On appeal from the Department of Human Services, Division of Medical Assistance and Health Services.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Lisa and Alvarez.
M.C. appeals from a final decision of respondent Division of Medical Assistance and Health Services (DMAHS) denying Medicaid services and imposing a four-month and twenty-eight-day ineligibility period as a result of the transfer of $33,800 approximately eight months before M.C.'s Medicaid application. M.C. contends that the transfer was a payment pursuant to a "care agreement," and that the contract overcomes the rebuttable presumption created by N.J.A.C. 10:71-4.10(b)(6)(ii) that transfers of funds for care rendered by a relative for free are "intended to be delivered without compensation." Although we question the ultimate merits of petitioner's issues on appeal, we are constrained to remand the matter to DMAHS for further proceedings to develop a more complete factual record.
On September 12, 2008, respondent Ocean County Board of Social Services (the Board) denied M.C. Medicaid benefits based on the $33,800 care agreement payment. The Board imposed a transfer penalty, or period of Medicaid ineligibility, of four months and twenty-eight days from the first day of the month that M.C.'s resources would fall below $2000. Generally, an applicant's countable available resources cannot exceed $2000 if they wish to qualify for New Jersey's Medicaid Only program. N.J.A.C. 10:71-4.5(c). Upon notification of the imposition of the transfer penalty and the denial of benefits, petitioner appealed and the case was transmitted to the Office of Administrative Law (OAL) as a contested case.
D.L., M.C.'s daughter, who allegedly holds a durable power of attorney (POA) for her mother, entered into a caregiver contract on July 1, 2007. No copy of the POA is supplied as part of this record; none was presented to the Administrative Law Judge (ALJ) before whom proceedings were conducted.
According to a document submitted with the Medicaid application, titled "Affidavit of Child Living With Parent" (Affidavit), M.C. began to live with her daughter D.L. on March 12, 2004. On that date, M.C., D.L., and D.L.'s husband purchased a home: D.L. and her husband held an 81.3% interest in the property and M.C. owned the remaining 18.7%. On January 22, 2008, M.C.'s 18.7% share was deeded to D.L.
The Affidavit states that M.C. has resided in a skilled nursing facility since April 7, 2008, and includes the following language: "This Affidavit is being executed contemporaneously with the transfer of real property to me from my mother in order to provide the factual basis for the exemption of this transfer from any transfer penalties pursuant to 42 U.S.C. § 1396(p) et seq." Neither the Affidavit nor the real estate transfer are mentioned in the DMAHS decision or in the ALJ's initial decision.
The "care agreement" was signed by D.L., both in her capacity as the caregiver and in her capacity as M.C.'s POA, on July 1, 2007. It enumerated the services that the caregiver would provide to M.C., referred to in the agreement as "parent," in exchange for a $33,800 lump sum payment. The agreement specified that services commenced on July 1, 2007, although payment would not be made until January 15, 2008.
The schedule of services attached to the care agreement were essentially word-for-word a copy of the list of available home health care agency services obtained by D.L.'s attorney's paralegal when she conducted a phone survey of three agencies in Monmouth and Ocean County. Those services were enumerated in precisely the same language in the paralegal's affidavit, dated December 2, 2008, supplied to the ALJ prior to the hearing. Somehow, the schedule of services as recited in the paralegal's subsequent affidavit was incorporated wholesale into the earlier "care agreement." It was not tailored to fit in any fashion to the services D.L. was actually rendering to M.C. D.L. submitted M.C.'s Medicaid application on August 19, 2008. The care agreement and the Affidavit were included with the application.
The federal Medicaid Act, 42 U.S.C.A. §§ 1396-1396v, creates a federal-state program that extends medical benefits to "individuals whose income and resources are insufficient to meet the costs of necessary medical services." 42 U.S.C.A. § 1396. New Jersey is expected to comply with the Medicaid statute and federal regulations, as are all other states, in order to receive funds. See Harris v. McRae, 448 U.S. 297, 308, 100 S.Ct. 2671, 2683-84, 65 L.Ed. 2d 784, 799 (1980). A state must submit a plan for review and approval by the Secretary of the United States Department of Health and Human Services in order to be eligible. 42 U.S.C.A. § 1396.
The Social Security Act vests significant discretion in participating states to adopt and develop standards for determining the extent of medical assistance, requiring only that the standards be "reasonable" and "consistent with the objectives of the Act." Monmouth Med. Ctr. v. State, 158 N.J. Super. 241, 249 (App. Div. 1978), aff'd, 80 N.J. 299 (1979). By the enactment of the New Jersey Medical Assistance and Health Services Act, N.J.S.A. 30:4D-1 to -19.5, New Jersey authorized participation in the program and adopted relevant standards. See N.J.S.A. 30:40-2. Eligibility for medical assistance is governed by regulations adopted by the Commissioner of the New Jersey Department of Human Services. N.J.S.A. 30:4D-7. DMAHS is the agency within the Department of Human Services that administers the Medicaid program. N.J.A.C. 10:71-2.2.
Applications are submitted to local boards of social services in each county and are reviewed for compliance with the regulatory requirements. N.J.A.C. 10:71-1.1; N.J.A.C. 10:71-2.2. In this instance, the Board ...