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health-ins-policy
When a parent reaches the point of needing long term medical or assistive care, sometimes a family member cannot locate the actual policy even if they know a long term care insurance policy exists.  How do you get a copy of the policy?  One tactic used by insurance companies is to delay everything – including the simple task of complying with a request for a copy of the policy itself.  They also know that if the policy’s language (terms and conditions of coverage) is not consulted early on, damaging statements regarding the condition of the insured and the type of care needed are often made to the detriment of obtaining coverage for the insured.

Knowledge of and citation to the Florida statutes should help to get a copy of the long term care policy asap.

Florida law requires insurance companies to promptly communicate with policyholders:  “acknowledge and act promptly upon communications with respect to claims.”  Fla. Stat. § 626.9541(1)(i)3.c.  In addition, another Florida statute requires the insurance company to represent policy provisions accurately and relate claim decisions to applicable policy language.  See Fla. Stat. § 626.9541(1)(i)3.b and Fla. Stat. § 626.9541(1)(i)3.f, respectively.

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One lesser discussed provision of the new tax bill passed at the end of 2017 provides great news for student loan borrowers.  Borrowers who have their loans canceled due to death or disability are no longer taxed for the forgiveness.  This also applies to those parents who have taken out Parent Plus loans for their children and their child dies (there is no forgiveness of a Parent Plus loan if the child becomes disabled, it is the parent who must be disabled).  The new law takes effect January 1, 2018.  Those with loans discharged prior to 2018 are still potentially taxable.  However, those with disability discharges should be able to argue that the loan is not actually discharged for tax purposes until the three-year monitoring period has ended – this is also when the 1099-C is sent.

This tax relief for student loan borrowers is set to expire at the end of 2025.

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get-rid-of-sl-in-bk
There are a ton of people who believed their student loans were discharged when they loans were simply listed in their bankruptcy.  It may have been years before the private student loan companies started to communicate with the borrowers to collect this debt which added to that impression.

As it turns out, there may be a way to argue this after all – in instances involving private loans.  Private student loan lenders have to prove their loans are in fact “qualified education loans” and meet other criteria in order to be exempt from a general discharge.  We are now filing cases where we do not believe the private lenders can meet this burden and the loans are and should have been considered discharged all along.  This opens the lender and servicer to a potential FDCPA and FCCPA case if it has tried to collect on previously discharged debt.  Moreover, it also opens up the lender to potential claims to refund monies paid toward these loans since discharge.

An easy way around this would have been for the private student loan lenders to have filed their own adversary actions in the debtor’s bankruptcy to obtain a declaratory judgment that its loans were excepted from the general discharge.  However, this was never done.

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are-you-covered
Let’s face it, many people stuck in the middle taking care of both elderly parents and their own children, are overwhelmed when the Long Term Care Insurance company denies coverage for their loved ones.  Who has the time to deal with this with our otherwise busy lives?  Who has the knowledge to go toe to toe with the insurance company and force them to grant coverage?  And does it really make a difference with Medicare picking up the pieces if coverage is denied?

American Society on Aging addresses some common misnomers about what Medicare covers when long term care is needed.  The ASA pointed out that contrary to recent surveys which show that the public believes that Medicare pays for long-term care, this is not what happens in reality.  Medicare tries to limit its availability for the provision of personal and assistive care services.  If skilled nursing or rehabilitative services are needed, that’s where Medicare kicks in.

Medicare.gov defines long-term care as a range of services and support for personal care needs.  Most long-term care isn’t medical care, but rather help with basic personal tasks called activities of daily living (bathing, eating, dressing etc.)  The site states very clearly:  “Medicare doesn’t cover long-term care (also called custodial care), if that’s the only care you need.  Most nursing home care is custodial care.”

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insurance-claim-denied
Can a doctor at an insurance company make a decision to deny care if he or she doesn’t even look at the patient’s medical records?

This is a question that the California insurance commissioner Dave Jones will be looking at during a new investigation of Aetna following this stunning admission.  Jones told CNN his expectation would be “that physicians would be reviewing treatment authorization requests.”  I think we all would agree.

This is concerning to us as consumer attorneys in Florida who note that Aetna is a long term care insurance company who reviews people’s applications for nursing home and Assisted Living care.

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https://www.tampabankruptcylawyerblog.com/wp-content/uploads/sites/10/2015/07/christie_d._arkovich_p.a_1_small.jpgIf you run into trouble paying your student loan, chances are you’ve been told to “just go on forbearance.”  Here are five reasons that is a terrible idea in many cases:

  1. The client I just finished speaking with has had a few hardships in her life (health, divorces, low pay, disabled daughter etc.).  When she called her servicer for help, she was told she could go on a forbearance.  She’s been on many forbearances over the years.  Her servicer never adequately explained her options.  She could have taken advantage of an income based plan with ten year debt forgiveness because she was a teacher.  She’s been a teacher for practically forever.  She would owe zero right now if she’d known what to do.  But instead her loan has ballooned from 23k to, wait for it, $126,000.  It’s gone up 10x!  And she has only three years until she retires, divorced with a disabled daughter.  Do.Not.Trust.Your.Servicer.to.do.the.Right.Thing.
  2. You might ask, how does a loan go up 10 times from 23k to 126k?  Easy, although this is one of the worst I’ve seen.  The interest capitalizes every time the forbearance is renewed.  This means the unpaid interest is added to the principal balance and now you owe interest on interest.
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Are you expecting a large tax refund this year?

If so, and you have had some financial difficulties this year, do NOT file your tax return if you are in default on your federal student loans OR about to file bankruptcy.

Instead, some pre-planning is in order.  For federal students loans, cure the default before you file your taxes.  File an extension if you must to gain some additional time.

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Crushing-debt-podcast

Parent Plus Loans are federal loans that a parent or grandparent takes out for their child or grandchild to go to college.  Learn more about these loans, their high default rates and avenues to reduce this type of student loan debt by listening to our interview on the Crushing Debt Podcast with Shawn Yesner.

 

 

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PAF
I’d like to thank the PAF’s Hillsborough Chapter for the invitation to speak at their luncheon today with the assistance of our long term legal assistant, Angie Glaser, now paralegal!! — about Taking Control of Your Student Loans.

There were lots of good questions by people starved for information and surprised about what they learned today.  Hopefully, they will go back to their offices and share this with their attorneys and clients – and help us to share the word that there are many ways to reduce student loan debt that are not discussed by student loan servicers.

If you know of any group who would be interested in learning more about dealing with their student loans, please contact us to arrange a speaking engagement!

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https://www.tampabankruptcylawyerblog.com/wp-content/uploads/sites/10/2015/07/christie_d._arkovich_p.a_1_small.jpgWe’ve noticed over the past few months that some of our clients and many other borrowers have been reporting that they are having no luck getting their federal loans in forbearance after they’ve filed a Borrower Defense to Repayment (“BDTR”) application.  These forbearances are simple to request and are supposed to be automatic.  Basically, you check a box requesting the forbearance in the application.  The DOE is supposed to automatically grant the forbearance while the review is under way – a process that may take a year or even longer.

However, under Secretary DeVos’ watch, the BDTR department has basically been gutted, with only a handful of people working to process what appears to be approximately 1200 claims received per week.  So the work isn’t getting done.

So who’s responsibility is this to make sure the borrower is being placed on forbearance as they should – DOE, the servicer (such as Navient, AES, Great Lakes, FedLoan, Nelnet), or both?  That is the question we are now looking into.

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