NJ Medicaid confirms outright transfers to disabled kids cause no Medicaid penalty

Generally speaking, if a Medicaid applicant made gifts of assets during the 5-year look-back preceding her Medicaid application, eligibility will be denied for a period of time called a “transfer penalty.” There is a special exception to this rule for transfers that were made to disabled children.  

In this case , M.C. v. Union County Div. Soc. Serv. And DMAHS, HMA- 8967-2013, the local Medicaid agency imposed a transfer penalty for an outright transfer of assets to a disabled child, despite copious federal and state law to the contrary. On appeal (“fair hearing”), the Administrative Law Judge  recommended that the penalty be reversed, and on March 18, 2014,  the NJ Division of Medical Assistance and Health Services (DMAHS) issued its Final Agency Decision adopting the ALJ decision, eliminating the penalty.

The case was argued and briefed by Linda S. Ershow-Levenberg.

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