Chapter 159 Oregon Laws 1999

Session Law

AN ACT

HB 2264

Relating to liability for cost of care in state institutions; creating new provisions; and amending ORS 179.620, 179.640, 179.653 and 179.655.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 179.620 is amended to read:

179.620. (1) A person and the personal estate of the person, or a decedent's estate, is liable for the full cost of care. Full cost of care is established according to ORS 179.701.

(2) While the person is liable for the full cost of care, the maximum amount a person is required to pay toward the full cost of care shall be determined according to the person's ability to pay. Ability to pay is determined as provided in ORS 179.640.

(3) Upon the death of a person, the decedent's estate shall be liable for any unpaid cost of care. The liability of the decedent's estate is limited to the cost of care incurred on or after July 24, 1979. The decedent's estate shall not include assets placed in trust for the person by other persons. Collection of any amount from a decedent's estate shall be pursuant to ORS 179.740.

(4) Regardless of subsection (1) of this section and ORS 179.610 (6), assets held in trust by a trustee for a person are subject to laws generally applicable to trusts.

(5) Notwithstanding subsections (1) and (3) of this section, the Mental Health and Developmental Disability Services Division may not collect the cost of care from:

(a) Any assets received by or owing to a person and the personal estate of the person, or the decedent's estate, as compensation from the state for injury or death of the person that occurred when the person was in a state institution listed in ORS 179.321 (1) and for which the state admits liability or is found liable through adjudication; and

(b) Any real or personal property of the personal estate of the person, or the decedent's estate, that the person or an authorized representative of the person can demonstrate was purchased solely with assets referred to in paragraph (a) of this subsection or partially with such assets, to the extent such assets were used in the purchase.

SECTION 2. ORS 179.640 is amended to read:

179.640. (1) The Mental Health and Developmental Disability Services Division shall establish rules for determining ability to pay. The rules shall require, in addition to other relevant factors, consideration of the personal estate, the person's need for funds for personal support after release, and the availability of third-party benefits such as, but not limited to, Medicare or private insurance. The division may also consider the probable length of stay at the state institution.

(2) In determining a person's ability to pay, the division may not consider as part of the personal estate of the person or the decedent's estate:

(a) Any assets received by or owing to the person and the personal estate of the person, or the decedent's estate, as compensation from the state for injury or death of the person that occurred when the person was in a state institution listed in ORS 179.321 (1) and for which the state admits liability or is found liable through adjudication; and

(b) Any real or personal property that the person or an authorized representative of the person can demonstrate was purchased solely with assets referred to in paragraph (a) of this subsection or partially with such assets, to the extent such assets were used in the purchase.

[(2)] (3) A person and the authorized representative of the person, if any, shall provide all financial information requested by the division [which] that is necessary to determine the person's ability to pay. To determine ability to pay, the division may use any information available to the division, including information provided by the Department of Revenue from personal income tax returns pursuant to ORS 314.840, and elderly rental assistance claims. Upon request, the Department of Revenue shall release copies of tax returns to the division. Where the person or the person's authorized representative fails to provide evidence to demonstrate an inability to pay full cost of care, the division may determine the person has the ability to pay the full cost of care.

[(3)] (4) The division shall provide actual notice to the person and any authorized representative, if known to the division, of its determination by issuing an ability-to-pay order. The order shall state the person's full liability and the person's determined ability to pay. Actual notice means receipt by the person and the authorized representative of notice. The notice shall include a copy of the ability-to-pay order, a description of the person's appeal rights and the date upon which appeal rights terminate and state the address where a request for hearing may be mailed or delivered. At any time, the division may reissue an ability-to-pay order to notify an authorized representative as provided by ORS 179.653 (4).

[(4)] (5) At any time during the person's stay at the state institution or within 36 months from the date the person is released, if the division receives new financial information [which] that shows a change in the person's financial circumstances, the division shall consider the changed circumstances[,] and [shall] issue a new ability-to-pay order.

[(5)] (6) Orders issued after the person is released shall not require the person to make payments toward the cost of care for more than 36 consecutive months following release. However, the division may collect beyond the 36-month period any payments [which] that became due but were not paid within the 36 months following release. Any remaining balance of full cost of care shall be collected as provided in ORS 179.740.

[(6)] (7) If a person or authorized representative disagrees with any ability-to-pay order issued pursuant to this section, the person or authorized representative may request a contested case hearing. To the extent practical, the hearing will be held at a location convenient to the person or the authorized representative. The request must be postmarked within 60 days from the date of the mailing of the ability-to-pay order. If the person or the authorized representative makes a timely request for a contested case hearing, the hearing and any appeal of the final hearing order shall be governed by ORS 183.413 to 183.497. If the person or the authorized representative fails to make a timely request for a contested case hearing, the ability-to-pay order shall be final and not subject to judicial review, except as subsequently modified by the division as provided in subsection [(4)] (5) of this section.

[(7)] (8) On appeal, regardless of other information presented, payment of the full cost of care [can] may be ordered if the person or the authorized representative refuses to produce financial information [which] that the Hearings Officer determines is relevant and must be produced.

SECTION 3. ORS 179.653 is amended to read:

179.653. (1) If any person or authorized representative refuses to pay for the cost of care as ordered by the Mental Health and Developmental Disability Services Division under ORS 179.640, the amount unpaid plus interest shall be a lien in favor of the State of Oregon. The lien shall arise as each payment is due under the order and shall continue until the liability with interest is satisfied. The lien shall be upon the title to and interest in the real and personal property of the personal estate.

(2) Prior to the filing of a distraint warrant as provided in ORS 179.655 (2), the lien shall only be valid against:

(a) Property of the person;

(b) Assets held by any authorized representative bound by the ability-to-pay order; and

(3) Regardless of any other provision of law or statute [which] that provides a procedure for establishing obligations, including the claim and payment provisions of ORS chapter 125, an authorized representative who has received notice and had an opportunity to request a contested case hearing shall comply with an ability-to-pay order upon demand by the [Mental Health and Developmental Disability Services Division] division. The division may issue the demand any time after the order becomes final.

(4) An authorized representative who has not had an opportunity to request a contested case hearing, either because the authorized representative was not appointed at the time the ability-to-pay order became final, or was not given notice of the ability-to-pay order as required by ORS 179.640 [(3)] (4), shall not be bound by the order of the division. To bind the authorized representative, the ability-to-pay order must be reissued and notice provided to the authorized representative pursuant to ORS 179.640 [(3)] (4). The authorized representative shall have the same appeal rights as if the order had originally been issued to the authorized representative. After the order becomes final, the authorized representative shall be bound as provided in subsection (3) of this section. The division shall not issue an execution of a lien or foreclose against property held by or in the control of the authorized representative until the authorized representative is bound by the order of the division.

(5) An authorized representative who is a trustee shall only be bound to the extent that the final order specifically finds that the trust assets of a trust fund are subject to claim by the division.

(6) If the authorized representative does not comply with the demand, the division may file with the probate court a motion to require the authorized representative to comply. If the authorized representative is a conservator or guardian appointed under ORS chapter 125, the motion shall be filed in that proceeding. The motion shall be accompanied by an affidavit stating that the order is final, that demand has been made on the authorized representative and that the order has not been complied with.

(7) The authorized representative may object to the motion only on grounds that the order is not final, that the order is not binding on the authorized representative as provided in this section or that all required payments have been made. The objection must be by affidavit.

(8) If the authorized representative objects by affidavit, the court shall hear the motion. If the court determines that the ability-to-pay order is final and binding on the authorized representative and that all required payments have not been made, the court shall order the authorized representative to comply with the ability-to-pay order.

(9) If the authorized representative fails to object by affidavit within 15 days of the filing of the motion, the court shall order the authorized representative to comply with the order. An authorized representative who willfully fails or refuses to comply may be found in contempt of court and may be held personally responsible.

(10) Nothing in this section shall affect the requirement that the division issue a new order in accordance with ORS 179.640 [(4)] (5) if financial circumstances have changed.

SECTION 4. ORS 179.655 is amended to read:

179.655. (1) If any amount due the Mental Health and Developmental Disability Services Division for the cost of care of a person is not paid within 30 days after it becomes due, and no provision is made to secure the payment by bond, deposit or otherwise, pursuant to rules adopted by the division, the division may issue a distraint warrant directed to any county of the state.

(2) After the receipt of the distraint warrant, the clerk of the county shall enter in the County Clerk Lien Record the name of the person, the amount for which the distraint warrant is issued and the date the distraint warrant is recorded. The amount of the distraint warrant shall become a lien upon the title to and interest in any property owned or later acquired by the debtor against whom it is issued, and it may be enforced by the division in the same manner as a judgment of the circuit court.

(3) In the event that an ability-to-pay order issued [pursuant to] under ORS 179.640 [(3) or] (4) or (5) becomes final, and supersedes a previous final ability-to-pay order on which a distraint warrant had been issued, the division shall issue a new distraint warrant superseding the previous distraint warrant, and the lien shall conform to the new order.

(4) The division may direct a copy of the distraint warrant to the sheriff of any county of the state commanding the sheriff to levy upon and sell the real and personal property of the taxpayer found within that county, for the payment of the amount due, with interest, collection charge and the sheriff's fee. The sheriff shall return the distraint warrant to the division and pay to it the money collected not less than 60 days from the date the copy of the distraint warrant was directed to the sheriff.

(5) The division may issue the directive provided in subsection (4) of this section to any agent of the division. In executing the distraint warrant, the agent shall have the same powers conferred by law upon sheriffs. However, the agent is not entitled to any fee or compensation in excess of actual expenses incurred in the performance of this duty.

SECTION 5. The amendments to ORS 179.620 and 179.640 by sections 1 and 2 of this 1999 Act apply when the injury or death of the person occurs on or after the effective date of this 1999 Act.

Approved by the Governor May 3, 1999

Filed in the office of Secretary of State May 3, 1999

Effective date October 23, 1999

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