A recent article in Forbes pointing out the potential problems that many adult children face as their parents transition into an assisted living or nursing home environment. About 30 states have what are known as “filial responsibility” laws. These laws require adult children to pay for an elderly parent’s nursing home bills if that parents is unable to do so.
Though the laws differ significantly in their details, about 20 of them allow nursing home and extended care facilities to file lawsuits against adult children for unpaid bills their parents have incurred. In other states, children who do not pay for an elderly parents care face criminal charges such as fines and even jail time.
While these laws have not been used or enforced with much frequency, some estate planning experts believe that more and more extended care facilities may use filial responsibility laws as more people have a harder time paying for nursing home expenses.
Preventing filial responsibility laws from impacting adult child’s finances can often be done through one of two main options. First, an elderly person can obtain long-term care insurance to pay for nursing home costs should the need arise. Second, elderly people can also develop a Medicaid plan that allows them to become eligible for Medicaid, the joint federal and state program that pays for much of the nursing home expenses in the country. Both options have their benefits and drawbacks, so you should speak to your estate planning attorney before you choose either one of them.