation from a marketing perspective. There are a lot more people who want to talk to me about updates in MSP compliance or lien resolution than structured settlements. You see more cases when you offer other services. You become a problem solver as opposed to a problem identifier."
• Prieto identified multiple sources of alternative revenue now available to settlement planners in 2016: alternative products (retail annuities, life insurance, managed money); trust company fees or referrals; lien resolution or verification fees or referrals; MSP compliance fees or referrals; attorney fee deferral programs; QSF referrals and administration fees.
• Although one SSP panel, discussing "Comprehensive Settlement Planning", emphasized the importance of "planning before products", another SSP panel spoke specifically about expanding opportunities for alternative (non-traditional structured settlement) settlement planning products: Martha Hunt (equity-indexed annuity riders); John Arendt (reinsurance); James Creel (settlement trusts); Michael Upchurch (rehabilitation facilities); Rick Miller (indexed annuities).
• Consistent with the themes of "diversification" and "changing the conversation", John Darer made a convincing case for "transition expertise" as a critical settlement planning skill.
• What potential professional liability issues accompany plaintiff broker product and service diversification? The SSP conference did not directly address this issue comprehensively.
  • Speaking about "ELNY and Factoring Industry Lawsuits", attorney Edward Stone asserted that the "New Normal" (i.e. personal injury settlement planning) will not work if the core product (i.e. structured settlements) does not work. Focusing specifically on structured settlements, Stone asked whether a broker (plaintiff and/or defendant) owed any duty of care - and to whom? Also whether split commission arrangements changed the analysis? Based upon ELNY, he offered several related lessons for settlement planners.
  • Insurance law expert David Childers provided SSP conference attendees with a traditional analysis of standards of care and duties of care for insurance brokers, agents and producers under Arizona law.

CONCLUSION: Personal injury settlement planning is a large, complex, dynamic marketplace within which structured settlements historically has represented a strategic, if arguably under performing, product. The traditional structured settlement industry has heretofore avoided the educational analysis and strategic association relationships necessary to help its "New Generation" membership successfully transition to the "New Normal". It remains to be seen whether, when and how successfully future industry leadership will figure out how to put old wine in new bottles. Based upon this year's joint SSP/ASNP conference (and mixing metaphors), it appears the "New Normal" train is already leaving the station with a diversified cargo of blended products and services.

For additional S2KM analysis about personal injury settlement planning, see the structured settlement wiki.

NASP 2015 Annual Conference

Patricia LaBorde, President of the National Association of Settlement Purchasers (NASP), opened her association's 2015 Annual Conference last week in Las Vegas with a provocative description of its prior 12 months: "a year of unimaginable successes and challenges".

Founded in 2004, NASP identifies itself as "a leader in setting standards and implementing best practices for the structured settlement purchasing industry. Our association safeguards the rights of settlement recipients to readily access their funds through an efficient, fair and transparent judicial process."

NASP Presidential Panel

Subsequent conference presentations detailed NASP's successes and challenges including an historic President's Panel, moderated by Robin Shapiro, and featuring LaBorde and Michael Goodman, the first sitting President of the National Structured Settlement Trade Association (NSSTA) to attend a NASP conference.

Goodman has identified "growth opportunities for the structured settlement industry" as his number one goal as NSSTA President. He also characterized his remarks and opinions as personal and not representative of official NSSTA policy or positions.

Goodman highlighted the need for "responsible factoring" and mentioned the consumer protections that have been put in place in Wisconsin, Maryland and Illinois. Based upon his own professional experience, Goodman gave multiple examples of what he considered appropriate and inappropriate transfer activities.

Among Goodman's other noteworthy comments:

• "Factoring is not a zero sum game. What is bad for the secondary market is not necessarily good for the primary market."
• "Both NSSTA and NASP need to improve/correct the branding of "structured settlements". Confusing the primary and secondary markets is not beneficial for either association."
• "I am proud we have been able to create more consumer protections for injured annuitants. I am hopeful that by the end of this year, we will have improved the Structured Settlement Protections Acts (SSPAs) in five states.”

Both LaBorde and Goodman acknowledged business practices within their own markets that have created problems for the structured settlement brand. Some of the worst of the secondary market business practices were publicized nationally in an August 25, 2015 Washington Post front page article (featuring a non-NASP company) which more than one industry observer called "a perfect storm" for the factoring industry.

Legislative Collaboration

Even before the Washington Post article, however, and as a direct result of the 2013 Brenston case, which temporarily shut down the secondary market in Illinois, NASP and NSSTA initiated a proactive and collaborative legislative strategy to add five consumer protection amendments to targeted state structured settlement protection statutes:

• No forum shopping.
• Payee required to attend hearing.
• Stricter application of approval requirements.
• Advanced notice of transfer.
• Required disclosure of prior transfers.

The first success of NSSTA and NASP's legislative collaboration resulted in amendments to the Illinois statute. The Brentson case propelled the two organizations to negotiate and work a compromise that improved the Illinois SSPA. From the perspective of LaBorde and NASP, the result in Illinois represented "the biggest victory since the Model Act".

To memorialize the success in Illinois, NASP honored Illinois State Representative Michael Zalewski as recipient of its 2015 Alexander Hamilton Award. Representative Zaleweski, who sponsored the new Illinois structured settlement legislation, praised its "clarity and protection" compared with the "ambiguity" of the prior law.

NASP has bestowed its Alexander Hamilton Award eight times "to distinguished individuals who have supported and defended the right to free alienability of property rights." NASP considers this right to be its own cornerstone and the foundation of the structured settlement factoring business.

Further highlighting the success of NSSTA and NASP's legislative collaboration, LaBorde and Goodman jointly announced that Governor Scott Walker had signed, just prior to their panel discussion, Wisconsin's first Structured Settlement Protection Act - thereby becoming the 49th state (all except New Hampshire) to have enacted such protective legislation.

During his Legislative and Regulatory Update, NASP lobbyist Jack Kelly, who serves as point person for the NSSTA / NASP collaborative state legislative strategy, provided additional details concerning both the political aftermath of the Washington Post article and the collaborative state legislative strategy.

Without dismissing the negative public relations impact of the Post article, Kelly does not see any immediate Congressional threat despite letters making headlines. "NASP's primary federal concern is the tax bill," Kelly stated, "and it's not on the calendar."

As for state legislation, "good planning has made the difference", according to Kelly. He spoke about "mutual respect" for NSSTA and identified Florida, Maryland and Virginia among priority states for joint future lobbying to improve consumer protection.

Additional Conference Highlights

In his Litigation Update, NASP Executive Director Earl Nesbitt summarized recent court decisions addressing statutory "no-split" payment provisions, judicial "best interest" standards and various lawsuits involving Rapid Settlements.

Nesbitt allocated significant time to In re: Rains, a Texas case in which the appellate court determined the trial court: 1) could not force MetLife into a contract with the transfer company, directly or indirectly, by imposing a servicing arrangement on account of the Texas statutory "no-split" provision; and 2) abused its discretion in approving the transfer citing a "severe discount rate" among other factors.

The Rains case featured an extensive "best interest" analysis establishing a new judicial precedent in Texas. This analysis requires a judge to consider a "penumbra" of information including "future yet foreseeable liabilities; domestic, economic, physical, medical and educational needs of payee and dependents." Also at issue: how much and what type of evidence is required to place into the court record to justify a transfer.

Matt Bracy reprised his role as moderator of NASP's popular Judicial Panel - this year featuring Judges Daniel Buckley (California); Laura Inveen (Washington); and Jeremy Warren (Texas). The two hour program included questions to and from the judges addressing such transfer topics as:

• Interpreting the best interest standard;
• Common mistakes at transfer hearings by attorneys, factoring companies and sellers;
• How to best present a transfer;
• How judges consider objections to transfers;
• What documentation judges want to see at transfer hearings;
• How to best protect the seller's privacy;
• Information judges are not seeing presented that should be;
• Significance of the origin (type of personal injury) to the judge's analysis;
• Impact of prior transfers on assessments.

Two separate NASP presentations addressed unprecedented and changing perspectives of risk. Discussing Privacy Issues in Structured Settlement Transfers, Shawn Tuma spoke about risks due to cyber attacks. Citing the FBI, Tuma divided corporate America into two company types: those that have been hacked and those that will be - including many that have but don't realize it.

Health records, according to Tuma, are more valuable than financial records because they are rarely modified. Regardless of how you obtain health information, Tuma emphasized, you are obligated to protect it. These obligations include: stewardship, legal and public relations.

Tuma reported that both the SEC and the FTC have developed legal requirements that encompass prevention, detection, response, training, and third party access - and companies cannot insulate officers and directors from personal liability for related damages.

The lessons to be learned, according to Tuma: 1) document a record of compliance; 2) you will be breached; 3) Its not the breach, its your diligence, that matters most. Steven Fox supplemented Tuma's presentation with a discussion of ID Theft and Domicile Determination.

As secondary market transfers have expanded to include life contingent annuity components, mortality underwriting has become a critical skill set. Michael Fasano focused his presentation about Mortality Review / Process in Life Contingent Underwriting on unhedged life contingent secondary market structured settlement transactions.

Fasano emphasized that traditional medical underwriting practices utilized for life settlements or normal life insurance and/or annuities won't work for this class of individuals. Reasons include a high frequency of:

• Low income demographics. Most are unemployed.
• Rx and illicit drug issues.
• Incarceration and other behavior issues.
• Anti-selection and/or lying.

Fasano approximates that, as a class, mortality impairment of life contingent structured settlements results from: accident and behavioral (55%) vs. medical (45%). In addition to medical reports, Fasano utilizes targeted questionnaires to obtain underwriting information and makes adjustments for lack of candor and non-disclosure.

Completing NASP educational program: Jason Sutherland moderated a Servicing Panel featuring Melissa Bolling and John Enyart. Additional Breakout Sessions offered the following topics and speakers:

• Successfully Managing Difficult Payee Issues - Brian Dear; Duane West.
• Strategies for Securing Approval From Tough Judges - Samuel Cortes; Abagail Adams.
• Primer on Special Needs Trusts and Medicare Set-Asides - Patrick Hindert.
• Spousal Consent Issues in Transfers - Elyse Strickland; Shannon Harvey.

Congratulations to NASP, especially Conference Chairman Doyle Chisholm and Association Administrator Susan Barnes, for organizing such an informative and well-attended conference.

For additional, related S2KM reporting, see the structured settlement wiki plus these prior S2KM blog posts, see:

• Structured Settlements 2014 - Secondary Market
• NASP 2014 Annual Conference
• Michael Goodman Interview

NSSTA 2015 Fall Conference

Although the National Structured Settlement Trade Association (NSSTA) did not promote a specific theme for its 2015 Fall Educational Conference, one of the speakers succinctly captured the program's overall purpose and accomplishment when he described NSSTA's new Industry Growth Initiative as "changing the focus of our future."

Industry Growth Initiative

NSSTA's website description of its Industry Growth Initiative highlights "a significant decline in production since its peak at $6.3 Billion in 2008" and asserts "we do an excellent job protecting our industry" before announcing that "this year we want all NSSTA members to focus their time, energy and resources on new opportunities to expand the use of structured settlements-to grow our industry."

NSSTA President Michael Goodman utilized his Opening Conference Comments in Phoenix (as well as a preconference interview with S2KM) to describe the status and organizational structure of the NSSTA Industry Growth Initiative.

"My first priority as President of NSSTA," Goodman stated, "is to identify growth opportunities for the structured settlement industry. First, we asked all NSSTA members to submit ideas for growth at [email protected]. . Second, I tried to put together a NSSTA Growth Committee consisting of a highly talented cross section of industry leaders with diverse perspectives. Third, the Committee evaluated all of the 28 (to date) NSSTA member growth proposals and selected three for NSSTA Board of Directors approval to develop immediate implementation plans with success metrics."

Goodman introduced the NSSTA Growth Committee members including co-Chairmen William Goodman, Sean Coleman, John McCulloch and John Arendt. Speaking for the Committee, Coleman enthused: "I love our change of focus. Historically, NSSTA has been reactive, dodging bullets. The Growth Initiative redirects our mindset and focus. It encourages us to become proactive. The Growth Committee has already surpassed by highest expectations."

Goodman and the Committee co-Chairmen identified the following three NSSTA Growth Initiatives already selected and approved:

• Rejuvenate Defense Programs (including casualty insurers, commercial insureds and TPAs) - Originally the prime movers for structured settlements, many defense insurers have reduced or completely abandoned their structured settlement programs citing a variety of reasons. Beginning with three target carriers, the Committee plans to analyze the causes, and ultimately revitalize the programs, to create new prototype defense program models. Note: NSSTA recently commissioned surveys of Senior Claims Executives; and front line Claims Professionals which S2KM summarized and evaluated in prior blog posts.
• Amend the Federal Employee Compensation Act (FECA) - FECA, which provides workers compensation like benefits for federal workers, currently does not permit structured settlements. With payouts totally approximately $4.5 billion per year, FECA represent an attractive potential market for structured settlements with administrative cost savings being one justification for a legislative amendment. Based upon preliminary interviews, the Growth Committee believes FECA stakeholders view structured settlements favorably. The Committee is gathering statistical data to support its proposal and building grassroots support.
• Convertible Deferred Lump Sums - As a sales response to "low interest rates", the Growth Committee is proposing a new structured settlement feature. As envisioned, the convertible deferred lump sum would allow a structured settlement recipient to select a future lump sum that would automatically convert on its payment date into a series of predetermined periodic payments payable at whatever annuity rates offered at the time of conversion by the issuing life company. A Canadian broker attending the NSSTA conference stated that at least one Canadian life company already offers this structured settlement product feature. The Committee anticipates whichever annuity provider introduces this product feature in the U.S. will probably also seek an IRS private letter ruling.
• Note: NSSTA's Growth Committee identified a fourth preliminary initiative (Dissipation Study) - to confirm that injury victims squander lump sums. However, this initiative is currently on hold. For background, see this 2009 S2KM review of Jeremy Babener's legal research paper analyzing historic dissipation studies.

Factoring Update

Goodman also addressed the state of the structured settlement industry including a "factoring update". As part of this report, Goodman confirmed that NSSTA and the National Association of Settlement Purchasers (NASP) have agreed to cooperate legislatively in several states to seek the following consumer protection amendments for state structured settlement protection statutes:

• No forum shopping.
• Payee required to attend hearing.
• Stricter application of approval requirements.
• Advanced notice of transfer.
• Required disclosure of prior transfers.

Supporting this cooperative initiative, NSSTA has begun offering its members a new Judicial Education Training Seminar - taught in Phoenix by John McCulloch and Stephen Harris. Goodman also announced he will be a featured speaker at NASP's 2015 Annual Conference next week in Las Vegas - the first serving NSSTA President to do so. Perhaps anticipating his NASP appearance, and cognizant of the recent Washington Post article ("a perfect storm for factoring"), Goodman advised the NSSTA Conference attendees: "Factoring is not a zero sum game. What is bad for them is not always good for us."

Additional Conference Presentations

Many structured settlement participants believe control of the primary structured settlement market, and future market growth, have shifted from the defense to plaintiff attorneys and their injury victim clients. Although NSSTA has been slow to embrace plaintiff-focused personal injury settlement planning, NSSTA's Fall Conference included two presentation featuring plaintiff representatives:

• A Trial Lawyer Panel - moderated by Ryan Garrison with plaintiff attorneys Julio Zapata and Francisco Gutierrez; plus
• An introduction to the National Association of Trial Lawyers Executives (NATLE) by Gayle Bennett, Deputy Director of the New Mexico Trial Lawyers Association.

Both plaintiff presentations emphasized opportunities to expand the market for structured attorney fees. Both plaintiff attorneys expressed a preference for advisors who are "knowledgeable not just about structured settlements but also other investment vehicles."

In addition to the Judicial Education Training session mentioned above, three other NSSTA presentations addressed educational issues and programs:

• Best Practices for Structured Settlement Case Resolution - During her excellent review of structured settlement fundamentals, Betty Gregware expressed serious concern about the general quality of structured settlement documentation and the need to increase competence across the industry.
• Professional Broker Education - Gregware, Melissa Price and Debbie Sink introduced a new educational program NSSTA is developing primarily for individuals who are new to the structured settlement industry. They also provided an administrative overview of "NSSTA University" whereby NSSTA partners with members to secure CE credits for member-sponsored educational seminars for insurance claims departments or law firms.
• MSSC Paper Presentation - Mal Deener moderated a panel featuring Trish Fairhurst, Richard Carroll and other members of the first graduating class of NSSTA's new Masters Structured Settlement Consultant (MSSC) professional designation. Each MSSC graduate is required to submit a paper and these papers will be published on NSSTA's website. NSSTA will offer its next MSSC program beginning April 27, in conjunction with its Certified Structured Settlement Consultant (CSSC) program, at the University of Notre Dame

Separate from, but related to, NSSTA Growth Initiative, NSSTA's Board of Directors has appointed a Special Needs Attorney Task Force to develop strategic relationships with special needs attorney professional associations and to identify collaborative marketing opportunities with special needs attorneys more generally. NSSTA member Carola Davis and Special Needs Alliance attorney Patty Sitchler initiated a NSSTA presentation/discussion in Phoenix which hopefully will continue and expand to the benefit of both professional communities.

A critical factor, both challenge and opportunity, for growing the primary structured settlement market concerns succession planning. What new generation of distributors, or distribution channel(s), or business models, will emerge (and when) to replace and build upon the accomplishments of the pioneering generation (now in their 60s and 70s) who originated the structured settlement market in the late 1970s? NSSTA's Fall Conference featured two presentations addressing these issues:

• Succession Planning - Presenter Jim Early looked at the succession issue primarily from the point of view of the individual producer. Among his observations: "nepotism works in the structured settlement industry" and "a lack of capital has prevented the primary market from bringing in and training new people."
• Diversity Discussion - Angel Viera and Stacy McCall offered a convincing case for promoting greater diversity among new structured settlement professionals as a key component for future growth. Their presentation included and elicited several thought-provoking observations including: 1) "From a demographic perspective, our industry should mirror the people we serve" and 2) "Our industry suffers from a lack of diversity of thinking. Where do we find new voices and perspectives?"

Lifetime payments represent a valuable, optional structured settlement benefit which can be further enhanced from a pricing perspective when rated ages are applicable. Kevin Puckett and Ken Kiefer expounded on these important issues during their presentation about Mortality, Morbidity & Rated Ages.

NSSTA members Susan Clark and Robert Caples introduced Arnie Begler and Scott Henry, representing Pipitone Group, NSSTA's new public relations firm, and together they discussed NSSTA's Communications Program. Because journalists, as well as their readers, frequently confuse the primary and secondary structured settlement markets, Pipitone's "first test" was responding to the aforesaid Washington Post article. Pipitone's stated assignment is "to find the best communications practices and bring them to NSSTA" which will include designing a new NSSTA website. Among NSSTA's priorities, and Pipitone's challenges, will be attempting to reclaim the "structured settlement" brand inclusive of Google searches which currently are dominated by secondary market companies.

NSSTA Executive Director Eric Vaughn concluded NSSTA's Fall Conference with a Government Relations Update - his characteristically insightful and energizing overview of structured settlement legislative and regulatory activities. Among other accomplishments, Vaughn was recently named Vice Chairman of the American Association of People with Disabilities (AAPD).

Other recent NSSTA-related S2KM blog posts:

• Michael Goodman Interview
• NSSTA Marketing Surveys
  • Senior Claim Executives
  • Claim Professionals
  • Plaintiff Attorneys
• NSSTA 2015 Structures 202 Conference
• NSSTA 2015 Annual Conference

2015-2016 Educational Conferences

During a transitional era for both personal injury settlement planning and structured settlements, participating professionals are fortunate to have multiple upcoming educational opportunities to update and expand their knowledge. Here is an overview of recommended upcoming national conferences listed chronologically. Note: some associations restrict conference attendence to association members.

1. NAMSAP 2015 Annual Conference - September 30 - October 2 in New Orleans. The National Alliance of Medicare Set-Aside Professionals (NAMSAP) is "the only non-profit association exclusively addressing the issues and challenges of the Medicare Secondary Payer Statute and its impact on workers’ compensation and liability settlements". Medicare set-aside arrangements (MSAs) represent an increasingly important submarket for structured settlements. One of the innovative features of this conference: NAMSAP has developed an App so attendees can stay connected before, during and following the conference. Among the speakers, S2KM's Managing Director, Patrick Hindert, and Ann Koerner will lead a discussion titled: "How the Affordable Care Act Impacts Medicare, Medicare Compliance and MSAs". For S2KM's most recent NAMSAP reporting, see: NAMSAP 2015 Winter Regional Conference .
2. Stetson 2015 SNT Conference - October 14-16 in St. Petersburg, Florida. Stetson Law School's National Conference on Special Needs Trusts (SNTs) is widely recognized as the preeminent educational forum for this topic. The two-day conference offers one day of "Basics" plus one day of "Advanced" SNT education plus two additional and optional pre-conference half-day programs ("The Tax Intensive" and "Pooled Trusts"). Similar to MSAs, SNTs represent a strategic submarket for structured settlements. Among important recent developments: 1) the impact of the Affordable Care Act (ACA) on existing and prospective SNTs; 2) The Special Needs Trust Fairness Act, recently approved unanimously by the U.S. Senate, would correct a previous legislative error and allow individuals with disabilities, who have capacity to create their own SNTs.
3. NSSTA 2015 Fall Educational Conference - October 28-30 in Phoenix, AZ. The National Structured Settlement Trade Association (NSSTA) is "the leading voice of the structured settlement industry" with nearly 1200 individual members. NSSTA has previously announced an "Industry Growth Initiative" - "designed to identify opportunities to expand the use of structured settlements and bring those opportunities to the structured settlement marketplace" - which appears to focus multiple growth-oriented goals NSSTA president Michael Goodman identified during NSSTA's 2015 Annual Meeting. The first progress report for this Growth Initiative is scheduled to occur during NSSTA's Fall Conference. As a prelude to its Growth Initiative, NSSTA commissioned a three-part survey of traditional structured settlement stakeholders which S2KM reviewed in previous blog posts: senior claims executives (Part 1); front line claims professionals (Part 2); and plaintiff attorneys (Part 3).
4. NASP 2015 Annual Conference - November 10-12 in Las Vegas. The National Association of Settlement Purchasers (NASP), "the only trade association related to the secondary market for structured settlements, ... is dedicated to ensuring the secondary market for [such] transfers remains fair, competitive, and transparent." Following years of conflict between the primary and secondary structured settlement markets, an historic "President's Panel" will highlight NASP's 2015 conference featuring the respective presidents of NSSTA (Michael Goodman) and NASP (Patricia LaBorde). This event was preceded by NSSTA inviting LaBorde to speak at the NSSTA 2014 Fall Educational Conference. and appears to signify increased cooperation between the two associations extending to legislation as well as education. Among other speakers, S2KM's Patrick Hindert will provide "A Primer on Special Needs Trusts and Medicare Set-Asides" for secondary market attendees. For S2KM's most recent NASP reporting, see: NASP 2014 Annual Conference .
5. Evolve 2015 QSF Symposium - November 12-13 in Memphis. Organized "to provide a forum for open dialogue that helps shape industry developments", Evolve Bank and Trust's Annual Qualified Settlement Fund (QSF) Symposium offers a valuable and unique addition to the growing number of personal injury settlement planning conferences and educational resources. Although Rev. Proc. 93-34 permits QSFs to make IRC 130 qualified assignments, and no tax authority exists prohibiting single claimant QSFs, structured settlement annuity providers currently refuse to accept single claimant QSFs which they broadly define to encompass claims by family members, plaintiff attorneys, lien holders and creditors. Evolve's recent symposiums have avoided the single claimant controversy and focused instead on other important QSF and settlement planning issues. For S2KM's most recent Evolve reporting, see: Evolve 2014 QSF Symposium.
6. NSSTA 2015 MSSC Program - November 18-21 at the University of Notre Dame. Complementing and extending its Certified Structured Settlement Consultant (CSSC) Professional Certification Program, NSSTA has added a new Master's Certificate in Structured Settlement Consulting (MSSC). This program is one of multiple new educational initiatives, including Structures 202 (a comprehensive program of case management fundamentals and business development opportunities) and "NSSTA University" (whereby NSSTA will partner with any member to secure CE credits for member-sponsored educational seminars or insurance claims departments or law firms), which NSSTA is offering to attract and train "Next Generation" professionals to grow the structured settlement market.
7. NAELA 2016 Summit - January 28-30 in Newport Beach, CA. The National Academy of Elder Law Attorneys (NAELA) was the first and remains the largest U.S. professional association focused on the needs of elder and special needs law attorneys. NAELA was founded in 1986 and now consists of more than 4300 attorney members. Because NAELA was slow to embrace special needs as a separate strategic market, NAELA members independently formed the Special Needs Alliance (Alliance) and the Academy of Special Needs Planners (ASNP). Most Alliance and ASNP member, however, remain active NAELA members and look to NAELA as their primary political lobbying resource. NAELA member resources include the NAELA Journal which has published a series of excellent articles about the Affordable Care Act.
8. AANLCP 2016 Annual Conference - February 5-8 in San Antonio. The increasing number, importance and roles of life care planners represents one of the most significant developments S2KM has observed while attending recent structured settlement and settlement planning stakeholder educational conferences. Life care planners predominate the membership of NAMSAP and have been featured speakers at other recent structured settlement and settlement planning stakeholder conferences. Multiple life care planners exhibit at American Association for Justice (AAJ) national conferences. The American Association of Nurse Life Care Planners (AANLCP) is one of two national associations of life care planners. During 2014, S2KM published an interview with nurse life care planner Wendie Howland. Patrick Hindert's article "How the Affordable Care Act Impacts Life Care Planners" was featured in the 2014 Winter Issue of the AANLCP Journal.
9. AAJ 2016 Winter Conference - February 27 - March 1 - Boca Raton, FL. The American Association for Justice (AAJ, formerly ATLA) "is the world's largest trial bar" whose mission includes supporting "the work of attorneys in their efforts to insure that any person who is injured by the misconduct or negligence of others can obtain justice in America's courtrooms ..." Plaintiff attorneys, however, also perform essential settlement planning roles which include recommending appropriate product and service providers to their clients. As one result, plaintiff attorneys represent the primary marketing target for companies and professionals offering settlement planning products and services - as well as a logical priority marketing target for growing the structured settlement market. Multiple companies offering structured settlement, lien resolution, MSA compliance, life care planning, legal finance and economic consulting services were among the 141 sponsors and exhibitors at the AAJ 2014 Annual Meeting. NSSTA recently commissioned a Plaintiff Attorney Structured Settlement Survey.
10. ASNP 2016 Annual Conference - March 10-12 in Tucson, AZ. The Academy of Special Needs Planners (ASNP) and the Special Needs Alliance are both national associations of special needs attorneys most of whom are also members of NAELA and many of whom also increasingly specialize in personal injury settlement planning. ASNP recently opened its membership (with a vetting process) to non-legal (finance/insurance) professionals and also sponsored a 12-part Settlement Planning Webinar Series. Unlike educational programs sponsored by NAELA and SNA, ASNP's annual conferences are open to non-members. For S2KM's most recent ASNP reporting, see: ASNP 2015 Annual Conference - which includes a comparison of settlement planning vs. special needs planning.
11. SSP 2016 Annual Conference - March 10-12 - Tucson, AZ. Society of Settlement Planners (SSP) members "work with the injured party to create a comprehensive and integrated settlement plan focused on meeting the needs of the claimant." They also "seek to elevate the profession of settlement planning by promoting ethical industry standards, providing education and certification and knowledge transfer among its members." For the first time, SSP's 2016 conference will feature joint educational sessions and social events with ASNP. For S2KM's most recent ASNP reporting, see: SSP 2015 Annual Conference Part 1 and Part 2.
12. NSSTA (April 6-8 in Palm Springs, FL), NAELA (April 7-9 in Denver) and AAJ (July 23-26 in Los Angeles) have also separately announced their 2016 Annual Meetings.

SSP 2015 Annual Conference - 2

The Society of Settlement Planners (SSP) hosted its 2015 Annual Conference last week in Las Vegas with an unprecedented number of structured settlement association leaders as speakers and attendees including representatives from the National Structured Settlement Trade Association (NSSTA) and the National Association of Settlement Purchasers (NASP). For a list of SSP speakers and topics, see this prior S2KM blog post.

In his keynote address, SSP President Neil Johnson re-affirmed SSP's traditional commitment to "open dialogue" of industry issues with a mandate for "healthy, respectful discussion of all industry issues, controversial or not - rejecting the the temptation to sweep the uncomfortable under the carpet."

While seeking to engage all perspectives to identify shared permanent interests and discuss industry problems and issues, Johnson acknowledged and accepted that conference attendees would not agree on all issues - and they did not.

Some of the issues discussed:

• The need for structured settlement industry unity - encompassing education and, in some situations, political lobbying.
• How NSSTA and NASP are collaborating to improve state structured settlement protection statutes.
• Improving public relations by first acknowledging and addressing structured settlement primary and secondary market problems.
• The uniqueness of the structured settlement product and the need for better primary market self-regulation.
• The impact of "fiduciary standards" on settlement planning and the future of structured settlements.
• Collaborative primary/secondary market strategies for addressing "the darker side of factoring".
• Settlement planning as an important and distinctive growth strategy for structured settlements.
• Differentiating settlement planners from single-product plaintiff structured settlement brokers.
• Financial planners - a competitive threat or the next generation of structured settlement consultants and settlement planners?
• The inevitability and risks of "off-shore" settlement planning products in a globalized world.
• Lessons learned from the Executive Life debacle for claimants and their attorneys and advisors.
• How settlement planners and structured settlement consultants misuse life care planners and life care plans.
• The Social Security Administration's recent hostility toward special needs trusts (SNTs) and what it means for structured settlements.
• How and why settlement planners must learn to take control of the Medicare set-aside (MSA) process.
• The explosion of multi-claimant QSFs - a missed market for structured settlements?

None of these issues were resolved in Las Vegas. What did occur was a healthy exchange of ideas among leaders of historic structured settlement adversaries (NSSTA, SSP and NASP) with active participation from leaders of other settlement planning associations. The result: a unique industry gathering as much like a diplomatic conference as an educational event.

With NSSTA's President, Executive Director, and several members of its Board of Directors in attendance, whether and how NSSTA (as well as NASP) and its members will respond remains uncertain. NSSTA helped to initiate a more open industry dialogue during its own Fall 2014 Educational Conference by inviting SSP President Johnson and NASP President Patricia LaBorde to appear as featured speakers.

Structured Settlement Industry Unification

During the NSSTA Fall 2014 conference, Johnson outlined a "Blueprint for Industry Unification" which he and NSSTA President Kevin Silo continued to discuss in Las Vegas in a repeat performance of their "Presidents' Panel". Johnson's appeal for unity characterized "industry disarray" as a "threat to our future." Labeling diversity "good" and disparity "bad", he called for a united front before the public.

In Johnson's words: Lack of structured settlement industry unity is "a drain - a drain on financial resources ... a drain on productivity ... a drain on our public image ... a drain on physical and emotional health. Lack of unity diverts attention from productive projects. It always focuses attention on the negative, never on the positive. Lack of industry unity shows no partiality or favoritism for either NSSTA or SSP."

Both Johnson and Silo expressed optimism, however, about the future of structured settlements - especially in the context of generational transition. Johnson, in particular, highlighted potential opportunities amidst his self-described industry disparity, including a strengthened resolve and commitment for improvement and growth. According to Johnson and other settlement planners, the structured settlement industry needs a wakeup call - a fresh look and reevaluation that includes, but extends beyond, NSSTA's "protect and preserve" orientation.

Here are the core components of Johnson's proposed "solution" for structured settlement industry unity:

• Recognizing and accepting product and professional diversity.
• Identifying and pursuing permanent shared interests without necessarily agreeing on all issues.
• Engaging all perspectives to discuss industry problems and issues.
• Promoting and practicing settlement planning with the structured settlement annuity as a core strategic product.

The Future of SSP

Throughout its 15 year history, SSP has punched beyond its weight class. Born out of a troublesome recognition that the structured settlement playing field was seriously tilted to the disadvantage of plaintiffs and their advisors, SSP has helped bring respect and professionalism to the plaintiff side of the table by emphasizing "settlement planning", not "settlement selling".

Recognizing the strategic role of structured settlements, settlement planning nonetheless seeks the "best interest" of its injury victim clients and includes multiple products and multiple experts.

Despite these accomplishments, and perhaps because of them, SSP's future as an association is uncertain. NSSTA has more plaintiff structured settlement brokers than SSP and has been more successful in adding a new generation of members.

Other, well-organized, non-structured settlement professionals, such as special needs attorneys and life care planners, increasingly focus their marketing, educational programs and work product on settlement planning using SNTs and MSAs as their gateway.

As was evident in Las Vegas, however, SSP continues to raise the educational bar for an entire industry of settlement professionals. Settlement planning remains an evolving profession - largely unregulated with few industry standards. The ultimate role and growth potential for structured settlements within the settlement planning market have not yet been determined.

SSP's ability to organize an educational conference where an unprecedented cross-section of industry leaders engaged in civil discussions about strategic industry issues suggests SSP has an important continuing role within both the structured settlement and settlement planning markets.

For S2KM reporting about prior structured settlement and settlement planning conferences, see the structured settlement wiki.

S2P2J Release 57 Highlights

The United States structured settlement market has been in existence for more than 35 years and continues to expand its scope, complexity and importance within the context of personal injury settlement planning.

Since it was first published in 1986, "Structured Settlements and Periodic Payment Judgments" (S2P2J), has provided structured settlement stakeholders with an authoritative reference guide, consisting of 16 chapters with extensive footnotes and Appendix documents, to help them understand issues and fashion settlements and judgments utilizing periodic payments. Both the National Structured Settlement Trade Association (NSSTA) and the Society of Settlement Planners (SSP) have utilized S2P2J as an educational resource for their certification programs.

Co-authored and updated semi-annually by Daniel W. Hindert, Joseph J. Dehner and Patrick J. Hindert, S2P2J now features an online version as well as the traditional hardcopy. Online S2P2J includes a search feature and download capability as well as link features to access individual book sections, appendices, footnotes, cases and statutes.

Publisher Law Journal Press anticipates a March 2015 distribution date for hardcopy supplements for S2P2J Release 57 with online S2P2J subcribers receiving their update simultaneously with no additional subscription charge. Competent professionals confronted by structured settlement issues should have access to an up-to-date copy (or the online version) of this indispensable source book.

Release 57 Highlights - Release 57 will feature new, updated and/or expanded sections addressing the following structured settlement topics:

• WCMSAs - Release 57 re-positions and expands S2P2J's extensive summary of the new CMS rules for workers compensation Medicare set-asides, the fastest growing segment of the structured settlement primary market. Regulatory rules for liability MSAs remain essentially unchanged following the withdrawl by CMS on August 8, 2014 of it the liability MSA-related NPRM it had earlier submitted to the Office of Management and Budget.
• Indexed Annuities - PLR 143928-13 highlights the potential importance of indexed annuities and annuity riders as structured settlement funding alternatives. Release 57 features a new section explaining indexed annuities, differentiating variable annuities and summarizing the related PLR.
• Commutation Riders - PLR 143928-13 also provided favorable tax treatment for a commutation rider pursuant to a Notice of Hardship Conversion as a potential alternative to factoring transactions. This PLR justified an expansion in Release 57 of S2P2J's current section discussing commutations.
• Non-qualified Assignments - Most non-qualified assignments depend upon off-shore assignment companies which raise tax and security issues for participants. Release 57 expands S2P2P's analysis of non-qualified assignments to address these issues.
• CLM Advisors Surveys - Release 57 summarizes results from two surveys commissioned by NSSTA to determine the value claims executives and adjustors place on structured settlements and structured settlement consultants. The results and related metrics are generally favorable and arguably provide a valuable marketing blueprint for defense brokers.
• ABLE Accounts - Release 57 features a new section describing ABLE Accounts, a tax-preferenced funding option authorized by the Achieving a Better Life Experience Act (ABLE Act) of 2014. Although some structured settlement consultants view ABLE Accounts as a competitive product, others see opportunities to fund ABLE accounts using structured settlements.
• Insurance Regulation - States historically have regulated insurance in the United States. As a result of the 2008 global financial crisis, however, new federal and international insurance regulatory agencies now exist which are targeting some of the largest structured settlement annuity providers among other financial and insurance companies. Release 57 adds a new section to introduce and explain these new regulatory developments and entities.
• ELNY and Reliance - The recent ELNY and Reliance liquidations have each impacted thousands of structured settlement recipients. Although judicial solutions have been fashioned, litigation continues - as least involving some ELNY shortfall payees. Release 57 updates S2P2J's extensive coverage of the ELNY and Reliance liquidations.
• Role of Plaintiff Attorneys - As structure settlements and personal injury settlement planning have become more complex, and plaintiff attorneys increasingly require the services of other settlement planning professionals, plaintiff attorneys should continue to perform certain essential structured settlement and settlement planning roles. Release 57 identifies and discusses those roles and provides additional related advice for plaintiff attorneys.
• Secondary Market Update - The continuing expansion of the secondary market has generated controversy and litigation as well as legislative reform and changing business practices. S2P2J continues to track these developments in expanding chapter 16 titled "Transfers of Structured Settlement Payment Rights". Release 57 highlights include "anti-assignment" issues in Illinois originating with the Brenston case and the market "chaos" some secondary market participant see occurring as the result of the Washington Square v. RSL Funding case.
• IRC 104(a)(2) Treasury Regulations - Recent U.S. Treasury Regulations for IRC 104(a)(2) relating to the exclusion from gross income for amounts received on account of personal physical injuries or physical sickness make two primary changes to the current regulations which Release 57 summarizes in the context of S2P2J more extensive analysis in Chapter 2 of "Taxation of Damages Received by the Claimant".

For related S2KM blog reporting about structured settlement 2014 developments, see:

• Primary market
• Secondary market
• Settlement planning
• ELNY and Reliance

 

Structured Settlements 2014 - Settlement Planning

During the late 1970s, and throughout the 1980s, when defendants retained exclusive control of structured settlements, many brokers and their liability insurance company clients referred to unsuccessful sales as "cash outs". Their professional interests and curiosity were narrowly defined and focused upon their own product to the exclusion of other settlement related products and services.

With the advent of plaintiff structured settlement brokers, continuing legislative and regulatory developments, plus an expanding array of settlement planning professionals, products and product providers, structured settlements are now viewed by most stakeholders as a subset of the larger and more complex personal injury settlement planning market.

For future success, a new generation of structured settlement leaders must look beyond structured settlements and learn to re-position their product as a fundamental and catalytic settlement planning component. This strategic adjustment requires a more comprehensive understanding of, and interaction with, other professional associations whose members also provide settlement planning products and services.

During 2014, S2KM attended 13 national educational conferences sponsored by such professional associations. What follows are 2014 summaries, from a settlement planning perspective, of the educational programs offered by these professional associations plus links to related S2KM reporting. Prior S2KM blog posts provide 2014 summaries of the primary and secondary structured settlement markets. A subsequent S2KM blog post will summarize continuing 2014 developments related to ELNY and Reliance.

American Association for Justice (AAJ)

The role of personal injury attorneys historically has encompassed settlement planning and negotiation as well as litigation. As settlement planning has become increasingly complex, however, personal injury attorneys now require the services of other settlement planning professionals including: tax attorneys, special needs attorneys, settlement trustees, financial planners, structured settlement specialists, life care planners, case managers, economists, Medicare set-aside (MSA) specialists and damage allocators.

Regardless of case complexity, plaintiff attorneys continue to perform the following essential settlement planning roles:

• Recognizing settlement planning issues which impact their clients;
• Recommending appropriate settlement planning professional resources to their clients; and
• Retaining ultimate responsibility for effectuating settlements.

As one result, plaintiff attorneys represent the primary marketing target for for companies and professionals offering settlement planning services. Seven primary market brokers, one structured settlement annuity provider and one factoring company were among the 141 sponsors and exhibitors at the AAJ 2014 Annual Conference which also included companies offering lien resolution, MSA compliance, life care planning, legal finance and economic consulting services.

Notable features of the 2014 AAJ conferences:

• AAJ's educational programs focused on litigation issues with no structured settlement, no Affordable Care Act (ACA) and almost no settlement planning presentations.
• Exhibiting structured settlement brokers shared one distinguishing characteristic - their product and service offerings extended far beyond traditional structured settlements.

Related Resources:

• AAJ 2014 Winter Meeting
• AAJ 2014 Annual Meeting

Society of Settlement Planners (SSP)

SSP is a professional association most of whose members are plaintiff structured settlement brokers. SSP's 2014 Annual Conference provided three important contributions to settlement planning.

First, SSP President Neil Johnson's SSP keynote speech, which he repeated at NSSTA's Fall Conference, highlighted continuing polarization among structured settlement professionals and proposed the following solutions: 1) recognizing and accepting product diversity; 2) focusing on client and customer service; 3) identifying and pursuing permanent shared interests without necessarily agreeing on all issues; 4) engaging all perspectives to discuss industry problems and issues; 5) improving relationships among stakeholder groups; 6) promoting and practicing settlement planning not settlement selling.

Second, consistent with Johnson's proposed unification solutions, SSP's Secondary Market Panel featured two leading structured settlement transfer experts whose clients typically oppose each other in secondary market cases: NASP Executive Director Earl Nesbitt and Stephen Harris, former co-Chairman of NSSTA's legal committee.

Third, SSP speaker Michele Fuller identified her list of 2014 settlement planning "game changers" as a baseline for industry discussion:

1. Affordable Care Act.
2. Lien resolution statutory and regulatory developments.
3. Federal recognition of same-sex marriages.
4. Wrongful death caps determined unconstitutional.
5. State and federal tax reform.
6. Potential reductions in social security benefits.
7. MSAs in liability cases.
8. Settlement planning goes cyber.
9. Increasing need for Qualified Settlement Funds.
10. Increasing number of persons with disabilities.

Related Resources - SSP 2014 Annual Conference

• Part 1 - Secondary market panel.
• Part 2 - Conference summary.

National Structured Settlement Trade Association (NSSTA)

By inviting NASP President Patricia LaBorde and SSP President Neil Johnson to speak at its members-only 2014 Fall Educational Conference, NSSTA took a symbolic step toward restoring its original vision as articulated by David Ringler, NSSTA's first president: "a place where everyone and anyone can sit down with each other and discuss the issues and viewpoints regardless of beliefs is the most important reason for NSSTA."

For the past several years, NSSTA's leadership has superimposed a political litmus test for membership, as well as for topics and speakers at its educational conferences. NSSTA's near-sighted strategy has limited the potential growth of structured settlements within the larger and more complex settlement planning market and created multiple challenges for the next generation of structured settlement leaders.

Structured settlements, however, represent a core settlement planning product with emerging product improvements and nontraditional products demonstrating the potential for settlement planning market expansion. In addition, NSSTA's Fall conference underscored, and re-enforced, NSSTA's and NSSTA members' strategic settlement planning relationship knowledge about and with: 1) plaintiff attorneys; 2) insurance associations; 3) insurance claims adjustors; 4) national consumer associations; 5) U.S. Congressional members; and 6) MSA administrators - as well as with SSP and NASP.

Related Resources:

• NSSTA 2014 Fall Educational Conference
• Potential "Game Changing" Structured Settlement PLR
• Structured Settlements 2014 - Primary Market

National Association of Settlement Purchasers (NASP)

Assuming settlement planning includes adjustments during an injury victim's lifetime, structured settlement transfer (factoring) companies should be included among settlement planning participants. Like NSSTA, its primary market counterpart, NASP and its members face serious challenges which NASP president Patricia LaBorde acknowledged during NASP's 2014 Annual Conference.

"There are some forces working against us right now" Laborde stated, "and we need to remain diligent so our customers (structured settlement recipients who sell payment rights to NASP member companies) continue to have access to liquidity." These "negative" forces include predicted secondary market "chaos" resulting from the Washington Square v. RSL case as well as market restrictions resulting from anti-assignment lawsuits.

Shared educational dialogue among representatives of NASP, NSSTA and SSP during 2014 appear to support the possibility of increasing primary and secondary market integration as predicted by Peter Arnold during his NASP conference presentation.

Related Resources:

• NASP 2014 Annual Conference
• Structured Settlements 2014 - Secondary Market

Academy of Special Needs Planners (ASNP)

ASNP is one of three national associations of attorneys whose members practice special needs (SN) planning. SN planning encompasses individuals with congenital and developmental defects, as well as personal injury victims, and therefore represents a parallel market which overlaps with personal injury settlement planning.

For the past eight years, ASNP has sponsored some of the best educational programs addressing settlement planning topics including such fundamental issues as: "know your client", "needs analysis", "best practices", "industry standards" and "product suitability", as well as "professional responsibility, qualifications and liability".

Among other topics, the ASNP 2014 Conference expanded previous ASNP educational programs about the Patient Protection and Affordable Care Act (ACA aka "Obamacare") including a multi-professional "ACA Panel" consisting of: David Lillesand (attorney); Ann Koerner (life care planner); and Scott MacDonald (investment adviser).

Other settlement planning topics addressed during ASNP's 2014 Annual Conference:

• Blaine Brockman and Patricia Kefalas Dudek spoke about "Housing, Food Assistance, Employment Benefits" - critical topics for many people with disabilities which are rarely addressed at structured settlement and settlement planning educational conferences.
• Cynthia Barrett discussed "Post-Windsor Issues for LGBT Couples & Children" - another settlement planning subject other settlement planning conferences failed to encompass.

Expanding its settlement planning educational programs, ASNP is currently sponsoring a 12-part settlement planning webinar series which demonstrates both the growing importance of settlement planning for SN attorneys as well as the broad scope of settlement planning topics.

Related Resources:

• ASNP 2014 Annual Conference
• ASNP Settlement Planning Webinar Series
• ACA and Future Medical Expenses

National Alliance of Medicare Set-Aside Professionals (NAMSAP)

NAMSAP is the only national professional association whose singular focus is Medicare Set-Aside (MSA) arrangements. NAMSAP's growth has paralleled the expansion of workers compensation MSAs (WCMSAs) to satisfy the requirements of the Medicare Secondary Payer (MSP) Act. Enacted in 1980, the MSP Act requires certain insurers, including liability, automobile, no-fault and workers compensation insurers, to make payment first for services to Medicare beneficiaries regarding claimed injuries, with Medicare responsible only as a “secondary payer.”

The Center for Medicare & Medicaid Services (CMS) published a WCMSA Reference Guide (WCRG) on March 29, 2013 plus a WCRG Version 2.0 on November 7, 2013. Both address structured settlement issues and provide guidelines for their utilization. WCMSAs represent one of the few submarkets where structured settlements sales have increased since 2008 - in large part because the method CMS requires for calculating WCMSA present values provides an inherent cost advantage for annuities compared with lump sum alternatives.

CMS withdrew its Notice of Proposed Rulemaking (NPRM) related to liability MSAs in October 2014 because it failed to gain approval from the Office of Management and Budget (OMB). Therefore, settlement planners must continue to analyze each liability case individually to determine whether and how to protect Medicare's interests.

During NAMSAP's 2014 Regional Conference, Roy Franco predicted the following settlement planning changes likely to result from the Bipartisan Budget Act of 2013, implementation of the ACA and the still anticipated CMS rules for liability MSAs: "workers' compensation, liability and no-fault insurers will all become primary payers vis a vis Medicare, Medicaid and ACA health providers" as part of integrated settlement planning models similar to WCMSAs." Franco added, however, that different state models are likely to develop as a result of both state-specific collateral source rules and the new Medicaid reimbursement rules promulgated by the Bipartisan Budget Act of 2013.

Related Resources

• NAMSAP 2014 Regional Conference
  • Part 1
  • Part 2
• NAMSAP 2014 Annual Meeting
• Bipartisan Budget Act of 2013

Evolve Qualified Settlement Fund (QSF) Symposium

Organized "to provide a forum for open dialogue that helps shape industry developments", the 2014 Evolve QSF Symposium avoided the single claimant controversy and focused instead on other important QSF and settlement planning issues including:

• How QSFs reconfigure the traditional settlement planning process.
• QSF-related compensation issues for administrators and structured settlement brokers.
• The increasingly important settlement planning roles for life care planners and case managers.
• QSF-related tax issues such as state taxation, foreign structured settlement assignment companies and structured attorney fees.

Related Resources

• Evolve 2014 QSF Symposium
• Single Claimant QSFs Revisited
• "How the ACA Affects Nurse Life Care Planners"
• Wendie Howland Interview

National Academy of Elder Law Attorneys (NAELA)

NAELA was the first and remains the largest U.S. professional association focused on the needs of elder and special needs law attorneys. Responding to its own strategic challenges, NAELA organized its 2014 Annual Conference to address what it perceives to be its two primary strategic issues: 1) the future needs of persons with disabilities; and 2) the future of elder law.

Compared with ASNP, however, NAELA's educational programs rarely address settlement planning or structured settlements. When NAELA members discuss special needs planning, many tend to think about developmental (as opposed to personal injury) disabilities. Unfortunately, many NAELA members view structured settlements negatively despite familiarity with the concept and a general affinity for annuities.

Related Resources

• NAELA 2014 Annual Conference
• Person-Centered Planning
• Cornell Disability Studies, Research, Statistics