When a family member enters a nursing home or assisted living, it is an emotional and overwhelming time. This generally means that carefully reviewing the admission contract and related documents is not the top priority. In addition, most families do not know their rights. Unfortunately, some unscrupulous facilities take advantage of this. Family members who sign admission contracts can find themselves held liable for their loved one's care costs.
Recently, one family won a lawsuit brought by FutureCare, the financial management company for Alaris Health. The lawsuit alleged that the daughter of a nursing home resident was responsible for the charges. She had signed a contract which made her personally liable as guarantor. However, nursing homes are prohibited from requiring third parties to guarantee payment by state and federal law. Therefore, the lawsuit was dismissed. A recent Star Ledger article examined this case, as well as noting almost 50 other lawsuits against FutureCare, Alaris or related entities.
Unfortunately, many families do not know their rights and they will agree to pay for their loved one's care if pressured or sued. And while nursing homes are prohibited from requiring third party guarantors, assisted living facilities are not. Therefore, a family member should avoid signing the admission contract if possible. Commonly, facilities will ask family members to sign if the resident cannot. They may be asked to sign as guarantor or responsible party. Signing as responsible party does not necessarily mean assuming personal responsibility. The exact language of the contract is key - it should state the responsible party agrees to pay for care from the resident's funds. Even in this case, the family member may have liability for paying timely and applying for Medicaid.
Another common issue is that facility admission representatives often make promises that directly conflict with the Medicaid policies which are laid out in the contract. For all these reasons, it is smart to have a certified elder law attorney review the facility contract before signing.