I recently appealed the Oklahoma County Department of Human Services (DHS) denial of Medicaid for nursing care for a paraplegic husband. I represented the wife. They had a forty-five year marriage at the time of the denial of benefits. They were denied Medicaid because the husband had too much gross income. He had just less than $3,100 gross income.
Following the denial, the wife came to see me. She subsequently filed for and was granted a legal separation from her husband. The District Court Judge awarded her ½ of the husband’s pension. A Qualified Domestic Relations Order was issued. The retirement pension was divided between the two. Following that the wife had some income of her own and the husband had less than the $3,000 Oklahoma hard income cap. In Oklahoma the person in nursing care is disqualified for Medicaid if he or she has more than $3,000 gross income. This is the hard income cap Oklahoma imposes.
Medicaid was reapplied for. DHS denied it. I filed an appeal requesting a fair hearing. It raised several defenses. One was that the only reason for the legal separation was Medicaid qualification. Therefore it was not a real legal separation, but a sham. In response I developed a strong rebuttal showing that the parties were truly incompatible. Also, that the wife had a reason unrelated to Medicaid. She did not want to continue being on the legal hook for the payment of his nursing care. She also needed some of the pension in order to have enough to live and maintain the home. The point to remember is that the couple must have reasons not tied to Medicaid for seeking a legal separation. Otherwise the legal separation will not pass the smell test.
Another defense raised was that the transfer of income through the legal separation to the wife was a disqualifying transfer of a resource. Therefore DHS reasoned it could apply a disqualifying Medicaid penalty, the same as if money had been gifted away on the even of filing for Medicaid. DHS ignored the law that allows an institutionalized spouse to convey resources to a community spouse. DHS also denied that the wife remained a community spouse once legal separation was granted.
I argued that Oklahoma was not following its state Medicaid plan filed with the federal government. In it plan Oklahoma promised the federal government that it would comply with federal law. That it would allow individuals, such as this couple, to medically spend down, then qualify for Medicaid. I argued that DHS was required to allow spend down of the institutionalized individual’s income, then qualify him for Medicaid. Oklahoma is one of eleven 209(b) states. Social Security POMS Section: SI 01715.010A.1. 209(b) States, provides: “The 209(b) States use at least one eligibility criterion more restrictive than the SSI program. States that have elected this option may not use more restrictive standards than those in effect in January 1, 1972, and must provide for deducting incurred medical expenses from income through Medicaid spend down so that individuals may reduce their income to the income eligibility level. Medicaid spenddown is an important concept not only to the 209(b) States but also to all States with medically needy programs. Spenddown applies to individuals who have too much income to qualify under the State’s income limits. When an individual has too much countable income to qualify for Medicaid, the State Medicaid agency looks at the individual’s incurred medical expenses during a budget period (one to six months). In some cases, the State can also look at some anticipated expenses, such as the cost of health insurance. The State then takes incurred costs for medical services covered under the State’s Medicaid plan during the budget period and deducts them from the individual’s countable income until the individual meets the
State’s income limit. The amount in excess over the State’s income limit is the responsibility of the individual, i.e., to qualify for Medicaid, the individual will have to spend down income to the State’s income limit.”
When Oklahoma filed its Medcaid plan with the federal government it agreed to follow the above rule. Oklahoma has not officially told the federal government that it instead set a hard income cap of $3000 per month. Nor did Oklahoma report that its Medicaid rules do not allow for Medicaid spend down. In Oklahoma if gross income exceeds $3,000, the Department of Human Services simply says, sorry you are out of luck! I argued that Oklahoma cannot have it both ways. If it is going to participate in Medicaid, it should be required to follow federal Medicaid law. At least, the Department should be required to follow what the Oklahoma State Medicaid plan says it will do.
Fortunately for my client, the appeal was abandoned by the Department of Human Services and Medicaid was granted. I later received a letter ruling stating that the granting of Medicaid was fact specific to this case alone and did not constitute precedent. It could not be relied upon as a change of policy. That is too bad. The law as applied by Oklahoma is not just. It is cheating our disabled out of benefits they are entitled to receive. It is causing terrible hardship upon families. I suppose, it will take more people willing to fight with DHS over eligibility. Someday a case will make it to a court of law. Hopefully this law will then be changed.
Applicants are often caught in a “catch-22″ type paradox. The applicant will have more than $3,000 gross income. But, not enough income to pay for nursing care. Often the at home family is impoverished trying to pay their loved one’s nursing care. Wikepedia describes a “catch-22 as a “paradoxical situation in which an individual cannot avoid a problem because of contradictory constraints or rules. Often these situations are such that solving one part of a problem only creates another problem, which ultimately leads back to the original problem. Catch-22s often result from rules, regulations, or procedures that an individual is subject to but has no control over.”