Nursing Home Admission Agreements

posted by Jane Freeman January 16, 2015

Admitting your parent to a nursing home can be a stressful event.  Your parent may be reluctantly giving up residence in a long-time family home and you may have spent substantial time and energy trying to find a facility where your parent can live safely and comfortably.  On move in day, your parent is asked to review and sign numerous documents, including a nursing home admission agreement (“Admission Agreement”).  Your parent signs the Admission Agreement as the “resident”.  You are also asked to sign the Admission Agreement and do so by signing on the line labeled “responsible party.”  Although both federal and state law prohibit a nursing home facility from requiring a third party guarantee of payment as a condition of admission to the facility (42 U.S.C. §1396r(c)(5)(A)(ii) and Conn. Gen. Stat. § 19a-550(b)(26))”, nursing facilities typically request that a family member or friend also sign the Admission Agreement as a “responsible party.”

What liabilities have you assumed, if any, by signing the Admission Agreement as a “responsible party”?  The Admission Agreement is a written contract between the resident and the nursing facility to provide care and services to the resident.  Nursing facilities, however, have also attempted to contractually bind responsible parties for payment of their parents’ unpaid accounts, by arguing that the responsible party, upon signing, agreed to perform the duties described in the Admission Agreement.

Connecticut courts have often focused on the language in the Admission Agreement to decide on responsible party liability.  In one case, the Admission Agreement provided that “[i]f the responsible party has control of or access to the resident’s income and/or assets, the responsible party agrees that these funds shall be used for the resident’s welfare, including but not limited to making prompt payment … in accordance with the terms of this agreement.”  The resident’s daughter who had signed as the responsible party held a power of attorney from her mother. The daughter transferred some of her mother’s assets for estate planning purposes and used other assets to pay for a personal companion for her mother.  The Court rejected the daughter’s argument that these payments and transfers were made for her mother’s welfare and held her contractually liable for her mother’s eighty-thousand ($80,000.00) debt to the nursing facility, because she had failed to use her mother’s assets to pay the nursing home debt, as required by the Admission Agreement.  In another case, the Court also relied on the language in an Admission Agreement which required the responsible party to pay all of the resident’s monthly income to the nursing facility.  The Court held in that case that the resident’s son was contractually liable to the nursing facility for $20, 727.90, the amount of his father’s monthly income which he had failed to pay to the nursing facility as required under the Admission Agreement.

The children of nursing home residents have had some success, however, in defending against responsible party liability claims.  In one case, where the resident’s daughter signed the Admission Agreement as her mother’s conservator, the Court refused to find responsible party liability because the nursing facility had never asked her if she were willing to be the responsible party or advised her that by signing as conservator she would be designated as the responsible party.   In another case, the resident’s daughter did sign as a responsible party, but was not held financially liable because she did not have a power of attorney from her father and did not have access to his checking account or other financial resources.

The existence of federal and state laws prohibiting nursing facilities from requiring third party guarantees upon a resident’s admission has not deterred these facilities from aggressively pursuing collection claims against responsible parties, who unwittingly signed Admission Agreements.  While a nursing facility may request that you sign as a responsible party upon your parent’s admission to the facility, you cannot be required to do so nor can your parent be refused admission for that reason.  Therefore, you are well-advised to have the Admission Agreement reviewed by legal counsel before signing it as a responsible party.

Subscribe to receive our quarterly newsletter with law tips, case studies and firm news.