By: Casner & Edwards' Trusts & Estates Group
On June 22, 2018, a Suffolk County Superior Court (Wilkins, J.) has issued a declaratory judgment that MassHealth (the Office of Medicaid of the Executive Office of Health and Human Services) is in violation of Federal Medicaid regulations when it issues a “standard” eligibility denial notice for excess countable assets held in a trust. The denial notices at issue are those that arise in applications for Medicaid coverage for long-term care (nursing home coverage).
Up to now, MassHealth's standard practice has been to issue a denial notice that simply states that the applicant has too much in countable assets in order to qualify for MassHealth coverage. However, no reasons or explanations are given for why the assets are being deemed “countable,” especially when they are owned by an irrevocable trust that -- based on applicable law -- would seem to render them non-countable.
The Court’s judgment provides that, in order to comply with Federal regulations (42 C.F.R. Sec. 431.210(b)), MassHealth must “provide a clear statement of the specific reasons supporting the intended action.”
The judgment applies to MassHealth denials based only on excess “trust assets,” and not a wider universe of denial notices. Thus, the decision is especially relevant to those who have undertaken estate planning and long-term-care planning with irrevocable income only trusts and other types of irrevocable trusts.
The Court did not specify the exact approach that MassHealth must take to comply with its order; that is a next step in the proceedings.
The judgment was entered in the consolidated cases of Maas v. Sudders (No. 18-129-D) and Hirvi v. Sudders (No. 18-845-D).