Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

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Rollo
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Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Rollo » Thu Sep 19, 2019 10:44 am

Hello, new to this board. As the topic states, I had a relative pass and she was taken to two hospitals before her passing. She is a beneficiary of a trust but she only gets a small amount of money yearly. From what I understand, the heirs to her share of it will be her kids. Now what is going to happened is her husband who is on S.S. and living on it, will get all the hospital bills. Is he able to speak to the hospitals and tell them to collect their money from the trust? He is not going to be able to pay whatever is coming and he already had a stroke earlier this year and basically is not able to work. If anyone has any information on this kind of situation, I would be most greatful.

NotWhoYouThink
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by NotWhoYouThink » Thu Sep 19, 2019 2:42 pm

You don't really have enough information to determine what happens here. If the trust is part of her estate, the hospitals can try to get money from her estate. If the trust is not part of her estate, then there may be nothing in her estate that could be used for medical bills.

You'd need to get a copy of the trust to understand for sure what will happen. Or talk with the trustee(s).

gtd98765
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by gtd98765 » Thu Sep 19, 2019 3:23 pm

Sorting out bills from the deceased is usually done by the executor; is that you? the husband? Is there a will? The trust documents probably spell out what happens when a beneficiary dies; the executor will have to understand the trust. Legal advice will probably be necessary.

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Vanguard Fan 1367 » Thu Sep 19, 2019 3:26 pm

Bogleheads tend to get what they don't pay for with investing. I spent some money on an attorney when we had to deal with an estate. For me it was well worth the money, the attorney earned his fee.

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by BarbBrooklyn » Thu Sep 19, 2019 5:52 pm

gtd98765 wrote:
Thu Sep 19, 2019 3:23 pm
Sorting out bills from the deceased is usually done by the executor; is that you? the husband? Is there a will? The trust documents probably spell out what happens when a beneficiary dies; the executor will have to understand the trust. Legal advice will probably be necessary.
The executor should deal with this situation and the estate should have a lawyer handling probate.
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FIREchief
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by FIREchief » Thu Sep 19, 2019 6:16 pm

Rollo wrote:
Thu Sep 19, 2019 10:44 am
'She is a beneficiary of a trust but she only gets a small amount of money yearly. From what I understand, the heirs to her share of it will be her kids.

Now what is going to happened is her husband who is on S.S. and living on it, will get all the hospital bills.
We need two key pieces of information:
a) Was the trust her own living trust or is it an irrevocable trust established by a different grantor?
b) Is the husband living only on SS with no other assets that were jointly owned or community property with the decedent?

I don't believe anybody can offer any guidance without those two bits of information.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by TropikThunder » Thu Sep 19, 2019 6:50 pm

Why would the husband be financially responsible for the medical debts of the wife?
Unless there is an exception, you do not have to take responsibility for the debt of the deceased person. You are not obligated to do this and the creditor or debt collector cannot use unfair, deceptive, or abusive practices to get you to assume responsibility.
https://www.consumerfinance.gov/ask-cfp ... e-en-1467/

I do note the word "exception", and state law may vary (especially in community property states), but in most cases no one can go after the surviving spouse when someone dies. The estate is fair game, but not the surviving individual.

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Gill » Thu Sep 19, 2019 6:59 pm

It sounds as if she was only the income beneficiary of a trust in which case there would be no liability on the part of the trust. Also, the husband would normally not be liable for her debts. They very well may go unpaid.
Gill
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Rollo
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Rollo » Wed Sep 25, 2019 8:50 pm

FIREchief wrote:
Thu Sep 19, 2019 6:16 pm
Rollo wrote:
Thu Sep 19, 2019 10:44 am
'She is a beneficiary of a trust but she only gets a small amount of money yearly. From what I understand, the heirs to her share of it will be her kids.

Now what is going to happened is her husband who is on S.S. and living on it, will get all the hospital bills.
We need two key pieces of information:
a) Was the trust her own living trust or is it an irrevocable trust established by a different grantor?
b) Is the husband living only on SS with no other assets that were jointly owned or community property with the decedent?

I don't believe anybody can offer any guidance without those two bits of information.
a) The trust was left by her father, after his death, it was left to her mother, after her death, she became one of three beneficiaries. From my understanding, she just gets a check once a year. I read a part of the papers many years ago and I just recall it stating that upon her or the other two beneficiaries' death their children would get the yearly check split equally among them.
b) The husband owns their mobile home, they live in Texas, have been married for almost 40 years. That would be the community property that they own.

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Rollo
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Rollo » Wed Sep 25, 2019 9:03 pm

Gill wrote:
Thu Sep 19, 2019 6:59 pm
It sounds as if she was only the income beneficiary of a trust in which case there would be no liability on the part of the trust. Also, the husband would normally not be liable for her debts. They very well may go unpaid.
Gill
This would be great, I'm sure there will be a lot of hospital bills. BUT, if I'm reading correctly on the FTC consumer info website, if someone signs they can become obligated to pay the debt. Here in Texas they will not work on you in a hospital unless someone signs and I know the husband signed at both hospitals.

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CAsage
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by CAsage » Wed Sep 25, 2019 9:06 pm

State laws may apply, but I think in a lot of cases spouses are responsible for each other's medical, housing etc expenses. Possibly credit card debit... it's messy. The real key here is the details of the trust, and her will, and the trustee and executor need to sort it out.
Salvia Clevelandii "Winifred Gilman" my favorite. YMMV; not a professional advisor.

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by random_walker_77 » Wed Sep 25, 2019 9:41 pm

Sounds like the husband should ask for a free consultation w/ a lawyer (or two). Sounds like worst case is bankruptcy, but according to this, he could keep his house, car, and perhaps $50K of property, so that might not even be so bad:

https://www.natlbankruptcy.com/chapter-7-bankruptcy/

Anyways, check w/ a lawyer for advice...

OnTrack
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by OnTrack » Thu Sep 26, 2019 10:17 pm

Was there Medicare, Medigap, Medicaid, and/or other health insurance that would cover some or all of the hospital bills?

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boomer
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by boomer » Fri Sep 27, 2019 9:55 pm

I'm not a lawyer either, just have done some reading on this in the past. The husband may be bankruptcy proof if all he has is social security, retirement accounts, and his mobile home. I believe that they cannot take his social security or retirement accounts, or his home.

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by TheDDC » Fri Sep 27, 2019 10:05 pm

No. The husband is not responsible for the expenses from the vultures (I.e., hospital). You are your own medical “guarantor” unless something stupid was signed. That would probably not even hold up in court anyway if they pushed it. And he should totally push it.

The estate would be fair game. However if the estate was structured properly and assets were TOD anyway then the creditors would get nothing [OT comment removed - mod oldcomputerguy].

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Kagord » Sat Sep 28, 2019 6:58 am

See an attorney, on the estate handling, notice to creditors is something you may want to do, if not done already, hospitals can move slow sometimes.

I am not an attorney.

mptfan
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by mptfan » Sat Sep 28, 2019 7:09 am

CAsage wrote:
Wed Sep 25, 2019 9:06 pm
State laws may apply, but I think in a lot of cases spouses are responsible for each other's medical, housing etc expenses.
Do you have a cite for this?

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Jack FFR1846 » Sat Sep 28, 2019 7:12 am

Rollo wrote:
Wed Sep 25, 2019 9:03 pm
Gill wrote:
Thu Sep 19, 2019 6:59 pm
It sounds as if she was only the income beneficiary of a trust in which case there would be no liability on the part of the trust. Also, the husband would normally not be liable for her debts. They very well may go unpaid.
Gill
This would be great, I'm sure there will be a lot of hospital bills. BUT, if I'm reading correctly on the FTC consumer info website, if someone signs they can become obligated to pay the debt. Here in Texas they will not work on you in a hospital unless someone signs and I know the husband signed at both hospitals.
I would think that he is on the hook for any bills. His signing is acceptance of financial responsibility.
Bogle: Smart Beta is stupid

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by fposte » Sat Sep 28, 2019 9:37 am

mptfan wrote:
Sat Sep 28, 2019 7:09 am
CAsage wrote:
Wed Sep 25, 2019 9:06 pm
State laws may apply, but I think in a lot of cases spouses are responsible for each other's medical, housing etc expenses.
Do you have a cite for this?
IANAL, but it looks like some states' take on the doctrine of necessaries could give creditors grounds. It seems like a tricky sell in practice, but I suspect how tricky would depend on the state and the debt.

Ob81
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by Ob81 » Sat Sep 28, 2019 9:48 am

With the little information provided, I would guess that the trust is safe. Her personal assets are at stake, as well as the husband’s assets. Wife’s personal debt is his debt. He can have it linger for as long as he likes, but when he passes and his personal estate pays out, debt gets paid first. Unless he passes with nothing, then the debt goes away.

mptfan
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by mptfan » Sat Sep 28, 2019 10:02 am

fposte wrote:
Sat Sep 28, 2019 9:37 am
mptfan wrote:
Sat Sep 28, 2019 7:09 am
CAsage wrote:
Wed Sep 25, 2019 9:06 pm
State laws may apply, but I think in a lot of cases spouses are responsible for each other's medical, housing etc expenses.
Do you have a cite for this?
IANAL, but it looks like some states' take on the doctrine of necessaries could give creditors grounds. It seems like a tricky sell in practice, but I suspect how tricky would depend on the state and the debt.
That citation supports the idea that spouses may be responsible for the other's medical bills in some states, but not for "housing etc expenses."

fposte
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by fposte » Sat Sep 28, 2019 10:10 am

mptfan wrote:
Sat Sep 28, 2019 10:02 am
fposte wrote:
Sat Sep 28, 2019 9:37 am
mptfan wrote:
Sat Sep 28, 2019 7:09 am
CAsage wrote:
Wed Sep 25, 2019 9:06 pm
State laws may apply, but I think in a lot of cases spouses are responsible for each other's medical, housing etc expenses.
Do you have a cite for this?
IANAL, but it looks like some states' take on the doctrine of necessaries could give creditors grounds. It seems like a tricky sell in practice, but I suspect how tricky would depend on the state and the debt.
That citation supports the idea that spouses may be responsible for the other's medical bills in some states, but not for "housing etc expenses."
Sure, but it's a thread about medical bills; I'll save the housing research till we get a housing thread.

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CAsage
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by CAsage » Sat Sep 28, 2019 12:07 pm

mptfan wrote:
Sat Sep 28, 2019 7:09 am
CAsage wrote:
Wed Sep 25, 2019 9:06 pm
State laws may apply, but I think in a lot of cases spouses are responsible for each other's medical, housing etc expenses.
Do you have a cite for this?
As always in legal issues, divorce, money, google on it! It can vary wildly. Depends on state laws. YMMV.

https://www.hg.org/legal-articles/can-i ... ebts-31801

https://family-law.freeadvice.com/famil ... nsible.htm

"In general, all debts incurred jointly to provide for marital expense or to benefit the children of the marriage continue to be the responsibility of both spouses even after separation. These include expenses for food, rent, mortgage, education, and certain bills such as utilities. Even if one spouse is wealthier than the other and the spouse with fewer resources runs up a large credit card debt to pay these expenses while separated, a court will usually consider these debts the responsibility of both spouses. "
Salvia Clevelandii "Winifred Gilman" my favorite. YMMV; not a professional advisor.

mptfan
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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by mptfan » Sat Sep 28, 2019 4:17 pm

CAsage wrote:
Sat Sep 28, 2019 12:07 pm
"In general, all debts incurred jointly to provide for marital expense or to benefit the children of the marriage continue to be the responsibility of both spouses even after separation."
Yes, of course if a debt is "incurred jointly" it is the responsibility of both spouses, but that is true with any jointly incurred debt no matter if you are married or not. In that case being married does not make you obligated for your spouse's debt, it was the fact that it was "incurred jointly" that makes you responsible. The relevant question is whether you are responsible for your spouse's debt if you also did not incur the debt? The general answer to that is no.
Last edited by mptfan on Sat Oct 19, 2019 11:32 pm, edited 1 time in total.

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Re: Beneficiary passes, leaves hospital bills, can hospitals get money from her trust fund until paid in full?

Post by oldcomputerguy » Sat Oct 12, 2019 4:00 am

Several off-topic comments which were threatening to derail the thread were removed. Please keep the discussion centered on information that might assist the OP in their situation.
"I’ve come around to this: If you’re dumb, surround yourself with smart people; and if you’re smart, surround yourself with smart people who disagree with you." (Aaron Sorkin)

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