Everything you need to know about nursing home resident trust funds

A nursing home resident trust fund is an optional account with the resident’s money. This account is managed by the nursing home on behalf of the resident and is used for expenditures.

It is important to note that this trust account is optional. Money can still be managed separately from the nursing home. An incoming resident is not required to set up a resident trust fund with a nursing home.

Suppose the nursing home manages the money of the resident. In that case, all necessary information must be carefully reviewed to ensure the nursing home correctly manages the cash according to federal and state laws.

Keep reading to learn more from a Chicago nursing home abuse lawyer.

nursing home resident trust fund

USA TODAY Investigation: Five tips to protect money in nursing home trust funds

A USA TODAY investigation has determined that there have been instances where money kept in nursing home trust accounts has been improperly managed. In some of these cases, money was accessed by unauthorized persons. In others, actual money was stolen from these supposedly secure accounts.

To better protect assets in a nursing home resident trust account, below are a few important suggestions on how to make sure that the money is being properly managed:

  1. Watch quarterly statements: All nursing home residents keeping money in a trust fund maintained by the facility should get quarterly statements. Read them and watch for unexpected or unexplained charges.
  2. Ask how funds are managed: Find out if the nursing home audits resident trust funds. If so, ask how often and whether the audits are available to patients, their families, or guardians.
  3. Check the nursing home’s record: See if state or federal regulators have cited the facility for thefts or mismanaging resident trust funds. “Deficiencies” can include failing to provide account statements, not paying interest, or not insuring the funds.
  4. Ask the resident to check all expenditures listed on the trust fund statements. Make sure they can access money whenever needed.
  5. Check for interest: Residents’ funds should be held in interest-bearing accounts. Check quarterly statements to be sure interest is being paid.

What are the legal obligations of nursing homes for managing resident trust funds?

The Illinois Nursing Home Care Act governs the operations of nursing homes (including assisted living and memory care facilities) in the state. Section 2-201 (5) of this Act requires facilities that elect to accept and manage residents’ funds to purchase a surety bond as a guarantee.

Nursing home residents’ trust fund rights

The Illinois Long-Term Care Ombudsman Program establishes rights for residents of nursing homes and assisted living facilities. It is responsible for enforcing violations of patients’ rights and investigating complaints about nursing home abuse and neglect.

These rights include:

  • The right to manage their own money
  • The right to refuse to let the facility manage their money
  • The right to refuse the facility from being their Social Security payee
  • The right to demand a current itemized written statement if the facility manages its money
  • The right to see their financial record at any time

If the facility manages money for residents receiving Medicaid, it must provide an itemized written statement every three months. Resident funds must be placed in an interest-bearing bank account if there is more than $50 (more than $100 if Medicaid isn’t the payer).

You can dispute any charge assessed on your nursing home resident trust fund. Contact a nursing home abuse lawyer if the facility refuses or delays responding to your request.

How to report mismanagement of a nursing home trust fund

Mismanagement of a resident’s nursing home trust fund may be a form of nursing home neglect. Regarding resident trust funds, nursing homes must comply with state regulations.

The Long-Term Care Ombudsman Office is responsible for ensuring compliance. It also investigates complaints of abuse and neglect in Illinois long-term care facilities.

If you suspect someone is taking advantage of your loved one or your nursing home trust fund is being mishandled, report the complaint to the Long Term Care Ombudsman Office.

Obligations of nursing homes to insure resident funds against loss

Nursing home resident trust fund regulations include insuring resident trust funds against loss by taking out a Surety Bond or another assurance satisfactory to the Departments of Public Health and Insurance. That agency is named as the obligee of the bond. For the facility to legally be permitted to manage a resident’s funds, the resident must be made aware of their rights and sign a written authorization form.

Impact of Medicaid and other government benefits on nursing home trust funds

The threshold for income and assets to be eligible for Medicaid is quite low. Many nursing home residents may have a Medicaid Asset Protection Trust (MAPT), which protects their Medicaid eligibility while preserving the assets for them to use or pass along to heirs.

The MAPT is different from the nursing home trust fund. Maintaining the nursing home trust fund, the integrity of the MAPT, and Medicaid eligibility may take the services of a savvy financial planner.

Legal help for nursing home residents who are victims of trust fund mismanagement

If you or your loved one is a victim of trust fund mismanagement by a nursing home or one of its employees, contact Horwitz, Horwitz & Associates today at (800) 985-1819 for a free consultation.

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