Why Does the Assisted Living Facility Want Me to Be the Responsible Party?

Often, when an elderly person is moving into an assisted-living facility, nursing home, or continuing-care community it is after the elderly person has experienced cognitive decline and may no longer have the mental capacity to make financial or medical decisions on their own.

In situations like these, someone the elder trusts will be their power of attorney and sign the contract on behalf of the resident. What this means is that the power of attorney agent will have access to the elder’s funds to be able to make payments for him or her. However, they could, instead, sign as a guarantor if they do not tread carefully. 

Basically, a guarantor is someone who will be held personally responsible for paying the resident’s bills if they were to run out of money. An inability or failure to pay could lead to the facility calling a collections agency on the guarantor, which could really hurt the person’s credit. What’s more—they could even try to evict the resident from the facility if bills are not paid.

To see that this does not happen, it’s best to sign the parent’s name to the contract as the responsible party, and put the name of the power of attorney agent after it, followed by the date. Simply put, facilities want the children to be the responsible party to make sure they get their money. However, by signing the parent’s name as the responsible party, this frees up the adult child from being responsible for making the payments out of their own pocket.

As always, make sure to thoroughly read through the contract before signing anything. Make sure you understand fully what is expected and have someone else along who can look through the contract as well. That way, you can be sure to make the best possible decision that will both benefit your loved one and keep you from having to be responsible for any unpaid bills or monthly payments. if you have any questions, please contact an elder law attorney.