Nursing Home Charges and Collection Practices in the Spotlight
This past week the Associated Press (AP) reported on a recent publication from the Consumer Financial Protection Bureau (CFPB) that highlights coercive and potentially illegal debt collection tactics by nursing homes, debt collection companies, and law firms.
The CFPB report outlines how even though the Nursing Home Reform Act (NHRA) "prohibit[s] nursing homes that participate in Medicaid or Medicare from requesting or requiring that a non-resident personally guarantee the cost of nursing home care as a condition of admission, expedited admission, or continued stay in the facility", in practice many nursing homes are attempting to do just that -- hold loved ones and caretakers responsible for the bills of those staying in the nursing home. These nursing homes are attempting to do this via so-called "admission agreements" or other contract language that purportedly makes relatives or caregivers financially responsible for the admitted person's bills; these "agreements" are often buried in a mountain of paperwork that relatives or caretakers are required to sign at the time of admission into a nursing facility. In addition to not being able to understand or have the proper time to consult an attorney on the language in these "agreements", the CFPB report also mentions that frequently nursing home staff offer misleading or outright contradictory explanations to the documents that relatives and caregivers are signing, so they might have no idea what the potential ramifications of these documents are, and they certainly have no idea that they could be unenforceable as directly contradictory to the NHRA. The AP report cites consumer protection attorney Anna Anderson of New York who calls this a "deeply troubling practice" but sadly also "routine."
The CFPB goes on to state that the NHRA "prohibition applies to all residents and prospective residents of a nursing facility, regardless of whether they are eligible for Medicare or Medicaid", and notes to the CFPB report indicate that 94% of all nursing homes are covered under the NHRA as a result of receiving Medicare or Medicaid funding. This means that the NHRA prohibition against requiring a non-resident to personally guarantee the cost of nursing home care as a condition or admission or stay in the facility should apply to the vast majority of the population.
The AP cites the CFPB report in indicating that attempted "collection of debts from [admission agreement] contracts may violate the consumer financial protection laws, including the Fair Debt Collection Practices Act [(FDCPA)] and its prohibition on false, deceptive, or misleading representations connected to debt collection." For relatives and caregivers, this is incredibly important to know, because this could mean that they are not only not responsible for the costs of care at the nursing home facility, the attempt to try to hold them financially responsible for that cost of care could also be actionable against the debt collector. In other words, they could sue the debt collector for trying to sue them, and under the FDCPA, the relatives and caregivers could be entitled to a financial award and to have their court and attorney fees paid by the debt collector.
In sum, the AP and CFPB reports highlight important rights and questionable tactics in the area of nursing home charges and collection practices. If you find yourself in a similar situation, don't hesitate to reach out to an attorney to learn more about your rights and potential recourse against the debt collector.