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