(a) Definitions.  For purposes of this section:

(1)  “Applied income” shall mean the amount of income a Medicaid beneficiary is required to contribute to the cost of his or her care.

(2)  “Authorized individual” shall mean a person who has authority over the income of a patient of a nursing facility, such as a person who has been given or has otherwise obtained authority over a patient’s bank account; has been named as or has rights as a joint account holder; or is a fiduciary as defined below.

(3)  “Costs of care” shall mean the costs of providing care to a patient of a nursing facility, including nursing care, personal care, meals, transportation, and any other costs, charges, and expenses incurred by a nursing facility in providing care to a patient. Costs of care shall not exceed the customary rate the nursing facility charges to a patient who pays for his or her care directly rather than through a governmental or other third-party payor.

(4)  “Fiduciary” shall mean a person to whom power or property has been formally entrusted for the benefit of another, such as an attorney-in-fact, legal guardian, trustee, or representative payee.

(5)  “Nursing facility” shall mean a nursing facility licensed under chapter 17 of Title 23, that is a participating provider in the Rhode Island Medicaid program.

(6)  “Penalty period” means the period of Medicaid ineligibility imposed pursuant to 42 U.S.C. § 1396p(c), as amended from time to time, on a person whose assets have been transferred for less than fair market value.

(7)  “Uncompensated care” — Care and services provided by a nursing facility to a Medicaid applicant without receiving compensation therefore from Medicaid, Medicare, the Medicaid applicant, or other source. The acceptance of any payment representing actual or estimated applied income shall not disqualify the care and services provided from qualifying as uncompensated care.

(b) Penalty period resulting from transfer.  Any transfer or assignment of assets resulting in the establishment or imposition of a penalty period shall create a debt that shall be due and owing to a nursing facility for the unpaid costs of care provided during the penalty period to a patient of that facility who has been subject to the penalty period. The amount of the debt established shall not exceed the fair market value of the transferred assets at the time of transfer that are the subject of the penalty period. A nursing facility may bring an action to collect a debt for the unpaid costs of care given to a patient who has been subject to a penalty period, against either the transferor or the transferee, or both. The provisions of this section shall not affect other rights or remedies of the parties.

(c) Applied income.  A nursing facility may provide written notice to a patient who is a Medicaid recipient and any authorized individual of that patient:

(1)  Of the amount of applied income due;

(2)  Of the recipient’s legal obligation to pay the applied income to the nursing facility; and

(3)  That the recipient’s failure to pay applied income due to a nursing facility not later than thirty (30) days after receiving notice from the nursing facility may result in a court action to recover the amount of applied income due.

A nursing facility that is owed applied income may, in addition to any other remedies authorized under law, bring a claim to recover the applied income against a patient and any authorized individual. If a court of competent jurisdiction determines, based upon clear and convincing evidence, that a defendant willfully failed to pay or withheld applied income due and owing to a nursing facility for more than thirty (30) days after receiving notice pursuant to subsection (c), the court may award the amount of the debt owed, court costs, and reasonable attorney’s fees to the nursing facility.

(d) Effects.  Nothing contained in this section shall prohibit or otherwise diminish any other causes of action possessed by any such nursing facility. The death of the person receiving nursing facility care shall not nullify or otherwise affect the liability of the person or persons charged with the costs of care rendered or the applied income amount as referenced in this section.