Volume 6     Number 2     1998    

EEOC v. Johnson & Higgins, Inc. : Making the World Safe for Millionaires - Daniel P. O'Meara

In the recent case of EEOC v. Johnson and Higgins Inc., both the U.S. District Court for the Southern District of New York and the Second Circuit concluded that Johnson and Higgins, Inc. unlawfully discriminated on the basis of age in enacting a mandatory retirement program for its Board of Directors and, thus, violated the Age Discrimination in Employment Act (ADEA). Mr. O'Meara suggests that both courts were misguided in reaching this conclusion. More specifically, he criticizes the appellate court's reasoning that allowed the Equal Employment Opportunity Commission (EEOC) to proceed with the case despite the absence of an aggrieved party.

Finally, the essay criticizes the EEOC's decision to pursue this particular case. The author posits that the EEOC misallocated funds in seeking to protect wealthy corporate executives through an ADEA suit. He bases this conclusion on the fact that the employees at issue were not likely to need government-subsidized counsel to fight for protection from employment discrimination. Given the EEOC's limited resources and backlog of cases, Mr. O'Meara recommends that the best use of public resources in a similar case is to advise the allegedly aggrieved executives of their right to file a charge, and of the EEOC's willingness to challenge the policy in court, instead of initiating expensive litigation on behalf of such relatively wealthy individuals.

Whose Decision Is It Anyway?: Identifying the Medicaid Planning Client - David M. Rosenfeld

In the Medicaid planning context, the answers to seemingly easy questions are often quite elusive. Client identification is fundamental to every attorney-client relationship, yet resolving this basic question for Medicaid planners has sparked some debate. This essay explores the difficult question Medicaid planners encounter regarding client identification. The author, Mr. Rosenfeld, reveals the lack of guidance provided by contemporary legal ethic codes and then investigates some of the client representation models currently used by practitioners. Upon identifying the inherent conflict of interest that often develops in estate planning, Mr. Rosenfeld argues that individual client representation is the only ethically acceptable model of representation.

 ARTICLES

Can We Talk: Impediments to Intergenerational Communication and Practice in Law School Elder Law Clinics - Steven Keith Berenson

Because older and younger Americans bring vastly different life- perspectives to dialogic encounters, the current generations of older and younger Americans have difficulty discussing solutions to national problems that will affect both groups, such as health care and Social Security reform. The author, however, postulates that the two groups will be better able to communicate despite their different experiences if both groups meet in a common social milieu. Mr. Berenson suggests that because elder law clinics encounter issues similar to the national problems faced by both age groups, they are ideal arenas within which dialogic encounters can take place between older and younger Americans. Mr. Berenson concludes the article with a discussion of ethical issues that elder law clinic practitioners may face during such dialogic encounters.

The Home Health Care Crisis: Medicare's Fastest Growing Program Legalizes Spiraling Costs - Brian E. Davis

Home health care was developed with the benevolent intention of providing a cost-effective alternative to existing forms of long-term health care, while permitting beneficiaries to receive needed short-term, posthospitalization, acute care in their own homes. However, the home health care segment of Medicare recently sustained an unprecedented and explosive growth in program cost. As a result of this alarming expansion, home health care has become the fastest growing expense of the overwhelmingly complex Medicare program and is in danger of spiraling out of control.

This article begins with a review of the current structure and administration of the home health care program under the Health Care Finance Administration (HCFA). Mr. Davis details the requirements of Home Health Agencies and their patients to qualify for full Medicare reimbursement under the home health care program. Current practices, based on lenient administrative and judicial interpretations of these qualifications, have resulted in growing demand for home health services and the resulting increase in program cost. Mr. Davis explores the primary limitations on the home health care program, including the overemphasized potential for fraud and abuse, billing and budget inefficiencies, the overavailability of services, the ease of entry into the home health care market, the lack of meaningful physician or patient involvement, and the lack of any insurance copayment or deductible.

Mr. Davis critiques contemporary solutions offered to cure the program's incredible cost growth, including Medicare amendments from the Balance Budget Act of 1997 and new HCFA initiatives. Mr. Davis, wary of the effectiveness of these solutions, argues that other solutions which have eluded Congress and HCFA are more promising. These solutions include a revision of the prospective payment system, the imposition of an insurance copayment or deductible, increasing the role of the physician and patient in the provision of services, a legislative reduction in the availability of services, and a more contained approach to remedying fraud and abuse. The article concludes by emphasizing that the most fundamental problems facing the home health care program are perfectly legal practices and, therefore, the current focus on fraud prevention is largely misplaced. Mr. Davis suggests that only through a comprehensive solution addressing all of these cost factors will the home health care program remain a viable and cost justified program within the Medicare system.

NOTES

To Transfer or Not to Transfer: Congress Failed to Stiffen Penalties for Medicaid Estate Planning, but Should the Practice Continue? - John M. Broderick

The high cost of long-term health care motivates many middle-class and wealthy individuals to transfer their assets in order to qualify for Medicaid. After Congress repealed an unpopular and short-lived law criminalizing such transfers, it enacted a replacement law prohibiting the counseling of others to make such transfers. This new law criminalizes the actions of attorneys who advise their clients to divest themselves of assets in order to qualify for Medicaid. However, U.S. Attorney General Janet Reno declared she will not enforce the statute, citing a concern that such enforcement would criminalize the counseling of an otherwise lawful estate- planning strategy. Questions remain as to whether attorneys should continue to advise their clients to transfer their assets in order to receive government assistance and whether Congress should continue to legislate in this area.

In this note, Mr. Broderick examines the purposes and costs of Medicaid and discusses the current Medicaid eligibility rules. Mr. Broderick then analyzes the history of asset transfer regulations and discusses why these measures have ultimately failed. Mr. Broderick suggests a better solution would be to remove the motivation to engage in asset transferring by making long-term health care insurance less expensive and more accessible to the elderly. Moreover, Mr. Broderick advocates a continuation in the practice of transferring assets within the context of estate planning, but only if further legislation is developed that protects the elderly from being coerced by their family into divesting their assets in order to maximize the size of the estate left to the family members.

Gradow Finally Laid to Rest?: The Impact of Wheeler v. United Stataes on Judicial Interpretation of the Bona Fide Sale Exception to Section 2036(a) of the Internal Revenue Code - Grant Robert Gulovsen

For the purposes of computing the tax consequences of a decendent's estate, § 2036(a) of the Internal Revenue Code states that when a decedent transfers property to another party while retaining a life estate, the property's full value shall be included in the valuation of the decedent's estate. The provision provides for an exception to this inclusion in situations where property transfers to the party are effectuated through a bona fide sale for an adequate and full consideration in money or money's worth. The bona fide sale exception has important implications for estate planners and their clients in choosing the most tax advantageous means of structuring an estate.

Mr. Gulovsen argues that although the U.S. Claims Court's decision in Gradow v. United States lacked a clear economic justification, Gradow is still more sound than Wheeler from a statutory reading perspective. According to Mr. Gulovsen , there is no acceptable interpretation of the bona fide sale exception to § 2036(a) as applied to the sale of remainder interests. As a result, only a statutory change can ensure confidence from estate planners and their clients that estate plans involving the sale of remainder interests will be treated uniformly by the courts.

Has the Age Discriminataion in Employment Act Remained Effective in the United States as Well as in an Increasingly Globalized Economy? - Cynthia Jean Robertson

Despite congressional amendments to the Age Discrimination in Employment Act of 1967, elder Americans working both in the United States and abroad continue o experience discrimination from their employers. While Congress attempted to limit the negative effects of international employment loopholes, various courts' interpretations of the ADEA fall short of effectively implementing Congress's intent to protect the elderly plaintiff. Such interpretations essentially allow foreign employers in the United States and U.S. employers operating overseas to discard older workers without regard to the underlying purposes of the ADEA. As the economy continues to globalize, age discrimination claims reflecting these situations, along with a number of defenses utilized by employers to escape liability, have grown significantly.

In this note, Ms. Robertson first analyzes the different types of defenses available to foreign employers operating within the United States . While concluding that a plain text reading of the ADEA should not provide a valid defense to the employer, she finds that treaties between the United States and foreign countries create a more formidable hurdle for the ADEA plaintiff to overcome. The note then shifts focus to the defenses specific to American employers operating in a foreign country. Ms. Robertson, acknowledging that the United States must abide by the principles of a foreign law defense, recommends that, at the least, U.S. courts should refuse to recognize contract agreements that bargain away ADEA plaintiff rights as a matter of genuine foreign law.