Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.

W.B. v. Division of Medical Assistance and Health Services


February 24, 2010


On appeal from a Final Agency Decision of the Department of Health and Human Services, Division of Medical Assistance and Health Services, Agency Docket No. HMARP 04611-2007S.

Per curiam.


Submitted January 13, 2010

Before Judges Sabatino and J. N. Harris.

This is an appeal on behalf of W.B., a mentally incapacitated person, contesting a May 13, 2008 final agency decision of the Division of Medical Assistance and Health Services ("the Division"). Appellant challenges the Division's decision insofar as it set May 1, 2007 as the effective date of W.B.'s eligibility for Medicaid benefits. In particular, appellant contends that the Division erroneously treated certain stock held in W.B.'s name as a disqualifying financial resource until that stock was liquidated in April 2007. We affirm.

W.B. resides in a nursing home. Her adult son ("the son") holds a power of attorney to act on her behalf. In July 2006, the son applied for Medicaid benefits for W.B. That initial application was denied by the Hunterdon County Board of Social Services ("the Board") because W.B. had financial resources above the applicable $2,000 Medicaid resource limit.

In November 2006, the son re-applied for benefits for W.B. At the time of this second application, W.B. owned a motor home. Upon reviewing the circumstances and consulting with the Division for guidance, the Board decided in February 2007 to treat the motor home as an inaccessible resource that did not count against W.B.'s Medicaid eligibility determination pending its sale. Thereafter, on April 16, 2007, the son notified the Board that he had sold the motor home.

Meanwhile, the son and other members of W.B.'s family learned in April 2007 that W.B. owned stock in the Metropolitan Life Insurance Company ("MetLife"). The MetLife stock was valued at $6,289.25, a sum well above the $2,000 Medicaid resource limit. Upon discovering the stock, the son promptly sold it on his mother's behalf. The stock proceeds were used, along with the funds from the motor home sale, to pay some of W.B.'s outstanding nursing home bills. This was all accomplished by the end of April 2007.

After verifying that the proceeds from the motor home and MetLife stock liquidation had been spent down, the Board consequently found W.B. eligible for Medicaid benefits as of May 1, 2007. The son filed an administrative appeal of that determination, contending that an earlier eligibility date of December 1, 2006 should apply.

The dispute over W.B.'s proper eligibility date was referred to an Administrative Law Judge ("ALJ"). In his written decision, the ALJ slightly differed with the Board's ruling on the timing issues. The ALJ found that the Board should have resolved the issues concerning the motor home by the end of January 2007, thereby potentially qualifying W.B. for Medicaid as of February 1, 2007. However, the ALJ further concluded that the discovery of the MetLife stock required an additional one month postponement, thereby making the effective date of W.B.'s eligibility March 1, 2007.

The Director of the Division reviewed the ALJ's recommendation and rendered a final decision on May 13, 2008. The Director reversed and modified the ALJ's ruling. He found that W.B.'s eligibility was not established until May 1, 2007, after the MetLife stock had been sold and used to pay down the nursing home bills. In the course of his written analysis, the Director rejected the son's contention that the MetLife stock should not have been treated as a countable resource for W.B. because her family members were not aware of the stock's existence until April 2007. The Director concluded that, despite her children's professed ignorance of the stock, W.B. had the "right, authority, or power" to liquidate that asset, making it a countable resource for Medicaid eligibility purposes. See N.J.A.C. 10:71-4.1(c)(1); see also 20 C.F.R. § 416.1201(a)(1). Consequently, the Director reinstated the Board's determination to fix the effective date of eligibility as May 1, 2007, by which point the MetLife stock had been liquidated.

Through her son, W.B. appeals the Division's final decision. In reviewing that decision by the administrative agency statutorily entrusted to operate the Medicaid system in our state, we must accord the Division substantial deference in its areas of expertise. In general, we do not disturb the final decision of a state administrative agency unless there is "a clear showing that it is arbitrary, capricious, or unreasonable, or that it lacks fair support in the record." In re Herrmann, 192 N.J. 19, 27-28 (2007) (citing Campbell v. Dep't of Civil Serv., 39 N.J. 556, 562 (1963)). In that vein, a "strong presumption of reasonableness must be accorded [to an] agency's exercise of its statutorily delegated duties." In re Certificate of Need Granted to the Harborage, 300 N.J. Super. 363, 380 (App. Div. 1997).

Appellant has not demonstrated that the final determination in this case contravened these well-settled principles. Appellant maintains that the Board took an inordinate amount of time in determining that the motor home was a non-liquid resource that did not disqualify W.B. for benefits, and that W.B. should not be penalized for the Board's delay. Whether or not that is true, it is immaterial because W.B.'s ownership of the MetLife stock through April 2007 provides a reasoned basis for the agency's ultimate designation of May 1, 2007 as her effective date of eligibility.

As the Director correctly noted, an asset is a countable resource that can defeat an individual's eligibility for Medicaid if the individual has the "right, authority, or power to liquidate the property." N.J.A.C. 10:71-4.1(c)(1). This provision in the applicable New Jersey regulations tracks verbatim language in the federal Medicaid regulations. See 20 C.F.R. § 416.1201(a)(1) ("If the individual has the right, authority[,] or power to liquidate the property[,] or his or her share of the property, it is considered a resource.")

The above-referenced regulations contain no exception for situations in which the applicant, or his or her guardians, profess ignorance of the asset. Nor has appellant cited to such an exception in the Code of Federal Regulations, the New Jersey*fn1 Administrative Code, or in the pertinent enabling statutes. Regardless of whether W.B.'s relatives were aware of the MetLife stock or whether she had the mental wherewithal to direct others to liquidate it, W.B. maintained the legal right to that valuable asset through April 2007. See also Chalmers v. Shalala, 23 F.3d 752, 755 (3d Cir. 1994) (holding that an applicant's legal rights in certain real property justified treating her interests in that property as a countable resource for purposes of Social Security Income ("SSI") benefits eligibility, despite the applicant's contention that her schizophrenia impeded her practical ability to exercise those legal rights).

In W.B.'s reply brief, appellant points to a portion of the SSI section of the Social Security Program Operations Manual System ("POMS"), Section SI 01110.117, which states that if an individual is unaware of his or her ownership of an asset, the asset should not be treated as a countable resource "during the period in which the individual was unaware of his/her ownership." According to a disclaimer on its first page, however, the POMS "states only internal SSA [Social Security Administration] guidance." See poms.nsf/aboutpoms (last visited Feb. 8, 2010). The POMS "is not intended to, does not, and may not be relied upon to create any rights enforceable at law by any party in a civil or criminal action." Ibid. Moreover, the two hypothetical scenarios presented in Section SI 01110.117 to illustrate appropriate situations of an applicant's unawareness of an asset are not plainly comparable to the present case. The first example depicts a situation in which the applicant is unaware that he had inherited an interest in property from a landowner who had died. The second scenario describes an applicant who is sent a "get well" card while in the hospital, and is unaware that the card enclosed a check to her as a gift, which her daughter put away in a desk drawer. In both of these illustrations, the applicant did not learn, ab initio, that he or she had acquired property. In the instant case, there was no proof adduced before the agency that W.B. herself was oblivious to her original acquisition of the MetLife stock before she became mentally incapacitated.

Although we appreciate that competing equities exist in the present case, given our limited scope of review and the dearth of controlling law nullifying the Director's legal analysis and application of the agency's regulations, we affirm the final agency decision dated May 13, 2008.


Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.