Magazine article Developments in Mental Health Law

State and Local Reimbursement Rules Revamped

Magazine article Developments in Mental Health Law

State and Local Reimbursement Rules Revamped

Article excerpt

How much should the family of a mentally ill or mentally retarded recipient of state or local services be required to contribute to the high cost of providing those services? What family members should be responsible? Should the reimbursement practices of local providers follow the example of state hospitals?

The 1982 General Assembly sought to answer such questions by passing 1982 Va. Laws ch. 50, and in doing so they raised some new issues.

As amended, Sections 37.1-105 and 37.1-110, seem to require the following.

1) The patient is fully liable for the cost of his treatment in a state facility. Other previously enacted statutes, such as Sections 37.1-112 and 37.1-116, continue to give the state and the courts discretion to waive enforcement of this liability to avoid a hardship. Another statute, Section 37.1-117 limits the liability of the estate of a deceased patient to the cost of five years of state care or training.

2) The guardian or trustee of a patient with an income or estate is also fully liable for the cost of the patient's treatment. The fiduciary is directed by the new amendment to Section 37.1-105 to "apply such income and estate towards the expenses of the patient's care and treatment or training." This language might override the discretion given to a trustee in a "spendthrift" trust, i.e., a trust designed to allow a parent to leave to a mentally disabled child wealth which would not be subject to reimbursement claims and would not disqualify the child from welfare benefits. To the extent that this new law renders doubtful the effectiveness of such trusts, parents will be more inclined to disinherit their mentally disabled children.

3) Certain family members generally responsible for the patient's support under Section 20-61 (the state nonsupport law) are liable for the cost of the patient's treatment, but their liability can be limited to a total of 1,826 days of state and community treatment, if a payment or agreement to pay (not, apparently, necessarily by the family member) for 1,826 days of treatment had been made. The family members subject to Section 20-61 and thus entitled to this limitation on their liability are the spouse and the parents, unless the patient is a child receiving state or federal disability benefits.

4) Adult children continue to be liable for the cost of their parents' treatment at a state facility under Section 37. …

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