Es v. Division of Med. Ass. & Health Serv.

990 A.2d 701, 412 N.J. Super. 340
CourtNew Jersey Superior Court Appellate Division
DecidedMarch 26, 2010
DocketDOCKET NO. A-2564-08T2
StatusPublished
Cited by59 cases

This text of 990 A.2d 701 (Es v. Division of Med. Ass. & Health Serv.) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Es v. Division of Med. Ass. & Health Serv., 990 A.2d 701, 412 N.J. Super. 340 (N.J. Ct. App. 2010).

Opinion

990 A.2d 701 (2010)
412 N.J. Super. 340

E.S., Petitioner-Appellant,
v.
DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES, Respondent-Respondent, and
Middlesex County Board of Social Services, Respondent.

DOCKET NO. A-2564-08T2.

Superior Court of New Jersey, Appellate Division.

Argued November 2, 2009.
Decided March 26, 2010.

*703 Linda S. Ershow-Levenberg, Clark, argued the cause for appellant (Fink Rosner Ershow-Levenberg, attorneys; Ms. Ershow-Levenberg, on the brief).

Lisa Marie Albano, Deputy Attorney General, argued the cause for respondent (Anne Milgram, Attorney General, attorney; Melissa H. Raksa, Assistant Attorney General, of counsel; Zoe J. McLaughlin, Deputy Attorney General, on the brief).

Before Judges LISA, BAXTER and ALVAREZ.

The opinion of the court was delivered by ALVAREZ, J.A.D.

Ninety-seven-year-old E.S. (petitioner) appeals the December 4, 2008 final agency decision of the Department of Human Services, Division of Medical Assistance and Health Services (Division), affirming a transfer penalty imposed on her application for Medicaid benefits. Petitioner sought the benefits to pay for the cost of her nursing home care. The transfer penalty was imposed based on a determination that a "life care contract" (LCC) between petitioner and her daughter, in which petitioner made a lump sum advance payment to her daughter for the future provision of personal care services, was not a transfer for fair market value.

Upon notification of the imposition of the transfer penalty, petitioner appealed and the case was transmitted to the Office of Administrative Law (OAL). The matter was decided by way of summary decision, over petitioner's objection, on stipulated facts and oral argument. The Administrative Law Judge's (ALJ) September 8, 2008 initial decision upholding the imposition of the transfer penalty was adopted and amplified on December 4, 2008 by the Division. This appeal followed. We affirm.

I.

When the Middlesex County Board of Social Services (Board) advised petitioner of the transfer penalty on February 28, 2008, it was due to, among other items, the advance payment of $56,550 on account of the LCC, to her daughter E.K. during the look-back period. The look-back period is a fixed term of months preceding an application for Medicaid benefits in which transfers of assets or income are closely scrutinized to determine if they were made for the sole purpose of Medicaid qualification.[1]See H.K. v. State, 184 N.J. 367, 380, 877 A.2d 1218 (2005) (citations omitted); N.J.A.C. 10:71-4.10(b)9(ii), (b)9(iv).

A transfer penalty is the delay in Medicaid eligibility triggered by the disposal of financial resources at less than fair market *704 value during the look-back period.[2]See H.K., supra, 184 N.J. at 380, 877 A.2d 1218. Congress's imposition of a penalty for the disposal of assets or income for less than fair market value during the look-back period is intended to maximize the resources for Medicaid for those truly in need. See Estate of DeMartino v. Div. of Med. Assistance & Health Servs., 373 N.J.Super. 210, 219, 861 A.2d 138 (App. Div.2004), certif. denied, 182 N.J. 425, 866 A.2d 982 (2005). New Jersey has codified the formula for calculation of the length of the transfer penalty at N.J.A.C. 10:71-4.10(c) and (m)1.

E.K., who holds a durable power of attorney for petitioner, entered into the LCC, on behalf of petitioner, on September 26, 2007. She named herself as the designated "caregiver" who was to receive a payment of $56,550 for services to be rendered to her mother, the "resident," as specified in the LCC. Although throughout this opinion we refer to petitioner as the party in interest, in reality, it is E.K. who is pursuing the appeal.

Petitioner entered a nursing home in June 2007 and initially paid the costs from her own funds. E.K. applied for Medicaid benefits on petitioner's behalf shortly thereafter.[3] Petitioner has at least one other child still living.

The $56,550 payment was calculated by applying the following formula, described in the LCC:

$25 per hour × 15 hours per week × 52 weeks per year × 2.9 years

According to petitioner, the hourly rate is at the lowest end of the pay scale for comparable personal care services to nursing home residents and fifteen hours per week is the estimated time necessary to provide the enumerated services. Petitioner's 2.9-year life expectancy is taken from the Periodic Life Table promulgated by the Social Security Administration and a table contained in Transmittal 64, published by the Center for Medicare and Medicaid Services (CMS).[4]See Transmittal Number 64, State Medicaid Manual, Life Expectancy Tables-Males,[5]available at http://www.sharinglaw.net/elder/ transmittal64.htm.

Although the "preliminary statement" to the LCC refers to compensation for services being at "market rate," and to the "wish to manage" the relationship between E.K., the "caregiver," and petitioner, the "resident," "in a business-like fashion," it includes the following:

SECTION 3. THE CAREGIVER IS NOT OBLIGATED TO DEVOTE FULL TIME TO THE RESIDENT'S CARE. The Resident and the Caregiver recognize and acknowledge that the Caregiver has her own professional or familial responsibilities to career and family. The Caregiver is, therefore, not obligated to devote her entire time, attention and energies to the business of the Resident. The Caregiver shall, to the best of her ability, devote as much of her time that is not devoted to career and family to fulfill her obligations under this Contract. However, the Caregiver *705 shall be on-call at all times and available to assist the Resident within a reasonable period of time after being contacted by the Resident or by a staff person of a facility in which she resides.
. . . .
SECTION 11. COMPENSATION. The Resident shall pay and the Caregiver agrees to accept, in payment of the aforesaid services to be rendered by the Caregiver, the compensation as computed below, which compensation the parties stipulate and agree to be fair, reasonable and of fair market value, commensurate with the quality and extent of the services provided.
11.1 Hourly Rate. The parties acknowledge that home health care aides who perform the services noted above generally receive $20.00 per hour and that geriatric care managers who perform such services on a contractual basis normally receive in excess of $100.00 per hour for their professional services. It is stipulated that the Caregiver receive $25.00 per hour.
11.2 Number of Hours. The services to be performed by the Caregiver are to be furnished on an "as needed" basis over the whole of the lifetime of the Resident and, therefore, the hours that the Caregiver will in fact expend in performance of the Caregiver's duties will vary from time to time over such lifetime. At times it may be necessary for the Caregiver to perform 40 or more hours of services per week, and at times less than that. The parties stipulate that, over the lifetime of the Resident, it is expected that the average time which the Caregiver will expend will be 15 hours per week or more.
. . . .
11.5 Payment.

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Bluebook (online)
990 A.2d 701, 412 N.J. Super. 340, Counsel Stack Legal Research, https://law.counselstack.com/opinion/es-v-division-of-med-ass-health-serv-njsuperctappdiv-2010.