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State Pays $16 Million in Nursing Home Lawsuit

The Washington Post published a story yesterday on the latest development in a large class-action nursing home lawsuit out of Maryland. On Wednesday the state began paying $16 million to various nursing homes and their residents as part of a settlement from a nursing home lawsuit filed in 2005.

The lawsuit involved the improper methods that the state used to gauge the ability of nursing home residents to pay for their own care without government assistance. According to the lawsuit, state officials erroneously inflated the income of certain nursing home residents. The state consequently used that inflation to refuse to provide supplemental financial support to offset the cost of their medical care at nursing homes.

Specifically, both state law and federal law required the state to consider the debt that a resident accrues while awaiting approval for Medicaid coverage as part of the calculation into their ability to pay for their own care without government support. Yet, officials did not factor this adverse financial burden into assessing resident finances. As a result of their mistake, many nursing home residents were left in severe financial straits-needing nursing home care but unable to pay for all of those services without some assistance from state welfare agencies.

In total almost 12,000 current and former residents were affected by the violation of nursing home law. The settlement will attempt to provide relief to those victimized by the legal wrong. Besides that basic fair compensation the resolution of the case also shone a light on the problem, ensuring that from now on the state will make changes to its calculation of funding. In that way, future nursing home residents are spared the stress and heartache of trying to survive while being denied legally obligated medical funds.

As this case demonstrates, and as our Chicago nursing home lawyers at Levin & Perconti have learned, lawsuits can serve an important social function. Besides attempting to correct a wrong to a particular resident, these lawsuits often serve as wake-up calls to extremely negligent conduct. In that way, future harm is prevented and the system of care is improved for all.