Regulation Nightmares! CFPB on the Hunt for Unlawful nursing home debt collection.

Regulation Nightmares!

CFPB on the Hunt for Unlawful nursing home debt collection

The Consumer Financial Protection Bureau is a financial office whose primary attention is channeled towards older Americans protecting their finances and enabling them to make sound decisions on matters regarding their capital as far as age is concerned. CFPB aims to address and safeguard older citizens from risk emerging from consumer protection and ensure consistent and effective enactment.

CFPB worked toward protecting older citizens and conducted a survey that put together the challenges nursing home residents and caregivers encounter, which in turn cause financial harm to consumers. A part of CFPB’s results was on home debt collection practices that home expert nurses carry out, lawful aid, and elderly law attorneys.

Collecting debt unlawfully affects family members and friends. There are over 40 million people who take care of older pals catering to their health and functional needs. Nearly one person in every six is responsible for an aged relative or a friend. In as much as the National Home Reformation Act does not allow non-residents to add personal responsibility for the resident’s care cost, it has become a common issue as a result passed by some nursing homes. Consequently, such nursing homes have severe forms of punishment for friends and relatives with arrears. For instance, they can either sue such people in court, hire debt firms to collect payments, or worse, report debt to a firm that deals with credit reports so that their credit score is altered negatively. The rules are based on the “responsible act,” signed by the person assisting the resident with the admission process. Some of the negative results of the act are that it can lead to bankruptcy and foreclosure on homes of people responsible for older relatives in nursing homes.

NURSING HOME CARE IS EXPENSIVE, WHICH IS CHALLENGING AMONG AMERICANS

The high cost of a nursing home will probably lead older people who need aid to run into debt. In most cases, the average price of a nursing home is slightly above $100,000, which has been so from 2004 to 2020. The costs are expected to rise further by 60% or 19% if the prices stabilize for inflation.

Due to demographic changes, people will likely need nursing home care in larger groups by the

year 2060. Especially people above 65 years require being in nursing homes for at most one year and a few months, which could extend up to two years. Statistics state that women, blacks, and lower-income people are more likely to have over two years of nursing home care.

Third-party family members taking care of their friends at a nursing home are sometimes in awkward positions where they have to choose between taking care of their family and ruining their financial life. Affected relatives raised the alarm about the issue, which led the Department of Health and Human Services Centers for Medicare to write letters to nursing homes urging them to follow the law.

RESPONSIBLE PARTY CLAUSES

NHRA has a law prohibiting nursing homes from asking third parties to take responsibility for people in nursing homes, but the practice continues. It is incredibly vivid when family members are invited to sign numerous contracts, which in one or another make them responsible for their older relatives. Such prohibitions apply to both residents and future residents irrespective of whether or not they qualify for Medicare and Some of the observations that CFPB found out were that some admission contracts make the third-party responsible for nursing home residents. These contracts may appeal to nonresident relatives since they are emotionally attached to their older family members. They may also appear to be internally contradicting where nursing homes in later stages include provisions that seem to make the third party personally responsible.

CFPB also found out that some nursing homes forcefully make third parties responsible for their older folks that do not submit a time and accurate application for Medicare. When residents do not make timely payments, non-resident friends and relatives are forcefully made to pay and, if not, threatened and harassed.

There are instances where such nursing homes sue the third party, especially those not well aware of the terms and conditions of the contract. Some non-resident friends and family who probably cannot afford a lawyer to represent them in court are wrongly judged, leading to foreclosures on their homes and bankruptcy.

CONCLUSION

Nursing homes are critical to older Americans, and the number of people needing such care is increasing yearly. However, costs of nursing homes are expensive since there is limited coverage which causes older people to deplete all their savings and accumulate debts.

Although NHRA, on the other hand, prohibits nursing homes from charging third parties for their relatives. However, the act continues by making the non-resident member sign numerous contracts during admission. Although the CFPB is against charging non-residents, there is a probability that unlawful debt collection practices may continue, especially in nursing homes.