Protecting the Funds of Nursing Home Residents

Many nursing home residents’ funds are managed by a third party – often called a “responsible third party” or a “responsible payor” – because the resident in many cases lacks the cognitive ability to manage their own financial affairs. Commonly, this responsible third party is the resident’s child, grandchild, or other family member. This arrangement can expose residents to abuse and exploitation, as some responsible third parties improperly divert or steal residents’ funds that are needed to pay for the resident’s long-term care.

As a result, when a responsible third party misappropriates a resident’s funds, a nursing home is left to either discharge the resident, provide charitable care to the resident, or take legal action against the resident. Each of these decisions has an unfair impact on the resident and the nursing home, as neither was at fault.

SB 270, which I authored and sponsored, prevents this kind of financial abuse by allowing nursing homes to: (1) pursue debts against a third party who has improperly diverted a resident’s funds; and (2) seek injunctive relief from a court to stop a responsible third party from continuing to misappropriate a nursing home resident’s funds. Closing this loophole will protect aging Texans from financial abuse and exploitation.