In general it’s difficult to argue against the notion that children who have the means should be willing to contribute to keep mom & dad when they no longer can live on their own: the question is do we want the state forcing that when costs have become astronomical? Well, 30 states have laws like that on the books that come under the heading of “filial responsibility” and these laws date back to what England put on their books in the 1600s. If the parents can’t or won’t pay, then to the extent adult children have the ability to pay, these states’ laws say they must.
Between 1965 and 2005, medicaid essentially covered nursing home care costs for the elderly, few questions asked. But the Deficit Reduction act of 2005 changed the parental asset transfer lookback to 5 years, now parents entering a facility are required to prove they haven’t made any asset transfers to children in that time so the nursing home can collect state medicaid and the state can get reimbursed by the federal government. All children have to be accounted for and sign paperwork. Any asset transfers reduce medicaid funding dollar for dollar.
As a result, nursing homes have been dusting off these old statutes and using them against patients’ children when there are unpaid balances to collect. The statutes pre-date the Constitution, and although they have been ruled constitutional despite attacks on several grounds, one notable ground that has not been used to attack them is the constitutional prohibition against acts of attainder. The notion would be that our Constitution stopped people from being prevented from inheriting from individuals who are out of favor with the government; it’s perhaps a stronger case to say that the government shouldn’t allow money to be taken from the descendants of a parent who has done nothing wrong.
In many ways the statutes seem surprising and unfair. You have no control over who your parents are and little control over where they decide to live. Unlike a divorce situation, you didn’t voluntarily enter into any relationship with them, and unlike your children you didn’t choose to bring them into the world. But in most cases, your parents will have supported you for eighteen years or more, and from that viewpoint there is an argument in favor of the nursing homes.
Even if the statutes are enforceable, you may not even have sufficient minimum contacts with a distant state for the courts there to have jurisdiction over you. The Supreme Court has said the Constitution requires that you reasonably expect to be in court in a state or it’s unconstitutional to take you there–but if you default on a distant lawsuit and there’s a judgment rendered it’s presumptively valid. You have it on your credit report and you will have to fight it if they try to bring it to the state where you live. An important caveat: if you set foot in the other state at any time, you could be served with papers and you would be able to be sued there, regardless of your otherwise-minimal contacts with the state.
These statutes present a painful Catch-22: If you don’t have the money to pay, you could be relieved of liability by showing up in court and fighting the situation, but you may not have the money to fight.
Pennsylvania has been the most aggressive state, but the statutes have also recently been enforced in South Dakota. Pennsylvania’s code says half your disposable income is accessible to the nursing home. If you don’t pay, you could spend 6 months in jail for contempt of court. 27 Pa. CSA s. 4603. Laws vary in the 28 other states.
The laws can also produce a nightmare scenario: a favored sibling could take mom’s money within the 5 year lookback, spend it all and then you would be on the hook for her care-the laws look for a deep pocket, not who might be at fault.
If Pennsylvania medical providers remain successful in using the statute other states will probably reenact their filial responsibility statutes. But even if that doesn’t happen, when parents go in the nursing home children are often asked to obligate themselves (if the place isn’t a run down establishment), regardless of whether there’s a filial responsibility statute.
A dozen or so states including Florida have state-administered insurance program to help families plan for nursing home care and another twenty are looking at them. Florida’s program allows you to shelter a dollar of assets by buying a dollar’s worth of coverage.
If you have aging parents, it’s vital that you and your siblings begin to think now about what you may be facing in the future. Planning can make all the difference.