What Happens to Unpaid Nursing Home Bills After Death?
Have unpaid nursing home bills after a loved one dies? Learn how debt is handled through probate, when you might be responsible, and how to protect your assets.
Key Takeaways
When a nursing home resident dies, their unpaid bills generally become the responsibility of their estate — not their family. The executor or court-appointed administrator pays debts like nursing home bills from estate assets during probate. If there isn’t enough in the estate, the debt often goes unpaid. Family members are not personally liable unless they co-signed for care or live in a community property state. Some states may enforce filial responsibility laws, but these are rarely used.
If the deceased received Medicaid to cover long-term care, states may try to recover costs through the Medicaid Estate Recovery Program (MERP). However, exemptions apply, such as when a surviving spouse or minor child lives in the home. Facilities may also charge post-death room fees or removal costs until belongings are cleared.
To protect loved ones, individuals can use tools like final expense insurance, irrevocable trusts, and advanced estate planning. The Fair Debt Collection Practices Act also protects families from aggressive collection tactics.
What Happens to Unpaid Nursing Home Bills After Death?
When a loved one passes away, the remaining family members have a significant mental, emotional, and financial toll to carry. The last thing a family needs after a death is any unpaid nursing home and medical bills. These bills can quickly pile up, especially if the nursing home in question includes additional care like hospice care, memory care, and full-time nursing support.
If you are in a nursing home or planning your end-of-life expenses, and are worried about what happens to any of your bills after you pass, use this guide to distinguish between debt your family will be legally responsible for paying, and debt they don’t have to worry about. With this information, your family will have more time to grieve instead of worrying about finances.
Are Family Members Responsible for Nursing Home Debt?
The answer to this question can depend on several factors, but the short answer is no, families don’t have to worry about paying nursing home debt. Instead, your estate will typically pay off this debt. There are only a couple of circumstances when loved ones would have to pay for unpaid nursing home debt, including:
- A surviving family member co-signed for resident care, making them responsible.
- Surviving loved ones inherited assets within the estate, including outstanding debts.
- If the state seeks reimbursement for any nursing home costs that Medicaid covered.
Beyond these exceptions, nursing homes will seek compensation for any unpaid bills from any remaining assets in the estate plan, including savings accounts, real estate, or other property left over. The federal government protects some assets from these creditors, such as the primary residence of any surviving loved ones, household furniture, and retirement accounts like 401(k)s.
Some states will have additional protections, so if you’re concerned about creditors taking specific assets, research your state’s stance on asset protection.
Filial Responsibility Laws
Filial responsibility laws can also dictate whether your family will pay off any remaining nursing home debt. These laws were initially created in the Colonial era of the U.S., and dictate that, in some cases, the children of deceased individuals will be financially responsible for their parents’ deaths. That said, many nursing homes and other organizations rarely practice this law, and only do so if you have no means to pay off the bills, Medicaid and other types of insurance don’t cover the care, and the child can pay. Still, the law exists in over two dozen states, including:
- California
- Alaska
- Nevada
- North Dakota
- South Dakota
- Oklahoma
- Arkansas
- Louisiana
- Georgia
- Mississippi
- Tennessee
- North Carolina
- Virginia
- Kentucky
- West Virginia
- Maryland
- District of Columbia
- Indiana
- Ohio
- Pennsylvania
- Massachusetts
- New Jersey
- Connecticut
- Rhode Island
- Vermont
- New Hampshire
- Delaware
Even if you live in any of these states, the Fair Debt Collection Practices Act (FDCPA) also protects your family. If creditors practice any harmful or abusive debt collection acts to obtain any unpaid nursing home bills, your family can pursue legal action.
How Probate Handles Nursing Home Debt
When someone passes away, their assets don’t just magically get distributed. Instead, they often get handled through probate. Probate is the legal process where a person’s estate gets settled after their death. During the process, an executor, whom the will appoints, or a court-ordered estate administrator, will gather the deceased’s assets, pay off any legitimate debts, and then distribute what’s left according to the will. If there’s no will, they will handle the assets based on state law.
If you had unpaid nursing home bills, the facility can file a creditor claim during probate. This means they formally request repayment from the estate. As long as the estate has assets, the executor may be required to sell or liquidate those assets to pay off debts.
However, just because your nursing home files a claim doesn’t mean it must receive payment right away. Probate follows a specific priority order when it comes to repaying debts. Each state may differ in the order of payments prioritized in probate, but often it goes in the order of:
- Administrative expenses (like court fees and executor compensation)
- Funeral and burial costs
- Taxes owed to the government
- Secured debts (like mortgages or car loans tied to property)
- Unpaid medical expenses (including nursing home care)
- Unsecured debts (like credit cards or personal loans)
Because unsecured debts are at the bottom of this list, nursing home debt may only be paid off if the other higher-priority obligations are paid first. If the estate can’t pay, the nursing home debt becomes insolvent. In that case, creditors (including nursing homes) may receive only partial repayment or nothing at all.
Importantly, any leftover debt that the estate can’t pay will stay unpaid unless any surviving members of your family are legally responsible for the debt. For example, if your spouse is a co-signer or a joint account holder, they may be responsible for any debt associated with the estate, including nursing home bills.
Can Medicaid or the State Recover Nursing Home Costs?
If you are on a Medicaid Long Term Care plan, the state can seek to recover any costs Medicaid paid for long-term care, which includes nursing home care. This is also known as the Medicaid Estate Recovery Program (MERP), and will typically take place during probate, as a majority of U.S. states only reclaim probate assets listed in a will. In the remaining U.S. states, the state Medicaid program can also reclaim assets left over by the beneficiary’s spouse after they pass away.
However, the state doesn’t proceed through MERP in these exceptional circumstances:
- The beneficiary’s spouse is alive
- The statute of limitations has passed
- The beneficiary has a child under the age of 21 or is disabled
- Recovering assets will cause undue hardship to the surviving family
If the state has sent your family a notice after your passing about proceeding through MERP, they can sign a Hardship Waiver that claims that the process will cause undue hardship. Generally speaking, they can claim undue hardship in these circumstances:
- If MERP will cause your family or heir to seek financial state assistance
- If your heir currently receives state assistance, and your estate proceeds would cause them to no longer require assistance
- If your estate is their sole income
- If the estate is worth 50% or less of the average price of a home in the country
In addition, the definition of undue hardship will differ depending on the state, so it’s vital to research how your state defines it and whether your family will qualify.
Moving Out and Hidden Costs After Death
Even if your family is not financially responsible for any unpaid nursing home bills that existed while you were alive, they may be responsible for any charges that continue after your passing. This includes any monthly charges that accrue until they clear out your room. Some facilities allow a grace period of 24 to 72 hours, while others may extend a longer timeframe depending on the contract. However, if belongings remain past the allowed window, the facility may charge:
- Daily room rates
- Storage fees
- Packing or removal charges
In some cases, the facility may contract with a third-party removal service and pass the cost along to the estate or family. Because policies vary, review the original admission contract and any documents or notices provided after death. Look for sections that address move-out timelines, room clearance, and post-death billing practices. If you’re unsure, ask the facility for a written explanation of their move-out policy.
In addition, your family should take photos or videos of the room’s condition when they move items out to avoid any future disputes. This way, they have photographic evidence that they moved everything out in prime condition by a specific date.
How To Protect Your Family from Nursing Home Debt Surprises
Planning out the end of your life is stressful enough, let alone estimating what costs your family will have to handle after you pass. The best way to make the process as simple as possible is to include an end-of-life plan within your overall retirement plan. Doing so can save your family from any costly surprises that can compound on any grief they will experience from your passing.
Legal and Financial Planning Steps
One of the most effective ways to avoid confusion and debt disputes after death is to establish a solid estate plan. This includes:
- A will to guide the distribution of assets
- An advance directive to outline healthcare wishes
- A durable financial power of attorney (POA) to allow someone to manage finances if you are unable
These tools not only ensure your wishes are respected but also help reduce legal delays and financial confusion after you pass. If you’re unsure where to begin or have a complex family or financial situation, it’s wise to consult an attorney. These professionals specialize in the intersection of healthcare, aging, and estate planning, and they can help you take advantage of protections you may not know exist.
Look Into Final Expense Insurance
One of the best ways you can avoid sudden expenses related to your death is if your family is the beneficiary of final expense insurance. This type of insurance is a small life insurance policy designed to cover end-of-life costs such as funeral expenses, medical bills, and nursing home debt. It’s an affordable option for many families and can offer an essential financial cushion when other assets are tied up in probate or unavailable.
Avoiding Medicaid Estate Recovery
If you use Medicaid to cover long-term care, you’ll need legal tools to protect your assets after you pass from MERP. These tools include:
- Irrevocable trusts: These can transfer ownership of assets so the state does not count them as part of Medicaid eligibility or estate recovery
- Life estates: A way to transfer a home to an heir while retaining the right to live in it during their lifetime
- Medicaid-compliant annuities: Special financial products that convert excess assets into income, helping meet Medicaid eligibility while preserving value
These strategies often require early action—usually at least five years before applying for Medicaid—due to look-back periods. That’s why starting conversations about estate planning as a part of retirement planning sooner rather than later is one of the best ways to shield your family from unexpected debt.
End-of-life planning may be a dark conversation, but it’s imperative if you want your family to have a safety net after you pass. Making small actions now will pay off in the long run, and you can rest easy knowing your family is cared for and won’t have to worry about any of your expenses.
If you’re unsure of what other tools and planning you should do as part of your retirement plan, sign up for our newsletter! We cover retirement and end-of-life topics that can make this next stage in your life all the better for you and your family.
FAQs About Unpaid Nursing Home Bills
Nursing homes themselves cannot directly seize a home after a resident’s death. However, if the deceased received Medicaid benefits to pay for long-term care, the state may try to recover those costs through the Medicaid Estate Recovery Program (MERP). This process can involve placing a claim on the deceased person’s estate, including their home. That said, there are several protections in place. For example, if a surviving spouse, minor child, or disabled child still lives in the home, the state usually cannot force a sale. Estate recovery also doesn’t apply in every situation, so it’s worth speaking with an elder law attorney to understand your specific rights and options.
If you pass away without significant assets or an estate, most unpaid debts—including nursing home bills—go unpaid. The nursing home may try to file a claim, but if there are no assets available, there is usually nothing to collect. In most cases, children and other family members are not personally responsible for these debts unless they legally agreed to take them on, such as by co-signing a contract or serving as a guarantor.
The best way for your family to avoid personal liability is to avoid signing any paperwork that commits them financially. Some facilities may ask adult children to sign as a “responsible party,” which can lead to unintended financial obligations. If they do need to sign anything, they must make it clear they are signing only in a representative capacity, such as “Jane Doe, as Power of Attorney for John Doe.” It’s also wise to consult with a legal professional before signing long-term care agreements.
Legally, a nursing home cannot bill your family directly for your debts unless they co-signed the agreement or otherwise agreed to be financially responsible. However, some facilities may still try to send your family a bill or make informal collection attempts. If this happens, it’s essential to know your rights. Under the Fair Debt Collection Practices Act, your family has the right to request verification of the debt and to dispute any attempts to collect if they’re not legally responsible. Always review any demands carefully and seek legal guidance if you’re unsure of your obligations.
The Medicaid Estate Recovery Program, or MERP, is a federal requirement that allows states to seek reimbursement from the estates of deceased Medicaid recipients who received long-term care services. This program typically applies only to people over the age of 55 and only after their death. States can place a claim on assets like homes, vehicles, or bank accounts to recover the amount spent on nursing home care. However, there are limits and exceptions to protect surviving spouses, dependents, and individuals facing undue hardship. Planning in advance through trusts or other legal tools can sometimes help protect assets from recovery.
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