The Appellate Division of the Superior Court of New Jersey dismissed this appeal, refusing to remand the case for administrative hearings that were never held because the applicant failed to preserve her right to those hearings. B.M. v. Division of Medical Assistance and Health Services, Docket No. A-3546-16T3 (App. Div., August 29, 2018)

Esther Schulgasser was the authorized representative for the Medicaid applicant in this case, B.M. Schulgasser filed a series of Medicaid applications on behalf of B.M. between January 2016 and August 2016. The first Medicaid application filed on B.M.’s behalf was denied by the Passaic County Board of Social Services (county welfare board) for failure to provide required information. Schulgasser appealed, requesting a fair hearing on that first denial, and the state Medicaid agency, the Division of Medical Assistance and Health Services (DMAHS), acknowledged receipt of the hearing request. A second Medicaid application was filed for B.M. later that year. Again, the county welfare board denied B.M.’s second Medicaid application for the same reason: failure to provide required information. Schulgasser alleged that she submitted another fair hearing request on the second denial of Medicaid benefits.

Later, counsel for B.M. withdrew the hearing request on the first denial of benefits, but maintained that “[a]ll other appeal/fair hearing requests remain in effect.”

B.M.’s counsel was then told that the agency had never received the appeal from the second denial of Medicaid benefits. He was advised to re-submit the appeal for the second denial. Over four months later, Schulgasser attempted to re-submit the fair hearing request for the second denial. Critically, however, Schulgasser mistakenly re-submitted the hearing request for the first denial instead. Schulgasser later submitted the incorrect hearing request for a second time. Thus, DMAHS was never provided with a fair hearing request for the second denial of benefits.

In the meantime, the county welfare board denied a third Medicaid application filed by Schulgasser on B.M.’s behalf. Schulgasser requested another fair hearing on that third denial of benefits. The county welfare board acknowledged receiving that third fair hearing request.

In August 2016, the County Board partially approved one of B.M.’s applications and granted her Medicaid benefits retroactively from May to August 2016. Schulgasser claimed to have submitted a fourth fair hearing request regarding the partial grant of Medicaid benefits. However, DMAHS never acknowledged receiving that fourth fair hearing request.

Counsel for B.M. withdrew the fair hearing request for the denial of the third Medicaid application, stating in a letter: “The Medicaid application denied by [the county welfare board] upon which the fair hearing is based has since been approved. I therefore ask that the fair hearing currently scheduled for tomorrow be cancelled.” Counsel failed to  state in the letter that there was any issue remaining to be decided on any appeal filed on B.M.’s behalf.

Later, counsel claimed that B.M. filed two fair hearing requests, on the second denial of benefits and on the August 2016 partial grant of Medicaid benefits, that DMAHS failed to acknowledge receiving and refused to schedule hearings. As a result, Schulgasser filed an appeal to the Appellate Division on B.M.’s behalf. On appeal, Schulgasser claimed that the denial and partial grant of B.M.’s Medicaid applications should either be reversed, or remanded for fair hearings.

The appeals court disagreed, concluding that B.M.’s right to fair hearings was not properly preserved. In that regard, the court held that Schulgasser failed to properly re-submit the hearing request for the second denial of benefits. Instead, she mistakenly re-submitted the hearing request for the first denial of benefits on two separate occasions. Thus, the hearing request for the second denial of benefits was never perfected.

As to the appeal on the partial grant of benefits, the court held that “the record was not clear as to what documents were actually sent to DMAHS. The incomplete record before us does not allow for a meaningful review of this argument.”

Thus, the court dismissed B.M.’s appeal, concluding as follows: “Based upon the procedural deficiencies presented on this record, and Schulgasser’s failure to preserve B.M.’s right to fair hearings, we decline to reverse or compel any hearings on the [second] denial and the . . . partial grant of B.M.’s applications.”

The case is attached here – B.M. v. Division of Medical Assistance and Health Services

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