An Ohio appeals court rules that a Medicaid applicant did not transfer assets for less than fair market value even though he sold property at below the appraised price because the sale was an arms-length transaction. Lawrence v. Ohio Department of Job and Family Services (Ohio Ct. App., 6th Dist., No. H-15-020, Sept. 2, 2016).
Eugene Lawrence owned a rental property that he could no longer maintain, so he sold it in 2011 for $22,720, which was the remaining balance on the mortgage. The auditor had appraised the property at $66,800. In 2014, he entered a nursing home and applied for Medicaid. The state determined that because Mr. Lawrence sold the property for less than fair market value, it was an improper transfer, and it imposed a penalty period.
Mr. Lawrence appealed the decision. After a hearing, the state upheld the penalty period, and Mr. Lawrence appealed to court. The trial court found that Mr. Lawrence sold the property in an arms-length transaction, so the state should not have imposed a penalty period. The state appealed.
The Ohio Court of Appeals, Sixth District, affirms, holding that Mr. Lawrence did not transfer assets for less than market value. According to the court, "the market conditions at the time of the sale combined with the condition of the property and circumstances of the sale demonstrated an arms-length transaction for fair market value."
For the full text of this decision, go to: https://www.supremecourt.ohio.gov/rod/docs/pdf/6/2016/2016-Ohio-5697.pdf
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