When a spouse dies, it is hard to dedicate time to think about anything else, and it can be even harder if they had spent a lot of time in the hospital or in an extra care facility. It’s an emotional time, and sadly it’s when you could be at your most vulnerable financially.
In America, medical bills are expensive and even if you have insurance, your co-pay and other services will add up. So if you are recently bereaved and sitting in the state of New York reading this, are you wholly responsible for your spouse’s medical bills?
In the state of New York, if only the name of the deceased is on the medical bills and any other debt, most of the time creditors can only seek payment from the deceased’s estate and not the spouse. There are certain circumstances when creditors can seek payment from the spouse, but those are rare.
This will likely not stop the hospitals, creditors, and/ or debt collectors from trying to get the money from you. This may be illegal in many instances depending on how they go about it, so you should know your rights in the state of New York.
When you read on about this topic I will try to clear up some of the confusing parts of the laws in New York.
Disclaimer: I’m writing this to give you some basic information, please always seek out your own independent financial and legal advice before acting on anything mentioned below.
Get legal advice
I want to preface this article by saying that I am not a lawyer, this is not legal advice but more along the lines of guidance.
If you do not understand any part of this or you need more assistance, it would be best to seek professional help. There are a plethora of great lawyers in New York that are willing and able to help you solve this issue or just give advice, you can go to this website to search for a lawyer in New York.
Who is responsible for medical bills in New York after death?
Even if you are the spouse or any type of relative, it does not matter how close or far the person was to you, liability will be minimal.
If your spouse died owing money for medical bills, credit cards, or loans that were solely in their name, you are not personally liable for their debt. The same applies if the deceased is any type of relative father, mother, grandma, sister, aunt, uncle, etc.
New York is not a community property state. There are nine community property states (including California, see my article). In a community property state is everything is split equally. All property and debt including medical bills that either spouse acquired during the marriage, is considered community property.
So, the surviving spouse is legally required to pay. If the marriage was originally in one of these nine states or you the medical bills were from there you may have to pay for them. This is a grey area and it is best to get legal representation/ advice if this was to happen.
However, this shouldn’t be something that a resident of the state of New York has to worry about.
I recently looked into getting a loan and I’ve actually had a good experience with Supermoney.com. For me, it was a car loan but I spoke to them about a dedicated funeral expenses loan, which is one of the services they offer, and was quite impressed. To see if you could qualify, check out my link here.
Is my spouse required to pay for the medical bills?
In the state of New York, if only your spouse’s name is linked to any debt it is generally theirs alone and the creditors can only get paid from the deceased estate.
There are exceptions to this and in certain cases, it is possible for creditors to try to get recouped for their bills from the spouse of the deceased.
The main two ways are if they co-signed or based on the “Doctrine of Necessaries”.
- Simply put, if you have signed or co-signed any document accepting joint responsibility for paying the debt you are liable. Most people know that they should carefully read any and all documents before signing but rarely do. If you choose to not read the whole document the main thing to look for it “guarantee of payment” this phrase makes the signer personally liable if there spouse dies or cannot pay.
- The lesser well-known way, the spouse may be legally liable for medical bills is a legal obligation based on the “Doctrine of Necessaries” ( Necessities for short). This states that a married couple has a “mutual obligation of support”. They are equally responsible for providing necessities like food, clothing, shelter, medical bills, etc. The spouse will only be responsible though if the expenses were given based on the non-debtor spouse’s credit and or the non-debtor spouse has the capacity to pay the medical bills. This is not usually the case but can happen.
What happens if my spouse has a terminal illness?
Most people in the state of New York will leave behind some debt when they move on. This happens a lot for those diagnosed with terminal diseases like cancer. This issue may be of concern for the spouse when they start medical treatment that could impact their and their family’s, financial stability.
Treatments for cancer and other such ailments are expensive. Some options can cost hundreds of thousands of dollars if you don’t have the proper insurance. Even if you have insurance coverage, the deductibles and pocket costs can add up quickly.
To get these types of treatments the spouse or family members usually have to sign off on the bills so they then become liable for the bills.
Hospitals and insurance companies may not even allow the treatment to happen in New York unless there is a co-signor as they know the laws and always want someone liable for payments.
Therefore the debt will not automatically end with the death of the spouse. If this is the situation that you are in or signing paperwork it is crucial for you and your family to understand your rights and to seek legal advice from a professional.
How are the debts handled after someone dies in New York?
When your spouse or relative move on they will leave behind bank accounts, property, cars, etc. These things collectively called an known as the “estate”.
This estate will go through a court process known as probate (read more about probate in my full article here). This process entails that the court makes sure that any debts (like medical bills) are paid first from the estate and then the assets are distributed to the spouse or legal heirs.
So the hospitals and bill collectors will get paid first, but if there is not enough asset left to pay them and you are not the co-signor the process should end there for everyone.
If there is enough money or assets after the probate process, someone should receive them. Who gets what will be up to the will and it is hopeful that they have one.
Everyone should have a will. But if not it will be left to New York’s “intestacy” laws. In general who gets what will depend on who the living relatives are and their relationship to the deceased. You can read more about this here.
What if there is no will, who has to pay for medical bills then?
With all the debt surround medical bills and end of life expenses, most people in the states do die with some sort of debt, and it is often medical debt.
If the spouse and family didn’t know about the debt and the deceased did not leave behind a will, don’t worry. In the state of New York as long as no one (spouse, family, or even friend) signed the paperwork they cannot burden you with the debt.
Even if there is no debt and no will, how the remaining property and assets are divided could start family issues. In New York, the spouse will most likely get the assets after probate in the case that there is no will and it is not protested. But if protested, the money could stay in probate for a long time till the issues are settled.
If you and your spouse don’t have a will you should look into getting one. A will not only protects you and your spouse’s assets and money but gives them peace of mind despite your passing. You can learn more about getting a will here (www.USLegalWills.com).
Do my children have to pay for the medical bills or my debts?
No, under New York state law, children are not liable to pay their parents’ outstanding debts, including their medical bills. This is again unless they signed any document accepting responsibility for paying the bills.
As stated above, make sure you read all documents carefully before signing them or the children may be liable for payment. Even the patient’s entrance from when going to a hospital, often this is a legally binding document to pay all the medical bills.
What if you were separated or divorced, are you still responsible?
This is pretty cut and dry in New York, as the spouse would not be around to sign documents they would not be held liable to pay them. The laws and legality gets a bit murky when you have signed the documents and then got divorced.
Most of the time if you were separated and not legally divorced they could come to you with the bills and you possibly will still have to pay. You would really want to get legal representation here as it might just be cheaper to pay the bill rather than it go to court or a bill collector.
If you have been legally divorced they will not be able to come after you for the medical bills.
What happens if you forget to pay?
If you did sign for the bills and just forgot to pay, you really don’t have an excuse, they will charge you interests and ask you to pay. They will often reach out to you a few times to try to get the funds from you.
If the billing department was not able to contact you, they often will sell your debt to a credit collection agency for whatever they can get.
The agency will try to collect from you in by any means in their power and may try for up to 6 years in New York. These companies are not known to be kind and may break the law when trying to collect from you even if you don’t know it. Know your rights and what they can and cannot do when trying to collect.
Rember that both hospitals and creditors will most likely to work with you and set up a payment plan and or you can settle down the amount to something that you can afford. These companies just want any money they can get, and some is better than none.
Does a Funeral plan cover medical bills?
It is quite rare if a funeral plan will cover the medical bills. These plans are set up far in advance and for the plan to cover medical and other bills you need to have set up from the start. This is not something you can just add.
If you do set it up from the start it may not be fiscally smart in most cases, as you would pay a high premium for bills to be included. Also with funeral plans, if the business you bought the plan from was to go under you would lose all of the money you had put into it with little to no chance for compensation.
What if you don’t have any money?
This is all too common that people will have medical bills and not enough funds to pay for them. You want to first talk to the hospital and there billing department to see what you have actually signed and said that you would pay for.
You probably didn’t even know but when your spouse entered the hospital those forms that you signed if they were unable to state that you will pay the bills in full and it is your responsibility if your spouse dies.
If you don’t have any money and sat down with the billing department they might be able to waive the fees that you owe or at least lower the amount of money that you owe.
The latter is very common and hospitals see this often and are willing to work with you. What you don’t want is it going to the creditors. If this was to happen they will no doubt keep trying to get the money from you, but your credit score may be ruined for a long time as well. Try to avoid this from happening at all costs.
If you are also struggling to find enough funds for a respectful funeral for your deceased loved one, there are organizations which could help you; I’ve compiled a list of 11 of them in this article here.
Another option, which is only for people who have good money management skills, is to get a credit card to help pay off some of the debts. I recently got accepted to Principal Platinum and am really happy with the deal I got.
How long do you have to settle unpaid medical bills after death?
There is no set timeframe that you have to pay them. You want to keep in constant contact with the hospital about what you owe. By keeping them updated and paying what you can, will give you time to get the money or figure something out.
If you did not set up a payment plan with them the general amount of time they will ask for you to pay the bills is between 30 to 90 days from the death of your spouse. It will be a trying time for you, but hospitals are businesses that do need money to keep functioning. Paying them overtime is always better than defaulting and it going to debt collectors.
What steps can I take to pay for the medical bill?
If you did sign and have to pay the medical bills, there are two main steps to take to start the process and sort things out.
- You want to first call the insurance company or companies. You want to check your personal insurance, your spouse, and their work. The insurance companies are the first to handle and pay for the medical bills. When you do this, explain to the insurance company what the situation is, what you have paid, and have a copy of the plan sent to you for reference. The insurance provider has a lot more power than you as they might already have deals with certain healthcare providers for lower bills.
- If you do not have insurance or the insurance companies didn’t, you should always try to negotiate with them. They are used to this and usually willing to work with you if you explain your situation and nice to them. Don’t get angry or raise your voice even if they are in the wrong. Make sure you do your research and know what you are going to say, write out the script, and do your homework before you call them. Have a plan and have all of your documentation ready.
If you are reading this and thinking, wow maybe I should get some cover, then feel free to learn about my recommended life insurance brokers here.
Don’t be afraid and know your rights
If you feel that you are being unfairly harassed in New York, the state does have a fair debt collection practices act that protects people from these types of practices. But even if they contact you for any reason you should know your rights and the laws around what they can and cannot do.
For more information on the laws and regulations on what harassment is you can find out more information on your rights by going to the official website here
Can they take my home if I cannot pay?
In the state of New York, they most likely will not take your home if you cannot pay medical bills. They will go after bank accounts, cars, and any assets that you have in your name. This is yet another reason to be very careful, if reading this before you’ve experienced loss, to double-check where your liabilities lie.
