Splitting the Bill: Who’s Paying for Mom’s Nursing Home
Out of respect, indifference or confusion, children of elderly parents tread lightly on the topic of how a parent uses their finances. While a child should be considerate and always act in accordance with authority granted through financial powers of attorney, children must recognize that they may need to account for their parents conduct at a time when mom or dad may no longer have specific capacity to do so.
What could possibly be so difficult to explain? All transactions over $500.00 are scrutinized and those that cannot be explained, are penalized under the Medicaid rules when someone applies for benefits in a nursing home. Common examples occur when Mom withdraws her entire social security check to pay bills in cash or large annual charitable contributions to the church. Initially this only seems like a few dollars but explanations are necessary for the previous 5 years of transactions when a parent goes into a long term care facility. This is how $1,000.00 per month withdrawal from a checking account can create $60,000.00 of transactions that cannot be explained with independent, third party bills or receipts. These transactions mean that Medicaid won’t paid for $60,000.00 worth of skilled nursing home care.
When a skilled nursing home cannot charge Medicaid for services rendered, the facility is left with two alternatives to seeking reimbursement for care, namely through the admission contract and the Filial Responsibility law.
The admission contract to a nursing home facility is often overlooked as the routine intake documentation necessary to ensure mom receives her care at the new facility. However, this document is a contract between the facility and the individual signing the document, where the facility promises to provide medical care so long as the person who signs the document is responsible to ensuring the costs are covered. Oftentimes a child of an elderly parent will rush through the intake documents, signing his or her name personally, including on the line designated “Responsible Party”. B y executing this document personally, the child contractually agrees to ensure that the facility is paid for the services they rendered. If a child cannot explain those withdrawals or payments from Mom’s account, Medicaid won’t pay for her care and the Responsible Party guaranteed payment personally. Where applicable, I always recommend a child acting as the Financial or Medical Power of Attorney to execute the document as “POA” for mom or dad.
Alternatively, Pennsylvania’s Filial Responsibility law holds that the spouse, parent or child of an individual in a long term care facility can be held personally responsible for unpaid medical bills. Regardless of involvement, a child can receive a lawsuit naming them as a party for tens of thousands of dollars to no fault of their own besides their parent’s disorganized financials.
Through proper planning with the finances and careful discussions amongst the most important people in your lives, you can avoid the risks of not qualifying for and receiving long term care in a skilled nursing facility. It’s too expensive and too important to just ignore. We can help. Mooney Law has a completely dedicated and experienced Elder Law / Estates attorney ready to assist your family needs. To schedule a consultation, simply call us at 717-200-HELP and we can meet with you in any one of our 14 local offices in Central Pennsylvania.