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Little-known law allows nursing homes to sue adult children for unpaid bills

With the legislative wing at the state Capitol in Bismarck as a backdrop, siblings Joe Shook, Margaret Rennecke and Becky Pederson hold a photograph of their father, Durant "Phil" Shook, who passed away at the nursing home Augusta Place in Bismarck on Jan. 31, 2017. The siblings want the legislators to change North Dakota's filial statute after the nursing home billed them more than $43,000 after their father's death. Mike McCleary / Bismarck Tribune

BISMARCK—Less than six months after Durant "Phil" Shook died, his four children got a letter in the mail: A nursing home was suing them for more than $43,000 in unpaid bills relating to their father's seven-month stay in the facility.

Shook's daughter, Becky Pedersen, was shocked.

"(I was) scared, because I have young kids I'm providing for," said the 38-year-old Bismarck woman.

She and her other siblings, Margaret Rennecke, 47, and Joseph Shook, 48, didn't know about their father's overdue bills, nor did they think they would be responsible for them after his death.

"It might as well be $500,000, because it's just not something that we had a chance to prepare for," Pedersen said.

Phil Shook's children are among a handful of other adult children in North Dakota involved in litigation over their parents' unpaid nursing home bills. These lawsuits cite the state's "filial support" law, an often overlooked statute that requires children to support their indigent parents.

The statute was adopted in 1877, a decade before North Dakota became a state. Filial statutes are modeled after England's Elizabethan Poor Laws of 1601. At least two dozen states have these laws on the books.

The statute may soon be updated in North Dakota. Two state lawmakers say they are considering modifying or possibly repealing the statute this upcoming session.

"How do we protect, essentially, children from being responsible for potentially hundreds of thousands of dollars in bills they had no say in?" said Sen. Erin Oban, D-Bismarck.

Only one circumstance

Phil Shook was admitted into Augusta Place, a nonprofit facility owned by the Evangelical Lutheran Good Samaritan Society in Bismarck, on June 27, 2016, after falling gravely ill.

His children said he was on a ventilator in the ICU for a few days before but he was too sick and weak to return home. He stayed in the nursing home until he died on Jan. 31, 2017.

The nursing home filed a lawsuit against Phil Shook's wife, Suzanne Shook, and their children in June 2017. According to the complaint, Suzanne Shook retained ownership and control over his assets prior to his death, and she and the children retain possession and control over all real and personal property previously owned by him after his death.

In court documents, the nursing home's attorney Justin Hagel wrote that "numerous attempts to reasonably resolve" the more than $43,000 balance for care and services provided to Phil Shook "have been wholly unsuccessful." The nursing home contends that Phil Shook's children have "a duty to support" their father under North Dakota's filial statute.

Becky Pedersen, Margaret Rennecke and Joseph Shook said none of them knew the nursing home was not being compensated and considered their mother to be the one handling the home's monthly payments.

"We had no choice as far as what was occurring with his care at all," said Becky Pedersen, adding that, if she and her siblings knew that their father needed financial support, they would have helped.

The children also were not involved in assisting their father in applying for medical assistance through Medicaid and said they received no assets from their father before or after his death other than assorted family keepsakes.

Shelly Peterson, executive director of the North Dakota Long Term Care Association, said nursing homes use the filial statute to go after adult children in only one circumstance: When parents transfer income or assets to their children, and then the parents don't qualify for Medicaid. The Medicaid application includes a five-year look-back period, in which all asset transfers are reviewed.

Nursing facilities are "legally obligated" under Medicaid to pursue every avenue possible to collect that debt, including suing, before they can get reimbursed from the state Department of Human Services for debt that cannot be recovered, according to Peterson.

The filial statute helps long-term care facilities remain financially viable, said Peterson, adding that facilities statewide are "averaging a negative bottom line" and referencing a facility in Westhope that closed several years ago due to non-payment and bad debt.

Petersen said she has never heard of a case in which a nursing home has sued a child who never received an asset from the parents. She said, within the past decade, she's only aware of a few cases in which the facilities have used the statute.

However, Hagel, the attorney representing Augusta Place in the Phil Shook lawsuit, has had at least three other cases, two of which are currently open, that involve the filial support law. Hagel did not respond to an email request for comment.

Peterson said she's not surprised to hear of the recent cases, given that long-term care facilities have "significant" issues with non-payment. She reiterated that nursing homes would never sue "any child and hold them responsible or accountable if they did not receive that asset."

Advocacy

Becky Pedersen, Margaret Rennecke and Joseph Shook said the issue is bigger than their case.

The siblings voiced concern that other children could become entangled in similar lawsuits, and they would like the Legislature to review the filial statute next session.

"If we can help other people from this happening to them in the future, we'd want to do everything that we can," Margaret Rennecke said.

Their case is scheduled to go to trial on Sept. 11-13.

Another woman who is being pursued for her late mother's unpaid bills also wants the state's filial support law to be changed.

Linda Katsoulis's mother died on Feb. 15. About a month after her mother's death, she started getting about a half dozen bills in the mail, including a $4,000 bill from her mother's nursing home, Augusta Place, where she lived for about three years. With each bill, she sent back copies of her mother's death certificate. All of the bills were written off, except for the one from the nursing home.

She was surprised when she called a local attorney and discovered that the nursing home could sue her for her mother's bill. In March, Katsoulis became ill and retired from her job due to her health. Currently, she's on Medicare and a fixed income with her Social Security, so paying for her mother's bill is not possible for her.

"This (statute) is just not right for families that are struggling," said Katsoulis. "We should not be responsible for other people's bills, and that's including our parents."

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