Denial of Medicaid Benefits by NY Medicaid Agency Reversed Because Agency Failed to Reconsider in Reasonable Time

A New York trial court held that because the state Medicaid agency failed to reconsider its earlier eligibility determination in a timely manner, its amended decision denying benefits is vacated. dickinson-vs-ny-department-of-health-and-onondaga-county-department-of-social-services, (N.Y. Sup. Ct., No. 08-4831, Dec. 3, 2008).

After her application for Medicaid benefits was denied by the Onondaga Department of Social Services (DSS), Viola Dickinson requested a fair hearing, on June 14, 2007. After the fair hearing, a decision reversing the denial and reinstating benefits was entered on December 21, 2007. The DSS requested reconsideration of the decision due to an alleged mistake of law. On April 4, 2008, an amended decision was entered denying benefits.

On appeal, Ms. Dickinson did not challenge the substantive basis of the denial. Rather, she argued that because the agency failed to issue the amended decision within 90 days of her request for a fair hearing as mandated by state law, the amended decision must be vacated. The agency countered that the time limit is not mandatory, that the agency is entitled to review any decision to correct an error of law, and that the amended decision denying benefits was substantively correct.

The Supreme Court of New York, a trial court, held that the time limit imposed on the DSS to issue a decision within 90 days of the request for a fair hearing is mandatory. Because the agency failed to adhere to it, the amended decision denying benefits was reversed and the agency was ordered to comply with the December 21, 2007, order awarding benefits.