Watch out for the Rules of Evidence in Medicaid appeal hearings

The first level of appeal when the State Medicaid Agency issues an adverse decision is called a “Fair Hearing” and takes place at the NJ Office of Administrative law (OAL). The Judge is referred to as an Administrative Law Judge or “ALJ.” That Judge issues an initial decision that is subject to review and final decision by the NJ Division of Medical Assistance and Health Services (Medicaid). The burden of proof is on the applicant, and the hearing is conducted generally like a trial — witnesses can be questioned under oath; documents can be introduced in evidence. The formal rules of evidence that govern the New Jersey courts are relaxed somewhat, but there are still requirements to prove each point of the legal case by using some non-hearsay evidence. The following case illustrates what can go wrong when “the i’s aren’t dotted and the T’s aren’t crossed,” as they say.

 B.S. v. Div. of Med. Assistance & Health Servs., was an unsuccessful appeal after an unsuccessful Fair Hearing. The 92-year-old  Petitioner lived in a nursing home and had applied for Medicaid. When her 5 years’ of financial records were submitted for the required “look-back” scrutiny, the county division for social services noticed that there were two large bank withdrawals from her account. The funds had been transferred to her daughter’s account. The daughter was told to provide proof that either (a) all of the transferred money had been actually spent for benefit of the applicant or that (b) the transfer was some kind of purchase at fair market value for goods or services. The requested proof wasn’t supplied and a 224-day “transfer penalty” was imposed. The request for Fair Hearing was then filed.

The OAL has a rule that requires a “residuum” of non-hearsay evidence for each fact to be proven. If the other party won’t stipulate to the fact, then it must be proven through what’s called “competent” evidence – i.e., non-hearsay. Here’s the rule:

1:1-15.5 Hearsay evidence; residuum rule

(a) Subject to the judge’s discretion to exclude evidence under  N.J.A.C. 1:1-15.1(c) or a valid claim of privilege, hearsay evidence shall be admissible in the trial of contested cases. Hearsay evidence which is admitted shall be accorded whatever weight the judge deems appropriate taking into account the nature, character and scope of the evidence, the circumstances of its creation and production, and, generally, its reliability.

(b) Notwithstanding the admissibility of hearsay evidence, some legally competent evidence must exist to support each ultimate finding of fact to an extent sufficient to provide assurances of reliability and to avoid the fact or appearance of arbitrariness.”

Apparently, at the hearing, her evidence was made up of  “unauthenticated bank records” and a power of attorney, ruling that petitioner had failed to submit any competent evidence. The case was scheduled for hearing three times, and neither the Petitioner (nor her attorney) presented any witnesses to testify about what had occurred or to explain any documents that were presented in evidence.  As a result, the ALJ ruled that there was insufficient evidence to show that the transfers were anything other than an outright gift — which causes a penalty under the Medicaid program. The Director affirmed (adopted the decision) and the Appellate Division affirmed.

The burden of proof rests with the applicant in Medicaid cases. Careful detailed preparation is needed to successfully prove a case at an administrative hearing.

Call us for representation on Medicaid applications and appeals of denials …. 732-382-6070

 

Smoothing the way for a nursing home admission

The need to place a beloved family member in a nursing home may be one of the most harrowing and heartbreaking decisions a person has to make. Not only is there a terrible sense of guilt and failure, but the sheer cost of a single month in a nursing home is staggering, and leaves the family with a bleak view of their future security. They feel vulnerable, because they are at the mercy of forces they cannot control, and are thrust into a world full of acronyms, shorthand and procedures they have never encountered.

At the time of application for admission, the applicant needs to provide medical information that reports the individual’s clinical condition, diagnoses, relevant recent medical history, and treatment needs, so that the facility can make an informed decision about whether it can meet the needs of the resident. This will need to be coordinated with the physician(s) at home or the hospital discharge planner, as the case may be. Although all facilities are licensed to provide the full range of services needed for a long-term nursing home resident (with the exception of ventilator services; not all skilled nursing facilities provide this service), certain facilities are known informally for better handling certain kinds of situations. It could be that an applicant is denied admission due to presence or recurrence of infection, or some documented, serious behavioral disorders. For instance, a particular resident may require a private room or extra supervision. Or a resident may require psychiatric placement instead of an ordinary nursing home.

Admissions contracts should be signed by the resident himself, but can also be signed by the spouse, a Guardian or an Agent under Power of Attorney. When a fiduciary signs on behalf of a resident, the fiduciary is signing in their fiduciary/representative capacity, and is assuring the facility that they will manage the income and assets as authorized by law. Generally, there is no need for a family member to personally take on the duty to pay the nursing home bill. Commonly, a facility will ask  the person who is handling the resident’s income and resources to sign as Responsible Party. This would amount to a personal guarantee. No one should sign as responsible party unless they voluntarily intend to personally guarantee the payment out of their personal assets. The Nursing Home Act (NHA), NJSA 30:13-1 to -17 prohibits a facility from requiring a third party to guarantee the bill, as does federal law with respect to a person on Medicaid.

The person agreeing to be Fiduciary for the resident needs to be aware that they still have obligations to arrange for the nursing home bills to be paid using the applicant’s funds, and to apply for Medicaid benefits in a timely way. See generally, Manahawkin Convalescent v. O’Neill,  (fiduciary failed to turn over the income; facility sued; fiduciary counterclaimed for violations of Consumer Fraud Act; counterclaim dismissed, but Supreme Court expressed the need for contracts to be clearly worded).

If a resident is not Medicaid eligible, the nursing home’s rates can be determined by any factors it considers appropriate. The rate schedule has to be clearly and plainly disclosed in the contract.  42 CFR ‘ 483.12(c).

A nursing home cannot obligate a Medicaid-eligible resident or a third party on their behalf to sign a private pay contract to gain admission or to continue residing in the nursing home. NJAC 8:85-1.4(b). On the other hand, if the resident has not yet been determined to be Medicaid eligible, and has not yet applied for Medicaid, he or she may voluntarily sign a private pay contract at time of admission. Once the individual becomes Medicaid eligible, that contract will be void. NJAC 8:85-1.4(c).

Typically, a nursing home will ask the new resident for the first month’s fee plus a one-month security deposit, at the time of admission. If the resident expects to apply for Medicaid, s/he needs to be sure that the security deposit has been spent on the care prior to the end of the spend-down period, so that once the resident thinks they are financially eligible for Medicaid, it doesn’t turn out that they have an excess resource sitting in the facility’s trust account.

Caring for seniors requires planning, knowledge  and advice. Call us to help you in reviewing admissions contracts and negotiating nursing home admissions, to make sure your loved on gs the care they are entitled to. … 732-382-6070

Federal Law limits involuntary discharge of nursing home residents

The federal  Nursing Home Residents’ Rights Act protects residents against arbitrary, involuntary discharge by specifying only 6 grounds for discharge..And above all,  even when one of those 6 bases exists, a nursing home also has the duty to make a safe discharge.   A nursing home cannot involuntarily transfer a Medicaid resident unless there is another placement available which is acceptable to the Department of Health and Senior Services. NJAC 8:85-1.10(d), (e). This means that the facility cannot transfer the obligation of care to a family member of the resident who refuses to accept that obligation. The resident cannot be escorted to the door.

Discharge is limited to the following circumstances: 1.  The transfer is necessary to meet the resident’s welfare, and the resident’s welfare cannot be met in the facility. 2. The resident’s health has improved such that long term care in the institution is no longer necessary.  3. The safety of individuals in the facility is endangered.  4. The health of other individuals in the facility is endangered. 5. The resident has failed after reasonable and appropriate notice, to pay for a stay (including applying for Medicaid). 6.The facility closes.

On November 7, 2011, the Ombudsman for the Institutionalized Elderly in Trenton issued a Notice to all nursing home administrators reiterating the limited bases on which residents could lawfully be discharged, and reminding them that the notice must specifically cite one of these reasons. Here it is.Other justifications, such as behavioral problems or failure to follow facility policies, are not sufficient reasons under federal law.

The facility must provide the resident with at least 30 days written notice including the specific date of the intended discharge, unless the facility is closing, in which case, 60 days’ notice is required. Also the facility must specifically identify the exact place to which the resident will be transferred.

A Medicaid recipient or applicant would appeal the planned discharge through the Division of Medical Assistance and Health Services Fair Hearing Unit, P.O. Box 712, Trenton, NJ 08625, (609) 588-2655. A private pay resident would initiate an action for an injunction  in Superior Court, Chancery Division in the vicinage where the nursing home is located.

When it comes to senior care planning it’s vital that the family advocate become familiar with these resident’s rights. Forewarned is always forearmed.

If your loved one has received an involuntary discharge notice, spring into action. Sometimes a team meeting can resolve the problem.

Call us for representation on involuntary discharge emergencies and other nursing home issues … 732-382-6070

More reasons to consult with a lawyer when filing for Medicaid

The Medicaid program pays for nursing home care for financially eligible people. The program is administered by the State Division of Medical Assistance and Health Care Services (DMAHS), which delegates the application processing to the employees of the county Boards of Social Services (sometimes called county welfare boards). All of these people are government employees. They receive and process applications by relying on the NJ State Medicaid Manual — which is the state’s regulations, that are in turn based on federal law — and innumerable directives received informally through the policy process behind the scenes. Then there are the administrative procedures which are locally created. There are 23 counties in New Jersey and the procedures that are used in Middlesex County, for instance, may be quite different than those used in Passaic or Burlington.

What this means for an applicant is that if they call a friend who applied in a different county, they could be getting an incorrect picture of what to expect in their own county.

Another big issue is that  there is a general legal principle by which New Jersey government employees may not// do not provide “advisory opinions” to applicants as to how the law applies to their given case. I represented state agencies back in the 80’s and early 90’s and we would get calls from people asking questions like “I want to do such-and-such. Do your regulations allow that?” and we’d have to politely demur and suggest that they call their own lawyer to interpret the law for them.

Why is this problematic for Medicaid applicants? The State Medicaid Manual at N.J.A.C. 10:71-2.2(c) gives the local agency the responsibility to “1. inform the applicants about the purpose and eligibility requirements for Medicaid” and  “…3. Assist the applicant in exploring their eligibility for assistance.”  So a person files an application, has no idea whether they are eligible, receives vague information and no specific guidance other than “bring in five years of financial records and all these other verifications,” and then sits and waits months and months without receiving any “assistance” from the agency. Sometimes, a denial notice is issued a year or more after the initial application was filed, and that’s when the applicant discovers that they still have “excess resources,” are not eligible, and have a giant debt to the facility.

This is particularly problematic for married couples, because the community spouse is entitled to retain a protected share of assets (called the CSRA), and there is thus a specific “target” for the spend-down in every single case, which can be easily calculated by adding together the value of all the non-excluded assets as of the date the ill spouse entered the facility, dividing by 2, and comparing that number to the maximum limit of the program. So  if the caseworker doesn’t do the “resource assessment” and calculate the protected community spouse resource allowance for the applicant early in the process, the applicant will never know just what the “target end point” is for the spend-down. Nursing homes cost more than $10,000 every month. If that couple doesn’t “spend down” to below the target, the hapless community spouse will be personally liable for the nursing home bill for every month until they hit the target.

I encountered an egregious example of this problem recently. Believe me, this is not the first time I’ve seen this happen. Wife entered facility in the fall of 2013. Husband went to the Medicaid office in early 2014. Husband needed to “spend-down” to $119,000 and wife could keep $2,000, but he didn’t know that at the time. Caseworker gave him a list of required documents to provide to her. Shortly after the initial intake, caseworker sent an appropriate letter asking for the documents needed to do the “resource assessment” which is what I’m talking about here — to determine his spend-down target. Applicant provided those records and never received any information after that. No calls, no calculations, no letters, no replies to phone calls; nothing. He eventually calls the agency and is told “just spend down” “Well how much do I have to spend?” he asks and the answer is “you have to spend down. Have a nice day. Goodbye.” Long story short, he spent over $100,000 on the nursing home in the first year, went back to Medicaid a year later and filed the application, got no assistance from the agency and only got requests for documents on repeated occasions, and never knew that he still had a little too much left in the resources because no one gave him any “assistance.” He received a Denial notice recently, saying that he had $24,000 of “excess resources” and therefore wasn’t eligible!! He is now in arrears to the facility for a full year of his wife’s care.

There are many federal rules that are designed to PROTECT the assets of an applicant and their spouse, and it’s just not true that you have to “just keep spending down.” But applicants won’t get that advice from the agency charged with “assisting” them, and non-attorneys aren’t necessarily familiar with the intricacies of federal and state law that can be used to protect Medicaid applicants and their families. Call an elder law attorney – you don’t have to do this on your own.

Call us for an appointment to discuss Medicaid eligibility, filing an application, or pursuing an appeal … 732-382-6070

Medicaid Eligibility – What if the Services aren’t delivered?

After a Medicaid long-term care application is approved and the Plan of Care (PoC) for  home and community-based services is approved (MLTSS-HCBS), the individual may be faced with a wait. The New Jersey Medicaid HMO’s that provide the services for the State of New Jersey are required by the State contract to have a deep enough provider pool to service the need. However, clients are reporting that they are being told to “just wait until we can find someone who can service your area.” This is obviously unacceptable, and the question is, what remedies are available.

Disability Rights New Jersey is a nonprofit organization that has attorneys who are tackling these issues now. Lawsuits may be the only remedy, and there may be procedural football between the HMO and the State Department of Health and Human Services/ Division of Medical Assistance and Health Services (DMAHS). Who exactly bears the responsibility when promised services are not delivered to approved, eligible individuals? Section VIII, Paragraph 53 of the Special Terms and Conditions in the federally-approved Comprehensive Medicaid Waiver says that ” A “Plan of Care” is a written plan designed to provide the demonstration enrollee with appropriate services and supports in accordance with his or her individual needs. All individuals receiving HCBS or MLTSS under the demonstration must be provided services in accordance with their plan.” (emphasis added)

One approach could be that  failure to provide services would be appealed through the administrative “fair hearing” process at the NJ Office of Administrative Law.  The other approach could be that a mandamus action has to be filed in state or federal court.

The individual should be entitled to a Notice of Inadequacy when the HMO claims it has an inadequate provider pool. After a time, the applicant should call the HMO if services are not forthcoming. If the HMO reports network inadequacy as the reason, then the approved individual can (1) contact the Office of Quality Management and request to be placed into a different HMO or (2) can select a Person-Employed Provider option which would enable them to select their own aide but will add additional obligations on them as a household employer, state plan mn hcbs, or (3) wait some more, or (4) go to a nursing home or (5) borrow money from a friend or family member to hire private care, or (6) consider legal options.

The open question is whether a failure to provide services to an approved Medicaid applicant gives rise to a cause of action through the civil courts to compel the provision of services. Another open question is whether the failure to provide approved services is an adverse action by a government agency that gives rise to a right to an administrative fair hearing under the state’s Administrative Procedure Act (APA). In any event, a person who has been approved for Medicaid Home and Community-based Services who isn’t receiving services in a timely way should consult with elder law counsel to map out their options.

Call us for representation on regarding New Jersey Medicaid applications and appeals … 732-382-6070