Long Term Care Law News & Updates

Long Term Care Law Newsletter Spring 2015

Best Practices for Avoiding Resident Debt

Wickwire Holm’s Long-Term Care Law Group is pleased to send this newsletter to you. Our firm has long advised organizations in the long-term care sectors, primarily on labour and employment issues. However, in recent years the scope of our work with these institutions has significantly expanded. Increasingly, long term care facilities are faced with a range of legal issues, from construction disputes to concerns regarding financial fraud by appointed representatives.

With these challenges in mind, Wickwire Holm will be issuing a quarterly newsletter on topics related to the challenges currently facing long term care facilities. This newsletter addresses how to avoid resident debt.

Best Practices for Avoiding Resident Debt

Chasing down residents and their family for debts owed to a long term care institution is costly, both in terms of time and money. In an effort to reduce the number of residents falling behind on their payments, as well as to reduce the expense of collecting bad debts from residents, we recommend that continuing care facilities apply the following practices.

As each institution has its own established structures and policies, these practices should be applied in a flexible manner, as appropriate for the circumstances.

1. Personal Guarantee

When the resident is admitted to a facility, they should sign a guarantee stating that the resident is responsible for any costs incurred for their care. If the resident is legally incompetent and is under the care of a Power of Attorney (POA) when admitted, this individual should sign this guarantee.

If the resident is married or is in common law relationship, their spouse should be asked to sign the guarantee as well. As daily accommodation rates are calculated by the Department of Health according to the combined income of the married couple, it is important to have both these individuals responsible for any potential outstanding obligations.

2. Clear Power of Attorney

It is important that each resident have a valid Power of Attorney document signed, appointing a trusted individual to act as the resident’s POA. This document should comply with Nova Scotia’s Power of Attorney Act. If the Power of Attorney was signed in other Canadian jurisdiction, it must comply with the requirements of the Nova Scotia legislation.

If a resident is admitted under a valid Power of Attorney document, or the resident becomes incompetent during their stay, their POA is responsible for the financial affairs of the resident.

It is preferable that the Power of Attorney document have an alternate POA identified. If possible, these POAs should reside in Nova Scotia. The contact information and address of the POAs should be included within the resident’s documents, and updated regularly.

3. Living Adult Estate Questionnaire

Not every resident has a POA or someone capable of managing their affairs if they become legally incompetent. In these cases, the Public Trustee of Nova Scotia may become involved with the care and maintenance of a resident. If this occurs, the Public Trustee requires that a Living Adult Estate Questionnaire be completed.

To avoid complications completing this questionnaire, it should be completed by the resident upon their admission.

4. Online Banking Arrangements

As of April 1, 2016, the Government of Canada will be switching from cheques to direct deposit for all government payments, including Canada Pension Plan (including Post-Retirement Benefit) and Old Age Security. Therefore, it is important that the banking information of a resident or their POA be recorded upon their admission.

If a resident does not have a bank account or access to online banking when they are admitted, the facility could assist with setting up such an account. Most major Canadian financial institutions offer discounted banking services for seniors. Some online banking is free; while those accounts may be basic, they will likely satisfy the banking needs of most residents.

It is not recommended that facilities have resident funds diverted to their account and held in trust for their residents.

5. Fraud and Elder Abuse

Senior citizens are especially vulnerable to fraud and financial abuse. As a POA has access to a resident’s finances, in certain occasions a POA may fail to pay for the care of the resident by fraudulently using the resident’s funds for their own purposes.

If this ever occurs, the facility must consider contacting the local police authorities, as well as contacting Service Canada’s National Investigative Services. The National Investigative Services branch has the ability to halt the distribution of funds or divert these payments to a designated individual with the necessary authorization.

Facilities should also be aware of their duties under the Protection of Persons in Care Act.


While most residents do not fall behind on their financial obligations to their care facilities, on the rare occasions this does occur, it is best to have the required information on hand to move forward with collecting this debt. 

If you have any suggestions for a topic you would like addressed or have any questions regarding any information within a newsletter, please feel free to contact one of the lawyers listed within the "Speak With a Lawyer" section of this page.