December 28

State Properly Rejected Medicaid Application When Requested Verifications Were Not Provided

A New Jersey appeals court rules that the state properly rejected a Medicaid application because the appropriate verifications were not provided, preventing the state from determining whether the applicant’s property and life insurance policy were available resources. A.T. v. Division of Medical Assistance and Health Services (N.J. Super. Ct., App. Div., No. A-3341-13T3, Nov. 23, 2015).

A.T. entered a nursing home and her son, S.T., applied for Medicaid on her behalf. The state requested verification regarding A.T.’s bank account statements, the deed for property she owned, and proof that a life insurance policy had been liquidated. S.T. did not provide the requested verifications, and the state denied Medicaid benefits. After selling A.T.’s property and converting the life insurance policy to an irrevocable trust, S.T. again applied for benefits on A.T.’s behalf, and the state approved the application.

After the nursing home filed a complaint against A.T. and S.T. for non-payment of services, S.T. appealed the original denial of Medicaid benefits. A hearing officer ruled that the original application was properly denied due to lack of verification. S.T. appealed to court, arguing that the state did not distinguish which documents were necessary to make an eligibility determination.

The New Jersey Superior Court, Appellate Division, affirms the original denial of Medicaid benefits. According to the court, the state could not determine whether the property and life insurance policy were available resources until it received the requested verifications.

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December 17

No Penalty Period for Medicaid Applicant Who Sold House for Far Less Than Tax Assessment Value

A New York appeals court rules that the state should not impose a penalty period on a Medicaid applicant who sold her house for less than one-fifth of its tax assessed value because the price was fair market value based on the property’s condition. Matter of Whittier Health Services, Inc. v. Pospesel (N.Y. App. Div., 3rd Dept., No. 520890, Nov. 25, 2015).

A nursing home applied for Medicaid on behalf of a resident. The state determined that the applicant sold her home for less than market value within the look-back period and assessed a penalty period. Tax assessment records showed the property was valued at $143,511, but the applicant sold the home for $23,122.

The nursing home appealed, arguing that the house was sold for fair market value because it needed significant repairs and was sold to someone who was not related to the applicant. After a hearing, the state affirmed the penalty, and the nursing home appealed to court.

The New York Supreme Court annuls the penalty period based on the sale of the house. According to the court, the evidence shows the sale was an arms-length transaction and “a recent arm’s length sale is a more accurate indicator of actual market value of the [applicant’s] property than the tax assessment records relied upon by” the state.

For the full text of this decision, go to: http://www.nycourts.gov/reporter/3dseries/2015/2015_08690.htm. 

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December 14

Son Must Pay for Mother’s Care Under Filial Responsibility Law Despite Abusive Childhood

A Pennsylvania appeals court holds that a son is required to pay for his mother’s care under the state’s filial responsibility law even though the mother does not have outstanding medical bills and the son claims he had an abusive childhood. Eori v. Eori (Pa. Super. Ct., No. 1342 WDA 2014, Aug. 7, 2015).

Joseph Eori is attorney-in-fact for his mother, Dolly Eori, who requires 24-hour care.  Ms. Eori lives with Mr. Eori, and her medical and caregiving expenses exceed her income.

Mr. Eori filed a complaint on behalf of his mother seeking filial support from his brother, Joshua Ryan. Mr. Ryan objected, arguing, among other things, that his mother was not indigent because she did not have outstanding medical bills and that he had an abusive childhood. Pennsylvania’s filial responsibility law negates the support obligation if the parent abandoned the child for a 10-year period. The trial court granted the petition for support, and Mr. Ryan appealed.

The Pennsylvania Superior Court affirms, holding that Mr. Ryan is required to provide support to his mother. The court agrees with the trial court’s decision that the filial responsibility law doesn’t require a showing of unpaid bills or liabilities to justify a claim. In addition, the court affirms the trial court’s ruling that while Mr. Ryan may not have had an ideal childhood, there was no evidence that his mother abandoned him.

For the full text of this decision, click here.  

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November 30

No Medicaid Transfer Penalty on Sale of House to Granddaughter

Reversing a lower court, an Indiana appeals court rules that the state should not have imposed a transfer penalty on a Medicaid applicant who sold her house to her granddaughter because the evidence shows the house sold for fair market value. Brown v. Indiana Family and Social Services Administration (Ind. Ct. App., No. 87A01-1501-PL-38, Nov. 18, 2015).

Ada Brown and her husband transferred their house to a trust and made the trust irrevocable. Mrs. Brown moved into a nursing home and the trust sold the house to her granddaughter for $75,000. Two years later, Mrs. Brown applied for Medicaid benefits. Based on information from the county assessor that showed the value of the house as $91,900, the state determined that the house was sold for less than fair market value and assessed a transfer penalty.

Mrs. Brown appealed, arguing that the value of the house was reduced due to the need to replace the sewer system. A hearing officer and the trial court affirmed the penalty period, and Mrs. Brown appealed.

The Indiana Court of Appeals reverses, holding that the evidence shows the house was not transferred for less than market value. The court notes that there was no evidence that the tax assessment used by the state reflected the price of the house at the time of the sale. According to the court, “the evidence reveals a willing buyer and seller, albeit with a family relationship, and no evidence that either was under any compulsion to consummate the sale.”

For the full text of this decision, go to: http://www.in.gov/judiciary/opinions/pdf/11181501nhv.pdf

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November 26

Medicaid Applicant’s Assets Not Reduced By Probate Court Guardianship Orders

A Texas court of appeals rules that probate court guardianship orders setting monthly needs allowances and authorizing payments do not act as encumbrances against a Medicaid applicant’s bank account because they do not require the payment of specific legal debt. Henson v. Texas Health and Human Services Commission (Tex. Ct. App., 3rd Dist., No. 03-13-00621-CV, Nov. 5, 2015).

Nursing home resident Mary Henson was under guardianship. The probate court entered an order setting a monthly allowance for Ms. Henson’s needs and another order authorizing the payment of certain expenses. Ms. Henson applied for Medicaid benefits in April 2009. The state granted her benefits effective April 1, 2009.

Ms. Henson appealed, arguing that the state should have found her eligible for benefits on March 1, 2009. Ms. Henson acknowledged that her bank account had $2,239.77 on March 1, 2009, but she argued that the probate court orders were encumbrances that should have been deducted from the account. The trial court affirmed the state’s decision, and Ms. Henson appealed.

The Texas Court of Appeal affirms, holding that the probate court orders were not encumbrances. The court rules that even if the law compels the state to treat a court order as an encumbrance against a bank account if the order requires the payment of a legal debt, the evidence shows that the probate orders in this case “do not operate to restrict [Ms.] Henson’s guardian’s ability to access any funds and that they are not orders requiring the payment of any specific legal debt.”

For the full text of this decision, go to: http://www.search.txcourts.gov/SearchMedia.aspx?MediaVersionID=e9e62560-bdc4-487a-a2d7-e398507b4622&coa=coa03&DT=Opinion&MediaID=cbffe33b-f4b1-4827-99fd-13abde7f5a25

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