Posts Tagged ‘Jewish Home for the Elderly of Fairfield County Inc. v. Cantore’

Nursing Home May Sue On Surety Bond For Nonpayment

SEPTEMBER 10, 2001 VOLUME 9, NUMBER 11

When J. Michael Cantore, Jr., was appointed as conservator of the person and estate of Diana Kosminer, he was required to post a bond to help ensure that he would handle her finances properly. The purpose of a “surety” bond (the type usually required of conservators) is to protect the ward; if the conservator misspends money, or invests imprudently, or even steals from the ward, the bonding company will reimburse the ward for any loss and then pursue the conservator for recovery. That way the ward does not bear the loss for the conservator’s mistakes.

In 1989 (two years after the conservatorship was established) Ms. Kosminer moved into a nursing home. She would live in the home for the remaining six years of her life and, as it turned out, the $160,000 in her estate when she entered the facility would not be enough to pay for her care for the entire time.

From the very start Mr. Cantore tried to avoid using Ms. Kosminer’s money for her care. He made no payments to the nursing home, but instead made an application (eight months after her admission to the home) to have the state Medicaid agency pay for her care. That application was denied because Mr. Cantore did not provide the information the state required; if he had completed the application Ms. Kosminer would presumably have been denied because she had too much money to qualify for assistance.

Mr. Cantore tried twice more, unsuccessfully, to get Ms. Kosminer qualified for Medicaid benefits. In 1992, after the nursing home had cared for Ms. Kosminer for almost three years without payment, Mr. Cantore liquidated Ms. Kosminer’s assets and successfully qualified her for Medicaid.

Although Ms. Kosminer was not actually injured by Mr. Cantore’s failure to act properly, the nursing home filed a lawsuit against the conservatorship bond. The facility argued that Mr. Cantore had a duty to use Ms. Kosminer’s money for her care and then, when it ran out, to make a timely and complete Medicaid application. Had that been done, said the nursing home, they would not have lost $63,000 on her care.

The Connecticut courts initially threw the nursing home’s claim out of court because, the court ruled, a third party can not make a claim against the surety bond. The bond, according to that argument, is intended to protect the ward and not the ward’s creditors.

The Connecticut Supreme Court disagreed. It reinstated the lawsuit against the bonding company and ruled that Mr. Cantore had a duty to handle Ms. Kosminer’s finances in a timely and appropriate manner. If the nursing home can show that Mr. Kosminer failed in that duty, it can collect on the conservator’s bond. Jewish Home for the Elderly of Fairfield County v. Cantore, August 14, 2001.

Conservator Not Liable For Failure To Secure Medicaid Coverage

OCTOBER 23, 2000 VOLUME 8, NUMBER 17

J. Michael Cantore, Jr., was appointed as conservator of the person and estate for Diana Kosminer. Shortly after he took responsibility for Ms. Kosminer he arranged for her admission to the Jewish Home for the Elderly of Fairfield County, Inc., a Connecticut nursing home.

Within a year of her admission to the nursing home, Ms. Kosminer was running out of resources. In May of 1990 Mr. Cantore applied for Medicaid’s financial assistance with Ms. Kosminer’s care, but he failed to complete the paperwork necessary to secure eligibility. Eighteen months later, in November, 1991, tried again, but he did not follow through with verification of her assets. Three months after that he applied once more, but the Medicaid agency decided that Ms. Kosminer had too much property to receive benefits.

Five months later Mr. Cantore finally spent Ms. Kosminer’s assets down to the $1,600 level required by Connecticut Medicaid, and applied for (and obtained) Medicaid coverage. For three years (until Ms. Kosminer’s death in 1995), Medicaid subsidized her care.

The nursing home complained about Mr. Cantore’s delay in securing Medicaid eligibility. If he had acted promptly and followed through with the necessary paperwork he could have secured Medicaid assistance shortly after his first application. The result: the nursing home lost $63,000 of income it would have received had Mr. Cantore been a better conservator.

The nursing home filed a complaint against Mr. Cantore with the Connecticut probate court, and asked that his conservatorship bond be charged for the $63,000 shortfall. Both Mr. Cantore and the insurance company which issued his bond objected, arguing that he owed no duty to the nursing home and that Ms. Kosminer actually received excellent care despite his failure to apply for Medicaid in a timely manner.

The Connecticut Court of Appeals threw out the claim by the nursing home, agreeing that Mr. Cantore’s behavior had not harmed Ms. Kosminer. In fact, the court noted, Mr. Cantore had a duty to preserve Ms. Kosminer’s assets, and his failure to spend them more quickly so that she could qualify for Medicaid was not a breach of the duty he owed to her. Since the nursing home had never even threatened to discharge her while her bill was mounting, she had not been injured and the nursing home could not make its claim against Mr. Cantore or his conservatorship bond. Jewish Home for the Elderly of Fairfield County, Inc., v. Cantore, May 30, 2000.

With no Arizona case on point it is difficult to predict how Mr. Cantore would have fared under Arizona law. It seems likely, though, that an Arizona court would agree that Ms. Kosminer was not harmed.

Connecticut does differ from Arizona in two technical aspects: Mr. Cantore’s title would have been “guardian and conservator,” (rather than “conservator of the person and property”) and Ms. Kosminer would have been permitted to retain $2,000 while still qualifying for Medciaid (rather than the $1,600 limit imposed in Connecticut).

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