Nursing Homes Seize Patient Assets to Pay Debts
Every day, thousands of older Americans put their loved ones in nursing homes. The reasons for doing so are all very different, but the expectations are always the same. People place their loved ones in nursing homes expecting expert care and compassion. Over the last few years, there have been numerous complaints and reports about nursing homes filing for guardianship of their patients to secure their finances and pay nursing home debts.
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In one such case, Lillian Palermo, an insurance executive with a Ph.D. in psychology and a love of ballroom dancing, became incapacitated with dementia in her 80s. In 2010, she was placed in a Manhattan nursing home by her loving husband of fifty years and power of attorney went to Mr. Palermo. In the summer of 2015, Mr. Palermo disputed some nursing home bills that had suddenly doubled medicare copays. He also complained about negligent staff members who dropped Mrs. Palermo on the floor causing bruises and other injuries. Shortly after these incidents, Mr. Palermo found a seven page legal document in his wife’s room. It was a guardianship petition filed by the nursing home, asking the court for full legal power over Mrs. Palermo, now 90 years old, and complete control of her money.
Few people are aware that nursing homes can take such drastic steps, because guardianship cases are often sealed. At the request of the New York Times after numerous nursing home complaints, researchers at Hunter College uncovered thousands of such cases. This surprising practice underscores a growing power that nursing homes wield over residents and their families. According to Bogdan Martinovich, a Lake County nursing home abuse lawyer, “residents like Lillian Palermo who are incapacitated are extremely vulnerable, especially without family members around.”
In 700 reviewed cases, researchers found more than 12 percent were brought by nursing homes seeking guardianship as a way to seize a patient’s financial assets to pay their nursing home bills. The U.S. Legislature likely never intended the guardianship statute enacted in 1993 to be used for collecting a patient’s financial assets to pay debts.