EXECUTIVE SUMMARY

The Medicaid crisis grows more critical every day and threatens our recovering economy.  Rather than government concentrating on eliminating Medicaid fraud and making the system more efficient, the people fear government’s efforts to plug the Medicaid drain will cause them reduction of services. 

Although various state attorneys general are now pursuing actual provider fraud more vigorously, another gaping hole exists, allowing billions of dollars of loss to the economy and although well known, remains unplugged and flowing freely.

The legislative intent of state protective statutes is to:

• GUARD the protected person from harming him/herself or anyone else;

• CONSERVE the person’s assets (with prudent investments); and

• PROTECT the taxpayers from the ward becoming a public charge.  

State courts have jurisdiction to appoint fiduciaries to protect individuals who are adjudicated as "incompetent."  State courts, however, are not monitoring or adequately monitoring the activities of those fiduciaries, who are left free to misuse, misapply, or manipulate the law for their own self-enrichment.   

Operating the proceedings as a profit-making enterprise under color of law, the court-appointed fiduciaries can financially deplete a ward’s estate, create a false indigence, and leave the ward’s lifetime Medicaid care to the taxpayers, even though the protective statutes are supposed to prevent the ward from becoming a public charge. 

Simply put, without total monitoring and oversight, the states’  "protective" plans can be operated like "The Protection Racket."

We are asking Congress to deal with misuse of the "protective" statutes because: 

• 50 states with 50 different sets of laws have long failed to protect their citizenry from unlawful and abusive guardianships and conservatorships, despite numerous studies, meetings, and hearings over the years;  

• Federal rights and protections are being ignored by state-court judges;

• Federal funds are involved; and

• Baby Boomers, turning 65 this year, constitute 28% of  our population today.

ABOUT NASGA

NASGA was formed as a public interest/public benefit/civil rights advocacy organization in 2006 by several individuals, each of whom were involved in state guardianships[1]  conducted under color of law.  Our membership consists of victims - family, friends and associates - all across the country, who have experienced lawlessness, exploitation, and/or injury in the state courts.  Court-appointed fiduciaries - total strangers - claiming to be operating in the “best interests of the ward,” control the life, liberty, and property of their wards in the guardianship system.  Without adequate restraints, they are free to engage in lawlessness.  NASGA advocates on behalf of those individuals deprived of due process of law in overburdened, uncaring, or corrupt courts where lack of monitoring and oversight permit such abuse. 

We share a different perspective from those who have addressed the issues in the past.  We address the guardianship problem with the unique insight of experience as victims, not as detached professionals.

Our main goal is national reform of guardianship law in order to return it to its original intent:

• GUARD the protected person from harming him/herself or anyone else;

• CONSERVE the person’s assets (with prudent investments); and

• PROTECT the taxpayers against the ward becoming a public charge.

NASGA has found that many state courts are not complying with their own existing state law and are also clearly in violation of federal law.

In 2009, NASGA submitted its first white paper, “Protecting Our Citizens From Unlawful and Abusive Guardianships and Conservatorships”[2] to over 200 members of the House, Senate,[3] and the White House.

The Government Accountability Office (“GAO”) conducted a forensic investigation and issued its report in 2010 – “Guardianships:  Cases of Financial Exploitation, Neglect, and Abuse of Seniors,”[4] corroborating our complaints of exploitation by fiduciaries – the subject of our paper.  

This is the first of a series of NASGA papers focusing on individual problems in these “protective” proceedings – today, non emergency “emergencies” which contribute to the taxpayers’ Medicaid problem.



NON EMERGENCY “EMERGENCY” GUARDIANSHIP HEARINGS THREATEN VULNERABLE PERSONS
AND VIOLATE  DUE PROCESS AND CIVIL RIGHTS/LIBERTIES

In its 2009 white paper, NASGA warned that guardianship can be dangerous to the health and is dangerous to the wealth of all Americans.   As victims from all across the country continue to join NASGA, we have become aware of a growing trend and dangerous threat in guardianship:  the so-called “emergency” hearing.   This paper focuses on the specific abuse of “emergency” hearings and “temporary” guardianships, put in place under color of law.



AN OUTRAGEOUS EXAMPLE OF BLATANT VIOLATIONS OF LAW

NASGA member Danny Tate is the victim of a false and fraudulent conservatorship commenced ex-parte by his brother via an “emergency” petition, in a case so unjust it’s hard to believe it actually happened.  It is true; and it illustrates the type of abuse enabled in the specific category of “emergency” guardianship.

In this case, as in so many others, due process was completely thrown out the window: 

• No papers were served on the intended ward prior to the “emergency” proceeding, which was held ex-parte
  and attended only by those who worked in concert to create an unlawful conservatorship;

• There was no “hearing”:  No stenographer was present;[5] no testimony was taken; the judge ignored the
  statutory requirement for applying the “clear and convincing” evidentiary standard, relying exclusively on the
  unproven conclusory allegations of what later turned out to be a fraudulent petition; 

• The victim’s assets were seized and placed under the control of the petitioning brother, denying the victim
  the opportunity to hire counsel of choice to defend against the brother’s ambush.  

It is clear from examining the court records [6] that Danny Tate was sandbagged.   The fraudulent “emergency” proceedings stripped away all his civil rights and liberties under the guise of “protection” and trapped the now “ward” in an unnecessary, lengthy, and expensive litigation,[7] depleting his entire estate and plunging him into debt. 



AN ESCALATING THREAT

The same injustice described above is being played out across the country to a growing number of persons now clamoring for reform.  With the coming of age of the Baby Boomers, the problem will quickly escalate out of control.

As we said in our earlier paper, guardianship - including emergency guardianship - is necessary.  In true emergencies involving life-or-death situations, action must be taken quickly, but always in keeping with the requirements of due process.  NASGA advocates against abusive use of “emergency” proceedings - not the proceedings themselves – but the resultant unlawful trap they create, which is contrary to the original legislative intent of the protective statutes.

The same fiduciaries/practitioners who, for years past, have misused, misapplied, or manipulated guardianship law to unjustly enrich themselves at the expense of and to the detriment of the very people they have been appointed to protect, are now actively engaging in unnecessary and questionable “emergency” proceedings.  

When cooperating judges proceed without first confirming that notice has been served, and render an improper adjudication relying only on the unproven, conclusory allegations of a possibly fraudulent petition (if no true emergency exists), one must question:  what is the quid pro quo?  When there is no compliance with law and procedure, such proceedings should be void ab initio.

In such corrupt/unmonitored courts, there is little chance these victims will ever escape. 

Questionable guardianships easily morph from “temporary” to permanent; damage to the wards and their families increases as the court battle for freedom escalates and depletes their assets.  Our members no longer believe that justice can be found within the broken system.  

Wards' families aren’t the only victims affected by these fraudulent proceedings.  In the end, after the fiduciaries have bled the once-ample estates dry, they withdraw from the case and move on, leaving their wards on Medicaid at taxpayers’ expense.  This is why it is of paramount importance that the crisis be addressed and resolved without further delay.

Additionally, the problem of emergency proceedings are also sometimes brought about by watchdog agencies such as APS/DCF, etc., when they open an investigation and a guardianship proceeding is commenced before their investigation has been completed.  When these agencies complete their investigation and find no abuse, the guardianship does not automatically terminate, leaving the ward trapped in an unnecessary, expensive and often abusive guardianship situation.  In effect, the system itself becomes the abuser.

                                                                                                                                       
                               
EMERGENCY GUARDIANSHIP USED AS A WEAPON

In Illinois last year, a major hospital failed to advise patient Delores Bedin that she had a life-threatening cancer, and used the threat of guardianship to intimidate her daughter, Janet, into removing Delores from their hospital.[8]  Although the mother was completely competent and the daughter held her Durable Power of Attorney, the hospital boldly threatened to have it revoked by forcing a temporary guardianship[9]  if the daughter did not comply with their demands. 



TEN YEARS LATER…

NASGA is not alone in raising the issue of lack of due process in “emergency” proceedings.  As we pointed out in our first white paper, as far back as 2001 the issue was addressed at the Wingspan Conference:

          “Emergency proceedings require the following:  actual notice to the respondent before hearing; mandatory
          appointment of counsel; establishment of the respondent’s emergency, conduct of a hearing on the permanent
          guardianship as promptly as possible; and placement of emergency powers.”[10]

Ten years later, nothing much has changed; and the Baby Boomers are waiting in the wings!



FEDERAL INTERVENTION IS CRITICAL 

NASGA reiterates the urgent and critical need for federal intervention, because:

• The States have long failed to protect their citizenry from unlawful and abusive guardianships, despite numerous studies, meetings and hearings over the years;

• Federal funds are involved and unlawful exploitative guardianship proceedings are shifting more and more of the health care burden from previously financially capable individuals to the American taxpayer; and  

• State-court judges are ignoring federal rights and protections and their own protective statutes.

STATUTORY AND REGULATORY SAFETY NETS ARE ESSENTIAL

Federal intervention must ensure that the States provide simple and understandable law on these critical issues, including the right to a jury trial:    

• Prohibiting convening of ex-parte “emergency” hearings without advance due process notice not only to the AIP, but to immediate family members;

• Ensuring that when the AIP does not have the means to retain counsel, the judge must appoint counsel, so that the
  non criminal AIP has the same rights and protections as criminals, or the guardianship order/judgment, if any, must
  be vacated;

• Ensuring that an order/judgment may not issue on a petition alone, without supporting documentary evidence and/or
  sworn testimony with a court reporter or audio-video reporting system in place;

• Ensuring that if the “clear and convincing” evidentiary standard is not applied and met, the guardianship order/judgment, if any, must be vacated;

• Ensuring that the court, in adjudicating incapacity, comply with statutory requirements for findings of fact and conclusions of law, including specific powers and limitations for the guardian/conservator, without which appeal is not possible; i.e., orders not in proper appealable form must be vacated;[11]

• Ensuring that if the basic rights of due process and statutory requirements at the inception of a proposed guardianship are not met, the order/judgment, if any, must be vacated;[12] and 

• In an emergency situation, the assets can be briefly frozen until a proper hearing is convened and a proper adjudication issues.

Thus, unnecessary appeals, which are out of most victims’ financial reach, can be avoided.
 

TIME IS RUNNING OUT – THE BOOMERS HAVE COME OF AGE! 

Boomers – making up 28% of our population today - are turning 65 this year.  When they become victims of unlawful and abusive guardianships, how will our future economy survive the enormous drain on Medicaid caused by judicial sanctioning of the fiduciary bleeding of the estates?

Years of thorough studies, meetings, and hearings have brought no significant remedy to stop the escalating abuse of elderly and/or disabled persons under state guardianship.  The abuse continues to grow exponentially, affecting not only wards and their families, but every American taxpayer as well.  The unwary taxpayers – federal and state - contrary to the intent of guardianship law, ironically and unwittingly are compelled to pay for the health care of once-able guardianship victims pauperized by their court-appointed “protectors.



TRAINING AND CERTIFICATION ALONE WILL NOT CURE FRAUD AND DEFALCATION

If Congress suggests only training and certification as a means of reform, it will have the effect of applying a bandaid to a hemorrhaging injury.  While training and certification are also needed, NASGA believes neither one alone or together addresses the main problem:  deliberate, knowing, and willful violations of law, with fraud as a backdrop.

Officers of the court are educated and trained in law and court procedure and know the basic principles of due process, as do judges; yet, due process continues to be trampled in guardianship courts all across the country, causing innocent people to suffer.

NASGA does not stand alone in this regard.   In response to Illinois legislation introduced in 2009 requiring certification of some guardians and training, Mark Heryman, [13] clinical professor of law at the University of Chicago Law School didn’t believe good training will stop someone who wants to steal a person's money.  He said, "I think it's a nice, interesting piece of legislation… I don't think it will address the primary problem, which is fraud."  Professor Heryman was right, and still is.

A 2007 Carnegie Foundation critique on American legal education [14] found that law schools provide inadequate support for developing the ethical and social dimensions of the profession.  Courses teach how to avoid punishment for unethical conduct.  For most students legal education does not improve their moral judgment.

            “[W]hen lawyers fall prey to human avarice and exploit their wards, the betrayal weighs most egregiously.”[15] 

50 States with 50 different laws have not curbed guardianship proceedings, permitting violations of law and fiduciary exploitation actually damaging to taxpayers; therefore, Congress must!



WHAT CONGRESS MUST DO, WITHOUT FURTHER DELAY

The major issue which Congress must deal with without further delay is the need to impose federal law to protect due process and civil and human rights of the vulnerable elderly/disabled and their families, and stop the court-authorized plunder permitted in these so-called “emergency” guardianships and all guardianships created under color of law instead of due process of law, and the resultant unwarranted added burden of health care cost on the American taxpayer – the unintended result of “protection”!



THE FORGOTTEN PROMISE

Congress must make good its forgotten promise in 42 U.S.C. 3001 (10) of The Public Health and Welfare Law to protect older Americans against abuse, neglect, and exploitation.   “Exploitation” is defined in subsection (18)(A) as: 

          “[T]he fraudulent or otherwise illegal, unauthorized, or improper act or process of an individual, including a caregiver
          or fiduciary, that uses the resources of an older individual for monetary or personal benefit, profit, or gain, or that results
          in depriving an older individual of rightful access to, or use of, benefits, resources, belongings, or assets.”

 NASGA believes it is the duty of Congress to protect our elder and/or disabled population against such lawlessness in these state “protective” proceedings; to protect the American taxpayer from the avarice and greed which causes these problems.  And it is our duty as well, as victims of good law gone bad, to advocate for such protection from our elected government.
 
Respectfully submitted, 

/s/Elaine Renoire
ELAINE RENOIRE,
President

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