August 17

No Medicaid Undue Hardship Exemption for Transfer to Disabled Veteran

A federal district court rules that nothing in federal law requires the state to disregard a transfer of a life estate by a Medicaid applicant to a disabled veteran, so the applicant’s federal claims are dismissed. Pike ex rel. Estate of Pike v. Sebelius (D. R.I., No. CA 13-392 S, July 16, 2015).

F. Norris Pike’s mother transferred two life estates to her granddaughter, a disabled veteran. Later Mr. Pile’s mother was admitted to a Rhode Island nursing home and applied for Medicaid benefits. The state assessed a penalty period because of the transfers and denied Mr. Pike’s appeal.

Mr. Pike filed suit in federal court, claiming that the state should have applied the Medicaid undue hardship exemption to the transfers because the granddaughter is a disabled veteran. The state filed a motion to dismiss.

The U.S. District Court, District of Rhode Island, dismisses the federal claims. According to the court, there is nothing in federal law that requires a hardship exemption for a transfer to a disabled veteran, so Mr. Pike did not state a federal claim.   

For the full text of this decision, go to: https://scholar.google.com/scholar_case?case=7452280974869396478&hl=en&as_sdt=6&as_vis=1&oi=scholarr

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August 15

Agency-Created Rules on Medicare Home Health Services Appeals Are Binding on Agency

Medicare home health services are available for individuals who are “confined to the home.” Medicare pays for these services through contractors known as “Medicare Administrative Contractors” (MACs). A group of individuals filed suit against the Secretary of Health and Human Services alleging the Secretary does not follow its own agency regulations governing appeals of Medicare home health services, which has resulted in improper denial of plaintiffs’ benefits. Although administrative law judges found the plaintiffs to be homebound, the contractors repeatedly denied subsequent claims for services, which plaintiffs contend is in violation of Medicare regulations. The Secretary filed this Motion to Dismiss, which was denied.

The district court held the plaintiffs, who are eligible for both Medicare and Medicaid, have standing to sue even though, as the Secretary asserted, Medicaid would likely pay their claims if they were to be denied Medicare coverage. Plaintiffs are seeking a right to Medicare coverage, and an improper denial of benefits could impose personal liability for uncovered services. Moreover, should Medicaid be forced to pay, one of the plaintiffs would be exposed to estate recovery. In addition, there are differences in the home health services provided between Medicare and Medicaid. Plaintiffs have shown a concrete injury sufficient to support standing. As for jurisdiction, although the court agreed with the Secretary that it does not have mandamus or federal question jurisdiction, the matter is properly before the court under the appeals provision of the Social Security Act found in §405(g). Lastly, the court disagreed with the Secretary’s contention that plaintiffs cannot file a claim for failure to follow interpretive rules related to MACs that do not bind the agency. The court said that it is long settled that rules promulgated by an agency that affect the rights of others are binding on the agency. The regulations governing MACs and Medicare appeals are couched in mandatory language, which, according to the court, shows the agency’s intent to be bound by these regulations.


Ryan v. Burwell, 2015 WL 4545806 (D. Vt. July 27, 2015)

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August 13

Probate Judges Have Broad Discretion to Determine Whether Plenary Hearings Are Required

The son of a ward in a contested guardianship matter appealed a probate court’s summary dismissal of his request to remove the guardian without conducting a plenary hearing. The court reasoned summary dismissal protects further depletion of the ward’s estate that would result in a contentious hearing to address arguments that had been previously decided in the initial contested guardianship application. The probate court’s judgment was affirmed on appeal.

The court held removal of a fiduciary is an “extraordinary remedy” that should only be allowed sparingly and with evidence from the applicant seeking removal, the fiduciary engaged in misconduct. However, probate matters are subject to summary actions and probate judges have broad discretion in determining whether additional plenary hearings are warranted. The son merely raised the same issues that were decided in the initial contested guardianship action and offered no credible evidence supporting removal. Also, the guardian’s yearly accountings were proper, a nursing home report contradicted the son’s assertion the ward was receiving poor care, and the court had already decided the guardian had not engaged in self-dealing. For these reasons, the probate judge properly exercised his discretion to summarily dismiss the son’s claim and deny a plenary hearing.

Matter of Scuderi, 2015 WL 4112149 (N.J. Super. App. Div. July 9, 2015)

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August 8

Remand to Determine Whether Temporary Misuse of Special Needs Trust Bars Trust From Being Exempt Asset

For a period of time Susan Elias had direct access to her irrevocable first-party special needs trust (SNT) through the use of a debit card. This direct access ended when the trusteeship changed. The Social Security Administration determined Susan’s access rendered the trust a countable resource and discontinued her Supplemental Security Income (SSI) benefits, as well as requested recoupment of $18,137 for incorrectly paid benefits. An administrative law judge (ALJ) upheld the Administration’s decision. Susan appealed, arguing the ALJ erred in holding the trust was not a proper SNT and thus not an exempt asset, and that her benefits should have only been suspended during the period of misuse.

The district court held that if an individual can direct the use of the trust’s corpus, the trust should be considered a countable resource for SSI eligibility purposes. Susan’s use of a debit card freely to make purchases is substantial evidence of misuse of the trust rendering it a countable resource. But it said that held the Program Operations Manual does not fully address, nor did the ALJ adequately discuss on the record, whether the temporary misuse of a properly created SNT forever bars consideration of the trust as an exempt asset once the misuse is rectified. The court remanded for further consideration of the issue.

Elias v. Colvin, 2015 WL 4529877 (M.D. Pa. July 27, 2015)

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July 13

94-Year-Old Must Pay Alimony to Offset Ex-Spouse’s Nursing Home Costs

Nebraska’s highest court determines that a 94-year-old husband must pay alimony to his 95-year-old ex-wife in order to help offset her nursing home costs, even if doing so puts his income below the poverty level. Binder v. Binder (Neb., No. S-14-783, June 26, 2015).

Laura and Glen Binder married in 1982. It was a second marriage for both of them and they had no children together. Mr. Binder owned farmland and operated a fertilizer business. Ms. Binder did not work outside the home. In 2012, Ms. Binder moved into a nursing home. Her income did not cover the cost of care, so Mr. Binder contributed the remaining amount.

Mr. Binder filed for divorce from Ms. Binder when he was 94 years old and she was 95 years old. The court dissolved the marriage and awarded Ms. Binder alimony in order to offset her nursing home costs. Mr. Binder appealed, arguing that the amount of alimony was presumptively an abuse of discretion because it drove his income below the poverty level in violation of state child support guidelines.

The Nebraska Supreme Court affirms, holding that the state child support law does not apply because the Binders do not have any minor children. The court concludes that the alimony award is not unreasonable because Mr. Binder has the power to dispose of farmland.

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