Thursday, July 30, 2009

Caring for our Elders

What if your parent gets sick or falls and has to have emergency care? Then you learn that her insurance falls short when the hospital calls you for payment? Are you responsible for your parent's health care when they can't afford it on their own? These are the questions posed by Katherin C. Pearson, Professor of Law at Penn State Dickson School of Law in this article "Finances, Families and "Filial" Laws: The Real World as Classroom.

These filial responsibility laws are on the books in thirty states, including Utah.

Utah Code 17-14-2. Order in which relatives are liable.

Children shall first be called upon to support their parents, if they are of sufficient ability; if there are none of sufficient ability, the parents of such poor person shall be next called upon; if there are neither parents nor children, the brothers and sisters shall next be called upon; and if there are neither brothers nor sisters, the grandchildren of such poor person shall next be called upon, and then the grandparents.

Utah law requires children to be called on for support if they are of "sufficient ability." It also calls upon the grandparent to step up for the adult child. There is no case law in Utah that I could find.

According Professor Pearson, many states repealed or stopped enforcing filial law when Medicare and Medicaid were created in 1965. But long-term care is expensive and people are living longer. Should we have filial support laws to encourage families to take care of one another as a way to help strapped public plans?

Less than a third of older Americans are able to pay for two or three years of nursing home care. Medicaid is the federal-state health care program and the major funder of long-term care. When seniors exhaust limited Medicare benefits, those without long-term care insurance have to pay for their own care. If they spend their assets down again they can re-qualify for Medicaid.

Federal and state law allows Medicaid to seek reimbursement from recipients’ estates though most Medicaid recipients have no estate when they die. Many middle-income seniors transfer ownership of assets to their children to become Medicaid eligible which makes Medicare and “inheritance protection plan.” Medicaid has always excluded children’s assets in considering their parent’s eligibility. Enforcement of filial responsibility law would make much of the estate planning irrelevant. Nation Center for Policy Analysis

Another problem is putting adult children a precarious position while they are raising their own children and facing their own retirement. In an article in the AARP Bulletin today, Beth Baker quotes Bruce Vladek’s “Unloving Care-The Nursing Home Tragedy, “The drafters of Medicaid specifically sought to insulate middle-aged children from the prospect of financial catastrophe engendered by the need to institutionalize aged parents. … Middle-aged children are not forced to exhaust all their own resources in order to provide nursing home care for their parents, but they are forced to witness the destruction of their inheritances, for which their parents may have scrimped for a lifetime.”

The article tells the story of Elnora Thomas of Tampa, Fla., who in 2007, received a letter in the mail. Her mother's nursing home was suing her for $50,000 in unpaid bills. She had no money so they were going to put a lien on ther house.

The nursing home went after her and her sister after their stepfather refused to cooperate in the Medicaid application process. Fortunately, nonprofit legal services of Philadelphia appealed the case until Medicaid came through.

The PA Elder, Estate & Fiduciary Law Blog describes recent action where the law is bing used in Pennsylvania. A story in the Philadelpha Enquirer reported on a 50-year-old man who was struggling to pay his mortgage and college costs for his daughter. He was sued by a nursing home for an $8,000 bill. Another story from Pennsylvania was reported by ABC News of a 39-year-old Pennsylvania woman who was sued for more than $300,000 in unpaid for her parents care. She and her husband are both already working two jobs. She says they just don't have it.

Many children do contribute much to their parents care. AARP estimates that there are 34 million family caregivers who provide the equivalent of $375 billion in care and 54% of those have sacrificed financially.

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