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Paying For Parents’ Care? Kids Gave At The Office

While helping our aging parents is a responsibility many of us take seriously, footing the entirety of the bill for their long-term care would generally be seen as going “above and beyond.”

Unless your parents live in a state like Pennsylvania, in which case it might just be “abiding by the law.”

A 2009 article published by AARP focused on little-known laws in such states that require adult children to support their indigent parents. It examined in detail the case of Elnora Thomas, a Florida woman whose mother racked up nearly $50,000 in bills at a Philadelphia nursing home. The nursing home sued the patient’s two daughters for the unpaid amount.

Though Thomas and her sister Peggy Crowder were eventually released from their legal responsibility after obtaining professional assistance, the case was not an isolated incident in Pennsylvania. Although such lawsuits are uncommon nationwide, Pennsylvania nursing homes have started using filial support laws “routinely,” according a column that appeared in The Wall Street Journal last year. Examples range from a daughter who won a dismissal due to her inability to pay to a high-profile case in which a three-judge Pennsylvania appellate panel ruled that the son of a patient could be held responsible for $93,000 in unpaid bills even in the absence of any fault on his part.

As many as 45 states had filial support laws at one time. Today 29 states have such laws on the books, and of those, only Pennsylvania and South Dakota have reported cases recently. The scope of the laws also varies from state to state. Rhode Island’s law only applies to parents who are indigent through “misfortune,” for example; in Connecticut, children are not legally obligated to support parents older than 65.

Many states repealed filial support laws after Medicaid took a greater role in providing relief to elderly patients without means. In those states where the laws remained, they were generally used to prosecute adults who defrauded or financially abused their parents. The difference in Pennsylvania has been that third parties, usually long-term care facilities and nursing homes, can sue their patients’ adult children directly, rather than doing so on their patients’ behalf. Such cases may become more common as long-term care costs rise and more patients face a gap between bills, Medicaid coverage and their ability to pay.

Baby boomers often call themselves the sandwich generation, stuck between paying for their kids’ educations and taking care of their aging parents. Partly in consequence, and partly just because of life-long habit, they generally are not savers. Many are woefully unprepared financially for their own retirement and old-age care.

Still, most will do what they can for their parents willingly, if not always cheerfully. The question is whether old-fashioned laws that make caring for parents a legal responsibility are still fair or relevant.

Katherine Pearson, a Penn State law professor who published a study last year about long-term care providers’ use of filial support laws, told ABC News in 2009: “I think that if you ask the average person if they have a moral obligation to help their parents, if they say no, it’s because of a longstanding history of reasons why.” Some laws do have exemptions for children who were abandoned or treated cruelly, though it is up to the courts to determine if those exceptions apply.

This is not the era, pre-Social Security and Medicaid, when most elderly people expected to live out their days under the roofs of, and cared for by, their own relatives. Those relatives were not always prepared to support their aging loved ones financially, which is part of the reason that it has been public policy for the last three-quarters of a century to make elderly citizens financially self-sustaining, albeit with help from the government. As the AARP article reported, Medicaid was specifically designed to shield middle-aged children from financial catastrophe caused by the declining health of their parents.

Further, today’s working-age citizens can truly say, “I gave at the office.” Social Security and Medicare taxes consume close to 15 percent of what employers pay most wage earners, and don’t provide those workers a nickel of benefit. The taxes paid by today’s workers support today’s retirees. The baby boomers’ children, many of whom are burdened with large education debts and who have potentially even longer-lived parents, may find it harder still to save for their own retirements.

There are a few factors that may serve as a check on third-party suits, at least in some measure. Harold Grodberg, an elder-law attorney based in New Jersey, suggested that a federal Medicaid statute that prohibits long-term care facilities from demanding relatives act as “guarantors” before accepting a patient might conflict with nursing homes’ attempts to collect from patients’ children. Further, nursing homes’ own interests dictate that they not become known for being overly litigious, lest such a reputation make new patients (and their children) reluctant to select the facility in question.

Marielle Hazen, an attorney in Pennsylvania, also noted that filial responsibility has traditionally been interpreted as continual monthly support, rather than a lump debt settlement, though this has not deterred Pennsylvania facilities from pursing large sums.

As a society, we have taken on the responsibility of collectively supporting elderly citizens. It is unfair and impractical to then expect individuals to pay such support twice: once to fulfill their collective responsibility and once to care for their own parents. Nor should we expect them to be willing or able to easily shoulder the legal fees to defend themselves against facilities making the attempt. Many children will choose to support their aging parents, regardless of what they’ve already paid in taxes, out of love, respect or duty; but a law that seeks to make them do so in the absence of these factors cannot be fairly applied in today’s world.

Pennsylvania’s law and others like it tell working-age adults: “Don’t bother saving for your own retirement or long-term care, because the people who care for your parents will only seek that money for their own benefit.” It’s not a message we really want to send.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book The High Achiever’s Guide To Wealth.

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One Response to "Paying For Parents’ Care? Kids Gave At The Office"

  • Alfie Schloss
    January 11, 2013 - 12:48 pm

    As a baby boomer and a member of the “sandwich” generation, I can understand how this is a big problem going forward. I personally am unable to obtain long term care insurance due to a medical situation that occurred a few years ago making me “uninsurable”.

    I found my own solution to this though. I am in the reverse mortgage industry and my solution is to set up a reverse mortgage line of credit when my wife and I turn 62 in two years. I will probably qualify for a $250,000 line of credit and since it has guaranteed growth, I expect that it will grow to at least $750,000 by the time I’m 82. This should give my wife and children a great deal of flexibility in being able to pay for my care should I need it at that time or later. It is not taxable and it will be there regardless of what happens to home prices. I have no intention of being in a nursing home on Medicaid. I want to remain independent for as long as I am able to and stay in my home.

    Yes, it will mean that my estate will likely not get much from my house when I die, but I will not be a financial burden on my family either. If I don’t need to use the funds there will be very little cost to my estate to have had it be available.

    I am finding that many families are coming to the realization that taking care of a family member at home is far healthier and less costly than a nursing home.