In New York, debt collection activities are illegal against people who were eligible for Medicaid at the time they received services. It is the responsibility of the provider to determine whether a patient was eligible and to assist the patient with an application. Still, nursing homes and other providers may bill and attempt to collect against vulnerable low-income patients who should have been covered by Medicaid. Patients who are unaware of their rights may feel pressured to use their Social Security Income, which is exempt from debt collection, to pay these bills. The NSLS Senior Citizen Law Project and the Consumer Debt Legal Assistance Project help clients facing improper debt collection actions.
For example, a 75-year-old woman with low income contacted us after a nursing home facility sued her following an extended stay after a hospitalization. Our client was clearly eligible for Medicaid, but the nursing home had failed to assist her in filing an application. As a result, thousands of dollars in bills accumulated. Rose Caputo, staff attorney with our Senior Citizen Law Project approached the nursing home about a settlement. The nursing home refused to settle at first, even though our client did not have any assets or income that would be subject to collection.
At an initial conference, Caputo informed the court that the nursing home had failed to apply for Medicaid on her clients' behalf. Proceeding with the lawsuit would also be futile because our client was still living in a different nursing home. Even if she had non-exempt income, her new nursing home was entitled to virtually all of her income. As a result, going forward with this lawsuit would be futile. The judge agreed and asked the nursing home attorney whether litigation would make sense under the circumstances of this case. The nursing home attorneys agreed to discuss the matter with their client. The attorneys for the nursing home moved to dismiss the case with prejudice.