Beyond Structured Settlements

NSSTA 2017 Annual Conference

When Len Blonder was elevated to the role of President of the National Structured Settlement Trade Association (NSSTA) for an unprecedented third time during NSSTA's 2016 Annual Conference, he identified a very clear vision for the structured settlement industry.

"The times are changing and we must change", Blonder stated in 2016, as he addressed NSSTA's membership to begin his third term as President. "The business is more complicated. We must determine how the parts fit together. Despite plaintiff growth, defendants remain indispensable to structured settlements. Defendants must continue to play a key role."

NSSTA's 2017 Annual Conference, which occurred April 19-21 in San Francisco, provided an educational program consistent with Blonder's vision. The conference also re-confirmed that now is an exciting time to be part of the structured settlement industry and that NSSTA is well-organized to address the current challenges and opportunities confronting the industry.

Speakers and Topics

• Opening Remarks - Len Blonder, NSSTA President
• NSSTA Objectives - Jim Early - NSSTA President Elect
• Access to Justice - Elise Sanquinetti; Laurie Klimchock; Melissa Baldwin (Moderator)
• NSSTA Board of Director Candidate Speeches
• My Story: Meg Hertzel-Busing; Mike Wostoupal (Moderator)
• Getting Claims Professionals Invested in Structured Settlements: Taylor Smith; Dean Harring; Al Luther; Brad Cantwell; Jerry Lothrop; Jim Early (Moderator)
• ABLE Act Implementation - Stephen Dale
• Government Benefit Programs - Amos Goodale
• Special Needs Attorneys and Structured Settlement Consultants: Morris Klein; Phillip Krause; Eric Vaughn; Patrick Hindert (Moderator)
• Washington Update - Eric Vaughn
• MSAs in Third Party Settlements - Robert Sagrillo
• A Claimant's Story: Judge Larry Quan (retired); John Allan); Eric Vaughn (Moderator)
• Educating Defense Counsel - Kathy Martin; John Kouris; Nolan Robinson (Moderator)
• Structured Settlement Education - Patricia Fairhurst; Debbie Sink; Jordan Bossler; Matt Ross.

NSSTA Challenges

• Protecting and Preserving IRC Sections 104(a)(1) and (2) and 130 - the existential foundation of the structured settlement industry. Among many individuals, past and present, responsible for organizing and maintaining the political coalition responsible for safeguarding these code sections (including the Congressional Structured Settlement Caucus), Blonder (now NSSTA's immediate Past President), NSSTA Executive Director Eric Vaughn, and NSSTA General Counsel John Stanton have been the longtime leaders of NSSTA's diligent and successful legislative and regulatory team. Without overlooking this traditional tax priority, NSSTA has also become more proactive in seeking new legislation and regulation (both tax and non-tax related) to expand structured settlement opportunities.
• Transitioning to Next Generation Leadership - NSSTA's leadership continues to balance experience with fresh thinking as evidenced by new NSSTA President James Early, President-elect Geoffrey Kissel and newly elected/re-elected Directors: Michelle Caine; Michael Goodman; Melissa Baldwin; Jordan Bossler; and Ross Duncan. Among NSSTA's retiring Directors, Randy Dyer is especially noteworthy. Dyer, who previously served as NSSTA's Executive Director during its formative years, also received this year's NSSTA's President's Award. Among NSSTA's conference speakers, Next Generation leaders Phillip Krause, Brad Cantwell, Nolan Robinson and Jordan Bossler were featured. Robinson and Bossler received NSSTA's Leadership Award for their shared contribution to NSSTA's educational programming.
• Transitioning to New Business Models - No longer simply a "zero sum" negotiation alternative (structure vs. cash), the future growth of structured settlements requires an in depth strategic re-analysis of two separate but related transitional markets (defendant claim management and plaintiff settlement planning) and how best to integrate structured settlements into those markets. Historically slow to provide its members with an in-depth, continuing educational focus on these developing markets, NSSTA's 2017 Annual Conference provided a valuable "deep-dive" into defendant claim management and special needs planning as it relates to plaintiff settlement planning - both of which are discussed below under "NSSTA Opportunities".
• Updating/Improving NSSTA Educational Programs - or how best to educate NSSTA members, who possess varying degrees of experience and who market to a diverse group of structured settlement producers and decision makers, to deliver high value services to their respective clients - with multiple additional objectives including: attracting new industry participants and knowledge leaders; helping industry participants develop skill sets needed for success in transitional markets; better utilizing Internet and other technology resources to improve educational efficiencies; competing (and collaborating) with other professional associations and providers for members' educational time and dollars. NSSTA has addressed this challenge by upgrading multiple educational offerings in addition to its Annual and Fall conferences (egs.CSSC program; NSSTA University; Structures 202). The 2017 Annual provided both a foundation and a perspective for future educational development.
• Overcoming Negative Secondary Market Publicity - During his term as NSSTA President (2015-2016), Michael Goodman identified several goals for NSSTA including "moving beyond a focus on factoring". One way to help accomplish this objective is to focus on the many positive, inspiring life stories of structured settlement recipients. NSSTA's 2017 Annual Conference presented two such stories. The first featured Meg Hertzel-Busing who suffered traumatic brain injury as a result of a car accident, then developed epilepsy. During college summers, she volunteered at a California camp for kids with cancer and their siblings. Seeing the positive impact, she made her life mission to bring life-affirming experience to children with epilepsy in the Midwest by founding, with her husband Kael, Midwest YouCan Foundation in 2011. The second featured retired Judge Larry Quan who received a structured settlement after sustaining a spinal cord injury resulting in quadriplegia.
• Other Challenges - Of course, NSSTA and its members have other challenges - such as low interest rates; adding new life companies; promoting greater diversity among its membership. However, by highlighting the challenges listed above during its 2017 Annual Conference, NSSTA's Board of Directors and its Education Committee demonstrated an appropriate awareness and focus that should enable NSSTA to successfully pursue its current Growth Initiative.

NSSTA Opportunities

Rejuvenating Defense Programs

• During Michael Goodman's Presidency (2015-2016), NSSTA revised its historic and defensive "protect and preserve" strategy by embracing a new "Growth Initiative" - "designed to identify opportunities to expand the use of structured settlements and bring those opportunities to the structured settlement industry marketplace." Continued and expanded during Len Blonder's Presidency, NSSTA's first Growth Initiatives prioritized "Rejuvenating Defense Programs".
• Originally the prime movers for structured settlements, many defense insurers have since reduced or completely abandoned their structured settlement programs citing a variety of reasons. A NSSTA sponsored survey of claims professionals conducted by CLM Advisors in 2014 produced some troubling, yet opportunistic results and raised some important strategic questions for structured settlement brokers who market to defendants - as did an earlier CLM Advisors survey of senior claims executives also conducted for NSSTA.
• NSSTA's 2017 Annual Conference featured two outstanding panels addressing defense issues and opportunities: 1) "Getting Claims Professionals Invested in Structured Settlements"; and 2) "Educating Defense Counsel." The first panel, moderated by incoming NSSTA President James Early, featured three representatives of CLM Advisors including President Taylor Smith (who personally conducted the marketing surveys for NSSTA), as well as NSSTA brokers Brad Cantwell and Jerry Lothrop.
• The information generated from both panels provided a valuable supplement to NSSTA's earlier surveys and should help NSSTA's Growth Initiative Committee (and NSSTA members) accomplish its primary strategic objective. Examples:
• Professional backgrounds of today's claims executives have changed. They are less likely to be promoted from within the claims department and are more likely to be lawyers, accountants and/or MBAs hired from the outside. Question: what impact, if any, should this change in claims executive prototype have on structured settlement hiring practices and business strategy?
• These new claims executives focus more often on process rather than loss ratio. "What is important is what gets measured - and process gets measured," added one of the panelists. Observation: plaintiff structured settlement brokers transitioning to settlement planners are also emphasizing "process" - over "product" (see this S2KM report which includes the Society of Settlement Planner's (SSP)description of the "settlement planning process".). Question: How many defense brokers currently prioritize claim management process issues and metrics in their structured settlement marketing, sales and services?
• Also note, to double down on metrics - as S2KM previously reported, one of the "key findings" of a 2011 study titled: "National Litigation Management Study", conducted by CLM Alliance, the parent company of CLM Advisors, was: "litigation executives are not happy with the metrics and analytics available to them."
• One of the CLM Advisor panelists pointed out that "many young claim handlers don't understand structured settlements." They view structured settlements as "nothing more than post-settlement financial planning tools" and "have never seen any evidence that structured settlements save money." Questions: do structured settlements save money? If yes, in what context? (see next bullet). Focusing on claim management "process" (see above), should defense brokers develop a new structured sales strategy with supporting metrics - at least in this current economic/interest rate environment? For more on historic structured settlement metrics, see this 2011 S2KM blog series.
• Repeating a theme highlighted in NSSTA's 2014 surveys of both senior claims executives and claims professionals, one of the CLM Advisor panelists pointed out that claim adjustors "need help navigating Medicare Set-Aside (MSA) requirements." Every defense broker should understand exactly why his or her client can save money funding an MSA with a structured settlement as opposed to cash. For an explanation in the workers compensation context, see this S2KM blog post. Although CMS has not published similar rules for liability MSAs, many defendants are already utilizing structured settlements to fund liability MSAs and NSSTA's 2017 conference featured MSA expert Robert Sagrillo discussing that topic.

Special Needs Attorneys and Settlement Planning

• Within the personal injury settlement planning market, plaintiff structured settlement brokers interact with, and face competition from, other professional product and service providers who market to plaintiff attorneys. Among the most important of these other professionals are special needs attorneys. Settlement planning is now viewed as a growth opportunity by many special needs and elder law attorneys.
• Two national associations of special needs attorneys exist: the Special Needs Alliance (SN Alliance) and the Academy of Special Needs Planners (ASNP). SN Alliance members typically represent a majority of the speakers at the annual Stetson and University of Texas SNT conferences. The National Academy of Elder Law Attorneys (NAELA), to which most SN Alliance and ASNP members also belong, increasing emphasizes special needs as well as elder law issues among its educational and legislative lobbying priorities.
• Although their signature products are special needs trusts (SNTs), special needs attorneys play a variety of settlement planning roles (guardian; conservator; trustee; QSF administrator; in addition to legal advisor) and provide a variety of settlement planning legal products and services. Their expertise encompasses government benefits including: Social Security; Medicare; Medicaid; the Affordable Care Act (ACA); ABLE Act; veterans benefits; and public housing.
• Although special needs planning and settlement planning overlap in many respects, there are important differences. For example, "special needs" generally refers to birth-related or developmental disabilities. Special needs professional advice typically falls outside of the personal injury litigation process. Third party SNTs represent a prominent special needs planning tool rarely utilized in settlement planning. Unlike plaintiff structured settlement brokers, whose client relationships typically end once a case settles, the relationships of special needs attorneys and other special needs advisors may extend for their clients' lifetimes.
• Both plaintiff structured settlement brokers and special needs attorneys who practice settlement planning market their products and services to plaintiff attorneys who continue to perform the following essential settlement planning roles regardless of case complexity:
  • Recognizing settlement planning issues which impact their clients;
  • Recommending appropriate settlement planning professional resources to their clients; and
  • Retaining ultimate responsibility for effectuating settlements.
• Logically, structured settlement brokers and special needs attorneys could and should be natural settlement planning marketing allies and work product collaboration partners. This strategic relationship, however, has never achieved its full potential. Among other reasons, one of NSSTA's historic public policy justifications for structured settlements ("structured settlements enable injury victims to live free of reliance on government assistance") positioned NSSTA and its members at odds with special needs attorneys (who specialize in government benefits) and also contradicted multiple structured settlement growth opportunities (Medicare set-asides; SNTs; ACA benefits) which require integrating structured settlement annuities with government benefits.
• To change the direction and dynamics of its relationship with special needs attorneys, NSSTA created a Special Needs Attorney Task Force in 2015 and made it part of its Growth Initiative Committee in 2016 with the following Mission: "to identify opportunities to expand the use of structured settlements and bring those opportunities to the structured settlement marketplace by:
  • "Improving NSSTA's relationships with, and understanding of, SN attorneys and the primary national associations to which they belong;
  • "Improving SN attorney’s knowledge and understanding of the benefits and appropriate applications for structured settlements;
  • "Collaborating with SN attorneys in a professionally responsible and ethical manner to improve the lives of personal injury victims and their families."
• NSSTA's 2017 Annual Conference featured three special needs attorneys:
  • Stephen Dale - One of the nation's leading disability law experts, Dale provided NSSTA attendees with an overview of the Achieving a Better Life Experience Act (ABLE Act), which was signed into law in 2014 and for which 18 states have now opened qualifying ABLE programs offering various investment options. For eligible, disabled individuals and their families, Dale recommended ABLE accounts as an important supplement and/or alternative to special needs and/or pooled trusts. He views ABLE accounts as a valuable, immediate marketing and sales opportunity for both structured settlement brokers and special needs attorneys.
  • Amos Goodall - Goodall supplemented Dale's presentation with a general overview and introduction to government benefits. NSSTA and its members have traditionally emphasized and sold structured settlements based upon their inherent tax advantages compared with cash settlements. For many personal injury victims, however, maintaining Medicaid or other "means-tested" government benefits utilizing structured settlements may be an equally or more persuasive sales rationale. As pointed out above, current CMS rules for MSAs provide a cost advantage for structured settlements compared with cash.
  • Morris Klein - Klein, Co-Chair of NAELA's Public Policy Committee joined NSSTA broker Phillip Krause and NSSTA Executive Director Eric Vaughn on a panel to discuss: 1) how structured settlement consultants can improve their business relationships with special needs attorneys; 2) current political priorities of the SN Alliance and NAELA; and 3) how NSSTA and those associations might collaborate in the future. Among recent legislative developments, Klein highlighted the SNT Fairness Act (SNTFA) as significant for clients of both special needs attorneys and structured settlement consultants.

CONCLUSION: To achieve strategic success, it is important for NSSTA to link its educational programming with its Growth Initiative opportunities and priorities. From S2KM's perspective, NSSTA's Educational Committee Co-Chairs Jordan Bossler and Nolan Robinson, and NSSTA's Executive Administrator Debbie Sink, should be congratulated for accomplishing that objective to a remarkable degree in San Francisco. In particular, NSSTA's 2017 Annual Conference presentations focusing on rejuvenating defense programs, as well as those featuring structured settlement recipients and special needs attorneys, should provide NSSTA with a solid foundation for future educational programming and help NSSTA with strategic and legislative prioritization. For S2KM reports about prior NSSTA educational conferences, see the structured settlement wiki.

ASNP 2017 Annual Conference

For the past 11 years, the Academy of Special Needs Planners (ASNP) annual conferences have consistently improved the educational scope and standards for an expanding professional landscape which, in addition to, and overlapping with, special needs planning, also encompasses personal injury settlement planning, including various types of settlement trusts as well as structured settlements, Medicare set-aside arrangements and life care planning.

ASNP's 2017 Annual Conference, which occurred March 23-25 in New Orleans, maintained its deserved reputation and also highlighted an increasing number of opportunities, issues and challenges for both the traditional structured settlement industry and the "emerging" personal injury settlement planning industry - relatively few of whose combined members have historically attended this, or other, national special needs conferences.

ASNP 2017 TOPICS AND SPEAKERS

PRE-SESSION

• Drafting the World's Best Special Needs Trusts - Kevin Urbatch; Nancy Chudacoff; Ray Falcon; Travis Finchum; Michele Fuller; Robert Mescali
• Online Marketing for Attorneys Intensive Workshop - Conrad Saam

MAIN PROGRAM

• Developments and Updates on Special Needs Topics - Blaine Brockman
• Ethically Representing Persons with Disabilities and their Families - Dr. Roberta Flowers and Sheila Moragas
• To SNT or not SNT: How to Systematically Review a Client's Situation to Provide the Best Advice - Travis Finchum and David Lillesand
• Understanding the Issues that Arise When Persons with Disabilities Interact in Family Law Situations - Emily Kile and Jennifer Kupiszewski
• Taxation Issues that Arise for Persons with Special Needs - Vincent Russo
• SSI Update - David Lillesand
• Ask the Experts Panel - Moderated by Kevin Urbatsch
• The Arc - Robin Shaffert

CONFERENCE HIGHLIGHTS - A STRUCTURED SETTLEMENT / SETTLEMENT PLANNING PERSPECTIVE

Legislative Developments - Multiple legislative developments addressed at the ASNP conference represent expanding business opportunities for structured settlement and settlement planning professionals.

• Affordable Care Act - The political future of the Patient Protection and Affordable Care Act (ACA) and Medicaid remain uncertain. In fact, House Speaker Paul Ryan pulled the Republican ACA replacement bill concurrent with the ASNP conference. At present, however, both the ACA and Medicaid continue to represent critical health care alternatives for disabled individuals as David Lillesand and Travis Finchurm discussed in their presentation "To SNT or not SNT". In discussing these options, Lillesand highlighted the need for a "cost benefit analysis" to determine whether advisors should recommend private health insurance or a special needs trust (SNT). Both d(4)(A) (self-settled) SNTs and ACA premium payments continue to represent excellent funding opportunities for structured settlements as well as important settlement planning considerations.
• Special Needs Trust Fairness Act - Blaine Brockman summarized Section 5007 of the 21st Century Cures Act - a section referred to as the "Special Needs Trust Fairness Act" (SNTFA), which was signed into law by President Obama on December 13, 2016. The SNTFA adds “the individual” to the list of persons/entities who can establish a special needs trust pursuant to 42 U.S.C. 1396p(d)(4)(A) and thereby corrected a long -standing oversight in the OBRA 1993 legislation that created SNTs. Among the anticipated results of the SNTFA: more self-settled special needs trusts with more opportunities for structured settlements.
• The Achieving a Better Life Experience (ABLE) Act - Since the Federal ABLE Act became law in December 2014, 18 states have opened ABLE programs. ABLE Accounts "seemed pretty simple at first", according to Brockman. However, "as programs have developed, accounts have opened, and people with disabilities have begun using ABLE funds," Brockman added "what seemed like simple financial accounts have given way to more nuanced issues about the best use of the ABLE Act." Brockman's presentation addressed many of these ABLE issues and confirmed that, in appropriate cases, ABLE accounts provide a valuable new tool for special needs and personal injury settlement planners. Although Brockman did not specifically address structured settlements, special needs attorney Stephen Dale will be speaking about ABLE Accounts (and presumably structured settlements) later this week at the National Structured Settlement Trade Association (NSSTA) Annual Conference.

Collaboration Opportunities

• Structured settlement annuities represent a strategic product within the larger and more complex personal injury settlement planning (settlement planning) market. From a legal perspective, special needs planning and settlement planning increasingly overlap. Settlement planning is now viewed as a growth opportunity by many special needs and elder law attorneys.
• Although their signature products are special needs trusts (SNTs), special needs attorneys play a variety of settlement planning roles (legal advisor; guardian; conservator; trustee; QSF administrator) and provide a variety of settlement planning products and services. Their expertise encompasses government benefits including: Social Security; Medicare; Medicaid; the ACA; ABLE Act; Veterans benefits; and public housing.
• ASNP's commitment to settlement planning has included a 12-part settlement planning webinar series (including a section on structured settlements) as well as its joint 2016 Annual Conference with the Society of Settlement Planners (SSP)
• Noticeable by their general absence from the ASNP conference, as speakers, attendees, exhibitors and/or sponsors, were members of NSSTA and SSP - which might be explained, in part, by the calendar proximity of their own annual conferences. In S2KM's experience, however, NSSTA and SSP members are also general "no-shows" at other national special needs conferences such as those sponsored by Stetson Law School and the University of Texas.
• By comparison: among the 17 exhibitors at the 2017 ASNP Annual Conference, there were at least: seven settlement trustees, one life care planner, one MSA administrator, and one seller of Medicaid annuities. The Platinum Sponsor of the ASNP Annual Conference was MassMutual, a life insurance company which exited the structured settlement market in 2007. MassMutual now appears to be the leading national special needs life insurance provider - focusing on developmentally disabled individuals and their families rather than personal injury victims. MassMutual acquired Metlife's retail advisory force in 2016 including its special needs division.
• Why should members of NSSTA and SSP attend national special needs conferences? For NSSTA (and its "Growth Initiative") and SSP (and its "Emerging Professionalism"), attendance and participation at national special needs conferences is important, of course, for education and marketing. Beyond those objectives, however, It is also about:
  • Understanding special needs and special needs planning - and how they impact structured settlements and settlement planning;
  • Identifying special needs knowledge leaders and collaboration partners;
  • Establishing (or re-establishing and improving) professional and association identities within the special needs community;
  • Recruiting "next generation" structured settlement and settlement planning professionals;
  • Improving multi-professional work product and building better business models.
  • Becoming part of the local, state and national special needs community - as described during the ASNP conference by Robin Shaffert, Senior Executive Officer of the Arc.

Standards, Practices and Certification - In addition to developments noted above, some progress is being made toward improving professional standards, practices and certification within both the special needs and settlement planning (including structured settlement) markets.

• MassMutual, which sponsors the American College of Financial Services Center for Special Needs , announced during the ASNP conference that the American College now offers a new Chartered Special Needs Consultant (ChSNC™) program. The Mission of the Center is "to elevate the knowledge of financial service professionals in the area of special needs planning." However, its new certification program does not appear to encompass structured settlements or settlement planning.
• In her ASNP discussion titled "Ethically Representing Persons with Disabilities and their Families", Professor Roberta Flowers referenced the proposed and newly revised "Aspirational Standards for Professionalism and Ethical Behavior for Elder and Special Needs Law" published by the National Academy of Elder Law Attorneys (NAELA) which NAELA will introduce to its members later this summer.
• During its 2017 Annual Conference, SSP announced a four-step plan to elevate settlement planning to professional status: 1) re-focusing SSP on professionalism; 2) updating SSP's Standards of Professional Conduct; 3) renewing and upgrading the RSP Designation program; 4) adopting and embracing new proposed SSP Practice Standards.
• NSSTA, as an association, has been slow to embrace "settlement planning" and to investigate "special needs planning." NSSTA, however, has recently formed a "Special Needs Attorney Task Force" and its 2017 Annual Educational Conference will feature an unprecedented (for NSSTA) three special needs attorneys as speakers. NSSTA is a major contributor to the American Association for People with Disabilities (AAPD) for which Eric Vaughn, NSSTA's Executive Director, currently serves as Vice Chairman. Ringler, a founding NSSTA member and historically the largest structured settlement broker, recently re-branded itself as "Objective Settlement Advisors" and now claims to be "the largest settlement planning company in the nation." NSSTA currently is updating its CSSC certification program and is expected to increase emphasis on government benefit issues.
• Important, but often overlooked, in discussions about special needs planning and settlement planning are life care planners. The two most prominent U.S. based life care planning professional associations are the International Association of Life Care Planners (IALCP) and the American Association of Nurse Life Care Planners (AANLCP). Both offer or promote certification programs.

CONCLUSION - For S2KM, the ASNP Conference continues to be a "must attend" annual event providing "top tier" analysis of special needs and settlement planning developments, valuable perspectives on structured settlements plus the opportunity to converse with industry icons and next generation leaders. For S2KM reports on past ASNP conferences, as well as other structured settlement and settlement planning national conferences, see the structured settlement wiki.

SSP President Responds to AIG Class Action Lawsuit

Based upon the history of the Society of Settlement Planners (SSP), and the role of Richard Risk (an SSP founder and member) as one of the plaintiff attorneys, structured settlement industry participants might assume that SSP, as an association, supports the recently filed AIG Class Action Lawsuit. When asked by S2KM, however, SSP President Joe Tombs provided an unexpected response. Tombs' detailed response appears below. For context, however, S2KM first provides a brief background summary plus a summary of the AIG Class Action allegations.

Historic Industry Divisions

Although some structured settlement industry pioneers, including the late David Ringler, the first President of the National Structured Settlement Trade Association (NSSTA) envisioned NSSTA as "a place where everyone and anyone [could] sit down with each other and discuss the issues and viewpoints regardless of beliefs", that utopian environment never fully materialized as multiple divisions developed within both the structured settlement market and the larger personal injury settlement consulting market. Examples include:

• Plaintiff vs. defense structured settlement brokers.
• Primary vs. secondary structured settlement markets.
• Structured settlements vs. settlement planning.
• Settlement annuities vs. settlement trusts.
• Settlement planning vs. special needs planning.

Among other results, the structured settlement industry now has both a primary and a secondary market and structured settlement industry participants with alternative issues, viewpoints, beliefs and educational interests have formed two national associations in addition to NSSTA: the National Association of Settlement Purchasers (NASP) and SSP. Although numerous and divisive issues have created serious political conflicts among these associations historically, leaders of all three associations have increasingly recognized and addressed the problems created by these conflicts.

During his three successive one year terms as SSP President, Immediate Past President Neil Johnson served as a powerful advocate for structured settlement industry unity. For example, as a guest speaker during NSSTA's 2014 Fall Conference, Johnson condemned lack of structured settlement industry unity as "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."

At the same time, Johnson proposed a "solution" for achieving structured settlement industry unity including these core elements:

• 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.

Among other highlights and milestones, the Society of Settlement Planners (SSP) 2016 Annual Conference transferred association leadership from Johnson to Joe Tombs with Tombs promising to maintain Johnson's leadership direction, which focused on structured settlement "industry unity", and also, in a dramatic policy shift, to "pull SSP back completely from structured settlement politics."

AIG Class Action Lawsuit

Earlier this month, three plaintiff attorneys, including SSP founder and current SSP member Richard Risk, filed a Class Action Complaint in United States District Court District of Massachusetts. Among its allegations, the Class Action Lawsuit accuses Defendant American International Group, Inc. (AIG), a NSSTA member, and several of its affiliates of: 1) RICO violations; 2) fraudulent conduct; and 3) unjust enrichment.

Although not named as Defendants, the Class Action Complaint also identifies multiple structured settlement brokers (most, if not all, members of NSSTA) who, according to the Complaint, are "known as 'Agency Partners' [and] have been on the AIG Approved Broker List within periods relevant to this Complaint, and are part of the racketeering enterprise at issue..."

Plaintiffs characterize the primary AIG business practice they allege is illegal as a "short-changing scheme" which they describe as follows: "Defendants’ practice to fail to disclose to Plaintiffs and other members of the Class numerous material facts concerning how AIG conducted its Structured Settlement Program including, among other things, that:

• "Defendants participated in a short-changing scheme designed to allow them to recover the cost of their own structured settlement brokers, by deducting the brokers’ fees from that portion of the settlement that the settling parties had previously agreed would be one hundred percent (100%) invested in future payments;
• "Defendants accomplished this “short-change” by bundling the amount of the broker’s commission—namely, four percent (4%)—into the illustrated annuity cost;
• "Even when the broker’s fee was not 4%, AIG would keep for itself whatever portion of the commission was not paid to the broker; and,
• "As a result of the scheme undertaken by Defendants, the actual financial value of the settlement was materially lower than the value represented to injury claimants since four percent (4%) of the full amount of cash to be invested in annuity was, in fact, diverted by AIG to pay for its own Approved Brokers and In-House Brokers."

Other Plaintiff allegations:

• "AIG uses a structured settlement annuity software and quoting system that is represented by it and the Approved Brokers (and In-House Brokers) as illustrating future projected payments based on the amount of funds previously agreed between the settling parties to be invested in the annuity. But this representation is not true, because it does not reflect the commission that is paid to the broker, which is hidden in the cost or present value of the annuity communicated to the claimant or claimant’s attorney."
• "In fact, AIG trains its employees in the Structured Settlement Program, as well as its Approved Brokers and In-House Brokers, not to disclose to claimants (or their attorneys when retained) the fact that the broker’s fee is bundled into the represented annuity investment cost."
• "AIG’s employees, its Approved Brokers, and In-House Brokers are also trained to conceal this scheme, in the event of claimant inquiries about the payment of commissions, by avoiding a direct answer to the question or, sometimes, by indicating that payment of annuity premiums from the defendant’s AIG-affiliated liability insurer to American General avoids commission as a cost to claimant."
• "The AIG Approved Brokers are also required to fund periodic payments with an American General or other AIG-related annuity, if at all possible. This requirement is called the 'first and last right of refusal'.”

The Complaint includes a footnote #1 (page 1) explaining/alleging that: 1) most structured settlement "producers" are inappropriately referred to as "brokers" when in fact they are "agents" appointed by life insurance companies; 2) Use of the term "broker" is misleading and communicates a false duty of loyalty to the consumer/injury victim; 3) although a producer may hold a life agent's license, he/she cannot bind the life company when writing an annuity application; and 4) this distinction becomes important for defining a racketeering "enterprise" under the RICO Act when considering the relationship of structured settlement producers to issuers.

SSP President Joe Tombs Responds

Based upon the political history of the SSP, and role of Risk as plaintiff attorney, the AIG Class Action Lawsuit appears to present a significant test for SSP - especially in light of Immediate Past President Neil Johnson's advocacy for structured settlement unity and current President Joe Tombs' promise for SSP to avoid structured settlement politics. When asked by S2KM whether or not SSP supports the AIG Class Action Lawsuit, however, Tombs provided the following response (with S2KM emphasis):

• "We are neutral – SSP has no position at all and we will not take one in the future. A year ago, we decided to abandon taking “political” positions. Advocacy for victim’s financial rights had been a central mission of the SSP since its founding and so it was hard to let that go. A pillar of the “old” SSP’s advocacy mission was opposition to many of the features of some of the casualty company programs. Therefore, many people are confused that we don’t have a dog in this fight. Everyone expects the SSP to rush out and take its normal spot in the circular firing squad and start blastng away or at least provide the forum for a mob to form. I’m sorry to disappoint people but we are neutral - on the AIG Class Action Lawsuit or any political issue such as single claimant 468B Qualified Settlement Funds. Individual SSP members have the option to support or oppose specific political issues. SSP, as an association, however, will not. Our priorities are growth and the promotion of professionalism in the practice of settlement planning - both of which we are accomplishing successfully.
• "Dick Risk is a founding member and we once honored him with a lifetime achievement award at which time we granted him lifelong membership. The SSP makes no attempts to muzzle or restrain our members. They are free to think, say, or do what they wish. We used to carefully guard our roll and membership was open only to plaintiff-only structured settlement brokers. Today, membership is open to anyone interested in comprehensive settlement planning as long as they are not engaged in factoring. Our membership includes a diverse group of structure brokers from most of the larger groups, trust company officers, financial planners, special needs trust attorneys, plaintiff attorneys and many others.
• "Separate from my role as President of SSP, I have my own opinion about the AIG Class Action Lawsuit. Part of my opinion is based upon a lunch I was honored to have in 1997 or 1998 with Hank Greenberg (then CEO of AIG) and Ernie Stempel (then President of North American Operations for AIG Life & Annuity). I remember Mr. Greenberg talking about a huge high-rise building with several floors full of nothing but lawyers. He then informed me AIG spent millions on outside counsel and had other AIG lawyers scattered across the globe. In my opinion, if AIG is right, they are more than adequately equipped to handle this case without help from me or anyone else.
• "Another part of my personal opinion is that I hate structured settlement politics and I am not smart enough or educated enough to know which side is right in this lawsuit. It is a fact, however, that many of my clients cannot chose from a full selection of structured settlement products or product providers - and another fact that my market quotes include fewer companies than they did a few years ago. I wish I could still quote Hartford, for example, but we know what happened after their class action settlement. So, although I can see the AIG battle lines forming, I don't have time for the fight myself. I have an appointment with a widow this afternoon and I only wish I could offer her and her freshly fatherless children a greater assortment of structured settlement options. And if a lawsuit against AIG should ever cause American General to withdraw from the structured settlement market, I would have a still shorter list of companies to offer my clients."

Joe Tombs is currently completing the first year of a two-year term as SSP President. SSP's 2017 Annual Educational Conference is scheduled for March 1-3 in Las Vegas. As Tombs is preparing for this event, he agreed to answer a few additional S2KM questions about SSP's current status and future direction. That interview will appear in a follow-up S2KM blog post.

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.

NAELA 2016 Summit

As a benchmark for planning and/or evaluating 2016 professional association educational conferences, the National Academy of Elder Law Attorneys (NAELA) Second Annual Summit, hosted January 26-27 in Newport Beach, California, established multiple impressive standards.

Organized by Co-Chairs Michael Amoruso and Professor Roberta Flowers into a series of overlapping three-hour Immersion Sessions and one-hour Breakout Sessions, the NAELA Summit fulfilled its promise of "div[ing] deep" into real-life elder law and special needs law case situations and challenging office practices. Designed to support different types of learning, individual sessions were supplemented with workshop documents made available online in advance of the conference.

Approximately 200 NAELA members attended the Summit - including a significant number of first-time NAELA member conference attendees plus an additional 20 sponsoring exhibitors. Combining the old with the new, two of NAELA's original founding members (Michael Gilfix and Vincent Russo) appeared as featured speakers. Networking was encouraged and multiple opportunities were scheduled including a First-Time Attendee Orientation Session.

Featured Summit Sessions

Personality Evaluation - Organizational anthropologist and marketing strategist Kimberly Dodson Gilbey delivered the Summit keynote address titled "How My Communication Style Can Help My Bottom Line." As a keynote supplement, attendees were encouraged to participate in a pre-conference personality type assessment and to wear their resulting "personality type badge" throughout the conference. Combined objectives included: 1) understanding how different personality styles interact in a professional context; 2) recognizing the impact of clients' communication styles; 3) learning to recognize problems resulting from conflicting communication styles; and 4) acquiring skills to address conflicting communication styles.

Technology Training - The NAELA Summit offered three separate technology breakout sessions:

• An iOS clinic led by Scott Grossberg profiling aps specifically recommended for elder law and special needs attorneys.
• A social media introduction by Robin Krooks focused on useful sites, marketing advice and consultative resources.
• An interactive technology clinic organized by Apple representatives to teach Apple technology accessibility features.

Peer Instruction - "Peer Instruction" is an increasingly popular, interactive teaching methodology developed by Harvard Physics Professor Eric Mazur in the 1990s as an alternative to the traditional lecture format. S2KM was introduced to peer instruction by Forge Consulting, a personal injury settlement planning company which utilizes peer instruction to accelerate learning among its new employees. As described on wikipedia, peer instruction is "a student-centered approach that involves flipping the traditional classroom by moving information transfer out and moving information assimilation, or application of learning, into the classroom."

With the exception of Forge Consulting, S2KM had not witnessed or participated in any peer instruction educational exercise prior to the NAELA Summit. Without referencing the term "peer instruction", or consciously utilizing this learning methodology, both of the NAELA Summit Immersion Sessions led by Frank Johns ("Skills and Law When Serving Clients with Diminished Capacity") and Michael and Mark Gilfix ("Advanced Elder Law, Tax, and Estate Planning from Start to Finish, Part 1") represented (from S2KM's perspective) highly successful peer instruction educational prototypes worth additional evaluation and replication by NAELA. Note: S2KM was unable to attend Part 2 of the Advanced Elder Law Immersion Session led by Mark Munson.

Practice Management - Especially useful for the many Summit attendees beginning their elder law and/or special needs practice, NAELA scheduled several sessions addressing practice management topics:

• Michael Weeks - Explaining the Value of Your Fees to Clients.
• Jennifer VanderVeen - Practice Management Idea Sharing.
• Vincent Russo - Staff to Success.
• Shirley Berger Whiteneck - Communicating "Bad News" to Clients.
• Kirsten Davis - Writing Concise Letters.
• Sue Bronson and Michael Kirtland - Dealing with High Conflict Families.

Public Policy - As the professional practice of NAELA members continues to expand beyond traditional elder law to include special needs planning and personal injury settlement planning, NAELA is likewise challenged to expand its public policy focus. NAELA Public Policy Committee Co-Chairs Morris Klein and Jason Frank and Public Policy Manager David Goldfarb provided Summit attendees with an overview of potential legislative and regulatory changes that could affect their professional practice. Although the Special Needs Trust Fairness Act remains NAELA's most important lobbying priority, NAELA has proactively addressed several other public policy issues:

• Submitting comments about proposed FINRA rules relating to financial exploitation of seniors and persons with disabilities.
• Urging CMS to ban pre-dispute arbitration provisions in long-term care facility agreements.
• Recommending expanded Medicare home health coverage for persons with chronic illnesses to the Senate Finance Committee Chronic Care Working Group.
• Highlighting unanticipated harms to care giving spouses that could result from H.R. 1771 - a Bill to amend the Social Security Act to count portions of income from annuities of a community spouse as income available to institutionalized spouses for purposes of eligibility for medical assistance.
• Urging the U.S. Department of Housing and Urban Development (HUD) to issue new guidelines to ensure that HUD rental assistance providers apply consistent rules for Special Needs Trust distributions throughout the U.S.
• Submitting an amici curiae brief (jointly with the Special Needs Alliance and National Housing Law Project) in the United States Court of Appeals for the First Circuit case of Kimberly DeCambre v. Brookline Housing Authority et al. on the issue of "whether 42 U.S.C. Section 1437a as construed by the Department of Housing and Urban Development permits a local housing authority to treat the return of principle from a resident's self-settled special needs trust as "income" for purposes of the Housing Choice Voucher Program."

Special Needs Trusts - As evidenced by separate annual conferences sponsored by Stetson and the University of Texas Law Schools, Special Needs Trusts (SNTs) continue to represent a primary focus of practice for many elder law and special needs attorneys. The NAELA Summit did not overlook this important topic offering the following related presentations:

• Stuart Zimring - Drafting SNTs.
• Patricia Kefalas Dudek - Navigating SNT Trustees Through Rough Waters.

Advanced Elder Law Review - The NAELA Summit was preceded by a two-day advanced Elder and Special Needs Law review course consisting of 14 sessions designed in part to help attendees prepare for the CELA Exam.

As a relatively new addition to professional educational conferences, the NAELA Summit significantly exceeded S2KM's expectations and should become an important educational priority for an increasing number of NAELA members.

For S2KM reporting about prior NAELA conferences as well as conferences sponsored by other professional associations addressing special needs, settlement planning and structured settlement issues, see the structured settlement wiki.

Stetson 2015 SNT Conference

Sponsored by Stetson University College of Law, the 17th Annual Special Needs Trust (SNT) National Conference, held October 14-16, 2015 in St. Petersburg, Florida, fulfilled its promised objective of providing "an in-depth review of major issues presented in the creation, administration and monitoring of special needs trusts."

The three-day conference included an optional one day "Pre-Conference" featuring two alternative curriculum choices - "Tax Intensive" and "Pooled Trust Intensive" - plus a one day "Basics of SNTs" as well as the "SNT National Conference" itself.

Except for the Tax Intensive Pre-Conference, the other three programs each included multiple breakout sessions - for a total of 45 SNT-related presentations delivered during three days. Befitting this highly regarded program, the speakers represented a "who's who" of nationally-recognized SNT experts. In addition to power point presentations, almost every speaker also provided an original supporting handout paper.

More than 500 professionals attended the conference - many of whom are themselves recognized national SNT experts. Twenty-five (25) companies exhibited.

In addition to the outstanding speakers, the diversity of topics, the exceptional networking opportunities, the organizational acumen as well as the attractive conference setting and amenities, S2KM found the following conference issues to be noteworthy from a structured settlement and personal injury settlement planning perspective.

SNT Advocacy

• Working through their national associations [especially the National Academy of Elder Law Attorneys (NAELA) and the Special Needs Alliance (Alliance)] as well as less formal groups such as the SSI Advocacy Committee, special needs attorneys have become increasingly involved in legislative and regulatory lobbying. The SNT Fairness Act, which, if enacted, would allow persons with disabilities to create their own SNTs, represents one important current example.
• Among the highlights of the Stetson SNT Conference were two interactive video conferences featuring national and regional Social Security Administration (SSA) representatives. This dialogue followed, and may have resulted from, a series of meetings between individual SNT attorneys (the SSI Advocacy Committee) and SSA senior staff members which began in 2013 to address problems identified by, and complaints from, SNT stakeholders with the SSA's SNT approval process.
• The SSA representatives addressed numerous questions from the Stetson attendees in addition to outlining their internal processes and challenges. They also announced their intention to "retire" the controversial SSA Trust Training Guide (released April 23, 2014) which unfortunately conflicts with the POMS, SSA's primary technical resource, in several important respects. Among its problems, the SSA Trust Training Guide states that additions to a (d)(4)(A) SNT after age 65 results in disqualification with no mention of the exception that exists in the POMS (SI 01120-203b.1.C) for structured settlements.
• Additional legislative and regulatory issues exist that impact both structured settlements and special needs trusts and provide a growing rationale for collaborative lobbying to benefit their shared client communities. For examples, both professional groups would benefit from regulatory authority confirming that 1) the Deficit Reduction Act annuity rules do not apply to structured settlements; and 2) the mere existence of a secondary market does not disqualify SNTs funded with structured settlements.

Affordable Care Act

• From S2KM's perspective, Stetson's 2015 SNT conference allocated insufficient time to the Affordable Care Act (ACA). Presentations included one Pre-Conference Tax Intensive session titled "The Role of MAGI in Special Needs Planning" plus a two-part Basic's session titled "The Planner's Evolving Tool Box" during which the ACA shared conference time with SNTs, ABLE Accounts and other public benefits such as SSI, SSDI, Veteran's Pensions, the Disability Military Child Protection Act, CHIP, Section 8 Housing, and SNAP (formerly Food Stamps). By comparison, three separate, additional one hour sessions were devoted to ABLE Accounts during the three days of presentations.
• In fairness, Janet Lauder, who was allocated only 20 minutes to discuss the ACA, provided a valuable written analysis of the ACA as part of her conference handout materials.
• The ACA, however, is clearly a "game changer" for special needs planning and may prove a "career changer" for many special needs attorneys. Scott Solkoff points out the reasons in his excellent Spring 2015 NAELA Journal article titled "Report on the Patient Protection and Affordable Care Act: Its Impact on the Special Needs and Elder Law Practice", (reviewed here by S2KM).
• SNTs and Medicaid are now options and no longer necessities for many special needs clients. The ACA's elimination of pre-existing condition restrictions in health insurance policies complicates the insurance decision making process, as well as fundamental "needs and/or cost analysis", for special needs clients - as Solkoff illustrates with a suggested and valuable list of post-ACA client information questions.
• As ACA experts such as attorney David Lillesand have pointed out, ACA private health insurance offers special needs clients several potential advantages compared with SNTs. These advantages include: 1) ability to select your own insurer and insurance plan - and change annually if not satisfied; 2) a wider range of doctors; 3) no ongoing re-certification or sole benefit rule; 4) no estate repayment requirements; plus 5) reduced costs by eliminating SNT attorney, trustee and annual tax preparation fees.
• Given the many complicated ACA issues, continuing ACA developments and their profound impact on special needs individuals and special needs attorneys, Stetson conference attendees would have benefited from more time allocated to detailed ACA analysis and practice recommendations.

Structured Settlements

• Structured settlement brokers and special needs attorneys frequently play important and complementary roles in personal injury settlement planning. Historically, SNTs have represented a strategic submarket for structured settlements. Arguably, both the ACA and the ABLE Act provide additional opportunities for these two professional groups to collaborate. As suggested above, multiple legislative and/or regulatory issues exist involving both structured settlements and SNTs. Clearly, an important strategic relationship exists between these two professional communities.
• Somewhat surprisingly, therefore, the 2015 Stetson conference exhibited virtually no indication of this strategic relationship. For example, by S2KM's count, only one National Structured Settlement Trade Association (NSSTA) broker and zero NSSTA annuity provider representatives attended the conference. No NSSTA brokers or NSSTA annuity providers exhibited or spoke at the conference. This lack of attendance and participation by structured settlement participants at a prestigious SNT conference constitutes a notable missed opportunity - for learning, networking and improving the image of structured settlement brokers.
• For examples of why NSSTA and its members might want to improve their image with at least some special needs attorneys, see S2KM's 2012 blog review of the legal treatise "Special Needs Trusts: Planning, Drafting and Administration", edited by Kevin Urbatsch. In this two volume SNT treatise, structured settlements are the only SNT "funding product" that receives detailed coverage. Chapter 8 authors Donna Bradshaw and Leslie Ann Barnett justify devoting 12 subsections to "structured settlements" by stating: "special needs planners need to understand how structured settlements work with first party SNTs to best advise personal injury attorneys, persons with disabilities, and their families." Rather than endorse structured settlements, however, they provide several warning and cautionary notes.
• Although it was impossible for S2KM to attend every Stetson conference presentation, not one presentation S2KM did attend mentioned structured settlements. Significantly, during her presentation titled "Marketing Your Special Needs Planning Skills to Others; Expanding Your Practice Focus", Shirley Whitenack, current President of NAELA, emphasized a team-oriented special needs practice and recommended networking with other allied professionals "who can be an excellent source for referrals." Among allied professionals she identified: other attorneys; accountants; financial planners; financial advisors; insurance agents; trust officers; life care planners; care managers; teachers; family members; and medical providers - but did not mention structured settlement consultants.
• Both the structured settlement and the special needs attorney professional communities appear to be undergoing generational transitions at the same time the ACA is transforming both of their traditional practices. Now is an appropriate time for both professions to re-examine collaborative opportunities as they re-think their own future direction and growth.

Settlement Planning

• In a second article appearing in the Spring 2015 issue of the NAELA Journal, titled "The Affordable Care Act and the Continued Commoditization of Elder Law", (also reviewed here by S2KM) E. Spencer Ghazey-Bates warns that key provisions of the ACA, when combined with the anticipated addition of predictive technology "will either enable nonattorneys to compete with [elder and special needs] attorneys for clients or result in clients simply self-educating to the point of no longer needing attorney guidance."
• Ghazey-Bates is not alone in predicting some negative consequences for traditional special needs law practice as a result of the ACA. Attorney Lillesand, for example, observed during the Academy of Special Needs Planners (ASNP) 2012 Annual Conference and continues to opine that: "The need for self-settled (first party) special needs trusts has decreased (except when a beneficiary requires long term institutional care) because the ACA provides better insurance options than Medicaid for many persons with pre-existing medical conditions including personal injury victims."
• Assuming the ACA restricts their traditional SNT practice, special needs attorneys presumably will be forced to expand and/or redirect their practice by providing new services to new and/or existing clients. Both the Stetson conference two-part panel discussion titled "The Planner's Evolving Tool Box" and Whitenack's "Expanding Your Practice Focus" presentation highlighted, at least indirectly, this new reality. Indeed, the broad knowledge and skill sets associated with special needs law as a practice field should permit many special needs attorneys to successfully transition their practice.
• One expanding opportunity for special needs attorneys, actually a strategic component of special needs practice that deserves and requires greater independent market and product analysis, is personal injury settlement planning. Rather than restrict settlement planning opportunities for special needs attorneys, the ACA and other continuing legislative and regulatory developments actually increase those opportunities in S2KM's opinion.
• ASNP, an association of special needs attorneys, appears to support S2KM's opinion. ASNP recently sponsored a 12-part webinar series about "Settlement Planning" as distinct from "Special Needs Planning". And the distinctions are important - from both a marketing and work product perspective. S2KM highlighted some of the differences between these two related professional disciplines in this recent blog post.
• Although multiple speakers at Stetson's 2015 conference made references to personal injury settlement planning, future Stetson conferences could benefit from greater attention to both the settlement planning market itself as well as post-ACA settlement planning specific analytic and work product opportunities for special needs attorneys.

For prior S2KM reporting about the ACA as well as professional association conferences addressing structured settlement and settlement planning issues, see the structured settlement wiki.

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.

ASNP 2015 Annual Conference

The Academy of Special Needs Planners (ASNP), one of three national associations of special needs attorneys (the others being the National Academy of Elder Law Attorneys (NAELA) and the Special Needs Alliance (SNA), hosted its ninth annual educational conference March 26-28, 2015 in Charlotte, North Carolina.

Special needs attorneys are one of several professional groups who participate in, and are helping to define, the evolving personal injury settlement planning market. Other settlement planning professionals and associations include: structured settlement consultants (SSP and NSSTA); Medicare set-aside professionals (NAMSAP) and life care planners (AANLCP).

Unlike educational programs sponsored by NAELA and SNA, ASNP's annual conferences are open to non-members. ASNP's programs consistently provide superior learning experiences featuring prominent speakers and comprehensive handout materials.

ASNP 2015 SPEAKERS AND TOPICS

• Avram Sacks - "Childhood Disabled Beneficiary Benefits"
• Janet Lowder - "Family Law Issues for a Child or Spouse with Special Needs"
• Thomas Brinker and Vincent Russo - "Tax Traps for Families with Special Needs Children"
• Theresa Varnet and Fredrick Misilo - "SSA's New Trust Guide"
• Larry Rocamora - "Leaving Retirement Benefits to Persons with Special Needs"
• Theresa Varnet and Nancy Chudacoff - "Understanding the ABLE and the Disabled Military Child Protection Act"
• Scott Solkoff and Ann Koerner - "How the Affordable Care Act has Changed Settlement Planning and Special Needs Planning"
• Ask the Experts Panel

Based upon the settlement planning mandate "know your client", which should include your client's legal and financial challenges before, during and following settlement, all of these topics arguably are relevant to settlement planners. Three of ASNP's 2015 educational topics, however, ("SSA's New Trust Guide", "Understanding the ABLE Act" and the "Affordable Care Act") are especially important.

S2KM has reported previously about the ABLE Act as well as the impact of the ACA on structured settlements and settlement planning - including a featured article in the Winter 2014 Journal of Nurse Life Care Planning written by S2KM Managing Director Patrick Hindert titled "How the Affordable Care Act Affects Life Care Planners."

SSA New Trust Guide

Theresa Varnet and Fredrick Misilo's 2015 ASNP presentation about the Social Security Administration's (SSA) new Trust Guide introduced a new settlement planning topic which was repeated with permission and acknowledgments at the SSP 2015 Annual Conference by ASNP National Director Kevin Urbatsch.

The background to the new SSA Trust Guide was a lack of uniformity among SSA Regions especially in reviewing (d)(4)(A) self-settled special needs trusts (SNTs) which are frequently funded with structured settlements as part of personal injury settlement plans. Growing frustrations among SNT stakeholders peaked in May 2012 when the SSA issued a new POMS (SI01120.203b) , without advance notice, creating changes to the "sole benefit rule" resulting in the disqualification of many SNTs.

Note: The Program Operations Manual System (POMS) is "a primary source of information used by Social Security employees to process claims for Social Security benefits."

Responding to complaints from a group of SNT advocates, then SSA Commissioner Michael Astrue initiated a series of meetings in January 2013 between SSA senior staff members and the advocates who had organized themselves into the SSI Advocacy Committee. Many issues/problems were identified and discussed. One result was the new SSA Trust Guide released April 23, 2014 to be used for national SSA trust training and SSA Regional trust evaluation - with the POMS still considered the SSA's primary resource.

Unfortunately, there are some problems with the new SSA Trust Guide - and one of the problems concerns structured settlements. The Trust Guide states that additions to a (d)(4)(A) SNT after age 65 results in disqualification with no mention of the exception that exists in the POMS (SI 01120-203b.1.C) for structured settlements.

NOTE: during the SSP 2015 Annual Conference, NSSTA Executive Director Eric Vaughn identified another problem (d)(4)(A) SNT's funded with structured settlements are experiencing in some states. Although no evidence exists the Deficit Reduction Act of 2005 (DRA) annuity rules are applicable to structured settlements, some state SSA and/or Medicaid employees have attempted to disqualify SNTs if they include structured settlements that violate those rules. For background, see S2KM's 2007 series titled "Inconvenient Questions".

The SSI Advocacy Committee has requested special needs attorneys and other settlement planners to report problems with the SSA Trust Guide to committee members Neil Winston, Mary O'Byrne and/or Theresa Varnet. Although barriers to progress exist, including hostility from the current Congress toward SSI as a welfare dependency and uncertainty whether SSA will continue to meet with advocates, the SSI Advocacy Committee hopes to expand upon its initial success.

ASNP Webinar Series

During the past 18 months, in addition to its annual educational conferences, ASNP has sponsored two separate 12-part webinar series addressing "settlement planning" and "special needs planning". Not only do ASNP's webinars identify topical components of these complex, overlapping professional disciplines, they also raise fundamental questions: what are the similarities and differences between "settlement planning" and "special needs planning"?

Some of the similarities and differences are apparent from the ASNP webinar topics themselves. Others are not.

Settlement Planning vs. Special Needs Planning

Both settlement planning and special needs planning involve disabled clients and require multi-professional teams including special needs attorneys, life care planners, care managers and financial advisors. In addition to personal injury victims, special needs attorneys represent and advise individuals suffering from birth defects and developmental disabilities and their families.

Although special needs attorneys play a variety of roles and provide a variety of products and services, their signature products are special needs trusts (SNTs). For settlement planning, the SNTs are most typically (d)(4)(A) self-settled and pooled trusts. For non-personal injury special needs clients, third party special needs trusts play a more important role.

While many special needs attorney move easily between settlement planning and special needs planning, the financial planning communities for each respective discipline are divided and their products are different. For example: MetLife is an important product provider for both settlement planning (structured settlement annuities) and special needs planning (life insurance; Medicaid annuities). Their respective internal departments, marketing resources and sales forces, however, are completely separate.

Settlement planners (particularly financial planners who sell structured settlements) are one-and-done product providers. They focus on the settlement recipient and how to distribute settlement funds. Their role ends when the settlement occurs. Regardless of discipline, the roles of special needs planners are more diverse (attorney; trustee; guardian); holistic (family and estate planning); and long-term (with settlement planning, for example - continuing well beyond the settlement).

Settlement planning, of course, includes many priority issues which rarely, if ever, occur with non-personal injury special needs planning. For examples: Medicare set-aside arrangements; IRC 468B qualified settlement funds; lien resolutions). Nonetheless, one of the key factors for the successful development of personal injury settlement planning is a better understanding of its relationship with special needs planning. ASNP's webinars and annual conferences provide an excellent continuing resource to accomplish this educational objective.

Links to S2KM reports about prior ASNP conferences: 2014; 2013; 2012; 2011; 2010; 2009; 2008; 2007.