Court Decision Affirms Assignment of Spousal Support Rights for Purposes of Medicaid Eligibility
In a recent decision, the 2nd Circuit Court of Appeals has
affirmed that an applicant could not be disqualified for Medicaid due to
the inclusion of the community spouse's assets, where the applicant
had properly submitted an Assignment of Spousal Support Rights (ASSR) to
the state.
Robert Morenz has resided at Wilton Meadows nursing home in
Connecticut since late 2000. In January of 2004, his wife, Clara Morenz,
who lives in their family home, filed an ASSR for her husband via power
of attorney. The ASSR assigned any rights Robert had to support from Clara
to the State of Connecticut. Clara also submitted a Medicaid application
for her husband, along with a Spousal Refusal Statement (SRS), to the Department
of Social Services (DSS). The SRS declared she "decline[d] to further
contribute to [her husband's] financial support."
The DSS denied the application because the couple's combined
resources exceeded the eligibility resource limit. Even though Robert's
countable assets fell within the limit, the assets in Clara's name
far exceeded it. Robert and Clara petitioned the district court for a temporary
restraining order prohibiting the DSS from including the assets in her name
when calculating Robert's Medicaid eligibility because he had assigned
his spousal support rights to the state. The district court later granted
the Morenzes summary judgment and also ordered Robert's eligibility
be effective retroactively to three months prior to the decision. The Commissioner
of the Connecticut DSS appealed.
On appeal before the 2nd Circuit Court of Appeals, the Commissioner
claimed the Medicare Catastrophic Coverage Act of 1988 (MCCA) did not preclude
Robert’s disqualification, arguing, "only if the denial of benefits
will lead to undue hardship does [MCCA] preclude the state from denying
eligibility." The 2nd Circuit found this argument to be in error, pointing
out the MCCA requires (1) the institutionalized spouse has assigned to the
state any rights to support from the community spouse or (2) the state determines
denial of benefits would create an undue hardship. Only one, not both, of
the circumstances was required to provide sufficient statutory grounds for
ignoring the community spouse's resources for purposes of Medicaid
eligibility, the 2nd Circuit found. They even went so far as to say, "the
language of the statute could not be less ambiguous." The district
court's order of summary judgment for the Morenzes was affirmed.
Source: Morenz v. Wilson-Coker, (2nd Circuit
Ct. App., No. 04-4107-cv, 7-14-05)
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