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Lawmakers move to stop nursing homes from taking residents' stimulus checks

Nursing homes seek legal shield amid pandemic
Some nursing homes are seeking immunity from pandemic lawsuits 03:54

Some nursing homes have demanded that low-income residents turn over their $1,200 economic stimulus checks — a cash grab lawmakers want to halt.

Senators Chuck Grassley (R-Iowa) and Ron Wyden (D-Oregon) on Tuesday called on the Health and Human Services Department's inspector general's office to warn nursing homes and assisted living facilities that such practices are "improper and unlawful."

In the House, Democratic Representatives Richard Neal of Massachusetts and Frank Pallone of New Jersey asked the federal Centers for Medicare and Medicaid Services to spell out to nursing homes that the relief money from Congress is not considered income that facilities can legally claim.

Low-income Medicaid recipients must not be "coerced into wrongly handing over their checks for fear of being kicked out of their homes," wrote Neal and Pallone. Any funds taken must be returned and not held to defray residents' expenses.

Some nursing homes were claiming that if a resident was on Medicaid, the facility would get to keep the $1,200 stimulus payment.

Generally, a Medicaid recipient's taxable income is taken into account in determining their eligibility for the program. Taxable income can be taken by a nursing home, according to congressional staff, while the resident can keep a small amount as a personal allowance.

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However, lawmakers said Congress structured the payments as a tax credit, not as taxable income. They were passed as part of an economic package to provide a lifeline as the pandemic shut down much of the nation's business activity.

Nationally, over 35,500 people have died from coronavirus outbreaks at nursing homes and long-term care facilities, about a third of the overall U.S. fatality toll, according to a running tally by the Associated Press.

The Federal Trade Commission last month flagged some nursing homes' attempts to take residents' payments, saying the office had received reports of such incidents from Iowa and other states. Oregon's attorney general has issued a "scam alert," calling the practice unlawful.

The nursing home industry says if there's a problem, it's not that common. "We are not aware of widespread issues with resident stimulus funds," the American Health Care Association said in a statement.

On this issue, the Trump administration appears to agree with lawmakers. CMS chief Seema Verma tweeted on Tuesday that "nursing homes engaging in this behavior will be subject to enforcement action."

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