Nursing homes under scrutiny after warnings of seized stimulus checks

Nursing homes are coming under more scrutiny during the coronavirus pandemic, this time for complaints about efforts to confiscate coronavirus stimulus checks.

Lawmakers on both sides of the aisle are calling on the Trump administration to ensure nursing homes and assisted living facilities aren’t improperly seizing the checks from residents following alerts from the Federal Trade Commission (FTC) and state attorneys general.

State and federal authorities have recently notified the public about complaints of long-term care facilities demanding residents on Medicaid turn over their relief payments. Those alerts prompted prominent lawmakers to lean on various federal agencies, urging them to investigate the issue and make it clear to facilities that they aren’t entitled to the checks.

“These economic impact payments were not designed to reimburse people,” Rep. Gwen Moore (D-Wis.) told The Hill. “And we have provisions that protect the elderly.”

Moore, a member of the House Ways and Means Committee, authored one of several letters to federal agencies on the nursing home issue this week. In her letter, she urged the Treasury Inspector General for Tax Administration to exercise its oversight authority to protect residents of nursing homes and assisted living facilities.

State attorneys general say they’ve gotten complaints about nursing homes and assisted living facilities attempting to take residents’ payments.

The FTC in May issued alerts saying nursing homes and assisted living facilities can’t seize residents’ checks just because they are on Medicaid. Agency officials said they had heard about the issue from the Iowa attorney general’s office and other states.

“The main message is that the money belongs to the resident,” Lois Greisman, associate director for marketing practices at the FTC, told The Hill. “That’s the word we wanted to get out loud and clear.”

Lynn Hicks, a spokesman for the Iowa attorney general’s office, said the FTC alert referred to a complaint about a long-term care facility that had told residents they should not spend their stimulus checks until the Iowa Department of Human Services makes determinations about the amount of income residents have to pay to the facility. The owner of the facility subsequently sent another letter to residents saying they could keep their payments.

The Iowa attorney general’s office and other state attorneys general have also been warning their residents about attempts from nursing homes to take people’s payments, particularly after the FTC issued its message.

“If you or a relative are a Medicaid recipient living in a nursing home or assisted living center and you qualify for a CARES Act payment, be wary of attempts to take CARES Act payments using the Medicaid system as a guise,” Missouri Attorney General Eric Schmitt (R) said in a statement last month. The alert from Schmitt’s office said the office had received several complaints concerning this issue.

“We have heard some Oregon nursing homes may have taken or are attempting to take stimulus checks from residents who are Medicaid recipients. This needs to stop,” said Oregon Attorney General Ellen Rosenblum (D). “These stimulus checks are the property of the residents and must be returned.”

Concerns about facilities’ efforts to seize residents’ payments have prompted lawmakers in recent days to urge several federal agencies to take actions to help protect residents.

House Ways and Means Committee Chairman Richard Neal (D-Mass.) and House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.) on Monday sent a letter to Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verna, urging CMS to “issue guidance to nursing homes and residents on the status of these checks and their independence from residents’ Medicaid status.”

The lawmakers also asked CMS to provide information about what actions to take to ensure nursing homes don’t seize people’s payments and return any payments that may have already been taken.

Neal and Pallone said they have had reports of representative payees of Social Security and supplemental security income recipients — people who manage benefits for recipients that are incapable of doing so themselves — being confused about whether the relief payments should be given to long-term care facilities that demand payment.

Verna replied to Neal and Pallone on Twitter, saying CMS requirements prohibit nursing homes from seizing the coronavirus checks of residents on Medicaid.

“Nursing homes engaging in this behavior will be subject to enforcement action,” she said.

One day after the House committee chairmen sent their letter, Senate Finance Committee Chairman Chuck Grassley (R-Iowa) and ranking member Sen. Ron Wyden (D-Ore.) urged the inspector general for the Department of Health and Human Services to “look into these practices targeting elderly Americans and individuals with disabilities and issue alerts to raise awareness that this practice is improper and contrary to congressional intent.”

The direct payments are a key part of the record $2.2 trillion coronavirus relief package President Trump signed into law on March 27. Under the CARES Act, most Americans are entitled to a one-time payment of up to $1,200 per adult and $500 per child. The Treasury Department said last week that it has distributed about 159 million payments so far.

The legislation that established the direct payments prevents the checks from being reduced due to unpaid taxes or other debts owed to federal and state government agencies. Lawmakers say any seizures on the part of nursing homes go against the spirit of the law.

Additionally, the checks are advance payments of refundable tax credits. Under federal law, advance payments of refundable credits are not considered income for purposes of determining eligibility for which amount of assistance from programs such as Medicaid and are not considered resources for eligibility and assistance amount purposes for a period of 12 months after they are received.

It’s unclear how many nursing homes have tried to take the residents’ checks.

The American Health Care Association and National Center for Assisted Living said in a statement they “are not aware of widespread issues with resident stimulus funds” and that “stimulus checks are handled in the same manner as other resident benefit payments.”

The groups have sent a question-and-answer document to their members that specifies that the checks don’t immediately impact Medicaid eligibility.

Hicks said his office is also concerned in general about the rights of nursing home residents during the coronavirus pandemic.

Even if complaints about nursing homes seizing coronavirus relief payments aren’t highly common, policymakers and advocates for seniors want to make sure that confiscations don’t happen at all. They note that residents of long-term care facilities make up a significant portion of coronavirus cases and deaths in the U.S.

At least 32,000 residents of nursing homes have died due to COVID-19, according to CMS.

Advocates said they appreciate the efforts of lawmakers and federal agencies in wanting to protect seniors from having their relief payments confiscated.

“We welcome their attention to this issue so that facilities are not taking the stimulus checks of nursing home residents,” said Rhonda Richards, senior legislative representative at the AARP.