Bar News - May 17, 2017
Hourly Rate Cap Up to $125 in New ‘Modest Means’ Referral Program
By: Melanie Plenda
Correction: In the May 2017 issue of Bar News, the “Financial Eligibility for the Modest Means Program” chart presented out-of-date income levels based on the 2016 Federal Poverty Guidelines. This has been updated in the online edition. We apologize for the error.
Set to launch June 1, the NH Bar Association’s new Modest Means Legal Program is shaping up to be a win for attorneys and the public as it expands both attorney hourly rate caps (up to $125 per hour) and client income thresholds, replacing the former Reduced Fee Referral Program. It’s free to join the panel, and acceptance of all referrals is voluntary.
“There are a number of potential clients who need legal representation and are willing to pay for it, but they just can’t afford to pay the full amount,” says Sheila Vermacy, Lawyer Referral Service (LRS) Coordinator at the NHBA, who will coordinate the Modest Means Legal Program. “The Modest Means Program can help by sending attorneys potential clients who are pre-screened for legal issues and for their ability to pay reduced legal fees.”
The program’s new name, “Modest Means,” more accurately reflects the clients the program will serve, says Brad Kuster, chair of the NHBA’s Lawyer Referral Service Subcommittee.
“By expanding the income levels for eligibility, more people can get referrals,” Kuster said. “Expanding access to representation seems to me to be the most obvious and direct way to help people gain access to justice in New Hampshire.”
Under the new eligibility guidelines and sliding fee scale, a family of four making up to $79,900 per year would pay $125 per hour for legal help. The old program topped out at $66,000 in income for a family of four, with a fee cap of $80 per hour. The Modest Means Legal Program provides those living between 150 and 250 percent of federal poverty level (FPL) with an $80 hourly rate for legal services; for those between 251 and 300 percent, the cap is $100; and for those between 301 and 325 percent, the cap is $125. (See complete eligibility guidelines and fee scale in the table accompanying this article.) Clients must also meet minimum income standards or have a reasonable plan for paying legal fees, such as a personal loan or a tax return.
For attorneys, there are no fees to join the Modest Means panel and no percentage fees will be due on any cases, regardless of the amount earned. Participating attorneys – all of whom must be active-status members of the NH Bar Association and must carry liability insurance – are not “assigned” cases, Vermacy says; they are free to decline a referral for any reason.
Cassandra Brown started accepting reduced-fee referrals almost as soon as she started practicing law in 2015. She says she saw the NHBA program as a great opportunity.
“You get more people through the door, and can expand your client base,” she says of the referral program. “I feel like the reduced-fee folks are kind of an untapped market.”
LRS also makes referrals for unbundled services and limited-scope representation. This allows clients to pay by the task and, because attorneys typically do not file an appearance in the case, they have control over the scope and length of the services they provide to the client.
“It’s a great way to supplement income, and many reduced-fee clients prefer to hire an attorney that way, because coming up with a large retainer is often an obstacle in obtaining legal help,” Vermacy adds.
LRS determines a client’s eligibility based on a client’s self-disclosed gross household income, liquid assets and household size, which will be listed on a financial eligibility page with each referral. The hourly rate is determined by what percent of the FPL the client’s gross household income – less child support and alimony payments – falls under.
That said, if a panel attorney discovers more income or assets than are listed on the financial eligibility page, and the attorney doesn’t believe the client qualifies for the Modest Means program, the attorney can send the client back to LRS to be re-qualified. An attorney is not obligated to accept any case at a rate that he or she does not feel is fair.
Panel attorneys are allowed to charge a consultation fee, as long as the client is informed in advance and the fee doesn’t exceed the hourly rate for which they’ve qualified. The suggested retainer amount is $1,200, but it is up to the attorney to determine an appropriate amount.
In addition to enabling more people to access justice, the Modest Means Legal Program was designed to benefit participating attorneys.
“[The Reduced Fee Program] has provided an opportunity for newer attorneys to build or expand their practices, and, at the same time, a means for all participating attorneys, whether new or more seasoned, to help lower-middle-income people gain access to legal representation,” says Virginia Martin, who, as the NHBA’s associate executive director for legal services, oversees Modest Means.
“By expanding both the pool of people who qualify and the fee caps,” she says, “the Modest Means Legal Panel opens up more opportunities for attorneys on both these fronts.”
Vermacy points out that attorneys participating in both the Modest Means and LRS (full-fee) panels have an opportunity to generate additional referrals through the clients they help. “Modest Means clients may not pay full fees,” she says, “but they might recommend the attorney to their family and friends who can pay full fees. They also might return at a later date when they can afford full fees.”
Additionally, while it might not be feasible for some attorneys to take cases pro bono, especially solo practitioners, the Modest Means program allows attorneys to provide a public service while still earning income.
Katherine Morneau of Nashua has been a member of the Reduced Fee panel for the past 11 years.
“Even in law school, I always thought it was important to give back,” she says. “We have this crazy ability to help people with our knowledge. And if we can give some of that away to people who really need it, but maybe can’t afford it, I think it’s just so important that we do that.”
The program already has support among bar members, says Kuster. In a survey sent to 121 attorneys participating in the referral panels, 75 percent of the 66 attorneys who responded were in favor of expanding the financial eligibility for the Reduced-Fee Program to as much as 350 percent of FPL.
Last year, Vermacy says, LRS answered 6,507 phone calls and responded to 4,145 emails from clients. The service made 3,389 full-fee LRS referrals and 943 referrals under the Reduced Fee Program.
Vermacy says it’s not clear yet how many more New Hampshire residents the Modest Means Legal Program could potentially help, but statistics indicate that it could be substantial. According to US Census Bureau data, 333,700 people in New Hampshire live between 200 and 399 percent of FPL.
By increasing the number of New Hampshire residents who can access affordable legal representation, the Modest Means Legal Program is also expected to reduce the number of litigants who attempt to navigate the court system on their own. The NH Judicial Branch estimates that between 61 and 70 percent of all litigants in New Hampshire are self-represented, which puts considerable strain on the justice system.
Vermacy says her goal is to recruit as many new panel attorneys as possible, on top of retaining the existing reduced-fee panel.
For more information on the Lawyer Referral Service and the Modest Means Legal Program, please visit the Member Dashboard on the Bar’s website under “Grow Your Practice,” or email LRSreferral@nhbar.org. Contact Sheila Vermacy directly at (603) 715-3235.