Q. My wife and I are concerned that our adult children might be held financially responsible for our care in the event we run out of our own resources. Our children are good kids, but they have their own financial responsibilities, including putting their own kids through college. Can you shed any light on this?
A. Sure. This topic has generated some discussion in the news, prompted by a court case out of the State of Pennsylvania. In that case, a son was held liable for his mother’s unpaid nursing home bill of about $93,000, even when the mother had an application for Medicaid (which we call “Medi-Cal” in California) pending. The case sent shivers throughout the country, and elder law attorneys have expressed concern that this case could signal a new wave of claims by nursing homes and assisted-living facilities to recover unpaid bills.
For now, the good news is that the statutes in California seem to disfavor claims of this nature. While statutes are on the books which – on their face – would seem to permit children to be held responsible for the costs of their parents’ care, yet California carves out a huge exception to this potential liability: if the parent is an “applicant for” or “a recipient of ” Medi-Cal, SSI, or other public benefits, then no claim of any kind can be made against a parent or other relative to recover the cost of care. Welfare & Institutions Code § 12350. In short, the law in California appears very unlike that in Pennsylvania, which apparently did not include a similar exception.
Since a parent in need would most likely “apply” for some kind of public benefit and would thereby become an “applicant” and thus protected by the statute cited above, it would be an unlikely scenario where a child would have financial responsibility for his parent’s care. Indeed, I could not find any reported case decision in California which imposed such liability, absent egregious fact patterns involving extreme neglect of a parent amounting to elder abuse. Note that the statute refers to the parent being an “applicant” for public benefits, and does not seem to require that the parent actually “qualify” for same. Still, the law is developing in this area and specific fact patterns have yet to be adjudicated by courts.
For best protection, the best way to ensure that your children do not find themselves on the financial hook is to ensure that you and your wife have a plan in place to pay for your own long-term care. That plan might include setting aside sufficient assets to cover that cost, relying upon long-term care insurance (if you qualify and can afford it), or by making a timely application for a Medi-Cal subsidy when appropriate. In this regard, you may know from one of my recent articles that Medi-Cal has recently relaxed the resource caps, so that persons of more middle class means may now qualify for benefits: Under these recent changes, the “Ill Spouse” is now permitted to have up to $130,000 in savings or other resources, while the “At-Home Spouse” is allowed another $137,400 of his/her own savings and resources, for the new combined resource allowance of $267,400 for a married couple (in 2022).
Further, for those with even more savings or other countable resources, know that there are lawful strategies to accelerate Medi-Cal eligibility while still preserving assets, but these require strict compliance with Medi-Cal rules. In this regard, Medi-Cal planning is similar to tax planning in which the wealthy engage. However, these strategies should only be employed under the supervision of an elder law attorney with special expertise in Medi-Cal planning, or they could backfire. For example: gifts to children — if handled incorrectly — could actually prevent a parent from qualifying for a Medi-Cal long term care subsidy.
Reference note: : For the basic premise that an Adult Child can be held to be financially responsible to support a parent in need, see CA Family Code § 4400–4405. But the above cited Welfare and Institutions Code 12350 substantially undermines that legal authority by carving out a hug exemption.