Monday, January 26, 2015

NYT: Nursing Homes Seek Guardianships (And Fees) To Collect Unpaid Nursing Home Costs

In a major investigative report, The New York Times describes findings that nursing homes in counties throughout the state of New York are agressively seeking appointment of non-family members as guardians for residents of their facilities.  The trigger? Unpaid nursing home fees.  

Reporter Nina Bernstein uses the history of 90-year old Lillian Palermo to illustrate the practice, where a nursing home initiated a guardianship proceeding to displace her husband's authority as agent under a Power of Attorney, when disputes with her husband left unpaid bills, alleged to be "approaching $68,000."  

NYT  and researchers at Hunter College teamed to analyze the use of guardianships as a bill collection tool by nursing homes:

"Few people are aware that a nursing home can take such a step.  Guardianship cases are difficult to gain access to and poorly tracked by New York State courts; cases are often closed from public view for confidentiality.  But the Palermo case is no aberration,. Interviews with veterans of the system and a review of guardianship court data conducted by researchers at Hunter College at the request of The New York Times show the practice has become routine, underscoring the growing power nursing homes wield over residents and families amid changes in the financing of long-term care.

 

In a random, anonymized sample of 700 guardianship cases filed in Manhattan over a decade, Hunter College researchers found more than 12 percent were brought by nursing homes.  Some of these may have been prompted by family feuds, suspected embezzlement or just the absence of relatives to help secure Medicaid coverage.  But lawyers and others versed in the guardianship process agree that nursing homes primarily use such petitions as a means of bill collection -- a purpose never intended by the Legislature when it enacted the guardianships statute in 1993."

While, according to the NYT, at least one court has ruled such a "tactic by nursing homes is an abuse of the law," the increase of such suits highlights the payment dilemmas faced by facilities and families as Medicaid eligibility rules narrow and as the margin tightens for coverage of costs of care.

New York is not alone in seeing guardianship cases initiated by nursing homes.  In Pennsylvania, attorneys retained by families or individuals have also sometimes challenged the practice, focusing on the use of facility-preferred guardians and the amount of fees added to the care bills in dispute.

For more, read "To Collect Debts, Nursing Homes Are Seizing Control Over Patients."

January 26, 2015 in Consumer Information, Current Affairs, Elder Abuse/Guardianship/Conservatorship, Health Care/Long Term Care, Medicaid, State Cases | Permalink | Comments (0) | TrackBack (0)

Justice in Aging: New Name plus Long-Standing Commitment

National Senior Citizens Law Center, an important advocate for low income seniors in the U.S. since its inception in 1972, has announced a new identity, "Justice in Aging." But, don't worry, this change represents a deepening of their long-standing commitment (including a cherished role in training and education of senior advocates, including free webinars). As explained in news releases:

"The new name and accompanying 'look' will more accurately reflect the nature of our work, build on our legacy of impact, and open the door to engage more supporters and partners across the country.  And it is a LOT easier to say and remember!

 

Our new name will be Justice in Aging.  Our new tagline will be Fighting Senior Poverty Through Law.... Our new website will be www.justiceinaging.orgWe will begin using the new name on March 2, 2015.... While our name is changing, our work will remain the same.  As income inequality increases across the nation and the population ages, senior poverty is growing to unprecedented levels.... We still serve serve as a resource for advocates on important programs like Medicare, Medicaid, LTSS, Social Security and SSI." 

We wish the hardworking staff of NSCLC -- or now JiA, perhaps? -- all the best as they roll out their new identity, and in their continuing commitment to advocating for seniors across the nation. 

January 26, 2015 in Consumer Information, Current Affairs, Health Care/Long Term Care, Medicaid, Medicare, Social Security | Permalink | Comments (0) | TrackBack (0)

Thursday, January 22, 2015

Can Private Parties Sue to Challenge Underfunding of Medicaid-Care? Supreme Court Hears Oral Argument

Oral argument on Armstrong v. Exceptional Child Care Center before the U.S. Supreme Court on January 20 highlighted important issues of private standing to challenge funding under state-federal Medicaid programs. "The case raises the issue of whether Medicaid providers can challenge a state law in federal court on the basis that it violates the federal Medicaid Act and therefore is preempted by the Supremacy Clause of the U.S. Constitution," as summarized and explored by the Kaiser Family Foundation

Additional commentary on the oral arguments is provided on Volokh Conspiracy, via the Washington Post.  

January 22, 2015 in Medicaid | Permalink | Comments (0) | TrackBack (0)

Tuesday, January 20, 2015

NSCLC Update on Minimum Wage and Overtime for Home Care Workers

The National Senior Citizens Law Center (NSCLC) has sent out the latest news on pending (but delayed) implementation of new rules affecting payment of wages for many home care workers.  Here is the helpful update from NSCLC: 

"A U.S. federal district court has struck down new rules that would have applied Fair Labor Standards Act standards, like payment of minimum wage and overtime, to most Medicaid home care providers.  Historically, many personal care providers and other in-home assistants have been exempted from federal labor laws under the 'companionship services' exemption.  


The US Department of Labor is likely to appeal the decision to the D.C. appellate court, so a final decision on the validity of the expanded FLSA regulations will take some time.  In the meantime, however, the new regulations, which were supposed to start on January 1, 2015, will not take effect.  Unless a state chooses otherwise, home care providers’ wages and hours will stay the same.  For more details about the court decisions or the rule, visit http://www.dol.gov/whd/homecare/ or contact Hannah Weinberger-Divack."

January 20, 2015 in Consumer Information, Health Care/Long Term Care, Medicaid | Permalink | Comments (0) | TrackBack (0)

Sunday, January 18, 2015

Florida Supreme Court Advises on "Medicaid Planning" by Nonlawyers as "Unlicensed Practice of Law'

Following extensive hearings and related proceedings, including revision of an earlier proposed advisory opinion by the Florida Bar's Standing Committee, the Florida Supreme Court issued a per curiam opinion on January 15, 2015, addressing certain Medicaid planning activities, concluding that when performed by nonlawyers, they constitute the "unlicensed practice of law" (UPL), thereby leading to potential sanctions. Florida Supreme Court

The ruling focuses on actions by nonlawyers who assist with one or more of the following activities leading up to an application for Medicaid: (1) drafting of personal service contracts, (2) preparation and execution of Qualified Income Trusts; or (3) rendering legal advice on implementation of Florida law to obtain Medicaid benefits. The Court expressly distinguished the "preparation of the application for Medicaid benefits" as being outside of its opinion, pointing to federal law as authorizing nonlawyer assistance in the application process. 

The Elder Law Section of the Florida Bar was the petitioner seeking the advisory ruling.

In the detailed conclusion, the "harm and potential harm" from "unregulated" nonlawyers selling trust packages was outlined:

Continue reading

January 18, 2015 in Consumer Information, Estates and Trusts, Ethical Issues, Legal Practice/Practice Management, Medicaid, State Cases | Permalink | Comments (1) | TrackBack (0)

Wednesday, December 31, 2014

Why an Experienced Elder Law Attorney Can Make a Difference...

On November 14, 2014, the Ohio Court of Appeals affirmed a lower court's decision in a deceptively simple contract dispute.  The question was whether a son, who was his mother's agent under a power of attorney, could be held personally liable for $8,700 incurred by his mother in nursing home costs.  The ruling in Andover Village Retirement Community v. Cole confirmed the son's contractual liability.

When I first read about the case, I thought I would find another example of the often confusing use of "responsible party" labels for agents in a nursing home admission agreement, a topic I've written about at length before.  However, the Ohio case was a new spin on that troublesome topic.  According to the opinion, Andover Village actually presented two separate documents to the son at the time of his mother's admission.  One document was an admission agreement that the son signed, pledging:

“When Resident's Responsible Person signs this Agreement on behalf of Resident, Resident's Responsible Person is responsible for payment to [Andover] to the extent Resident's Responsible Person has access and control of Resident's income and/or resources. By signing this Agreement the Resident's Responsible Person does not incur personal financial liability.”

The second document, titled "Voluntary Assumption of Personal Responsibility," was also signed by the son, but this time it stated, “I, Richard Cole, voluntarily assume personal financial responsibility for the care of Resident in the preceding Agreement.”

The court viewed the second document as the son's personal guarantee, and it was this document that triggered the court to find the son personally liable for his "voluntary" assumption of the obligation to pay costs not covered by Medicare or Medicaid.

The Ohio court leaves me with another question, not directly addressed in the decision.  Did the son really make a knowing and voluntary decision to assume personal liability for costs, especially costs that can break most individual's piggy banks?  Or, did the son sign a stack of papers he was told were routine and necessary for his mother to be admitted?  Admissions to nursing homes are often made when everyone, the resident and the family members, is under stress.

At a minimum, I would like to think that a family's consultation with an experienced elder law attorney at the time of admission would have made a difference. 

For facilities that are Medicare or Medicaid eligible -- and that is most nursing homes -- key federal laws, set forth at 42 U.S.C. §§ 1395i-3(c)(5)(A)(ii), 1396r(c)(5)(A)(ii) provide: “With respect to admissions practices, a skilled nursing facility must . . . not require a third party guarantee of payment to the facility as a condition of admission (or expedited admission) to, or continued stay in, the facility.” 

I expect that an experienced elder law attorney would be familiar with this restriction on "mandatory" guarantees and would help the son see that for the nursing home to be compliant with federal law, any guarantee must be truly voluntary.  Advice from an experienced elder law attorney would help to guard against the not-so-voluntary signing of a stack of papers that are presented as "necessary" to admit the resident.  Perhaps a facility would refuse to admit the mother unless the son signs the "voluntary" agreement, but if that happens, it would be clear that the facility is violating the intention of federal law to protect individuals -- and families -- from waiving certain rights as a condition of admission or continued residence.

With that experienced lawyer's advice, a son could make a knowing and intentional decision to serve as his mother's contractual guarantor, and thus would be alert in advance to the ways that even small gaps can occur that are not covered by Medicare, Medicaid or private insurance. (Those small gaps can add up!)  Alternatively, if the son is not willing or able to serve as his parent's guarantor, another facility might be the better choice. 

In law school classes about elder law, we do teach Medicaid planning approaches, but frankly, that is usually a small part of any course.  The majority of our time is spent on the abundant ways that individuals and families can be helped by an attorney who understands the full panoply of rights and obligations that attend growing older in the U.S. and beyond. 

Hat tips to Pennsylvania attorney Jeffrey Marshall and Florida attorney Joseph Karp for alerts to the Ohio case.  

December 31, 2014 in Consumer Information, Ethical Issues, Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, Medicare, State Cases | Permalink | Comments (0) | TrackBack (0)

Monday, December 29, 2014

College Broadcast Student's Media Project Focuses on Filial Laws

Christopher Robb is in his final year at Westminster College in Pennsylvania and for his senior Media project he tackled "filial laws."  His impressive work included researching the history of such laws and studying recent court cases in Pennsylvania.  He interviewed and filmed a host of individuals from across the state who have experience with recent trends in use of filial support laws by nursing homes to seek payment from adult children for bills not satisfied by the resident's resources, insurance or Medicaid.  Chris Robb's resulting 15 minute video is titled, "Am I My Mother's Keeper?"  Thank you for sharing it with the Elder Law Prof Blog!

 

December 29, 2014 in Consumer Information, Current Affairs, Health Care/Long Term Care, Housing, Medicaid, State Cases, State Statutes/Regulations | Permalink | Comments (1) | TrackBack (0)

Thursday, December 18, 2014

CMS Invites Comments to Proposed Rule Recognizing Same-Sex Marriages

The Centers for Medicare and Medicaid Services (CMS) recently published a proposed rule that would make equal treatment for same-sex marriages (recognized under state law) a condition for all providers or suppliers seeking federal funding.  CMS also released interim guidance for long-term care surveyors, as part of the agency's implementation of the Supreme Court's decision in U.S. v. Windsor,

Comments to the prosed rule are due by February 10, 2015.  The National Senior Citizens Law Center provides additional information regarding its advocacy on this important topic, and on the proposed regulations and policies on its Center website, here.

December 18, 2014 in Medicaid, Medicare | Permalink | Comments (0) | TrackBack (0)

Friday, December 12, 2014

Another Filial Friday: Rest Haven York v. Deitz

"Nonprecedential decisions" sometimes make me a little crazy.  Talk about them? Ignore them?  What if that's where all the action is happening on a tough topic? 

This time I think it is important to report a nonprecedential decision, one of the few to emerge from the appellate courts in Pennsylvania in recent years where sons or daughters are not held liable under Pennsylvania's filial support law, and thus were not required to pay for the parent's nursing home care.

In the case of Rest Haven York v. Deitz, Case No. 426 MDA 2014, the Pennsylvania Superior Court issued a nonprecedential memorandum ruling on August 22, 2014.   Mom resided in the plaintiff-nursing home for about two and a half years, and when she died there was an alleged unpaid bill of approximately $55k.  No details are provided in the opinion about why that debt accrued or whether Medicaid was used for any payments.  The amount is large enough to suggest something went wrong somewhere on the payment side of the ledger, but it also is not large enough to suggest that no payments were made.

The facility sued the resident's daughter, who was alleged to have "signed the admitting papers as agent under a power of attorney" executed by her mother.  The complaint, filed three months after the mother's death, alleged breach of contract, implied contract, unjust enrichment, fraud, "and breach of duty to support" under Pennsylvania's filial support law, 23 Pa.C.S.A. Section 4603.

Daughter was granted summary judgment by the trial court, dismissing the entire suit.  The only issue on appeal was whether the nursing home had "failed to provide evidence that could have allowed the trial court to declare [the mother] indigent." Indigency, an undefined term in the statute, is one element of Pennsylvania's filial support law. 

The appellate court rejected the daughter's argument that indigency must somehow be declared or established by a judgment before a family member's support obligation can be triggered.  However, the court also concluded that attaching a copy of the contract signed by the daughter, as agent for her mother, and attaching a copy of "overdue" charges on the mother's account did not suffice. Interestingly, the court then went on to offer a bit of a lesson on how nursing homes "could" prove their case -- so, a nonprecedential opinion with a moral?

"To present competent evidence to prove indigence, Rest Haven should have provided a bank statement or similar documentation attesting to [the mother's] financial condition." 

In giving this lesson, the court cited two very precedential cases decided by the same court, Healthcare & Retirement Corp. of America v. Pittas (2012) and Presbyterian Medical Center v. Budd (2003).

As I often say to family members or lawyers who are startled to read about filial support law obligations, Pennsylvania appellate courts take this law very seriously when it comes to unpaid nursing homes.  There are some defense strategies available, but a successful defense is not easy.    

December 12, 2014 in Health Care/Long Term Care, Medicaid, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Saturday, November 29, 2014

Oregon Court Invalidates State's Attempt to Expand Medicaid Estate Recovery

On November 26, 2014, in Nay v. Department of Human Services, the Oregon Court of Appeals invalidated a 2008 attempt by the state to expand Medicaid estate recovery rules to reach assets conveyed prior to death by the Medicaid recipient to his or her spouse. 

The court's ruling analyzes the portion of federal statutory law that permits, but does not require, states to expand Medicaid estate recovery programs to cover "any other real or personal property and other assets in which the [deceased] individual had any legal title or interest at the time of death... including such assets conveyed to a survivor, heir, or assign of the deceased individual through joint tenancy, tenancy in common, survivorship, life estate, living trust or other arrangement."  Analysis of this language, which was mirrored by Oregon statutory law, leads the court to conclude that some ownership interest at time death of the Medicaid recipient must be present to make the asset a valid target of Medicaid estate recovery:

"Therefore, we conclude that 'other arrangement' in the context of the definition of “estate” means that assets transferred from the deceased 'individual'—the Medicaid recipient—by operation of law on account of or occurring at the recipient's death are included in that definition. Thus, the 'including' clause in the federal permissive definition of 'estate' incorporates nonprobate assets that are transferred from the Medicaid recipient to a third party by operation of law or other mechanism, but in which the deceased Medicaid recipient retained legal title or 'any' interest at the time of his or her death."
The appellate court then analyzes property law principles and elective share rules in Oregon, concluding that the state rulemaking attempt to reach pre-death interspousal transfers is not within the scope of the federal (or state) authorization:
 
"By including the 'interspousal transfer' text in the pool of assets from which the state can recover from the surviving spouse's estate, the rule includes assets that necessarily were transferred before the recipient's death. Because we have concluded that such predeath transfers are antithetical to the definition of estate as provided by federal and state law (requiring that the recipient have an interest in the property at the time of his or her death), we conclude that DHS's amendments of OAR 461–135–0835(1)(e)(B)(iii) relating to interspousal transfers exceeded its statutory authority granted by ORS 416.350 and 42 USC section 1396p, and we hold those provisions invalid."
The petitioner in this case, Tim Nay, is a Portland, Oregon attorney and former president of NAELA. By ruling in favor of the petitioner on the scope of authority for rule making issue, the appellate court found it unnecessary to address the petitioner's alternative argument on constitutionality of the rule

November 29, 2014 in Estates and Trusts, Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, State Cases | Permalink | Comments (0) | TrackBack (0)

Sunday, November 23, 2014

California's Managed Care Project Frustrates Elders Who Are Ill and Poor

From Kaiser Health News, this report of "confusion, frustration and resistence," associated with California's first six months of efforts to move 500,000 low-income seniors and disabled persons into managed care: 

"'The scope and the pace are too large and too rapid for what is supposed to be a demonstration project,' said Dr. William Averill, executive board member of the Los Angeles County Medical Association, which filed a lawsuit to block the project. 'We are concerned that [the project] is ill-conceived, ill-designed and will jeopardize the health of many of the state’s most vulnerable population – the poor, the elderly and the disabled.'

 

There is a lot riding on the pilot — the largest of its kind in the nation. The patients involved are among the most expensive to treat – so-called 'dual eligibles,' who receive both Medicare, the health insurance program for the elderly and disabled, and Medicaid, which provides coverage for the poor. Over the three years of the demonstration project, California is focusing on 456,000 of the state’s 1.1 million dual eligibles.

 

State officials acknowledge some transition problems but say the project will provide consumers with more coordinated care that improves their health, reduces their costs and helps keep them in their homes. In addition, officials estimate the program could save the state more than $300 million in fiscal year 2014-2015."

For more, read "California's Managed Care Project for Poor Seniors Faces Backlash," by Anna Gorman.

November 23, 2014 in Health Care/Long Term Care, Medicaid, Medicare | Permalink | Comments (0) | TrackBack (0)

Friday, November 21, 2014

Oral Argument Before Third Circuit on Use of Short Term Annuities in Medicaid Planning

On November 19, attorneys representing families and the Commonwealth of Pennsylvania argued consolidated cases before a panel of the Third Circuit Court of Appeals,  involving use of short-term annuities in connection with applications for Medicaid-funded care.  The argument follows appeals from a January 2014 decision on summary judgment motions by the Western District of Pennsylvania in the case of  Zahner et al. v. Commonwealth of Pennsylvania

A key issue on appeal is whether use of "shorter" term annuities is permitted by the language of federal Medicaid statutes referring to actuarially-sound annuities, or whether such use automatically constitutes a transfer of assets for less than fair value, and thus is treated as a prohibited gift.  HCFA Transmittal 64 is the subject of much of the very technical debate.

Here is a link to the recording of the oral argument.

The jurists on the panel are Judge Theodore McKee (the male judge's voice on the recording), Judge Marjorie Rendell, and Senior Judge Dolores Sloviter (the softer voice on the recording).  Interestingly, rather early in the argument, at least two of the judges interject to make the observation that "there is nothing wrong with Medicaid planning, per se," noting, rather, that the issue is the extent to which specific planning approaches have been directly addressed by federal law.

The attorney arguing the position of the appellant families is René Reixach; the attorney arguing the case for the state appellee is Jason Manne

Listening to the oral argument in this case provides an opportunity for students in advanced legal studies on asset planning to consider cutting edge legal issues and policy concerns.  The argument is also an opportunity for even first-year law students to discuss argument techniques, and to consider what does or does not work well with judges (and vice versa). It was a "hot" bench and there was a lot of interruption from both sides.  

November 21, 2014 in Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Wednesday, November 19, 2014

The Law of Medicare and Medicaid at 50

Earlier this month, Yale Law School hosted a conference marking the 50th anniversary of the passage of Medicare and Medicaid.  The program speakers were encouraged to examine the precedents set by these two major programs, against the backdrop of recent health care reform initiatives.  Videos from sessions on "The Law of Medicare and Medicaid at 5o"  are now available to the public, including segments on:

  • Medicare, Then and Now
  • Historical Context, Legislation & Administration
  • Policy Making and Innovation
  • Health Law Federalism, Especially After NFIB
  • Looking Ahead

In addition, the presentation by keynote speaker Ezekiel Emanuel, Vice President of Global Initaitives and Chair, Medical Ethics and Health Policy at the University of Pennsylvania is available. 

The video segments, while interesting, may be a little difficult to sit through, as they are not edited, and some of the speakers are not using the microphones.  Fortunately, Professor Allison Hoffman from UCLA School of Law and others have written a wonderful series of pieces, stemming from the Yale program sesssions, and the articles are posted on Health Affairs Blog. 

November 19, 2014 in Health Care/Long Term Care, Medicaid, Medicare | Permalink | Comments (0) | TrackBack (0)

Friday, November 14, 2014

NSCLC Webinar on Emerging Issues and Consumer Rights in Medicaid Managed Care

The National Senior Citizens Law Center (NSCLC) is offering a free webinar on "Emerging Issues and Consumer Rights in Providing Medicaid LTSS through Managed Care."

Date and Time:    Wednesday, November 19, 2014 2-3 p.m. Eastern time

Description:      "This webinar will examine the critically important issue of consumer rights in the 28 states that have moved to Medicaid managed long-term services and supports (LTSS) systems.  Additionally, it will evaluate emerging issues we've seen in certain states."

More information and registration here.

November 14, 2014 in Medicaid, Webinars | Permalink | Comments (0) | TrackBack (0)

Monday, November 3, 2014

Ohio Appellate Court Upholds Spousal Annuity in Medicaid Case

The Ohio Court of Appeals, relying on a Sixth Circuit decision that interpreted Ohio law in Hughes v. McCarthy (2013), has now determined that a wife's purchase of an annuity with funds in excess of her community spouse resource allowance after her husband's admission to a nursing home, was not an improper transfer.  The court's ruling permits her husband to qualify for Medicaid coverage for his long-term care without any penalty period. 

A key to the court's October 22 ruling in Koenig v. Dungey, 2014 WL 5361644, was recognition that use of $121k of "joint funds" to purchase a five-year, actuarially sound spousal annuity was permitted by the language of federal laws, when the "transfer occurred after institutionalization but preeligibility."

In part, the attempts by some states to block use of annuities to convert at least a portion of marital assets into exempt spousal income, depends on states that have adopted tighter language than the federal law.  Along that line, Pennsylvania attorney Kemp Scales shared with me potentially relevant language from the U.S. Supreme Court, when construing the purported effect of one state's attempt to capture proceeds of a tort recovery in order to reimburse the state for its expenditures under Medicaid. In Wos v. E.M.A., 133 S.Ct. 1391, 1400 (2013), the Court rejected application of a state lien, noting the conflict with federal law:

"A [particular state] statute that singles out Medicaid beneficiaries in this manner cannot avoid compliance with the federal anti-lien provision merely by relying upon a connection to an area of traditional state regulation."

In September, a federal district court judge in the case of Wagner v. McCarthy, pending in the Southern district of Ohio, granted preliminary injunctive relief favoring community spouses and prohibited state officials from imposing penalties "due to the transfer of community resources to purchase an actuarily sound anuity for the sole benefit of thier respective community spouse." In granting the injunction, the judge observed "there is little doubt that Plaintiffs will succeed on the merits," citing Hughes v. McCarthy.      

In August, a somewhat more complicated Medicaid planning case, involving one spouse's transfer and sale of the couple's home, was argued before the Ohio Supreme Court and in an earlier Elder Law Prof Blog post we linked to the court's recording of the argument.  A decision on that case, Estate of Atkinson, is still pending.

November 3, 2014 in Health Care/Long Term Care, Medicaid | Permalink | Comments (0) | TrackBack (0)

Thursday, September 11, 2014

Fed Court in NY Takes Hard Line on Effect of "Partial Cure" for Medicaid Ineligibilty

Judge Geraci of the U.S. District Court, Western District of New York, is the latest judge to address an important topic in Elder Law regarding eligibility for long-term care benefits under Medicaid.  The court defines the issue as follows:  "When an uncompensated transfer of assets has been made and a [Medicaid] penalty period imposed, how does a partial return of the transferred funds affect the beginning of the penalty period?"  

In its August 2014 decision in Aplin v. McCrossen, the court addresses summary judgment motions in two separate cases that were filed on behalf of 80-year-old Florence Aplin and 85-year old Sergio Ciardi, both residents of nursing homes.  In one case, for example, the Aplin case, the transfers totaled approximately $450,000; however, approximately $76,000 was later returned by the donees. The hope of the plaintiffs was that "return" of the money would permit them to shorten their penalty periods tied to the original transfers.  This approach, when planned in advance, is a post-Deficit Reduction Act technique sometimes known in Elder Law circles as a "partial cure" (as part of "reverse half-a-loaf" gifting).

Judge Geraci denied the relief sought by the plaintiffs.  He followed the hardline approach of "nonprecedential" rulings on New Jersey disputes about partial cures, ruling that "return" of money permits the state agency to recalculate the start of the penalty period. The court decided that NY administrative rules do not conflict with federal policy and not only permit but require the state agency to, in effect, restart the penalty period on the ground that the later date is when the "applicant becomes otherwise eligible for Medicaid." This phrase is a key concept in federal Medicaid law.  The plaintiffs had argued that phrase applied only to an earlier date, from their original application. Judge Geraci concluded:

"I find no circumstances in this case which indicated that Defendants' interpretation and application of the provisions of [New York administrative directives] contravene Congress' articulated purpose in enacting the Medicaid Act -- to provide medical care, services and supplies for the financially needy.  Essentially, the assessment of an applicant's income and resources which results in a determination that such applicant has transferred resources for less than fair market value during the statutory look-back period and that an appropriate penalty period must be imposed, ensures that the applicant has not falsely impoverished himself or herself in order to qualify for medical assistance at public expenses which, by law, is undeserved."

While it is apparent that the New York federal judge was not eager to give applicants any benefit tied to partial cures on transfers, the decision also appears to approve or at least ignore what some would describe as a "perverse effect" of the New York policy.  By imposing a new, later "start date" for the ineligibility period following the return, New York can actually impose a penalty that is longer than the original penalty period for the full transfer. 

Also at issue in the case was the effect of a series of statements on the federal government's side, including the so-called "McGreal Letter" from CMS that was relied on by the plaintiffs in making the returns. (The court did not expressly address a May 2014 GAO study, where it was reported at page 28 that "[a]ccording to CMS, states can choose whether or not to consider a partial return of transferred assets on Medicaid planning.")

Should there be uniformity among the states, not just on whether but how families can seek any relief from "resource" limits set by federal law?  (The GAO study linked above indicates a range of different state-specific options are in play.) The answer to that question may depend on one's point of view.

For more background on the complex interaction between Medicaid applications, ineligibility periods triggered by uncompensated transfers, partial cure attempts and penalty start dates, see ElderLawGuy Jeff Marshall's blog post from 2011.    

September 11, 2014 in Federal Cases, Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid | Permalink | Comments (0) | TrackBack (0)

Friday, August 29, 2014

Kaiser Health News: Will Calif. Governor Sign Legislation Limiting Medicaid Estate Recovery?

From Kaiser Health News (in partnership with NPR and Capitol Public Radio):

"A bill passed by the California legislature this week is putting Gov. Jerry Brown in a delicate position: Sign the measure and support consumer demands for a change in the state’s policy on recovering assets from Medicaid enrollees or keep the current system that generates about $30 million used to provide Medicaid benefits to more residents.

 

The governor typically does not comment on bills until he receives the actual text from the legislature. His Department Of Finance, however, opposes the bill, pointing out that the recovered assets help the state provide services to others. The bill that just passed the legislature this week, would prohibit the state from trying to recoup some of the money spent on older Medicaid enrollees for ordinary health coverage by recovering assets after they die.

 

Federal law requires states to recoup money spent on institutional care, such as nursing homes, by Medicaid, the state-federal health care program for low-income people. But it also allows states to recover costs from people after they die if they received basic medical services through Medicaid at the age of 55 or older. 

 

In California, advocates of the bill say the current law is complicating enrollment in Medi-Cal, the state’s Medicaid program, with some people refusing to sign up, and others terminating enrollment for fear of not being able to pass on their estate.The state has enrolled 2.2 million people into Medi-Cal under the Affordable Care Act."

For more, see "Calif. Bill Would Protect Estates of Many Who Received Medicaid."

 

August 29, 2014 in Estates and Trusts, Medicaid, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Thursday, August 21, 2014

Watch Oral Argument Before Ohio Supreme Court on "Asset Transfer" Case

Wow!  Medicaid transfer rules argued in prime time!  (Well, almost...)

On August 20, the Ohio Supreme Court heard oral argument on Estate of Atkinson v. Ohio Dept. of Job & Family Services, Case No. 2013-1773.  Video of the presentations (including the very interesting questions from the bench) can now be viewed here on the Ohio Channel. 

This strikes me as a great opportunity for Elder Law course students to read briefs and observe lawyers in oral argument tackle technical, challenging legal issues (listen to the Court ask one attorney to slow down and explain his use of pronouns).  Can you predict the outcome?  Note: The Supreme Court's arguments on Ohio Channel appear as high quality productions, well edited, with subtitles indicating the names of the speakers and the identity of the issues on appeal, and the website is searchable for other appellate cases for faculty members looking for examples to use in other classes.

As framed in the appeal, the issue is whether the community husband's actions triggered a period of ineligibility for Medicaid benefits for his wife in the nursing home.  The record showed the husband transfered the couple's  home "out" of the couple's long-standing revocable trust to the name of the institutionalized spouse, and then in turn, the same day, to the community spouse.  As described in one news account:

"The county department of job and family services found that the transfer of the home, valued at $53,750, was improper because it violated federal and state Medicaid rules. While Mrs. Atkinson’s Medicaid benefits were approved, the agency temporarily excluded nursing-home care from her coverage because of the transfer." 

The state has been successful with its arguments before state agencies up to this point.  The Ohio  Supreme Court, however, asked the attorneys about the applicability and relevance of the 6th Circuit's 2013 decision in Hughes v. McCarthy regarding permitted use of spousal annuities in Medicaid planning in Ohio.  During the oral argument, one Justice also asks whether the state should be bound by the position taken by the federal agency, Health and Human Services (apparently in an amicus brief), in support of the family's argument. 

There are also opportunities here to think about whether -- and how -- this particular transfer issue might have been avoided with different planning. 

August 21, 2014 in Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Wednesday, July 30, 2014

Overview of Statutory Claims for Health Care Fraud and Abuse

John Washlick, a shareholder with Buchanan Ingersoll & Rooney in Philadelphia and Princeton, provides a concise and useful overview of laws that form the basis for claims of "fraud" or "abuse" associated with Medicare and Medicaid in the most recent issue of Pennsylvania Bar Quarterly (April 2014, available also on Westlaw).  The abstract to his article, "Health Care Fraud and Abuse," provides:

"Medicare and Medicaid combined comprise the largest payer of health care services in the world, and account for over 20 percent of all U.S. government spending.  As a result, efforts to combat fraud and abuse in these programs have become a congressional and administrative priority. This article will address four significant federal fraud and abuse laws: (i) Anti-Kickback Statute, (ii) "Stark" Anti-Referral Law, (iii) Civil Monetary Provisions, and (iv) False Claims Act (Civil and Criminal).  The Patient Protection and Affordable Care Act, more commonly referred to as the "Affordable Care Act" significantly strengthened each of these laws, including increased funding to step up enforcement actions.  There are other federal and state statutes that are aimed at curbing fraud and abuse and they should not be ignored when reviewing a financial arrangement between or among potential referral sources."

A useful guide, especially when reading about multi-million dollar settlements in whistleblower cases growing out of nursing home care, home care, hospice care, and pharmaceutical sales, such as the Omnicare settlement reported on the Elder Law Prof Blog today

July 30, 2014 in Federal Cases, Federal Statutes/Regulations, Medicaid, Medicare | Permalink | Comments (0) | TrackBack (0)

Omnicare Inc. to Pay $124.24 Million in Settlement of Whistleblower Case

From the Department of Justice, news of the False Claims Act settlement reached with Omnicare Inc., "the nation's largest provider of pharmaceuticals and pharmacy services to nursing homes."  The company has agreed to pay $124.24 million "in return for their continued selection" as the supplier of drugs to elderly Medicare and Medicaid beneficiaries.  The claims related to improper discounts allegedly given by Omnicare as incentives for doing business with the company.

According to the DOJ press release, the settlement resolves two lawsuits filed by whistleblowers under the qui tam provisions of the False Claims Act. "The first whistleblower, Donald Gale, a former Omnicare employee, will receive $ 17.24 million." 

DOJ states that since January 2009, it has "recovered a total of more than $19.5 billion through False Claims Act cases," including more than $13.9 billion in cases alleging fraud associated with health care programs.

July 30, 2014 in Federal Cases, Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, Medicare | Permalink | Comments (0) | TrackBack (0)