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Information, Supply it Or Be Denied it (Medicaid)

When our office prepares Medicaid applications we try to be as thorough and accurate as possible from the beginning. We endeavor to submit all required documentation to the Department of Social Services (“DSS”) in an attempt to make it easy for DSS to make a favorable decision for our client. The DSS Regulations state that the Medicaid applicant (or recipient) has an ongoing obligation to provide accurate and complete information on his/her income, resources, and other factors that affect eligibility. The regulations further require the Medicaid applicant to provide information on the income and resources of a non-applying legally responsible relative such as a spouse.

EXAMPLE: Susan of Smithtown, NY was receiving Community Medical Assistance (Community based Medicaid) in the home she shared with her husband, Seth. Home health aides assisted her with the activities of daily living and this arrangement happily went on for years. However, in November 2014, Susan’s health required she be admitted to a nursing home. In December 2014, Susan applied for a change in need from Community Medical Assistance benefits to Long Term Care Medical Assistance for a nursing home stay.

Seth represented Susan for the Medical Assistance conversion application. Seth was advised by DSS to submit the following documentation, including, but not limited to copies of statements showing all account activity for any other bank and financial institution accounts owned by the applicant and/or their spouse at any time between December 1, 2009 and the present including: Savings and checking accounts, CD’s, Credit Union Accounts, Brokerage and/or Stock Accounts, IRA, 401K, Deferred Compensation accounts, and Annuities.(NOTE: this is a routine request).

Because Seth was having difficulty finding all the needed information, he requested an extension of time and asked DSS to conduct a “collateral investigation” to assist in finding missing information. The DSS granted these requests, and after performing the collateral investigation found another bank account (an old Bank of Smithtown account in Seth’s name) and requested that Seth provide statements and information regarding this newly discovered account.

In February 2015, the DSS denied Susan’s application for Medical Assistance benefits because Susan (Seth) failed to provide eligibility documentation to the Agency in a timely fashion: specifically, account statements regarding the newly discovered account. Unhappy with DSS’s decision and facing a large bill from the nursing home, Seth appealed the decision by requesting a fair hearing (a less formal trial in front of an administrative law judge).

At the fair hearing, Seth stated that he gave all the documentation that he could to DSS in a timely fashion. Seth asserted that DSS never asked for the old Bank of Smithtown account specifically and he did not know what account that was. Upon DSS’s clarification that he owned the account, he stated that he was having difficulty getting older statements from the banking institution and did not recall that account. DSS claimed that the missing banking statements were from an account owned by Seth, which was readily accessible to him and should have been known to him.

The Administrative Law Judge ruled that DSS properly denied Susan’s application. Complete and accurate verification of resources is required and was not provided. The Judge determined that Seth should have been aware of this account and had no barrier in obtaining such bank documentation. i

This denial cost Susan and Seth at least $50,000.00 ($10,000.00 per month for five months). By the way, assuming a monthly cost of $10,000.00 per month is assuming a very low amount. The average monthly cost of a nursing home in Suffolk County is closer to $13,500.00 per month although my office has seen monthly nursing home bills exceed $17,000.00 per month.

Aaron E. Futterman, CPA, Esq. is a partner in the law firm of Futterman & Lanza, LLP with offices in Smithtown, NY and clients throughout Suffolk, Nassau, Queens, Brooklyn, Bronx, Richmond, New York, Westchester and Rockland Counties. He concentrates his practice to Elder Law, Medicaid Planning, Medicaid Applications, Estate Planning, Probate, Estate Taxes, and Estate Administration.

i See Suffolk County Fair Hearing Decision #: 6994311M

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