To tell or not to tell

Submitted by a hospice social workers:  "I am working with an elderly gentleman who is the son and POA for a 93 year old woman suffering from end stage Dementia.  He has admitted to me that he “she has gifted $2,000 to a granddaughter one year ago and the granddaughter has not paid her back” – it is difficult to imagine that the patient may have been competent to make such a gift herself even one year ago.  In addition, he admits to using her investment funds to pay for his airfare back from Florida to take care of the patient after she needed to leave a local assisted living facility, to pay himself for being a caregiver for her (apparently thousands of dollars) and to pay himself for her room and board.  I educated him about the Deficit Reduction Act, cautioned him about being honest when filling out the nursing home application, and advised him to meet with an attorney as soon as possible to get legal advice to address her long term planning needs.  He did meet with the attorney, but apparently failed to fully disclose what he had told me.  He has called me to ask that I pick up his application for a local nursing home because he has filled it out and wants to move forward with her long term care placement.  I have already consulted with the patient’s physician and the Office of Aging caseworker regarding these concerning details.

This patient appears to have possibly have about $40,000 of investment funds left and will begin in a nursing home by being private pay, but will quickly need to apply for Medical Assistance funding.  How do I handle this dilemma  ethically and legally so that I am also not held liable if a facility accepts her and then has no payment source?"