January 2023
Elder Law Update
 

With 48 million families supporting someone in long-term care across the United States, all too often long-term care becomes the target for illegal activity that leaves the families who were simply trying to care for their loved one at a loss. However, you don’t have to become a victim.

 

TAKE TIME TO UNDERSTAND YOUR LOVED ONE’S ADMISSIONS CONTRACT

 

When securing a long-term care facility for your loved one, you will have to decide whether or not to sign an often lengthy and confusing admission contract. Yet, many caregivers do not understand what they are actually signing, providing the perfect opportunity for a facility to add illegal clauses that families unknowingly agree to.

 

For example, some admissions contracts include a clause that states a caregiver must pay the resident’s bill in the event that the resident cannot afford to do so. However, clauses like this are generally illegal. Yet, in the event that you unknowingly agreed to this clause in the admission contract, the nursing home can hire debt collectors, including law firms, to demand that you pay the unpaid bills; sometimes even going as far as personally suing you for the outstanding balance or reporting the debt to consumer credit reporting companies under your name.

HOW TO SPOT THE RISKS IN YOUR LOVED
ONE’S CONTRACT

 

Oftentimes you may not realize your loved one’s contract includes these clauses until the nursing homes attempts to collect from you personally. If you are already experiencing this pressure from a nursing home, it is important to reach out to a knowledgeable elder law attorney who can review the contract you signed and advise you on the best way to proceed.

 

If you haven’t yet signed a contract, it is a prudent idea to have the agreement reviewed by an expert elder law attorney so they can ensure these clauses are not present. At the very least, pay special attention to verbiage such as “responsible party” or “joint and several liability” in the admissions contract. Some contracts also include language about the caregiver’s liability for a completed Medicaid application or make the caregiver jointly liable with the resident for nursing home bills. In any event, make sure you read the contract thoroughly before you sign it.

 

HOW TO HOLD BAD ACTORS RESPONSIBLE

 

If you believe you are in a situation as described above, the best thing to do is to speak with an elder law attorney in your area about what you are experiencing. The attorney will be able to advise you on next steps, and help report the nursing home for illegally seeking money from you.

 

You can also report the nursing home for violating the Nursing Home Reform Act. To do that, you will need to contact your state’s nursing home survey agency and file a complaint with your state attorney. An experienced elder law attorney can also assist you with these actions.

 

Finally, if you are having a problem with a debt collector, you can submit a complaint to the CFPB online or by calling (855) 411-2372.

If you would like to discuss your situation with an experienced elder law attorney, contact us today for a consultation.
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When properly designed and implemented, Irrevocable Living Trusts can provide an almost unsurpassed level of asset protection, keeping your assets safe from the high cost of long-term care. And, similar to Revocable Living Trusts, they spare your family the delays, frustration and expenses of the probate process.

Other reasons to utilize an Irrevocable Living Trust include:

  • Tax minimization
  • Avoiding the risks of placing assets in the name of your children
  • Protecting assets against predators, creditors, and lawsuits

Assets placed in an Irrevocable Living Trust can include a business, cash, investments, life insurance policies, and more.

 

WHY AN IRREVOCABLE LIVING TRUST COULD BE BETTER THAN A REVOCABLE LIVING TRUST FOR PROTECTING YOUR ASSETS AGAINST THE COST OF LONG-TERM CARE.

 

The short answer is that under current Medicaid laws, assets in a Revocable Living Trust are not fully protected.

 

Why? Because any assets you place in a Revocable Living Trust are still available to you, the Grantor.

 

Therefore, Medicaid may determine that those assets must be used to pay for your long-term care. However, this is not the case with assets placed within an Irrevocable Living Trust, as long as it is properly designed and implemented to take into account the latest laws governing Medicaid eligibility.

 

HOW AN IRREVOCABLE LIVING TRUST CAN PROTECT YOUR CHILDREN’S INHERITANCE.

 

When you transfer assets directly to your children, they typically become outright owners of the assets. They also become responsible for the risks associated with owning the assets. A properly drafted and implemented Irrevocable Living Trust will avoid:

  • Loss of inheritances due to lawsuits, divorce, remarriage, or the inability of your children to manage money on their own
  • Gift tax liability
  • Income tax consequences for your children
  • Problems with getting financial aid to cover educational and other expenses for your grandchildren

To determine if an Irrevocable Living Trust is right for you and your family, contact us today for a consultation.