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Arnold Walter Nursing Home v. Pumarejo

March 23, 2010

ARNOLD WALTER NURSING HOME, PLAINTIFF-APPELLANT,
v.
HERIBERTO PUMAREJO, HERIBERTO PUMAREJO, JR., A/K/A HERBERT PUMAREJO, JR., A/K/A HERB PUMAREJO, AND KATHRYN PUMAREJO, A/K/A KATE PUMAREJO, DEFENDANTS-RESPONDENTS.



On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-2764-08.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued December 16, 2009

Before Judges Miniman and Waugh.

Plaintiff Arnold Walter Nursing Home appeals the dismissal on summary judgment of its claims against defendants Herbert Pumarejo, Jr., and Kathryn Pumarejo, Herbert's wife, for expenses related to nursing home care rendered to defendant Heriberto Pumarejo, Herbert's father, who is deceased and whose estate is insolvent.*fn1 We affirm.

I.

The following facts, taken from the record, inform our decision in this case.

Between October of 2005 and June of 2006, ownership of Heriberto's home, located in Union Beach, was transferred several times. In October 2005, ownership was transferred by Heriberto and his wife to Herbert. In January 2006, Herbert transferred ownership back to Heriberto alone. Finally, on June 29, 2006, Heriberto transferred ownership to Herbert. The stated consideration for each transfer was one dollar.

In February 2008, Heriberto became a patient at plaintiff's nursing home. On February 19, 2008, Heriberto, as the resident, and his daughter-in-law Kathryn, as the resident representative, entered into a written agreement with plaintiff. Heriberto agreed to pay, out of his own assets, for his nursing home care until he became eligible for payment by Medicaid.*fn2 Plaintiff was aware at that time that Heriberto had transferred ownership of his house, his only significant asset, to Herbert in 2006.

Kathryn, as the resident representative, undertook an obligation to make sure that nursing home bills not paid by Medicaid would be satisfied from Heriberto's personal assets. However, she did not agree to pay any of Heriberto's unpaid nursing home fees from her own assets. Herbert was not a party to the written nursing home agreement, although plaintiff alleges he entered into a verbal agreement similar to Kathryn's.

In the written agreement, both Heriberto and Kathryn agreed that it was their responsibility to apply for Medicaid coverage. Kathryn assisted Heriberto in making an application for Medicaid coverage immediately following his admission to the nursing home.

On May 6, 2008, Heriberto's application for Medicaid was denied, based upon the 2006 transfer of his house to Herbert. In addition, because of the transfer, Heriberto would not become eligible for Medicaid coverage until September 21, 2011.

The denial resulted from Medicaid's three-year look back requirement, which requires states to determine whether an applicant's assets have been transferred for less than fair market value during the three years prior to application for Medicaid coverage. See H.K. v. State, 184 N.J. 367, 380 (2005) ("[C]urrent regulations make an individual 'ineligible for institutional level services through the Medicaid program if he or she . . . has disposed of assets at less than fair market value at any time during or after the 36 month period . . . immediately before [seeking participation in the program].' N.J.A.C. 10:71-4.10(a)."). When an applicant is disqualified because of a transfer during the look-back period, there is a penalty, the duration of which "is calculated as 'the number of months equal to the total, cumulative uncompensated value of all assets transferred by the individual, on or after the look-back date, divided by the average monthly cost of nursing home services.'" Ibid. (quoting N.J.A.C. 10:71-4.10(m)(1)).*fn3

After plaintiff received notice of the Medicaid denial, it informed Herbert that his father would have to leave the nursing home unless (1) he transferred the house back to his father, so that his father could list it for sale and, pending the sale, use it to secure payment for past and continuing nursing home care; or (2) Herbert effectuated the sale of the house and made ...


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