The state’s highest court said on Tuesday that MassHealth erred in denying benefits to two seniors needing nursing home care, a ruling that may make it easier for some elderly residents to qualify for coverage.
With its decision, the Supreme Judicial Court vacated lower court rulings dealing with the complex legal terrain surrounding nursing home care and MassHealth, the state’s Medicaid program, which provides coverage to the poor, disabled, and elderly.
MassHealth denied coverage to two seniors because the agency said they failed to meet eligibility requirements. The individuals resided in their homes, and MassHealth counted the homes as assets. To qualify for MassHealth, individuals must have assets of $2,000 or less.
But because the seniors had put their homes into trusts at least five years before applying for benefits, as required by law, the SJC said the properties should not have been counted as assets. The court kicked the case back to MassHealth “for further proceedings consistent with this opinion.”
Lawyers involved in the case said the decision was largely a win for Massachusetts seniors. They said it would make it easier for the elderly to plan their finances — and for the possibility of needing nursing home care.
Lisa M. Neeley, a lawyer at the Worcester firm Mirick O’Connell who represented one of the plaintiffs, said that when seniors move their home into trusts, they give away legal title, so the homes should not be counted as assets.
“Over the past several years, MassHealth has been attacking these trusts,” Neeley said. “[The ruling] definitely gives assurance to people who have done estate planning that this is something MassHealth can no longer attack.”
Nursing home care is hugely expensive, costing a median of more than $128,000 annually in Massachusetts, according to a report cited in the court decision. About two-thirds of Americans in nursing homes are covered by Medicaid, a joint state-federal program, meaning the costs fall largely on taxpayers.
“Last year, MassHealth spent nearly $1.2 billion on nursing home care for 30,000 seniors, according to the agency.”
“The SJC’s decision reaffirmed the importance of maintaining the integrity of the MassHealth program to ensure that scarce federal and state resources are preserved for those without means,” MassHealth spokeswoman Sharon Torgerson said in a statement. “MassHealth is still reviewing the SJC’s decision to determine how to proceed in accordance with the Court’s order.”
Elder law specialists said MassHealth inconsistently approves and denies applications from individuals who have trusts. They were optimistic that the court decision would help clarify the rules, which even the court called a “labyrinth of statutes and regulations.”
“I’m pleased with the clarity. I’m pleased with the confirmation that these trusts are planning tools, as we all knew,” said Patricia Keane Martin, a Boston lawyer and director of the National Academy of Elder Law Attorneys’ Massachusetts chapter. The organization filed an amicus brief in the case.
While MassHealth has worked to root out cases of wealthy people trying to take advantage of a program meant for the poor, Martin said this case was different.
Court documents show that the plaintiffs lived in modest homes. One of them, Lionel C. Nadeau and his wife, lived in a Webster home worth $173,700. The other, Mary E. Daley and her husband, lived in a Worcester home valued at $150,943.
Daley’s lawyer, Brian E. Barreira of Plymouth, called the ruling a win, but he said it didn’t go far enough.
“The court didn’t even mention the inconsistency of the agency [MassHealth],” he said. “I was hoping the court would go broader and explain more about what the agency did wrong here and what they should do in the future.”
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