Williams v. Ohio Dep't of Job & Family Servs.

978 N.E.2d 1260

Helen WILLIAMS, Appellant,

v.OHIO DEPARTMENT OF JOB AND FAMILY SERVICES, Appellee.

No. 8–11–18.

Court of Appeals of Ohio, Third District, Logan County.

Oct. 9, 2012.

Donald C. Brey, Elizabeth J. Watters, Columbus, Thom L. Cooper, Centerburg, Elizabeth Durnell, for Appellant.

Amy R. Goldstein, Columbus, for Appellee.

OPINION

SHAW, P.J.

{¶ 1} Appellant, Helen Williams (“Helen”), appeals the September 20, 2011 judgment of the Logan County Court of Common Pleas affirming the Administrative Appeal Decision of the Ohio Department of Job and Family Services finding that Appellee, the Logan County Department of Job and Family Services (the “Agency”), correctly identified two improper resource transfers which subjected Helen to a period of restricted Medicaid coverage for her nursing home care. The trial court also determined that the Agency incorrectly calculated the amount of the improper transfers and directed the Agency to reassess Helen's period of restricted Medicaid coverage.

{¶ 2} The facts in this case are undisputed by the parties. Helen resides at a nursing home facility. Under the applicable law, she is considered the “Institutionalized Spouse.” Helen's husband, Bobby, continues to reside in the couple's home and is considered the “Community Spouse”.¹

{¶ 3} Prior to applying for Medicaid coverage for her nursing home care, the two following transfers of Helen and Bobby's assets were made. On June 9, 2010, the couple transferred funds in the amount of $17,114.05 to Bobby's son, Helen's step-son. On July 28, 2010, Helen and Bobby transferred their home out of their individual names to a revocable trust, the “Bobby Williams Family Trust,” via a quitclaim deed. The trust was created by Bobby for his sole benefit and listed Bobby as the initial trustee in the trust document.

{¶ 4} On August 18, 2010, Helen's Authorized Representative (“AR”) applied for Medicaid benefits on her behalf. The Agency then calculated the Community Spouse Resource Allowance amount (the “CSRA”), which is a capped, formula based amount of the couple's joint resources that the Community Spouse is allowed to retain to live on when the institutionalized spouse applies for Medicaid coverage of her nursing facility expenses. See Wisconsin Dept. of Health and Family Services v. Blumer, 534 U.S. 473, 482–83, 122 S.Ct. 962, 151 L.Ed.2d 935 (2002); Ohio Admin. Code 5101:1–39–36.1. The remaining resources are deemed available to the Institutionalized Spouse for the purpose of calculating her Medicaid eligibility. SeeOhio Admin. Code 5101:1–39–36; Ohio Admin. Code 5101:1–39–36.1. Specifically, the remainder of the couple's assets are to be used for the Institutionalized Spouse's care until that spouse has less than $1,500—at which point Medicaid eligibility is possible. Ohio Admin.Code 5101:1–39–05(B)(11). If the Community Spouse uses resources above the amount allocated to him by the CSRA, then it is deemed an “improper transfer” because resources have been transferred away from the Institutionalized Spouse's share. SeeOhio Admin. Code 5101:1–39–07.

{¶ 5} Here, the Agency determined that Helen and Bobby owned assets totaling $119,272. Accordingly, Bobby's CSRA was $59,636 or half of the couple's total combined assets as of the resource assessment date. Notably, the couple's home, valued at $89,500, was considered a “countable resource” in the resource assessment because it was held in the revocable trust at the time. After the CSRA was established, neither Helen nor Bobby disputed the CSRA calculated by the Agency.

{¶ 6} On August 25, 2010, Bobby transferred title to the home from the revocable trust to his individual name via a fiduciary deed. On August 30, 2010, Helen entered the nursing facility.

{¶ 7} On October 12, 2010, the Agency approved Helen's application for Medicaid coverage. However, the Agency also determined that Helen was subject to 17.7 months of restricted Medicaid coverage ² because it identified two “improper transfers”in the amount of $106,614.05, both of which occurred within the sixty-month look back period. SeeOhio Admin. Code 5101:1–39–07(B). The first of these improper transfers was identified as the $17,114.05 given to Helen's step-son on June 9, 2010.³ The second improper transfer identified by the Agency was the transfer of the home from the revocable trust to Bobby in the amount of $89,500.

{¶ 8} Helen, through her AR, administratively appealed the Agency's determination and challenged the impropriety of the transfers and the imposed period of restricted Medicaid coverage. On January 19, 2011, after a hearing, the State Hearing Decision was issued which determined that the Agency correctly identified the two improper transfers in the amount of $106,614.05 and correctly assessed the period of restrictive Medicaid coverage. Helen then filed an appeal of the State Hearing Decision to the Director of the Department of Job and Family Services. On this appeal, Helen conceded the transfer of the $17,114.05 was improper, but continued to dispute the Agency's finding that the August 25, 2010 transfer of the home from the revocable trust to Bobby constituted an improper transfer.

{¶ 9} On March 18, 2011, the Administrative Appeal Decision was issued by a panel of three administrative appeal examiners who found that the transfer of the home constituted an improper transfer. However, the administrative appellate panel concluded that the Agency incorrectly calculated the period of restrictive Medicaid coverage. Instead of the entire value of the home being considered the amount of the improper transfer, the administrative appellate panel determined that penalty amount should only consist of the difference between the CSRA and the value of the resources that Bobby received as a result of the improper transfer. Accordingly, the administrative appellate panel concluded that a new period of restricted Medicaid coverage should be assessed and reversed the State Hearing Decision on this limited basis.

{¶ 10} Helen then appealed the Administrative Appeal Decision to the Logan County Court of Common Pleas, which affirmed the Administrative Appeal Decision, finding that it was supported by reliable, probative and substantial evidence. The trial court also remanded the case to the Agency to recalculate the period of restricted Medicaid coverage.

{¶ 11} Helen filed a notice of appeal, asserting the following assignments of error.

ASSIGNMENT OF ERROR NO. I

THE TRIAL COURT ERRED IN AFFIRMING APPELLEE'S MARCH 18, 2011 ADMINISTRATIVE APPEAL DECISION AND JANUARY 19, 2011 STATE HEARING DECISION THAT APPELLANT'S TRANSFER OF HER HOME FROM A REVOCABLE TRUST TO THE COMMUNITY SPOUSE CONSTITUTED AN IMPROPER TRANSFER OF ASSETS

THAT RESULTED IN A PERIOD OF RESTRICTED ELIGIBILITY FOR MEDICAID BECAUSE THE DECISIONS ARE NOT SUPPORTED BY RELIABLE, PROBATIVE, AND SUBSTANTIAL EVIDENCE. THE EVIDENCE ESTABLISHES THAT THE TRANSFER OF THE PRIMARY RESIDENCE FROM A REVOCABLE TRUST TO A MEDICAID APPLICANT'S SPOUSE WAS NOT AN IMPROPER TRANSFER FOR THE PURPOSE OF MEDICAID ELIGIBILITY AND SHOULD BE TREATED THE SAME AS A TRANSFER DIRECTLY FROM THE INSTITUTIONALIZED SPOUSE TO THE COMMUNITY SPOUSE.

ASSIGNMENT OF ERROR NO. II

THE TRIAL COURT ERRED IN AFFIRMING APPELLEE'S MARCH 18, 2011 ADMINISTRATIVE APPEAL DECISION AND JANUARY 19, 2011 STATE HEARING DECISION BECAUSE THE DECISION [SIC] ARE NOT IN ACCORDANCE WITH LAW BECAUSE (1) THE TRANSFER OF APPELLANT'S HOUSE FROM A REVOCABLE TRUST WAS NOT AN IMPROPER TRANSFER FOR PURPOSES OF MEDICAID ELIGIBILITY AND COVERAGE UNDER OHIO LAW; (2) OHIO ADMIN. CODE 5101:1–39–07(E) AND (G) DO NOT REQUIRE THE VALUE OF THE HOME TO BE INCLUDED WHEN DETERMINING THE AMOUNT OF RESOURCES TRANSFERRED FOR CSRA PURPOSES; (3) THE DECISIONS ARE INOPPOSITE [SIC] TO AND IN VIOLATION OF OHIO ADMIN. CODE 5101:1–39–27.1 AND 5101:1–39–07, WHICH PERMIT THE TRANSFER TO ASSETS FROM A REVOCABLE TRUST TO THE COMMUNITY SPOUSE; (4) THE DECISIONS ARE INOPPOSITE [SIC] TO AND IN CONFLICT WITH PRIOR DETERMINATIONS AND STATE HEARING DECISIONS BY APPELLEE WITH OUR APPLICATIONS FOR MEDICAID BENEFITS IN BOTH LOGAN COUNTY AND THROUGHOUT THE STATE OF OHIO; AND (5) APPELLEE IS NOT PERMITTED TO INTERPRET ITS RULES SO AS TO REQUIRE DIFFERENT TREATMENT OF MEDICAID APPLICANTS WITHOUT A RATIONAL RELATIONSHIP TO A LEGITIMATE STATE PURPOSE.

ASSIGNMENT OF ERROR NO. III

THE TRIAL COURT ERRED IN AFFIRMING APPELLEE'S MARCH 18, 2011 ADMINISTRATIVE APPEAL DECISION AND JANUARY 20, 2011 STATE HEARING DECISION BECAUSE THE DECISIONS' INTERPRETATION OF OHIO ADM. CODE 5101:1–39–31 & 5101:1–39–27.1 ARE NOT IN ACCORDANCE WITH FEDERAL MEDICAID LAW, WHICH INVALIDATES APPELLEE'S OWN RULES UNDER THE SUPREMACY CLAUSE.

ASSIGNMENT OF ERROR NO. IV

THE TRIAL COURT ERRED WHEN IT DETERMINED THAT OHIO ADMIN. CODE 5101:1–39–27.1 AND 5101:1–39–07 DO NOT PERMIT THE TRANSFER OF ASSETS FROM AN INSTITUTIONALIZED SPOUSE'S REVOCABLE TRUST TO THE COMMUNITY SPOUSE.

ASSIGNMENT OF ERROR NO. V

THE TRIAL COURT ERRED WHEN IT DETERMINED THAT APPELLANT DID NOT REBUT THE PRESUMPTION OF IMPROPRIETY OF THE TRANSFER PURSUANT TO OHIO ADMIN. CODE 5101:1–39–07(E) & (G), AND THAT OHIO ADMIN. CODE 5101:1–39–07(G) REQUIRED THAT THE VALUE OF THE APPELLANT'S HOME BE INCLUDED WHEN DETERMINING THE AMOUNT OF RESOURCES TRANSFERRED FOR COMMUNITY SPOUSE RESOURCE ALLOWANCE.

ASSIGNMENT OF ERROR NO. VI

THE TRIAL COURT ERRED WHEN IT FAILED TO GIVE COLLATERAL ESTOPPEL EFFECT TO APPELLEE'S PRIOR DETERMINATIONS AND STATE HEARING DECISIONS WITH OTHER APPLICATIONS FOR MEDICAL BENEFITS IN LOGAN COUNTY AND THROUGHOUT THE STATE OF OHIO, WHICH DECISIONS APPROVED THE TRANSFER OF AN INSTITUTIONALIZED SPOUSE'S HOME FROM A REVOCABLE TRUST TO THE COMMUNITY SPOUSE AND ALLOWED APPELLEE TO INTERPRET ITS RULES AS TO REQUIRE DIFFERENT TREATMENT OF MEDICAID APPLICANTS WITHOUT A RATIONAL RELATIONSHIP TO A LEGITIMATE STATE PURPOSE.

{¶ 12} For clarity and ease of discussion we elect to address some of Helen's assignments of error...