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I don't think you need to bother with bankruptcy. If she's on Medicaid, the NH gets the bulk of the check minus the minor amount each state allows patient to keep. In MN, my MIL is on Medicaid in a NH and has dementia. Her ss is auto deposited into her account every month, and the NH automatically withdraws their payment from her account every month. Only $90 left. No creditors are going to touch it. Govt gets first dibs. She even walked away from her home, which was underwater on the 2nd mortgage. The bank never even bothered her when we told them she had dementia and no money. Just make sure your name isn't on any of the obligations and don't sign anything.
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igloo572 Oct 2019
Geaton, totally with you on not doing bankruptcy. Imo for your mom to basically walk on her debt was the best way to deal with the financial situation once LTC NH Medicaid is a factor for how their monthly income must be spent.

but if you don’t mind me asking, I have a ? for you...... so your mom walked or defaulted on her mortgage, right? I’m assuming this was done last year or perhaps 2017 & on a traditional long term type of mortgage- not a Reverse Mortgage, HELOC or HECM. Did your mom do this (the default) in 2018 (or 2017) tax year & did she get a IRS 1099-C issued to her / her SS# for 2018 (or 2017)for the mortgage balance & whatever fees?
The 1099-c would have been mailed by end of January of the incoming year to her for prior years tax filing. The 1099-C $ amount is taxable income...... so did mom file taxes (usually it’s a 1040 & 982 duo filed) to get the 1099-C zeroed out? Or was not tax filing done & if so did / has IRS sent any letters out regarding mom owing taxes on the 1099-c mortgage write off?
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The nursing home should start taking the social security check immediately if they have been made her rep payee. As far as debt, she won’t be able to pay her debts anymore.
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What kind of debt and are they in mom's name only? If medical debt by speaking with their billing department explain she is now un a nursing home and on Medicaid. They will write (forgive) the debt off knowing they will not get anything from her. If credit card debt, cancel her card and inform company she has no assets, in nursing home and receiving Medicaid. They are aware that they have no recourse or way to collect from her. Under NO CIRCUMSTANCES ever agree to make a payment to them for her or send one into the company written off of your account, this may make you liable for their debt. Same for any loans. Some may attempt to strong arm you into paying debt nicely but firmly tell them you are not financially responsible for your parent's debt and they have no assets. They are not able to garnish social security no matter what they threaten you with. If I'm not mistaken the only entities that can garnish ssi payments are for back income taxes, student loans, back owed child support and alimony. No private debtors are able to do so. Check with your local legal aid to see if one of their lawyers will write a to whom it may concern letter if companies begin to contact you for payment. Another option is to file bankruptcy for her. That way it should put an end to all of it. Not like she's going to be purchasing a new car or home anytime in the near future.
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I am mom's POA and I am on her bank account with her(that her social security is deposited into)
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igloo572 Oct 2019
Holly, once mom applies for LTC NH Medicaid, she is required to basically have her monthly income be paid to the NH each month. All she gets to keep is a smallish PNA - personal needs allowance- that averages $50 or $60 for most states. PNA is kinda enough for on-site beauty shoppe & some toiletries replacement. Any other debt she has either she defaults on or you or other family pays. Unless that CC debt is also in your name, your not responsible.

if she has a funeral / burial preneed or term life insurance that still have premiums due, you may want to pay these otherwise they will become defaulted & cancel.

the NH will likely heavily imply that mom either makes them her representative payee for her SS or that the monthly copay is paid via direct deposit. You do NOT have to do this unless you want to. As a signatory & dpoa you can write the NH a check each month to the penny of what her required copay is to the NH. Just make sure it gets paid by whenever it is due, every time.

I did it this way for my mom & it really made it beyond easier as I moved my mom from NH #1 to eons better NH#2 within her first year in LTC. Had NH1 been rep payee that would have beyond difficult as they foot-dragged to get billing correct or properly report payment compliance to Medicaid. If you possibly could move her to another place, I’d really suggest that you keep control over her finances. Also by doing this it allows for her PNA to build up & allow for a bigger “spend” when need be. I live in another state & sometimes it would be 3 months between trips in. I could do a bigger clothing & fresh toiletries buy as I had 3 months of PNA $. You can open a separate needs account at the NH & set up a twice a mo beauty shoppe schedule for her & put enough $ in it for like 3-4 months if you want to.
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The NH got all of my mom’s SS when she was on Medicaid. I’d forget the old debts, your mom certainly has no ability to pay them at this point, and unless you signed on them you have no obligation to pay
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Hollyjoy Oct 2019
I'm her POA and executrix of the will so that's why I'm wondering. I also have to adjust running our household without her money to help.
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The person in the business office at the NH told me to spend down my mom's money and not pay any bills, so I spent most of what mom had on a burial/funeral plan as instructed. That person then left the NH and bills started coming to me from the NH for thousands of dollars. The executive director called to ask why I wasn't paying them and I told her that I'd been told not to. She was not happy about it, but has since written off over half of it as bad debt. I am concerned however that it's going to come up again as I'm trying to get my mom moved to a different facility.
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mstrbill Oct 2019
I don't understand, Medicaid should be paying the NH.
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Holly, see my answer to emanes below. As POA you need to talk to the Medicaid caseworker directly, not the NH. I had Moms on speed dial. Is she still Medicaid Pending? While my Mom was still Medicaid pending, her SS checks were still being deposited to her checking account. This grew substantially over the months while they worked on her case. The NH bills & some medical bills kept coming, but the caseworker told me NOT to pay anything and forward all the bills to her that I wanted Medicaid to pay. When she finally was approved they told me exactly how much arrears to pay the NH (out of her checking account) and how much she would owe monthly going forward. She was allowed to keep only $60 a month out of her SS and pension. So do not spend any of her money, as you’re probably going to need to pay the NH in arrears after her case is finally approved, at which point you’ll get paperwork telling you what to do and pay. But if you develop a relationship with the caseworker, none of this will be a surprise.

If the Old Debts are like credit card or such, they just don’t get paid, as Medicaid won’t pay them. Write on the bill that the person is in a NH and has no money. Unless you want to pay them off yourself for some reason.
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Emanes, if mom applied for LTC NH Medicaid, then to use a line from Cool Hand Luke “what we (you) got here is a failure to communicate”.... the billing person at the NH was telling you that your mom had a too too much $ in assets for the max (usually 2k) allowed for Medicaid & as such whatever in ASSETS over 2k needed to be spent down, BUT her monthly income needed to be paid to the NH as the Medicaid required copay or SOC (share of cost). Almost always while they are in the Medicaid Pending stage, the resident does the copay from day 1 of when Medicaid application filed. Somehow, this NH either didn’t make your mom do this, or, the bills/statements sent to mom or you as DPOA were not understood by you both that they needed to be paid. Realize that if she didn’t do the required copay, then she’s out of compliance for Medicaid eligibility & can be either suspended or determined ineligible. You don’t want to have that happen, really find out please just what your mom needs to pay the NH to be at zero for her copays due. The situation that RocketJKat described is pretty spot on for my experience as to what staff at the NH tells you as for what Medicaid income rules are. The copay required is indicated in the Medicaid application as well.

Yes, LTC medicaid pays her daily room&board
BUT
Medicaid requires her to do a copay of her monthly income - like SS- to the NH each month. Whatever her income is, whether it’s $900 or $1900. My understanding is ONLY if there is a community spouse or dependent (like with tax filing as dependent, usually would be a long term handicapped child) family member can the required copay be waived. Adult family member that lives in moms home or is moms DPOA can’t get her income waived & paid to them

The “bills for thousands of $” from NH are whatever her monthly income was for those months plus any late charges or other delinquency fees. So if say mom gets SS of $1200 a mo, then Copay is $1200 less her states PNA (personal needs allowance, which averages $60), so like $1140 each mo she needed to pay NH as Medicaid copay or SOC; & pay it each & every month she is in the NH.

That NH actually wrote it off is beyond amazing. I’m surprised they did & haven’t instead filed to become your moms representative payee (so the NH gets moms Ss or whatever monthly income sent to them as direct deposit) &/or turned the past due over to debt collections (to go after you as DpOA).
If it was “written off” as a bad debt, to do this for taxes, the NH will need to issue a IRS 1099-C Cancellation of Debt for 2019 taxes. Debt over $600 needs a 1099 filed if you plan of taking it off on taxes. 1099-C forms are filed with IRS & are taxable income that your mom will owe IRS. IRS can attach a portion of her SS $ to pay her tax bill. Stuff like this morphs out of control. Please please Really try to find out exactly where your mom stands in her bill owed to the NH and being in total compliance for Medicaid rules & fix / pay whatever to get her there, only after that truly fixed think about moving her to a new place.
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Takincare Oct 2019
Unless nursing home told her they're "writing" it off as bad debt due to Medicaid pending, knowing they would not be getting full cost of living expenses, only what medicaid covers for their facility. I agree she needs to speak to case worker, not facility.
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I know you are up to your eyes in paperwork for mom but have you taken account of your living conditions and expenses? Go talk to senior services to see if they can assist you with a rent controlled apartment for seniors, or help you find more affordable housing. They can help you find programs and services you qualify for. It may take some of the financial strain off of you.
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Takincare Oct 2019
Sorry, was responding to different post and my phone decided it preferred this one.🤷‍♀️
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