Losing a parent is one of the most challenging things to experience in life. When an older adult was the recipient of medical care, this adds another challenge into the mix. This difficult time should be all about grieving your loss and arranging a funeral. However, for many, you also need to consider who’s responsible for these medical bills.
Jump ahead to these sections:
- What Survivors are Held Responsible?
- What Medical Bills May Need Attention
- What Happens If You Can’t Afford to Pay If You’re Liable?
Long-term care is especially expensive. Whether your parents were in a nursing home, hospice, or other care facility, these costs can be extreme. No matter your financial situation, this places a burden on families.
How do you know who’s responsible for paying, especially if money is already tight? In this guide, we’ll answer the question of who is responsible for your parent’s medical bills so you know your options.
What Survivors are Held Responsible?
If medical debt still exists at the time of death, it falls primarily on the estate. That means the executor of the estate, usually an adult child or partner of the deceased, will use the estate to pay these bills.
If the deceased person’s total debt exceeds the value of the assets in the estate, this is an insolvent estate. This means the deceased person left insufficient assets and cash to pay for all of his or her debt.
First, liquid cash and other assets go towards the payment of these medical bills. Payments are prioritized based on federal and state laws that say which creditors the estate is required to pay first. Other creditors will only get a partial payment or no payment.
In most states, medical debts take precedence over other types of debt. For things like credit card debt after a death, the estate pays these last. In most cases, children and other relatives are not responsible for paying these debts.
As mentioned, this responsibility falls on the estate. When the estate closes, the deceased person’s debts are typically wiped out if they haven’t been paid. However, there are some instances where you might be required to pay for these medical bills.
When you may be liable to pay
Cosigner: If the debt wasn’t only taken in the deceased’s name, the other cosigner might be required to pay. If you cosigned with your parents for any expense, this now is your responsibility.
Marital debts: In some states, called community property states, debts incurred by one spouse during marriage are equally owned. This would lead one spouse to be on the hook for the other’s medical expenses. However, talk to an attorney to determine whether this is true of your location and your debt.
Medicaid: Medicaid is an insurance program for those who don’t afford medical care through an employer or other means. In many states, Medicaid seeks payment even after death. Some states have an expanded definition of “estate” that includes assets that don’t pass through probate, such as joint accounts, paid on death accounts, and assets that pass directly to a beneficiary such as life insurance and retirement accounts.
In that case, Medicaid may go after the joint owner or beneficiary for payment from that asset. Medicaid cannot seek repayment from the joint owner or beneficiary’s own funds that are separate from the asset received from the deceased person. Medicaid can also file a claim against the estate of the spouse of the deceased person, but cannot seek repayment from the spouse during his or her lifetime.
Filial responsibility: Many states have filial responsibility statutes. This means adult children might be required to pay for unpaid medical debts if they are not covered by the estate. These laws are typically utilized by nursing homes and long-term facilities. Again, speak with an attorney for specific recommendations.
What Medical Bills May Need Attention
Let’s take a closer look at the specific types of care and treatment to determine when you might need to pay closer attention. Again, these regulations and laws vary by state. When in doubt, talk to an attorney. They can look at your specific situation and local laws.
Nursing home, hospice, and long-term care
Nursing homes are tricky. Long-term care facilities like hospice outside of a hospital or nursing homes are sometimes under the filial responsibility statutes. These laws say adults children are responsible for financially helping parents who are not able to afford care on their own. These laws stem from centuries ago when elderly poverty was a widespread issue.
Today, these laws feel out of place, and with good reason. A few states have taken steps to repeal or limit these laws in recent years. The good news is these laws are rarely enforced. For the states where filial responsibility is still on the books, it is unlikely that a care facility would pursue these cases. For a nursing home or facility to force adult children to pay these expenses, it would have to prove the resident is unable to pay. This is a challenge, and bills are not able to pass to families who do not have financial means to pay.
Most states do not have modern examples of these laws in action. In most cases, you don’t have to worry about it. However, when in doubt, consult with an attorney.
General practitioner and specialists
The family is not required to pay for any care under a general practitioner and specialist healthcare provider. These bills first go to health insurance, if applicable. For the elderly, these costs are usually covered under Medicare or another government insurance program.
If the full cost isn’t covered under insurance, the bill goes to the estate. Since medical bills typically take priority, the executor pays these bills first. If the estate doesn’t have the funds, that’s usually the end of the matter.
Similarly, prescription drug bills are the responsibility of health insurance and the estate. If neither of these is enough, the matter will not go any further. The family is not responsible for these expenses.
What Happens If You Can’t Afford to Pay If You’re Liable?
In the few cases where you are liable to pay for your parent’s medical bills after death, you have options. Most medical debts are not passed on to family members. However, if you are facing a debt collector, you have some options. But, these might not work for every situation.
If you’re unable to pay, seek out the counsel of an estate attorney, financial planner, or another professional for personalized advice for your circumstances.
Call the insurance companies
The insurance company is your first line of defense. These companies usually handle medical bills first. Contacting the insurance company is a good first step if your loved one has unpaid medical expenses.
Explain the situation to the insurance provider. They might negotiate with the healthcare facility to get a lower rate, or they might cover a higher percentage of the cost. Many insurance companies have guidelines they follow for these situations.
Just about any healthcare bill is negotiable. Talking to the healthcare provider or long-term care facility might prove fruitful. They might be willing to lessen the overall bill or even forgive the fees altogether. Even if the bill falls on the estate, the provider might negotiate a lower settlement.
Dealing with a debt collector
Debt collectors are legally allowed to discuss the deceased person’s debt with the executor. However, if you’re not the executor or the spouse or guardian, this is not allowed. Otherwise, collectors might contact you in order to get the name of the deceased person’s executor.
Debt collectors are not legally allowed to ask you to pay for the debt yourself. To exercise your right to stop contact, send a letter to the collector saying you no longer want them to reach you. You should receive confirmation that he or she will cease contact. If they continue to contact you, you can file a complaint with the Federal Trade Commission (FTC).
Handling Your Parent’s Medical Bills
If your parents passed away with debt, don’t fret. This is often a complicated process, but you’re not in this alone. Lean on relatives, friends, and professionals in your time of need. While it might feel like the weight of the world is on your shoulders, you have legal and financial rights.
In most cases, only the estate is responsible for your parents’ medical bills after they’ve died. In very rare instances will you need to cover these expenses yourself. If you’re the executor of your parents’ estate, it is up to you to pay these medical expenses with funds from your parents’ liquid cash and assets.
However, no funds need to come from your own pocket. Since this is a complex process, don’t hesitate to speak to a financial or legal professional to ensure you’re taking the right steps.
Disclaimer: The information posted on this site is provided solely for informational and educational purposes and is not legal advice or tax advice. Contact an appropriate professional licensed in your jurisdiction for advice specific to your legal or tax situation.
- “Debts and Deceased Relatives.” Federal Trade Commission: Consumer Information. Consumer.FTC.gov.
- Hoover, Susan JD. “Filial Support Laws: ‘A Sleeping Giant’.” CFA Institute: Enterprising Investor. Blogs.cfainstitute.org.
- “Paying for Care.” National Institute on Aging. NIA.NIH.gov.
- “Questions and Answers on Medicaid Estate Recovery for Long-Term Care Under OBRA ‘93.” AARP: Resource Center. September 1996. AARP.org.