Nursing Home’s Lawsuit Against Spouse of Resident Not Prohibited by Laws Limiting Third-Party Liability

Reversing a lower court, an Ohio appeals court holds that a nursing home’s lawsuit against the spouse of a resident who signed a promissory note agreeing to pay his wife’s unpaid balance does not violate federal and state law prohibitions against third-party liability because the payment agreement was not related to his wife’s admission to the nursing home. Laurels of Huber Hts. v. Taylor (Ohio Ct. App., 2nd Dist., No. 29223, April 29, 2022).

Nursing home resident Helena Taylor owed the facility approximately $43,000. After the nursing home threatened to sue, Ms. Taylor’s husband, Johnny Taylor, executed a promissory note, promising to pay the nursing home the amount due in monthly installments. Mr. Taylor did not make all of the payments.

After Ms. Taylor died, the nursing home sued Mr. Taylor for breach of contract. Mr. Taylor argued that he could not be held personally liable for Ms. Taylor’s nursing home costs under federal and state law. The trial court granted Mr. Taylor summary judgment, ruling that the installment plan was designed to impose personal liability on Mr. Taylor. The nursing home appealed.

The Ohio Court of Appeals, Second District, reverses, holding that because the payment agreement that Mr. Taylor signed was not related to Ms. Taylor’s admission agreement, the federal and state laws preventing third-party liability to a nursing home do not apply. According to the court, Mr. Taylor agreed to the pay the nursing home in exchange for the nursing home not pursuing collection activities. The court finds that “the authorities relied upon by [Mr.] Taylor did not provide an all-encompassing prohibition against a skilled nursing facility’s contracting with a third party to accept liability on a patient’s bill.”

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