This is a follow-up to an article published in the August
2011 edition of Lawyers Journal. For a better
understanding of the case, the author strongly suggests reading the
original article, which is available at www.massbar.org. Choose the
"Publications" tab on the top menu, select "Lawyers Journal" and go
to page 13 of the August 2011 issue.
In 1989, a trust was formed making my client the income
beneficiary, but distribution of assets were completely within the
discretion of the trustee. In September of 2010, my client -- now
requiring nursing home care -- applied for Mass Health benefits to
pay the nursing home, as her other assets were depleted.
Her Mass Health application was denied for the reason that the
trustee could distribute assets. The trustee, under the
terms of the trust, refused to distribute any of the assets and
hired legal counsel to defend the trust. I filed an appeal under
the hardship provisions contained within the Mass Health
regulations, leading to a lengthy dispute with the Mass Health
After 16 months and three administrative hearings, we finally
received, all things considered, a favorable decision by the
Massachusetts Office of Medicaid, Board of Hearings.
On Sept. 1, 2011, the hardship appeal for my client was
conducted. The hearing, in my opinion, was far more contentious
than necessary. First, there was a challenge that a trust did not
qualify for a hardship consideration. When I pointed out the
regulations did indeed give us the authority to appeal on a
hardship basis, the hearing officer ruled in our favor and we moved
on to the substantive issues.
The agency representative argued that no attempt to retrieve the
trust funds had been made. I countered with several documents for
the trustee's attorney that his client would not pay anything from
the trust assets in accordance with the terms of the trust.
Further, the nursing home had attempted to discharge my client for
nonpayment, which is required as a condition of a hardship
I called, as a witness, the director of the nursing home, who
testified as to how much money was owed to the facility. Despite
the evidence we presented, I sensed the hearing officer was looking
for a lawsuit to be filed. I had argued at the two previous
hearings that my client was without funds to initiate what would be
a protracted lawsuit and that sufficient evidence had been offered
to show that she had made all reasonable attempts to retrieve the
I asked that the record be kept open for 60 days to allow the
nursing home to make a decision to fund a lawsuit, since they had
the most to lose. This request was granted. Subsequently, the
corporate parent of this nursing home decided to fund an action,
including engaging an attorney (not me, since I have a conflict) to
represent my client's power of attorney to cover the standing issue
that the trustee's attorney would challenge. I provided evidence to
the hearing officer that the action had been filed in Superior
Court. Yet, this was not enough for the Mass Health agency.
The hearing officer forwarded the complaint to Mass Health for
their review. Their response was the filing of the complaint had
not changed their position as the "appellant has not taken any
reasonable steps to get the funds available through the trust. The
nursing home has filed suit against the trustee, but if the
hardship is granted, they will be paid and have no vested interest
in getting the funds from the trust."
The hearing officer then made a decision in our favor. There
were two parts to his decision. First, he deemed the trust assets
inaccessible as of the date the civil suit was filed and ordered
the Mass Health agency to pay the nursing home as of that date and
continue to pay for the period during the court proceedings.
Second, regarding the hardship issue for the nursing home bill
back to Sept. 1, 2010, the application will be held in abeyance
until the issue of the trust is resolved. If the Superior Court
decision is in favor of my client, she will have the funds to pay
the nursing home from the trust assets.
If not successful, my client will have additional evidence to
demonstrate that all appropriate action to retrieve the funds has
been exhausted and that she does have a valid hardship claim. The
Mass Health agency was ordered to then re-determine the hardship
waiver request after the decision of the Superior Court. Note that
there is no requirement for an appeal from the Superior Court
decision. So if my client does not prevail in Superior Court, her
hardship request should be granted without having to pursue an
appellate court action.
Massachusetts Senate Bill 490 would change the current draconian
requirements of hardship waiver requests so that clients won't face
such a nightmare scenario for issues beyond their control.
Springfield-based attorney Albert
Gordon concentrates in all aspects of elder and
estate law, including advocating for clients at administrative
hearings with the Medicaid Board of Hearings. He is the co-chair of
the Elder Law Subcommittee of the MBA's Probate Law Section