Tips on the nursing home admissions process

The need to place a beloved family member in a nursing home may be one of the most harrowing and heartbreaking decisions a person has to make. Not only is there a terrible sense of guilt and failure, but the sheer cost of a single month in a nursing home is staggering, and leaves the family with a bleak view of their future security. They feel vulnerable, because they are at the mercy of forces they cannot control, and are thrust into a world full of acronyms, shorthand and procedures they have never encountered.

At the time of application for admission, the applicant needs to provide medical information that reports the individual’s clinical condition, diagnoses, relevant recent medical history, and treatment needs, so that the facility can make an informed decision about whether it can meet the needs of the resident. This will need to be coordinated with the physician(s) at home or the hospital discharge planner, as the case may be. Although all facilities are licensed to provide the full range of services needed for a long-term nursing home resident (with the exception of ventilator services that are beyond the scope of this article), certain facilities are known informally for better handling certain kinds of situations. It could be that an applicant is denied admission due to presence or recurrence of infection, or some documented, serious behavioral disorders. For instance, a particular resident may require a private room or extra supervision. The resident may have a unique degenerative medical condition such as ALS, and would do better in a facility that has specialized services available. Or a resident may require psychiatric placement instead of an “ordinary” nursing home.

Admissions contracts should be signed by the resident himself, but can also be signed by the spouse, a Guardian or an Agent under Power of Attorney. When a fiduciary signs on behalf of a resident, the fiduciary is signing in their fiduciary/representative capacity, and is assuring the facility that they will manage the income and assets as authorized by law. There is no need for a family member to personally take on the duty to pay the nursing home bill. Commonly, a facility will ask the person who is handling the resident’s income and resources to sign as “Responsible Party.” This would amount to a personal guarantee. No one should sign as “responsible party” unless they voluntarily intend to personally guarantee the payment out of their personal assets. The Nursing Home Act (NHA), NJSA 30:13-1 to -17 prohibits a facility from requiring a third party to guarantee the bill.

The person agreeing to be Fiduciary for the resident needs to be aware that they still have obligations to arrange for the nursing home bills to be paid using the applicant’s funds, and to apply for Medicaid benefits in a timely way. See generally, Manahawkin Convalescent v. O’Neill, 217 N.J. 99, 85 A.3d 947 (2014) (fiduciary failed to turn over the income; facility sued; fiduciary counterclaimed for violations of Consumer Fraud Act; counterclaim dismissed, but Supreme Court expressed the need for contracts to be clearly worded).

If a resident is not Medicaid eligible, the nursing home’s rates can be determined by any factors it considers appropriate. The rate schedule has to be clearly and plainly disclosed in the contract. 42 CFR ‘ 483.12(c).  A nursing home cannot obligate a Medicaid-eligible resident to sign a private pay contract to gain admission or to continue residing in the nursing home. NJAC 8:85-1.4(b). On the other hand, if the resident has not yet been determined to be Medicaid eligible, and has not yet applied for Medicaid, he or she may voluntarily sign a private pay contract at time of admission. Once the individual becomes Medicaid eligible, that contract will be void. NJAC 8:85-1.4(c).

Typically, a nursing home will ask the new resident for the first month’s fee plus a one-month security deposit, at the time of admission. If the resident expects to apply for Medicaid fairly soon, s/he needs to be sure that the security deposit has been spent on the care prior to the end of the spend-down period, so that once the resident thinks they are financially eligible, it doesn’t turn out that they have an excess resource sitting in the facility’s trust account. .

Call us for contract review and advocacy in the admissions process … 732-382-6070

 

 

 

 

Banks are pummeling their customers with aggravating procedures

Many of our clients are aged and many of our clients are fiduciaries for other people in  roles such as Agent under Power of Attorney, Estate Administrator or Executor. NJ Rev Stat § 46:2B-19 (2013)    In a typical week our clients have to ask banks to provide documents and services that are required to enable the client to file an application for public benefits, pay expenses for an estate, transfer stock held by a deceased person, answer questions posed by the caseworker on a Medicaid application, or open and close bank accounts using a Power of Attorney. It seems like each year, the bank’s procedures become more onerous. For elderly clients it can be a maddening experience.

Here are a few problems that have been reported to us. (1) An executor of an estate in which the estate held bank accounts at a certain national bank which is related to an investment/securities firm needed to transfer stock. The transfer agent’s paperwork  required that the Executor’s signature be Medallion Guaranteed. The bank wouldn’t provide their customer with the Medallion Guarantee because the estate hadn’t set up a brokerage account and only held bank accounts. (2) The person who is named as Agent under a Durable Power of Attorney (POA) which has banking powers attempts to transact business at a bank, such as getting their signature on file or opening or closing an account for the customer who had signed the POA..  Some banks demand a current authorization (clearly a violation of state banking law). Yet there is a presumption that a POA is still in effect and a third party can rely on it. NJ Rev Stat § 46:2B-8.3 (2013)  and      NJ Rev Stat § 46:2B-8.5 (2013) Since the principal is often incapacitated and cannot sign anything, the bank will renege but will demand that the Agent for the customer sign an Affidavit that the POA is in full force and effect. Although this may violate the law,NJ Rev Stat § 46:2B-8.3 (2013)   this may not be too bad as long as the bank provides the form. However the personnel sometimes simply refuse to accept an older POA, and tell the customer to go get the necessary document on their own. (3) Further, some banks are now demanding that the Agent go back to the attorney who prepared the POA for a certification that it is a true original!! That attorney may be deceased or be inaccessible. This is a requirement that is clearly burdensome and unwarranted.NJ Rev Stat § 46:2B-13 (2013)

Executors needs to gain access to the decedent’s accounts so that they can pay the bills. For an estate that will be taxable, State banking statutes allow the bank to release up to half of the account to the Executor in advance of receiving the tax waivers from the State, and also allow the bank to issue a payment directly to the Division of Taxation. (4)  Some banks are refusing to release any funds without receiving a tax waiver first. (5) Other banks will only deliver the tax check directly to the treasury, which means the Executor can’t control the process — yet the Executor is personally liable for payment of the taxes if the estate doesn’t do so.

(6) People who are filing a Medicaid application to pay for nursing home care have to produce 5 years of bank records and cancelled checks (for the look-back) to support the application. Some banks charge $5 a page, and $5 for every cancelled check copy. The application is being filed for a person who is out of money. These fees could add up to a thousand dollars. Who can pay this? If the Agent under Power of Attorney or the next of kin is doing a good deed by preparing and filing this Medicaid application, why should they be expected to pay such fees? What about the aged spouse who is also only allowed to retain limited assets when applying for Medicaid for their ill spouse? Can they be expected to argue with a bank about such fees, or confront them and ask for a waiver?

These are only a few of the more common examples. Government agencies, brokers, and other entities  are becoming more particular about the documentation they require, but many procedures are overly burdensome, cause extensive delays, and are plainly unnecessary. If you are handling the finances for someone, you may wish to ask questions about these fees and procedures so that you can choose the institutions that will serve your needs and will facilitate rather than hinder your efforts.

For legal advice and advocacy concerning elder care or your responsibilities as a fiduciary call us at 732-382-6070

Managing Someone Else’s Money

If you’ve been a designated as someone’s “Power of Attorney,” they’ve given you a big responsibility. The job is different than managing your own money. You are a fiduciary with a duty to the principal (the person who selected  you). You have to safeguard the assets of your “principal,” for their wellbeing and benefit. You need to stay aware of all sources of income, file their income taxes on time, make prudent decisions on whom you hire or sign a contract with, and maintain their assets in a way that doesn’t disrupt their estate plan. You need to have a paper trail for all expenditures (checkbook or credit card records) and save all receipts. You need to keep excellent records so that you’ll be “above reproach” if a third party is ever looking at what you’re doing.

The federal consumer finance agency has published a series of booklets that you may find very useful. To order, click on this link:

http://www.consumerfinance.gov/blog/managing-someone-elses-money/

Always keep in mind that at any time, someone could start looking over what you’re doing — so expect the best, but plan for the worst.

For legal advice on issues concerning Agent under Power of Attorney, Trustee, Guardian or Conservator, call us at 732-382-6070