The Elder Firm, LLC - Nathan J. Forck, Attorney

Friday, August 24, 2012

MO Supreme Court Finds Cap on Non-Economic Damages Unconstitutional

How did I just now find out about this? Apparently, the Missouri Supreme Court overturned the statutory limit on non-economic damages ($350,000). I applaud the Court for retaking its Constitutional territory and not allowing the legislature to infringe on the right to a trial by jury.


Springfield News-Leader Article

Wednesday, August 22, 2012

Medicaid Estate Recovery Could Reach Home Regardless of Which Spouse Owned It at Death (Idaho)

During their marriage, Martha executed a quitclaim deed putting her home into the names of her and her husband, George. Later, she executed a power of attorney with George as her agent. Using the power of attorney, George later transferred Martha’s remaining interest in the home to him solely. Martha then applied for and was approved for Medicaid benefits. Until her death, the Department provided in excess of $100,000 in benefits. George had predeceased Martha and the personal representative of the estate sold the home for just over $81,000. The Department filed a contingent claim with the probate court for the amounts of benefits paid. The Department claimed entitlement under I.C. § 56–218, which allowed recovery from “any property which, at any time, had been the community property of the decedent and decedent's spouse, or which had been the property of decedent's spouse.
Both the probate and appellate courts denied the claim, finding that I.C. § 56–218 limited recovery to property in which the recipient spouse had an interest at the time of death. Since Martha validly conveyed her interest in the home to George via the power of attorney before that time, there was no estate recovery. The Idaho Supreme Court reversed. The court noted that while 42 U.S.C. § 1396p(b)(1) expressly allowed recovery from only “the individual's estate, it also allowed states to expand the definition of ‘estate’ to include any other property in which the individual had any legal title or interest “at the time of death.” Idaho had adopted this more expansive definition of “estate.” The court noted that the definition of “estate” in 42 U.S.C. § 1396p(b)(4)(B) included the phrase “other arrangements,” while the definition of “assets,” in 42 U.S.C. § 1396(h)(1) plainly included the resources of the recipient's spouse, as well as assets the recipient disposed of before death. The federal definition of “resources” included the home for purposes of recovery. In light of the ambiguously inclusive nature of 42 U.S.C § 1396p(b)(4)(B) and the plain definition of “assets” in 42 U.S.C. § 1396(h)(1), the court could not find that federal law preempted States from providing for recovery of assets from both spouses' estates under I.C. § 56–218(1), including assets that were community property during the marriage.  
Estate of Perry, 2012 WL 3206771 (August 9, 2012)
This is why it is important, at least in Missouri, to get your assets into a trust!  Missouri's Medicaid program has NOT expanded it's definition of "estate" to include trusts, but it might at some point.  Most people don't really think about their property being at risk of estate recovery because Medicaid considers the applicant's homestead to be an exempt asset for eligibility purposes.  HOWEVER, that does not mean that MO FSD cannot come after the homestead through Medicaid estate recovery in order to recover any money that it pays out on behalf of the applicant's medical care during their lifetime.