A New Jersey appeals court upholds a penalty period for a Medicaid applicant who did not receive compensation when the house she held a life estate in was sold and who was joint owner on two bank accounts with her daughter. E.S. v. Division of Medical Assistance and Health Services (N.J. Super. Ct., App. Div., A-2290-14T2, Oct. 26, 2016).
E.S.'s husband died, leaving all of his money to their daughter, L.R. L.R. deposited the money in to two bank accounts that listed E.S. as a joint owner. L.R. wrote checks using the money in the accounts. In 2006, E.S. conveyed her home to L.R. and retained a life estate. E.S. moved into a nursing home and in 2013, L.R. sold the house and kept the profits without giving E.S. any compensation for her life estate. E.S. applied for Medicaid, and the state imposed a penalty period based on the transfers from the bank accounts and the sale of the life estate.
L.R. appealed, arguing that the money in the bank accounts was her money and that she spent it on expenses for her and her mother's benefit. After a hearing, the administrative law judge (ALJ) recommended that no transfer penalty should be imposed because evidence showed the money in the bank accounts belonged to L.R. and the house was transferred before the look-back period. The state rejected the ALJ's recommendation and upheld the penalty period. E.S. appealed.
The New Jersey Superior Court, Appellate Division, affirms the state's decision imposing a penalty period. According to the court, regardless of when E.S. transferred the house to L.R., at the time the house was sold, E.S. was entitled to compensation for the life estate. In addition, the court rules that L.R.'s testimony alone is insufficient to establish L.R.'s sole interest in the accounts.
For the full text of this decision, go to: https://casetext.com/case/es-v-div-of-med-assistance-health-servs
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