Almost all older adults recognize the importance of estate planning. Yet, nearly half of Americans…
Suppose your mother can no longer make decisions for herself and she now needs nursing-home care. You are stressed and anxious. The nursing home puts a twenty-page, single-spaced contract in front of you. You wish you could flip straight to the last page and sign then and there, just to get it over with.
Do not do this. You could be agreeing to pay, out of your own pocket, many thousands of dollars for your mother’s care.
Try to get your mother admitted and then, before you sign the contract, bring it to us for our review and guidance. Once your mother has moved in, she can’t be evicted just because you want to negotiate the contract.
But if that is not feasible, then sit down and take a few deep breaths. Read the contract carefully. Make a list of questions and ask a facility representative to explain. Ideally, that person would sit with you as you go through the document. Don’t sign until you understand.
Here is what to watch out for.
You should not use your own money to pay
* Do not sign the contract if it requires you to obligate yourself to pay with your own money. Carefully scrutinize any language referring to you as the “responsible party” or “resident representative” or “agent.”
The suspect buzz-words are “co-signor,” “guarantor,” “personally guarantee,” “personally liable,” “private-pay guarantor,” “surety,” “individual capacity,” or any such language. Words like these obligate you, personally, to pay if your mother doesn’t have the money. Don’t sign even if there are no buzz-words, but the language looks something like this: “If the resident does not or cannot pay, I will pay the amount owed for residency charges, services, equipment, supplies, medication, and other charges.”
Please understand that it is legal for the facility to require you, if you hold financial power of attorney or are guardian, to pay nursing-home bills from your mother’s money and assets. It is legal to require you to spend her money on her care and not for any other purpose. It is not legal to condition your mother’s admission on your agreeing to pay her bills with your own money, which is what the above buzz-words mean in plain English. The nursing home can ask you to agree – and if they ask, refuse – but you cannot be forced to agree to pay with your own money.
If your mother lacks the money, the next step is to apply for Medicaid assistance, not to go digging into your pocket.
Sometimes the contract is confusing. For instance, one nursing-home agreement says that the representative “personally guarantees continuity of payment.” This alarming language is properly followed by an italicized statement that the representative is “not required to pay for Resident’s care from his/her own personal funds.” The agreement proceeds, though, to use the phrase “personally guarantee” in other contexts. Ambiguity like this is why we recommend that you first bring the agreement to us. We can ensure, on your behalf, that the facility clarifies such language and does not misapply it.
Everyone in need has the right to apply for Medicaid
* The nursing-home contract must not require your mother to waive – give up – her right to seek government assistance like Medicare or Medicaid, nor can it ask her or you to sign any statement that she is ineligible for those benefits.
* If your mother has no money to pay for care, a Medicaid application will be required. The contract may seek your permission to apply for Medicaid for you. You have the right to decline that option and, instead, seek legal counsel to help you apply. We have seen some facilities mishandle Medicaid applications, which wound up being denied when they should not have been.
In any case, though, whoever files for Medicaid, you must cooperate by immediately providing all records necessary for that application.
If your mother is eligible for Medicaid, Medicaid pays
* If your mother does get Medicaid, the nursing home must not require an additional payment over and above that designated by the Medicaid scheme in your State.
* The nursing home must not demand that your mother receive additional services not covered by Medicaid and then, if your mother declines those services, evict her. It should ask, in advance, whether those services are desired at specified additional cost.
* The nursing home must not require additional donations to a charity as a condition of admittance.
Do not agree to arbitration
* The contract may seek your consent to arbitration. If you agree, you will be giving up your right to a jury trial if a dispute arises. The rules are in flux at the moment, but, generally, you should decline such a provision.
The nursing home must protect property reasonably
* The nursing-home contract may try to fudge its responsibility to take care of your mother’s property, but the bottom line is that it is obligated to care for your mother’s property during her stay. You should, however, use good judgment to safeguard her valuable property like fine jewelry by keeping it elsewhere.
Protect yourself. Cross out, and sign the right way
* Cross out provisions in the contract that you decline, and put your initials by the strike-outs.
* Be sure to sign the contract only as your mother’s agent. Your signature should read: “[Mother’s name], by [your name], her agent.”
To be fair to nursing homes, they are entitled to be paid and they often have difficulty collecting on legitimate debts. Facilities are forbidden from suing to take a resident’s Social Security or pension income. They must comply with strict federal consumer-protection restrictions. Despite these payment hurdles, they must still protect frail and vulnerable people from all manner of harm. They also suffer public hostility, thanks to the misconduct of some bad actors. We always urge cooperation with nursing-home personnel if feasible, because their job is a difficult one.
On the other hand, you and your family have the right to be protected from the excesses of bad actors – or from the imperfections, for example, of the facility mentioned above that misuses the “personally liable” language. Thus, no matter how reputable the facility, it is good judgment to consult an attorney before you sign an admission contract. If that’s not possible, then take care and time to study the contract, get facility staff to explain it to you, and strike out the objectionable provisions as advised above.
A few moments of care, even despite the stressful circumstances you are surely in at the time, can save you a lot of difficulties later. If you have questions about planning for long-term care for yourself or a loved one, please contact our Tuscaloosa office at (205) 764-1262 or our Montgomery office at 334-239-3625 to discuss your particular situation.