A program that recovers about $3 million a year from the estates of people who have died in one of Pennsylvania’s six state-owned nursing homes for veterans and their spouses could soon be in for some changes.
The Department of Military and Veterans Affairs’ “estate recovery program” has been an unwelcome surprise for some family members who were not aware of the state’s policy until their relative’s estate was settled.
The agency is vowing to improve its communications with residents and their family members, while some state lawmakers are pushing for closer scrutiny and considering legislative changes.
Unlike many other similar facilities, Pennsylvania’s veterans’ homes charge fees to residents based largely on income, not on assets. They then seek to recoup the full cost of care, if possible, after a resident dies.
Officials who oversee the veterans’ homes said at a recent state Senate hearing that they intended to improve their notification procedures in response to the complaints, but defended their practices as legal, fair and sensitive to residents and their families.
Karen Cline said she was surprised to receive a letter in February from a lawyer informing her that her uncle, Merle Rowe’s, stay at the Hollidaysburg Veterans Home in Blair County generated an unpaid bill of more than $300,000 by the time he died at age 88 in November 2009. The bill was more than the value of the World War II Army Air Corps veteran’s estate.
“They cleaned out everything,” said Cline, of Apollo, Armstrong County. “I know his cremation was paid for, but I still have his ashes to bury and I still have a stone to get. I would at least like to see that much come back.”
She was a beneficiary in the will, but knew he had concerns about his estate and believes the current system is broken.
“We had no idea this was happening,” Cline said. “There’s got to be a way to protect the veterans and their families from these money grabbers.”
Brig. Gen. Michael Gould, who as director of veterans affairs has ultimate authority over the homes, said that during the past five years the agency identified more than 3,000 estate claims worth about $330 million. It collected just $17 million, and in about half the cases, the state recovered less than $100.
“I suspect that many families wish that the law were different and that they could keep their relative’s money instead of having it go to the veterans home to pay for a part – usually a very small part – of the total cost of care,” Gould said.
The homes – the others are in Philadelphia, Spring City, Scranton, Pittsburgh and Erie – provide nursing services
and personal care for about 1,600 veterans and their spouses. Their $172 million annual budget includes $141 million in state and federal funding.
After a resident dies, the state calculates the cost of services that have been provided, subtracts whatever the resident has paid out and goes after the estate for the difference.
In the recent past, that claim has averaged about $100,000, according to the state.
“There is the problem with the communications; they truly don’t understand,” said Kit Watson, who as department adjutant of the Pennsylvania American Legion has heard complaints about the estate recovery practices. “I guess they figured Uncle Charlie or Dad or Mom’s assets someday are going to be theirs, and they didn’t have everything figured into it.”
Watson said all of the agency’s policies do not appear to be specifically outlined in state law or uniformly applied.
Gould said the state provides incoming residents and their legal representatives with a clearly written notification of their financial obligations, including the potential for a claim against their estate.
“Saying the department ‘seizes assets’ gives the mistaken impression we just take the property. This is not correct,” Gould said. “We do not seize assets; we do collect verified estate claims using a systematic process that involves notice to the families and the opportunity to participate or object to the collection.”
Joan Nissley, the agency’s press secretary, acknowledged that the disclosure might easily be overlooked within the stack of paperwork that changes hands when a new resident is admitted. The fact that some do make payments while they are living may add to the confusion later, she said.
“They see that they’re paying this much each month, and they’re saying, ‘Oh, we’ve already paid,’ ” Nissley said.
“They think they’ve paid, but in essence they have not paid, really, the full amount.