Julian Gray:
I've always found it difficult to understand, especially on the bigger cases, how a person could assess someone's needs in eight hours at a mediation and say, "This is the investment you should have for the rest of your life."
Chris Dreyer:
Welcome to Personal Injury Mastermind. I'm your host, Chris Dreyer, founder and CEO of Rankings.io, the legal marketing company the best firms hire when they want the rankings, traffic and cases other law firm marketing agencies can't deliver.
On these special Toolkit episodes we dive deep into conversations with the leading vendors in the legal sphere. And speaking of the best, I've got some exciting news to share with you. This September at PIMCon in Scottsdale, Arizona, we'll be joined by none other than my favorite comedian, David Spade. You know I'm from the classic movies like Tommy Boy and Joe Dirt, and of course his unforgettable run on Saturday Night Live. It's going to be a blast having him with us, so get your ticket to PIMCon today. This is Toolkit Thursday on PIM, your weekly guide to staying sharp in the legal world. Let's get started.
As a personal injury attorney, you work hard to get those best settlements and verdicts for your clients, but what happens after they get the check? Will the money solve their long-term care and needs? Do they know how to manage such a large sum of cash? Is a structured settlement really the best option? And what about taxes? My guest today has spent decades working with clients just like yours and has all the answers. With over 25 years of experience and a team of eight certified elder law attorneys, Julian Gray has earned his place as Pennsylvania's Super Lawyer, Best Lawyer in America, and National Association of Distinguished Counsel Top 1% for seven years in a row.
His Pittsburgh-based firm, Julian Gray Associates, is renowned for its expertise in Medicaid planning, veterans benefits, special needs planning, and settlement planning. In this eye-opening conversation, Julian explains why partnering with a settlement planning experts from day one gives you a massive competitive advantage. How to protect your firm and your clients by navigating complex issues like Medicare interests, the power of custom-tailored settlement solutions to set your firm apart and attract top-tier cases, and how comprehensive settlement planning services can fuel your marketing and generate a steady stream of referrals.
Here's Julian Gray on how he got into settlement planning.
Julian Gray:
30 years ago, somebody asked me about very frail, elderly parents who was going into a nursing home, and said, "I don't want to lose literally the family farm." And I didn't even know what the law was. And so I spent a week researching the federal law and came back and solved the problem. And after that case it just blossomed into this crusade to help people with disabilities, first of all, lead a higher quality of life, but also not lose everything they own. And that's really how I got into it.
Chris Dreyer:
You help people with chronic disabilities that can last their whole lifetime, and even though you don't practice personal injury outright, you see a lot of people who have settlements from personal injury cases. Tell me a bit about your firm and the connection between your niche of elder care and tax issues and special needs planning and how that ties into settlement planning.
Julian Gray:
It's kind of interesting, you start practicing in one area and then your passion and certain events just take you to where you're supposed to be. I really feel that. And even though I started out in the mid-nineties doing elder law and exclusively helping elderly people not lose their life savings to nursing homes, that morphed into some planning about 15 years ago when a guy I went to law school, who's the managing partner of one of the largest PI firms here in Western Pennsylvania, said, "Hey, you know all about this benefit stuff and social security and Medicare and Medicaid. Why aren't you helping disabled people getting settlements?" And I thought that's a great niche to be in.
When I stumbled into settlement planning over a decade ago I found that the majority of people were just not getting really good, comprehensive advice, both before and after they settled their case. They were either getting a structured settlement and heading on their way, or if they were disabled or had a label of disability, they automatically got shoved into a special needs trust, and once again, just went on their way. And so we took it to I think a much higher level of representation to work with plaintiff attorneys.
Chris Dreyer:
What are some of the missed opportunities for those individuals that get those structured settlements?
Julian Gray:
Let me roll it back to the traditional situation that most plaintiff attorneys find themselves in. They do a great job working really hard to verify, improve liability, and then prove damages and maximize the value of their case. They're extremely busy doing that and they do a great job. And then normally what happens, at least with the attorneys I don't work with, is they settle a case at mediation and then they say, "We better call someone. We better call someone to clean up the mess because we're going to get paid, our costs are going to get reimbursed, but we've got to get someone to take care of this person for the rest of their lifetime," or at least fix things.
And that's where a lot of times this last-minute structured settlement offer comes in at the mediation table typically by defense, the defense carrier structure settlement person. And that's not to say all structures are bad, but there's a time and a place for everything. Some people need a special needs trust, some people don't. There's a lot of cases I do, seven, eight-figure cases, where we don't use a special needs trust and the person may have a severe disability. So it's about custom-building every case, especially on the larger cases, to fit the needs of the person.
And I've always found it difficult to understand, especially on the bigger cases, how a person could assess someone's needs in eight hours at a mediation and say, "This is the investment you should have for the rest of your life." And that's the problem I have with some of those structures. But there's cases where we think structures are really good for people, but it's typically the smaller cases where they don't need a trust and it's more to fix a person themselves.
In that process, what makes us different, is that we start working with the families long before trial and long before mediation. So some of the families I work with, I work with for two to four to five years, without getting paid by the way, with those families. And that's the difference, is that a person with a disability after their date of loss needs help. They probably have had a traumatic medical event and they've had a lot of medical procedures, they've got insurance questions, they've got care plan questions. "Where am I going to live? Who's going to pay for this until I reach a settlement two, three, four years down the road?"
We brought social workers into our law firm many years ago and we have social workers on staff, and that's our first point of context. So the plaintiff lawyers we work with, they know we're going to send out our social workers and they're going to start assessing that person's medical needs right away.
Chris Dreyer:
I love the proactive early estate planning. That's incredible because a lot of this takes a ton of time. You mentioned the three to five years. Is it like a contingency type compensation?
Julian Gray:
Yeah. I mean, we realize, just like the plaintiff attorneys, most of these people don't have any money to pay attorneys upfront, so we want to make it as easy for them as possible. So we act as that back office so to speak to the plaintiff attorney. We act as that additional helping hand with social work, estate planning, tax planning, and also helping the plaintiff attorneys to not make mistakes they may not even be aware of. And we do all that on a contingent fee.
And so for example, all the guidance, all the social work we're doing, if we're setting up some preliminary estate planning documents, if we're going out, and the case doesn't settle, we just write all that off. I think most of the attorneys, or all the attorneys we work with are pretty good. They're pretty good at judging value in cases, so it's rare that that happens. So it's not like we're taking the biggest risk, I'll be quite honest with you, and the folks doing those liability cases are the ones putting all the money in and taking all the risk, but we tag along and when the case settles, we get paid.
Chris Dreyer:
Let's talk about from the consumer side, what are some of the tax implications in these settlements and the planning that goes into it? You mentioned some words like the special needs trust and these different types of setups, could maybe you expound on just the tax side of things
Julian Gray:
On the bigger cases I can give you a few examples where both the plaintiffs and the plaintiffs' lawyers are just throwing money down the drain. And I can give you two quick examples. One, on any significant wrongful death case. One of the biggest mistakes I see is, whether that case is going to produce money or not, they should be filing an IRS Form 706 to elect portability, and that's a whole bunch of technical stuff. But what that means basically is when a person dies, they each have a lifetime exemption, and right now it's a little over $13 million of transferability. So when you go to the end of this case five, 10 years down the road and this plaintiff is sitting on a 20 or $30 million recovery, they've got a serious federal state tax problem.
And so we do a lot of federal state tax planning and many of those things have time constraints. For example, you need to file for portability typically within five years of the death of the person to maintain, and that's millions of dollars of credit. And so those are just things that we talk to plaintiff attorneys around the country and when I start telling them about federal estate tax planning, they say, "Most of the time we don't do that. No one ever talks to us about this." So that's one area on the wrongful death side.
Then on the other side, we have people that have significant settlements that are in the high seven-figure, low eight-figure range, typically we're going to start talking to them about how do we hedge against federal state tax for their family down the road. Because the federal state tax is 40%. So you get someone a great recovery and they're sitting on 25 million bucks and they only have a $13 million exemption, that if their trustee and their financial advisor are doing a good job is going to keep growing. Every dollar right now over $13 million gets taxed at 40% when they try to pass it on to their kids.
Chris Dreyer:
Unreal.
Julian Gray:
Here's the worst news. On January 1st, 2026, the 13 million goes down to six million, so that's another loss of $2.8 million out of pocket in taxes. So it's crazy. That's one big thing we do, is the federal state tax planning, both pre and post settlement.
The second thing is on the punitive damages cases, it amazes me that people give this money out to the plaintiffs on the punitive damages cases without reducing the income tax on these punitive damages cases. There are proven methods that the IRS will accept to allow you to basically eliminate the tax on the punitive damages portion that goes to the attorney's fees. I'm working on one right now where unfortunately they gave some of the money already out to one of the plans, but at least we're going to be able to eliminate the tax on the other one. These are multi-million dollar tax bills we're talking about.
So anything we can do to add value for the plaintiff's family, we want to let the plaintiff attorney know that as soon as possible.
Chris Dreyer:
Julian and his team work hard to reduce tax impact for clients. Their goal is to add value for plaintiff's family by identifying and addressing critical issues as early as possible.
But Julian's firm goes beyond just tax planning, they provide a comprehensive settlement planning that extends far beyond what a structured settlement can offer. Julian's firm focuses on enhancing the value of the case for the plaintiff by addressing all aspects of their financial and legal well-being. It's a holistic approach that recognizes the unique challenges and opportunities that come with a substantial settlement, ensuring the plaintiff receives the support they need to make the most of their recovery. He explains why personal injury attorneys need to partner early to take advantage of comprehensive planning.
Julian Gray:
We're doing comprehensive planning. A structured settlement is an insurance product that's sold in a room after eight hours of mediation with really no due diligence. And like I said, in my opinion, there's a time and place for structures, we do use them in limited circumstances. But at the end of the day, think about this analogy. If you were settling a medical malpractice case for 10 million bucks and you take that to a business owner selling his company that he built for the last 30 years and he's selling that company for $10 million, don't you think that business owner would have a swarm of professional advisors around him or her when they get ready to pull the trigger to sell that business and receive that $10 million? Why shouldn't the person who's been severely damaged, who's also getting that same amount of money, who is much less sophisticated in tax and estate planning and business matters, shouldn't they have even more handholding?
And so that's really it. It's enhancing the value of the case for the plaintiff, but it's more than that. It's reducing the liability to the plaintiff attorney, and in some cases defense counsel, believe it or not. And we can talk a little bit about that if you want to go there.
Chris Dreyer:
Let's lean right into it.
Julian Gray:
30 years ago I got into doing elder law and disability planning, and we've handled thousands and thousands of families across the country. And you have to be an expert in Medicare, Medicaid, Social Security, veterans benefits. We do all that stuff.
The big thing I've seen move in the last 10 years in personal injury work is that CMS, Center for Medicare and Medicaid Services, has made it clear that people who are handling liability-only cases must consider Medicare's interests when they settle a case. CMS is already aware that your case is going on, it's in the computer. And typical scenario looks like this, similar case I just did. Young person in late 20s, injured in an auto accident. When I was referred to the case, person already was on Social Security Disability, already on Medicare as his primary insurance. That to me rings all the bells that we need to investigate Medicare's position.
If you contrast that with another case I can think of off the top of my head a few years ago, where I had a lady that settled an eight-figure medical malpractice case in her 40s. When I looked at her situation, she was on SSI, she was not on Medicare, she had no interest or ability to get on Medicare because she really didn't have a work history. So we didn't even have to do a Medicare set-aside analysis in a case that was worth five times what the auto accident case was. And you say, "Well, why do people need to do this?" And it's real simple. The Medicare Secondary Payer statute is crystal clear, which says that if you're a Medicare recipient or you're about to become a Medicare recipient, you must consider Medicare's interest and do some type of analysis. If you don't, the plaintiff, plaintiff's counsel and defense counsel, all have liability for failure to do that, and that liability goes on forever.
And so the plaintiffs that I've worked with and the plaintiff attorneys that I've worked with, once I've explained to them how easy it is for us to do this analysis as part of our whole settlement planning process, I can't think of a single case where I've sat down with a plaintiff and I said, "Because of these factors, you should do a liability Medicare set-aside analysis." And they say, "Well, what's the risk if I don't? What if I don't put some money aside?" And I say, "Your risk is that five, 10, 20 years from now, you go in for a medical procedure that costs $250,000, or who knows what it costs by then and CMS, all the buttons click in that database, and they say, 'Oh, didn't this guy settle his car accident case for five million bucks 15 years ago? We don't see anything in our file saying that he considered our interests.'" And the statute is clear that Medicare will not be responsible for those tort-related future injury coverage.
And it takes so little to accomplish that. We've really done a bunch of these and we're able to drive down that number so it's so palatable to the plaintiff to say, "Look for a fraction of what you had even in costs in this case, you put this money aside, we document it, and it's there for CMS to look at."
And the other thing, Chris, not to belabor the point, I've been involved in significant eight-figure cases around the country where I've been called in by a plaintiff, and frankly defense counsel, and they've said, "Hey, we're not going to settle this case until somebody puts something in the file that considers Medicare's interest," because the numbers are just too big. A counter position would be by a lawyer who believes this isn't true, would say, "Well, Julian, there's not one single reported case in the United States of CMS denying future medical coverage under a Medicare recipient or Medicare Advantage recipient for a failure to consider Medicare's interest." And my answer would be, "You are correct." But I would also add, that my team members and the affiliations I have with some of my Mastermind groups, we have gone around the country, we have asked of CMS, we've asked of Social Security, all of the regional offices have said, "We are going to implement this, it's just a matter of time."
So our position was, where is the threshold where you should start looking at this? And we were thinking, well, low-hanging fruit are the big cases because there's a lot of margin there. And if someone's going to be liable, everyone can afford to pay up on the eight-figure cases to reimburse CMS, and then you work your way down. So our position has been, after consulting with a lot of practitioners around the country, is basically right now, if you've got a liability-only case and your person is probably a Medicare recipient or will be within 24 to 30 months, you probably ought to do this, just to paper the file.
Chris Dreyer:
With the level of deep diving and comprehensive planning Julian and his team provide, they can't just take on any case. So what's the sweet spot? Well, Julian's got a clear threshold, a million bucks and up. This magic number isn't set in stone. He explains why the Centers of Medicare and Medicaid Services have a big impact on the case that he will take on.
Julian Gray:
My threshold's a million and up right now, until CMS tells me different. And we have to look to the Workers' Comp rules, and I'm not a Workers' Comp attorney, but you've got to kind of look to the Workers' Comp rules to say, if this is the way CMS has done this for the last several decades, that's probably the way they're going to lean into it for liability-only cases.
But they've got to work that out. And they keep threatening, I mean, literally for the last 10 years CMS sends out stuff saying, "We're going to do this. We're really going to do this." But then they never really solidify it, but that'll come soon. But we still talk to plaintiff attorneys that say, "Oh, Medicare set-asides, those are unicorns. We're never doing that." And I feel like I hope you can sleep at night for the next 20 or 30 years, knowing that you probably should have looked into this. And it costs so little to get it done, it really does.
Chris Dreyer:
What about maybe a couple stories you can share, just the situations that come to mind, maybe where you got involved and some things that were ... Maybe take the structure where it wasn't right for them and you're like, "Oh, we found this unique situation."
Julian Gray:
The common theme that runs through all of our cases is we design our cases for the plaintiff. And that's a big difference. We design the case for where they are now and where we see them being five, 10, 15, 20 years out. And I think that's something that's not done. Many of the cases we're brought in on are old cases where there's a five, 10, 15, $20 million sitting in a trust and the family's saying, "We hate our trustee. They won't pay for anything. We can't get tires on the car." It's unbelievable.
So one of the things we're really proud about is not only do we use our social work on the front end to really help these people get a higher quality of life before they even get to trial or mediation, but then on the backend we're following up with them. One of the things we do, and I was just emailing with a plaintiff lawyer yesterday on a case we just settled, pretty significant med mal case, and I said, "Oh, by the way, on the other case, I'm about to send you my summary letter."
One of the things we do is we follow up with the plaintiff attorneys, usually a year or two after the case is settled. I mean, we literally work on these cases for another couple of years after mediation. And then we send them a letter that says, "Here's where we found your client when you sent them to us two or three or four years ago. Here's everything we've done for them. Including they got divorced in the meantime. We got them a divorce lawyer." I had one where the sewer lines backed up at their house and I found them a plumber to go excavate the street out. It goes on and on and on. That same case, we had to hurry up and get a hotel room for the family because they couldn't use the bathrooms. I mean, I could go on and on and on. And at the end of the day, we want to enhance the quality of life and we ask the right questions.
I recently did a med mal case where I discovered through our due diligence that the mother who suffered the malpractice had a 10 or 11-year-old disabled son that was on the spectrum. And of course we know that space very well. We have many, many families that have children on the spectrum. And so we made sure that when we designed her trust, we designed three different trusts. We didn't just do the typical knee-jerk special needs trust that you're going to have to pay back the state when you die and lose all your money. There's an exemption under the rules that allows you to make transfers of unlimited amounts of money to a disabled child or disabled child's trust without any penalty for your personal Medicaid. So that allowed us to bifurcate some of that settlement now and set up this trust for her young son and enhance his quality of life immediately by supplementing anything Medicaid and Social Security he was playing for, but not upset his benefits.
And then the other piece, to just tell you another story I like, and we do this in every case frankly, is we typically insulate the house. One of the number one assets, as you probably could imagine, people have been living in difficult conditions when they're injured, really not optimal conditions. Whether it's just a lack of financial means to get out of that situation or a situation that requires ADA compliant living space. Either way, we're probably buying a house in 75% of these cases. And the way you title that house is so important because while you may be able to put the house in the plaintiff's name or you may be able to put the house in the name of a special needs trust, you better have an exit strategy for that house 10, 20, 30, 40 years from now, other than I'm going through probate when we're basically going to give the keys to the house to the State Medicaid Agency.
We're so happy that we've never lost a house to the State Medicaid Agency in 30 years because we know how you've got to get out of that situation. And frankly, I did a lot of real estate lawyer stuff in the nineties so I understand real estate stuff pretty well. I can read deeds and title searches and do all that stuff. So the feel-good stories for us are that we go out and check on our clients two, three, four years later after they've settled their case and we want to make sure they're okay. And sometimes they come back and say, "Things have changed. Could we pivot and do some other things?"
But I get such joy in talking to these folks and saying, "Look, here's the guy you want to talk to get your mobility van because they're the best and they do a great job and their customer service is amazing." And I want know about the van. And I want to know, are we going to paint stripes or flames down the side of it to make it cool? Like, "What do you want to do?" So it's really satisfying to be on the same side of the table as your client.
Chris Dreyer:
That's amazing. Thank you for sharing all that. This is extremely eye-opening for me. I haven't had any individuals on with this skillset. And I think for the PI attorneys listening that has a case that hits that threshold, that'll be perfect to partner with, how can get in touch with you and where can they go to learn more?
Julian Gray:
Sure. First of all, once again, I appreciate the opportunity to bring you this information, Chris, and hopefully it's beneficial for someone listening.
Our website, the best way is to go to our website and it's saveyoursettlement.com. And you can click through there and get all kinds of information. And my assistant Courtney has been with me for 15-plus years, she's amazing. She'll talk to you, she'll talk to your client to gather some info. And there's never any charge for us to look at a case, we wait to get paid just like everybody else does.
Chris Dreyer:
Thanks to Julian for his insights today. Let's recap. Partner early. If you're working on a case with significant damages, don't wait until mediation to bring in a settlement planning specialist. With expert support from day one, you'll be equipped to navigate complex issues, maximize the settlement, and secure your client's future.
Julian Gray:
We start working with the families long before trial and long before mediation. Some of the families I work with, I work with for two to four to five years without getting paid, by the way, with those families. And that's the difference, is that a person with a disability after their date of loss needs help.
Chris Dreyer:
Customize client care, your clients to serve a settlement plan that's unique as they are. And that's exactly what you can deliver by partnering with a firm like Julian's. With custom-tailored strategies for every aspect of your client's life, you'll become known as the go-to firm for exceptional individualized care. From healthcare to housing to financial security, this concierge level service demonstrates an exceptional commitment to your client's wellbeing, a powerful differentiator for your firm. It's a reputation that will set you apart.
Julian Gray:
Some people need a special needs trust, some people don't. There's a lot of cases I do, seven, eight-figure cases, where we don't use a special needs trust and the person may have a severe disability. So it's about custom-building every case, especially on the larger cases, to fit the needs of the person.
I've always found it difficult to understand, especially on the bigger cases, how a person could assess someone's needs in eight hours at a mediation and say, "This is the investment you should have for the rest of your life." And that's the problem I have with some of those structures. But there's cases where we think structures are really good for people, but it's typically the smaller cases where they don't need a trust and it's more to fix a person themselves.
Chris Dreyer:
Shout it from the rooftops, offering settlement planning isn't just great for your clients, it's a marketing tool. By positioning yourself as a one-stop shop for lifelong client support, you'll set yourself apart from the competition and give potential clients a compelling reason to choose your firm. Imagine being able to tell clients, "We'll be by your side every step of the way, from the moment you hire us to the years after your case is settled."
By offering comprehensive settlement planning services, you can make that powerful promise a reality. You'll create an unmatched client experience that generates buzz, drives referrals, and cements your position as a leader in the field. It's the ultimate marketing advantage.
Julian Gray:
And normally what happens, at least with the attorneys I don't work with, is they settle a case at mediation and then they say, "We better call someone. We better call someone to clean up the mess because we're going to get paid. Our costs are going to get reimbursed, but we've got to get someone to take care of this person for the rest of their lifetime."
Chris Dreyer:
All right, everybody, that's it for today. I hope we added a few more tools to your kit. For more about Julian, head over to the show notes. Before you go, do me a solid and smash that Follow button, I'd sincerely appreciate it. And I know you won't want to miss out on our next episode. Thanks for listening to Personal Injury Mastermind with me, Chris Dreyer, founder and CEO of Rankings.io. Catch you next time, I'm out.
