Stimulus Checks Belong To Recipients, Not To Nursing Homes Or Senior Care Facilities, IRS Says

The $1,200 stimulus checks, officially known as Economic Impact Payments, belong to recipients, not to nursing homes or senior living facilities providing their care, the Internal Revenue Service said in an alert Tuesday. The checks started being sent in April, after the $2.2 trillion CARES Act stimulus package was signed into law.

“The payments are intended for the recipients, even if a nursing home or other facility or provider receives the person's payment, either directly or indirectly by direct deposit or check,” the IRS said in the statement. “These payments do not count as a resource for purposes of determining eligibility for Medicaid and other federal programs for a period of 12 months from receipt. They also do not count as income in determining eligibility for these programs.”

Medicaid is a federal and state benefits program helping low-income individuals afford healthcare. Every state offers a Medicaid program for individuals requiring long-term care in a nursing home, known as institutional Medicaid.

A Medicaid recipient’s taxable income can be taken by the nursing home, with the recipient allowed to keep a small amount as a personal allowance. Stimulus checks are considered to be tax credits under the CARES Act, meaning nursing homes and assisted living facilities are not allowed to take the payments.

This week, Kentucky Attorney General Daniel Cameron warned about “unlawful seizures” of stimulus checks to Medicaid beneficiaries in nursing homes.

“Medicaid recipients living in nursing homes and assisted living facilities could be more susceptible to financial exploitation while isolated from family during the COVID-19 pandemic,” Cameron said. “In many cases, federal stimulus checks provide assistance to Medicaid beneficiaries experiencing financial hardships due to COVID-19, and any unlawful seizure of those funds should be reported to our Elder Abuse and Medicaid Fraud Hotline at 1-877-228-7384.”

“Nursing homes engaging in this behavior will be subject to enforcement action,” Seema Verma, the administrator for the Centers for Medicare & Medicaid Services, posted on Twitter.

The American Health Care Association and National Center for Assisted Living said in a statement that they “are not aware of widespread issues with resident stimulus funds.” They asserted the “stimulus checks are handled in the same manner as other resident benefit payments.”

In May, the Federal Trade Commission also issued an alert that nursing homes are not allowed to take stimulus checks from residents. The alert tells victims to contact their state attorney general’s office or file a complaint with the FTC.

Congress and the White House are expected to begin negotiations on another stimulus package in late July. Treasury Secretary Steven Mnuchin has said the Trump administration is “very seriously considering” another round of stimulus checks.