Sarcoidosis: Estate And Related Planning
Originally posted on Forbes.com
What is Sarcoidosis:
Sarcoidosis (pronounced SAR-COY-DOE-SIS) is an inflammatory disease characterized by the formation of granulomas—tiny clumps of inflammatory cells—in one or more organs of the body. When the immune system goes into overdrive and too many of these clumps form, they can interfere with an organ’s structure and function. When left unchecked, chronic inflammation can lead to fibrosis, which is the permanent scarring of organ tissue. This disorder affects the lungs in approximately 90% of cases, but it can affect almost any organ in the body. Despite increasing advances in research, sarcoidosis remains difficult to diagnose with limited treatment options and no known cure.
Disease presentation and severity varies widely among patients. In some cases, the disease goes away on its own. In others, the disease may not progress clinically but individuals will still suffer from some symptoms that challenge their quality of life. The rest of patients—up to a third of people diagnosed with the disease—will require long-term treatment. Sarcoidosis is considered chronic in people whose disease remains active for more than 2-5 years; in this population sarcoidosis can be debilitating and life-threatening.
Planning Implications: The wide spectrum of symptoms, both as to the nature and variability of symptoms, will make it difficult for third parties to understand your situation. The fact that physical symptoms do not correlate with disease course makes it even more difficult for outsiders to understand your situation. When you or a loved one approaches an estate planner, financial advisor, insurance consultant, or CPA (we will collectively call them “advisers”) you have to assume that they will not understand your symptoms and you should explain it to them. For example, for those with moderate symptoms, or symptoms that remit after some period of time, planning may not be affected to a great degree. For others, planning, as discussed below, may have to be modified and tailored to your needs.
Disease Course: At present there is no known cure for Sarcoidosis. The cause of Sarcoidosis is not known but it appears to require both a genetic predisposition and an environmental exposure or trigger. Those with close relatives who have Sarcoidosis are 3.7 times more likely to contract it. Most people do very well with no treatment or only modest treatment. In some cases, sarcoidosis wanes without medical intervention. However, sarcoidosis may last for years and may cause multiple organ damage.
Planning Implications: If you or a loved one receive a diagnosis of Sarcoidosis it may be easier to put off tough planning decisions on the hopes that the disease course will not be severe or that it may even disappear on its own. That could be a dangerous mistake. It is wiser, yet obviously difficult, to plan comprehensively as soon as a diagnosis is received. Until you can know the severity of your disease course it is best to plan than the risks of waiting and finding out that planning is no longer feasible, or if feasible more limited. Some of the immediate planning steps might include the following:
Insurance Review: Immediately review all insurance coverage you have. If you have a term life insurance policy and have the financial wherewithal to convert it to a permanent policy that might be worthwhile. Once the current term ends you may not be able to again obtain new coverage given your health issues. If you are fortunate enough to have a mild form of Sarcoidosis that may not prove the case, but it may not be worth the risk. If you have a disability insurance policy you should find out exactly what benefits you might have and whether there are reporting requirements that you owe the insurance carrier. You certainly do not want to jeopardize coverage by not reporting as required under the terms of your policy. If you have a long-term care policy in place you should similarly review coverage and reporting requirements so that you understand options and obligations you may have.
Financial Plan: Get a budget and financial plan in place. Create, or have an advisor create, financial plans reflecting various scenarios of disease course. While you want to pursue proactive medical treatment and hope for the best, you should also, no matter how emotionally difficult, project for harsh outcomes so you can prepare. If there is a potential that you will have to cease work, it makes sense to start reining in your expenses immediately. The longer you defer taking protective steps the worse the financial outcome might become. For example, if your career may be truncated, waiting a few years to cut expenses may put you so behind the financial curve that you may never recover.
Estate Planning Documents: Review your estate planning documents. The reality is that many people never get all the core estate planning documents in place they need, and most do not keep them up to date. Even if your documents are relatively recent, a significant medical diagnosis such as Sarcoidosis means a review is critical. Consider health care documents. You should have a living will which is a statement of your medical wishes. You need a health care proxy (also called a medical power of attorney) in which you designate a person (called agent) to make health care decisions for you. You should also have a HIPAA release (“HIPAA” stands for Health Insurance Accountability Act) and is a document that authorizes persons you name to access medical records and speak to medical providers. If your disease course is particularly severe, speak to your physician about a POLST document (“POLST” stands for Physician Order for Life Sustaining Treatment, although it goes by different names in some states). Be certain you specifically consider your new diagnosis in those documents. Now that you have a health issue what might have been at most theoretical discussions when you previously created documents are now real and your feelings may have changed. Be certain to address and authorize if you wish experimental and off-label treatments and procedures so that your agent can authorize those if you are not able to. Update a will and revocable trust. You should also have a durable power of attorney. And should you need to have someone step-in and handle financial, legal, or other matters for you, consider better organizing and consolidating your financial accounts and records.
Who Is At Risk: It is estimated that 150,000 to 200,000 people in the US are affected by Sarcoidosis. Sarcoidosis can affect people of any race, ethnic background, or gender. It most commonly develops in middle-aged adults. The most common ages for diagnosis for men is those 30-50 years of age, and for women 50-60 years of age. Women have a slightly higher prevalence of the disease as compared to men. African Americans have a much higher incidence then Caucasians, 2:1 prevalence.
Planning Implications: Sarcoidosis is rare. So, as noted above, do not assume that the people (whether family, friends or loved ones) named in your estate planning documents will understand what you face. You should inform these people of the roles you have given them, confirm they are willing to serve, and explain to them the current and possible future outcomes of your disease course. They will be able to help you better if they understand. Also, as noted above, your advisors are unlikely to be familiar with planning for Sarcoidosis. Many advisers are not particularly experienced or knowledgeable about planning for any health challenges. So, you need to have a similar discussion with them to be certain they understand the challenges you face and can tailor your planning accordingly. Finally, to the extent that you are older you may have in place disability or long-term care insurance, you might have already (hopefully) accumulated savings from work, and so forth. To the extent you have that may put you in a better position to plan for your future. It may give you some viable planning options in the event you have to stop work. But it also means that you have to tackle analyzing every insurance, retirement and other plan and asset you have to make sure you make the right decisions. This really calls for professional advisers as a DIY approach could be too risky, even if you have been successful with that approach up until now
Duration: Those with chronic forms of Sarcoidosis may live with it for 20-30 years. Many affected are diagnosed in the prime of their lives and at high points of their careers. Many affected will have to cease work because of their symptoms.
Planning Implications: If your disease course could last decades you need to take a long-term view of planning for your finances, agents you name under legal documents, living environment, health care costs and more. Be certain that your advisers factor in a long-term scenario in forecasts and other aspects of your planning. If your ceasing work is a possibility project that as a possible scenario. If it is a likelihood, that may be something to assume in all of your analysis (and if your outcome is better great, but you do not want to plan for a better outcome then experience a worse result you were unprepared for). That may mean, as suggested above, cutting expenses proactively as soon as possible to preserve resources. Review all options.
Drug Costs: In some cases, your symptoms may subside after a course of steroids, such as prednisone. However, you may need to stay on steroids for longer periods of time. Side effects of steroids may include weight gain, diabetes, thinning skin, etc. While there are some drug therapies for Sarcoidosis, many, are off-label treatments. Thus, many drug therapies may not be covered by insurance. It is estimated that some Sarcoidosis patients incur costs of $4,000-$10,000 every few months for medications. Patients living with more aggressive forms of Sarcoidosis may incur costs of closer to $100,000/year.
Planning Implications: When you meet with a financial adviser (do not do this planning on your own, especially with the emotional trauma of having a new diagnosis) be certain that they understand realistic expenses you may incur because of your diagnosis. You should not rely on standard expense estimates a financial forecasting program has built in. You should not rely on your prior budget numbers without adjusting them for the new realities you face. You should evaluate not only what your current employer-provided health insurance will cover (and what it will not cover) but what options will be available to you if you have to cease work. Is there an option to continue your health insurance coverage? What might that cost? If not, what other government or other options might be available to you?
More Information: You can learn more and get support from the Foundation for Sarcoidosis Research (FSR). FSR is the leading international organization dedicated to finding a cure for sarcoidosis and improving care for sarcoidosis patients through research, education, and support. To learn more visit www.stopsarcoidosis.org.
A diagnosis of Sarcoidosis, or any health challenge or other life event, requires rethinking all of your planning. Being proactive and tackling these tough and unpleasant matters early on, however difficult that may be, might give you better options and change the security of your future.
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