Will you have to pay your parent’s nursing home bill?

I have written before on how common it is for family members to unwittingly make themselves liable for a nursing home bill when they sign admission papers for a loved one going into a nursing home (“Has a nursing asked you to sign?”). Although it is against the law (42 C.F.R. 483.15(a)(3)) to require a 3rd party to take financial responsibility for the bills of a nursing home as a condition to admitting that person into the facility, it happens frequently. Mom is sitting there, about to move into the facility, Daughter is with the admissions employee who is asking her to “sign here” so Mom can move in. I had it happen to my family member, and I’ve represented clients who signed as a “Family Representative” only to discover they actually signed to accept financial responsibility for all outstanding nursing home bills.

A recent Ohio case finally sheds some light on the law and specific steps that might instruct how to avoid becoming liable for a loved one’s nursing home bills. The case is Village at the Greene v. Smith, 2020-Ohio-4088, and I’ll summarize here how it is applicable to readers facing the possibility of helping a family member or loved one move into a nursing home.

Despite it being illegal, many nursing homes have provisions in their admissions agreements where the accompanying family member (or sometimes a family friend) signs as “Family Representative,” or “Responsible Party” described as someone who agrees to “secure financial information such as Medicaid and Medicare.” These agreements typically include third-party guarantor, or personal guarantee, language. If you sign as the “Family Representative” when you are admitting your mom, or dad, or whomever, into the facility, you’ve likely agreed to be responsible for all unpaid nursing home bills.

In the Village Green case above, Son accompanied Father to the nursing home when he was being admitted. Son correctly refused to sign in his individual capacity, as Family Representative or any other form. Son did sign, however, in his capacity as Power of Attorney for his father. Essentially, he signed on behalf of his father. This would look like “John Doe, POA for Dave Doe” or power of attorney, or agent, etc., instead of signing as just “John Doe.” Eventually Father died and had unpaid nursing home bills, where the nursing facility then brought suit against Son. The appeals court determined that Son, who signed as power of attorney for Father and did not sign in his individual capacity, could not be held liable for his father’s unpaid nursing home bills.

ADVICE

  1. Do not sign your name anywhere on a nursing home admissions agreement, or any additional or ancillary paperwork, unless you are certain it is for contact purposes only. See #3 below.
  2. If possible, have the person being admitted sign the document. If the person is competent but simply physically unable to sign, they can sign an X or something indicating signing. If this isn’t possible, try to have had a power of attorney prepared prior to admission into the nursing home. If you do this, then sign everything as power of attorney. “Jane Doe, POA.” This includes email signatures: “Thank you for the update. Jane Doe, POA.”
  3. If you don’t have power of attorney, and find yourself in a position where you are being asked for your signature and given assurances that you won’t be held liable, write after your name “My signature is not a personal guarantee for financial responsibility.” Get a copy immediately of the signed document, and note the name of the person who told you that you would not be held liable financially. In the situation with my family member, he was told by the admissions employee that “Oh, this is just a formality so we have a family member to contact. We never pursue payment.” Yes, the nursing home pursued the five-figure payment.

Helping a parent or family member through the nursing home admission process is stressful and emotional. Don’t set yourself up for future stress by unknowingly agreeing to be financially responsible for the nursing home bill. Unwinding yourself out of liability can be nearly impossible, and it is far better to not incur liability from the start.

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