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The adult children of elderly parents in many states could be held liable for their parents' nursing home bills as a result of the new Medicaid long-term care provisions passed by the House of Representatives on February 1. The children could even be subject to criminal penalties.

Life Care Planning, Estate Protection, Disability,
VA & Medicaid Assistance Lawyers

Adult Children Could Be On Hook For Parents’ Nursing Home Bills


            The adult children of elderly parents in many states could be held liable for their parents' nursing home bills as a result of the new Medicaid long-term care provisions passed by the House of Representatives on February 1. The children could even be subject to criminal penalties.


            The 750-page Deficit Reduction Act of 2005 (DEFRA) includes new punitive restrictions on the ability of the elderly to transfer assets before qualifying for Medicaid coverage of nursing home care.  Essentially, the new law attempts to save the Medicaid program money by shifting more of the cost of long-term care to families and nursing homes.


            One of the major ways it does this is by changing the start of the penalty period for transferred assets from the date of transfer, as it was prior to February 1, to the date when the individual would qualify for Medicaid coverage of nursing home care if not for the transfer.  In other words, the penalty period would not begin until the nursing home resident is out of funds, meaning there would be no money to pay the nursing home for however long the penalty period lasts.


            A few of the likely victims of the new law are:  the grandparent caring for a grandchild who provides savings to help pay for the grandchild's education; the devoted church supporter who donates personal assets to the church; the family farmer or small business owner who passes on the farm or business to the next generation; the widow who lacks records of her now deceased husband's spending; the caring sister who uses savings to help a needy sister remain in her home. Under the new law, each of these individuals will be denied Medicaid if they subsequently get sick and need long-term care.


            With the passage of the new law, nursing homes will likely be flooded with residents who need care but have no way to pay for it.  As a consequence, nursing homes will step up their efforts to collect from families.  For example, in a typical case a child of a nursing home resident signs the nursing home admission form.  This often makes them the "responsible party" and they can be held liable for their parent's nursing home costs.


            Now, DEFRA has given states and nursing homes a new means of shifting the cost of long-term care to families.  In states that have so-called "filial responsibility laws," the children of nursing home residents could be made responsible for their parents' nursing home bills.  These rarely-enforced laws, which are on the books in 30 states, hold adult children responsible for financial support of indigent parents and, in some cases, medical and nursing home costs.


            According to the National Center for Policy Analysis, 21 states allow a civil court action to obtain financial support or cost recovery, 12 states impose criminal penalties for filial non-support, and three states allow both civil and criminal actions.


            The Senate passed the DEFRA bill containing the new transfer provisions before Christmas, with Vice President Dick Cheney casting the tie-breaking vote.  However, procedural moves by Senate Democrats required the House to vote on the measure a second time after having passed it the first time by a 212-206 margin at the end of an all-night session.  On February 1, the House passed the bill a second time, by a razor-thin margin of 216-214 and sent it to President Bush (who signed it on February 8).


            Several Republican moderates who had supported the DEFRA bill when it was voted on in December changed their votes after learning details of the legislation and under intense pressure from groups like AARP, but in the end the vote switches were not enough to defeat a bill that the Congressional Budget Office says will reduce or bar benefits for millions of Medicaid recipients. The measure is estimated to save $39 billion over five years.


            Democrats attacked the measure as an assault on elderly and disabled Medicaid patients and other vulnerable groups and said it was a prime example of the powerful influence of lobbyists for corporate interests like drug manufacturers and health insurers, who got much of what they wanted in closed-door negotiations with Republican lawmakers.  "This is a product of special interest lobbying and the stench of special interests hangs over the chamber," said Rep. John Dingell (D-MI).


            Thirteen Republicans and all House Democrats, including Jerry Costello (D-IL 12th), voted against DEFRA.  Southern Illinois Republican John Shimkus (R-IL 19th) voted for the bill.


            Although DEFRA incorporates provisions that close certain asset transfer "loopholes," many planning options remain untouched by the new legislation.


            While the new federal law applies to all transfers made on or after February 1, it also gives the states time to come into compliance. This gives many people in most states, including Illinois, a little time to plan. The deadline for states to enact their own laws varies from state to state, but generally is the first day of the first calendar quarter beginning after the end of the next full legislative session.


            What does all of this mean to you, the reader?  If you may eventually need long-term care, you should run, not walk, to an attorney who is qualified to help put a good plan in place before it is too late.  If you know someone who has a medical condition, such as Alzheimer's, Parkinson's, ALS, or stroke, or is at risk for such medical conditions, reach out and help that person obtain the legal assistance they most assuredly need.  In most cases, such debilitating medical conditions inevitably and unavoidably require care in a long-term care facility and can cause a family to go broke.


            For the full text of the Deficit Reduction Act of 2005 in PDF format, click on:


            Richard Habiger is an elder law attorney.  You may contact him at 618-549-4529 or