Legal Question in Wills and Trusts in Virginia
medical bills
Mom died 5 months ago. Small estate. Now has medical bills coming, some of which have gone to collections. My sister and I are co-executors of the will. As we are trying to finalize things and pay debts the hospital assumed there was no estate (didn't ask me) and said the bill we were discussing would be 'taken care of'. When asked what that means, hospital rep said the bill would be absolved because there's no estate. Do I need to say that there IS an 'estate'? Or can I let them excuse the bill and move on without worrying that it'll come up to bite us later? I want to take care of mom's business, but I don't want to lose every penny of what she had if it's not necessary.
Thanks.
1 Answer from Attorneys
Re: medical bills
Well this is tricky. On the one hand, you CANNOT
say or do anything to tell the hospital that there
is no estate. That would be fraud. So if they
want to think there is no estate, it cannot be
because you CAUSED them to think that.
On the other hand, hospitals and medical
facilities do have charity or hardship funds or
programs and if they are willing to forgive the
debt or pay it out of a hardship fund, they can
do that.
There is no obligation for them to pursue every
debt, and no obligation for you to encourage them
to pursue the debt.
As part of your responsibilities as executor, you
do have to publish a notice telling creditors
where they can send in their bills to try to get
paid. Ask the probate division of the circuit
court about exactly how to do this.
The purpose of this is to let creditors know that
they can submit their bills and hope to get them
paid off.
However, you are not required to FORCE people
to submit their bills, if they choose not to, or
don't bother, or don't care. A great many bills
are simply not collected in all sorts of
situations for all sorts of reasons.
So although you must give notice where people
can submit their claims, you don't have to go
out and drag people in and make them submit a
claim.
So if the hospital chooses not to submit a bill,
that is their freedom to do that (or not do it).
However, if you CAUSE them to believe a falsehood,
then you could be guilty of fraud by MAKING them
believe something that is not true. If they
believe there is no estate because they do not
bother to check or ask, that is their fault.
But if you lie to them, then it is your fault.
However... If the bills are much greater than
the value of the estate, and they knew that they
would only get a small part of the bill paid,
then they STILL might choose to forget about it,
even if they knew that there was "some" estate,
but a small one.
So I think the real question is not whether there
is officially an estate opened or not, but whether
there is enough money in it to pay the medical
bills. If the hospital knows they are not going
to get paid very much no matter what, then it
might not be worth their trouble to collect only
a small part of the bill.
That is particularly true if a hardship or
charity fund exists. By applying for such
treatment, the entire amount of the bill might
get paid by the charity fund. But if they
proceed with sending in a claim to the estate,
they might end up with nothing or very litte.