Mr. Abril will be conducting a live teleconference presented by the National Business Institute entitled Recovering Debts for Nursing Homes and Healthcare Facilities on March 26, 2018 from 2:00 pm – 3:30 pm EST. One of the subjects which will be discussed is maximizing recoveries for nursing homes.
All nursing homes require someone to sign an admission form assuming financial responsibility for the resident before that resident can be admitted. This agreement serves as a contract that establishes the legal relationship between the resident and the facility. However, some admission agreements may contain sections that will not be held as valid under state or federal law. What some facilities fail to understand is that signing the contract does not make the illegal sections valid or enforceable. The focus of this article will be on the circumstances under which facilities can pursue the resident’s relatives for payment.
Frequently, facilities require that someone other than the resident sign the admission agreement as the “responsible party” or “guarantor”. Ultimately, whether or not the facility will actually be able to enforce its right to seek payment from these responsible parties or guarantors will depend on the applicable state law.
In Ohio, for example, a court ruled that a son was financially responsible for his mother’s nursing home expenses. Andover Retirement Cmty. V. Cole, 2014 WL 5802674 (Nov. 10, 2014). In that case, the resident’s son not only signed the respective admission agreement as the responsible party, but also admitted her as her agent pursuant to a validly executed power of attorney. The court cautioned that when he signed as an agent, he had not yet taken personal responsibility for the cost of her care. However, the court found that the contract in which he accepted personal responsibility was a separate contract that he signed personally and not as the agent for his mother.
Similarly, a New York court held that a resident’s wife could be held personally liable for the resident’s unpaid nursing home bill. Sunshine Care Corp. v. Warrick, 957 NY S.2d 122 (2012). In this instance, the wife had signed an agreement stating that she would be his designated representative and would use his assets to the extent they were available to her to pay his bills. Under the agreement, if she failed to do so, she could be personally liable. The Court upheld the agreement.
In contrast, a New York court refused to hold a grandson responsible for the cost of his grandmother’s nursing home care. Amsterdam Nursing Home Corp. v. Lang, 2007 WL 2671142 (NY Sup. Ct. 2007). The court ruled that the fact he had signed her admission agreement as her “legally authorized representative” was not sufficient to find him financially responsible.
As can be seen by the above mentioned cases, courts tend to look to the specific details of each case and applicable state law in determining whether a nursing home facility can enforce its right to seek payment from the relatives of its residents. Usually, courts look to whether the relative assumed any responsibility voluntarily, in their own personal capacity. For a more in-depth and detailed perspective on these line of cases and to learn how to best secure payment for nursing home services, please register for Mr. Abril’s teleconference presented by NBI, Inc. entitled Recovering Debts for Nursing Homes and Healthcare Facilities on March 26, 2018 from 2:00 pm – 3:30 pm EST.