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Manahawkin Convalescent v. Frances O'neill

May 31, 2012

MANAHAWKIN CONVALESCENT, PLAINTIFF,
v.
FRANCES O'NEILL, DEFENDANT, AND FRANCES O'NEILL IN HER CAPACITY AS EXECUTRIX OF THE ESTATE OF ELISE HOPKINS, THIRD-PARTY PLAINTIFF-APPELLANT,
v.
BROADWAY HEALTH CARE MANAGEMENT, LLC; M&A/COMPREHENSIVE HEALTH CARE MANAGEMENT SYSTEMS, LLC; M.R. OF MANAHAWKIN, LLC; AND H.W. OF MANAHAWKIN, LLC D/B/A MANAHAWKIN CONVALESCENT CENTER, THIRD-PARTY DEFENDANTS-RESPONDENTS.



On appeal from the Superior Court of New Jersey, Law Division, Ocean County, Docket No. L-2523-09.

The opinion of the court was delivered by: Maven, J.S.C.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued March 27, 2012

Before Judges Baxter, Maven and Carchman.

The opinion of the court was delivered by MAVEN, J.S.C. (temporarily assigned).

Third-party plaintiff Frances O'Neill (plaintiff), in her capacity as Executrix of the Estate of Elise Hopkins,*fn1 appeals from the September 2, 2011 order granting summary judgment in favor of third-party defendants Manahawkin Convalescent Center, Broadway Health Care Management, LLC, M&A/Comprehensive Health Care Management Systems, LLC, M.R. of Manahawkin, LLC, and H.W. of Manahawkin, LLC d/b/a Manahawkin Convalescent Center (collectively defendant); denying summary judgment of her claims against defendant; and dismissing her amended counterclaim and amended third-party complaint, with prejudice. We affirm.

I.

The issues presented in this case are whether the Rehabilitation and Nursing Home Admission Agreement (Admission Agreement) required to be signed prior to plaintiff's mother, Elise Hopkins' (Ms. Hopkins) admission to Manahawkin Convalescent Center (Manahawkin) violated the Nursing Home Act (NHA), N.J.S.A. 30:13-1 to -17, the Truth-in-Consumer Contract, Warranty and Notice Act (TCCWNA), N.J.S.A. 56:12-14 to -18, and the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -20.

The facts that give rise to this dispute are not complicated. In February 2007, plaintiff's mother, who suffered from Alzheimer's disease, became a patient at Manahawkin, a nursing home. Prior to her admission, plaintiff signed an Admission Agreement designating herself as the "Responsible Party"*fn2 and assigning the direct payment of her mother's Medicaid*fn3 benefits to Manahawkin for services rendered. Plaintiff did not agree to be the private pay guarantor for her mother's expenses and declined to have her mother's social security benefits deposited directly to the nursing home. In so doing, plaintiff assumed the responsibility of making monthly payments from her mother's financial resources to Manahawkin for the balance of monies due. During Ms. Hopkins' stay at Manahawkin, plaintiff made the payments until her mother's death in June 2008. Plaintiff disputed an outstanding balance due of $878.20 for the final month of care, for which defendant sought payment from plaintiff. After several attempts to collect payment, a special civil part complaint was filed to compel plaintiff, as the responsible party, to pay the outstanding debt.*fn4 Plaintiff filed an answer, a counterclaim seeking class action certification and a third-party complaint alleging, among other things, the aforementioned statutory violations. Specifically, plaintiff contended the Admission Agreement required a third party to incur personal financial liability for Medicaid and Medicare patients contrary to the NHA and TCCWNA; and that the Admission Agreement, as an unconscionable consumer contract, violated the CFA.

In opposition to the motion for summary judgment, plaintiff argued that the Admission Agreement compelled the responsible party to obligate his or her personal financial assets for the expenses of a resident. Defendant countered that the language of the Admission Agreement and the Residents Rights form clearly state that a nursing home is not permitted to require a third-party guarantee of payment.

The relevant language from the Admissions Agreement, under the "Failure to Pay" section states:

The Facility shall submit bills to Resident/Responsible Party for all services not covered by Medicare, Medicaid or other third parties. Resident/Responsible Party shall pay such bills within ten (10) days of receipt. In the event that any such bills are not paid within ten (10) days following receipt, in addition to any other remedies available by law or under this agreement, the Resident/Responsible Party shall pay a late charge of $5.00 per day computed from the 5th day following receipt and continuing until both the original billed amount and the late charges are fully paid. If no contact has been made by the Resident/Responsible Party in relation to paying these amounts within 15 days of receipt of the original bill, the process will begin to notify Resident/Responsible Party of intent to discharge due to nonpayment within 45 days.

Should Facility retain an attorney to enforce any provision of this Agreement, Resident/Responsible Party agrees to pay reasonable attorney's fees, collection costs and other costs of litigation. Resident and Responsible Party hereby agree to allow the Facility to place a lien on any owned properties in the event there is a ...


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