Should I notify creditors that parents have moved to a NH and cannot pay outstanding debt? - AgingCare.com

Should I notify creditors that parents have moved to a NH and cannot pay outstanding debt?

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The Elder Law Attorney I am working with advised me to have parents' mail forwarded to my home so that I don't miss any important docs (I live in a different state). I do not want to get all of the notices that will be sent for deliquent payments due. They will be on Medicaid. Should I send a letter to each explaining the situation? Thank you for your responses.

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Careful with the non-answering "unknown caller" and such - a lot of medical and hospital calls come in that way. And you can always stack up and recycle the collections notices if they come to you; if they go to the nursing home, and parents see them, it can really stress them out - that's exactly what the language in them intends to do. My mom once packed her bags and wheeled out front to wait for the van to take her from her nice assisted living to the charity nursing home (actually - one was a pretty good place with a long wait list where she was!) because it was a bill from a hospital she had never used before for several thousand dollars that they had not managed to submit to insurance yet and her assisted living had gotten into the record as her home address. I think your lawyer has the right idea. Ask specifically about any trouble with the tax write-offs to make sure - but chances are their total income is so low and medical expenses so high they will not owe any taxes. They should still file, and you want to use a tax person in their state of residence who knows the ropes, maybe even go with a bigger company in case you have to have them part in one state part in another for a year.

Funny story - sort of sick-funny if you think about it too hard - my mom used to buy Omaha Steaks stuff everything from the high fat meat cuts to the gooey desserts, diabetes and clogged arteries be damned. And she added me to their mailing list on several occasions, and they'd figure out I would not be buying a darn thing from them after a few months of ignoring their "Special Offer!" sales flyers. Well, I got catalogs in Mom's name for about two years - at first I was nice enough to send one or two back marked "deceased" - after all I guess they had every reason to know they'd helped kill off one of their better customers, right? - but that didn't stop them. So I made a little ritual of hand-shredding them for the recycling bin and thinking good thoughts about their money they were wasting by sending them all the time. And not totally wasted - the US Post office can always use the business, I guess. That smarmy, flattering advertising was just the kind of crap my parents fell for - complimenting their good taste and appreciating the finer things in life and all that rot and it was pretty satisfying for as long as it went on. But it finally stopped. And I got some things from my dad's old fraternity too - they got a donation or two and I found out he is considered a member of the "Chapter Eternal" and won't be forgotten.

Its a bittersweet business taking care of all that stuff, it really is - and it sounds lame, but when I did have to call someone, they almost always said, "first, I am sorry for your loss" and it was a heartfelt kindness to hear that a few times more.
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Igloo makes a good point about switching to a post office box instead of using a street address.

Collectors are aggressive, without mercy, and skirt the edges of legality, especially if the debts are assigned to offshore collection agencies with staff that don't have knowledge of US laws.

I'm not aware of any that hassled people in person but I wouldn't put it past them.

I would also gradually review the Fair Debt Collections Practices Act so you're aware of what's allowed and what's not, although the remedies available to harassed individuals are nominal.

https://www.ftc.gov/enforcement/rules/rulemaking-regulatory-reform-proceedings/fair-debt-collection-practices-act-text

Section 806 addresses abuses, and if the debt collectors crawl out of their holes in the woodwork, there's a good chance some of these abuses will occur if they try to recover any funds from you or your parents.

https://www.ftc.gov/enforcement/rules/rulemaking-regulatory-reform-proceedings/fair-debt-collection-practices-act-text#806

Scroll down a bit farther and familiarize yourself with Sec. 809(b). It's a very important one to protect people from harassment, and in my experience it's one debt collectors ignore.

I recently had to get aggressive with an outfit that was harassing my father for an alleged debt which had already been addressed under the FDCPA. Despite the no liability letter I sent, someone hired a second agency a few years later and started pestering Dad.

WindyRidge's warnings should be taken not as potential actions, but likely actions, so protect yourself.

I also wouldn't answer the phone if you get any "unknown caller", "name not found", or toll free calls (I assume you have caller ID). Let them go to voice mail; if they don't leave a message. use Google to search the number. Sometimes you can back trace it to a collection agency.

I would also keep a running list of any contacts from them as I can almost guarantee that the restrictions on calling will be violated.

And don't tell them where your parents are!! Big NO NO as they'll harass your parents.

Good luck.
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Runner - I would suggest that instead of having mail sent to your home address, that you instead rent a mail box and have all go to that address. The box you rent with your name and your parents names on it also. UPS stores have boxes. But what may be better is to get one at a independent package & ship type of store - usually these are nearby colleges and universities. Why you ask…….well they are more likely to give you a call when something comes in. Also this way all things "parent" is a one central location so you go once a week and get mail and have it all together to review and deal with.

Do a generic letter to all creditors that as of XYZ date all correspondence is to go to them at the new address; mailing all USPO certified return registered mail to the new address too. basic certified RRR is about $ 7.00 a letter and really invaluable to have if debt collectors start getting ugly. It also shows you are doing your fiduciary duty as their DPOA.

It actually can be critically important to know if they are having debt written off. What the original creditor will likely do once they finally realize that the debt will not be repaid, is to write it off. This amount can get a 1099-C Cancellation of Debt and is taxable income. The 1099-C does not have to be done in the year last payment made either and can include the amount plus interest and fees. Really truly the amount on a 1099-C is fully taxable income and if not paid or dealt via a IRS form 982 can be a huge issue for their Medicaid compliance. Keep in mind that the OC will sell the debt to collections and they will be relentless in trying to get paid. Only the OC can do the 1099-C.

They are on Medicaid, so all their income is going to the NH except the smallish amount that is their personal needs trust account $. How is this being handled? Are their monthly checks all going to NH so NH trust account builds each month? OR are you writing a check for their required co-pay (their SOC share of cost) to the NH each month for your parents and so their personal needs allowance is building each month in their bank account? Whichever the case you need to make sure that it does NOT build to go over the maximum asset limit for Medicaid. For individual Medicaid it's 2K. I'm not sure what it is for a married couple.

Ask the elder law if the state does an annual renewal and what the compliance will be like. For my mom in TX, the annual renewal was a multi page form and required the last 3 months of bank statements and a lot of the same items (funeral policy and it's details; life insurance info, etc) that were submitted in the original Medicaid application. All due within 14 days of mailing for even more fun….. So if your parents state does this, keep a binder going so you can easily get this done.
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Just to lend a bit of lightness to this discussion, my mother has been dead for a little over 13 years but my father still receives solicitations addressed to my mother. They're primarily from charities, some from aggressive politicians. Sometimes they're a lot worse than banks that issue credit cards.
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When my mother in law was admitted to the nursing home, we followed the same steps as Eyerishlass. We did the mail forward to our address. Once she passed some places we had to send the death certificate. Others we were just able to call and other we just wrote on the mailing deceased and returned to sender. I forgot the website (found on this website) but we put her name on that list as well to slow down some of the soliciting mail she use to receive. Utility companies we just had to apologize and let them know we had no funds to pay final bill. It was no lie. I think we are down to getting one piece of mail a week for her now.
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I had the exact same situation. When my dad went into a nursing home I had all of his mail forwarded to me. He had a few credit card balances and no money. I called his creditors to explain the situation to them. They didn't try to make me responsible (I wasn't on any of his credit cards) but since I called them from my cell they had my number and began calling me. I had to tell each of them to not call my number anymore and I told them all once more that my dad was in a nursing home and had no money.

Once my dad passed away I called them all to inform them. One of them requested a copy of the death certificate, the rest of them just said that they'd notate the account. It took a month or so for the calls and statements to stop but they did and I never heard another word from any of them.
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You are not responsible for their debts. Do the mail forwarding. That's very important. I would ask the attorney what you're asking here.
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The collection guys may try to come after you. These are the lowest of the scum who get a percentage of what they collect on behalf of banks, credit card companies and so on. Don't give them any info about yourself and don't agree to pay any of your parents bills from your own assets. Hang up the phone and turn over any nasty letters to your attorney and he can nasty them right back.
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Are you on any of the credit cards?
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There is no estate that can pay creditors. Parents have no savings at all. There is no power of attorney.
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