Below, in chronological order, is ElderLawAnswers‘ annual roundup of the top 10 elder law decisions for 2014. I’m happy to report that one of my cases, entitled Galletta v. Velez, is included in the “Top 10” list as No. 5 below. In the Galletta case, I represented the plaintiff, Alma Galletta, in a putative class action lawsuit filed in New Jersey federal district court in which we proved that Veterans pension benefits may not be counted as income for the purposes of Medicaid eligibility if the benefit is the result of “unusual medical expenses” as defined in the statutes. The Galletta case, and others in the “Top 10” list are described below, with hyperlinks to the cases and/or my blog posts about the cases.

1. Estate of Melby  – Iowa Supreme Court Ruled State May Recover Medicaid Payments From Irrevocable Trust

The Supreme Court of Iowa ruled that the state may recover Medicaid payments from the corpus of substantially identical irrevocable income-only trusts established by a husband and wife because, in addition to income, each trust was to pay “all expenses of” its respective trustor’s “last illness and funeral” and “any indebtedness owed by the Trustor . . .” Estate of Melby (Iowa, No. 12–1593, Jan. 10, 2014).  To read the case, click here: Estate of Melby

2. Zahner v. Mackereth – PA Federal Court Ruled Long-Term Annuities Not Subject to Medicaid Transfer Penalty While Short-Term Annuities Are

A federal district court in Pennsylvania ruled that 5-year annuities purchased by Medicaid applicants are NOT transfers for less than fair market value subject to a penalty, but the purchase of 18-, 14-, and 12- month short- term annuities are transfers for less than fair market value, subject to a penalty period. The court also declined to enforce a state law against plaintiffs’ attorney for counseling or assisting plaintiffs in the transfer of their assets to become eligible for Medicaid because the statute is unenforceable on constitutional grounds Zahner v. Mackereth (U.S. Dist. Ct., W.D. Penn., No. 11-306 Erie, Jan. 16, 2014). To read my blog post and/or the case, click here: Federal Court Holds Short-Term Annuities Purchased By Medicaid Applicants Constituted Improper Transfers Of Assets

3. M. W. v. Division of Medical Assistance and Health Services– New Jersey Medicaid Agency Ruled That Gift-Annuity Plan Will Work 

For the first time, New Jersey’s Medicaid agency held that a Medicaid applicant was eligible for benefits despite the fact that she made a substantial gift within the look-back period and purchased an $80,000 annuity to help pay for the resulting ineligibility period. M.W. v. Division of Medical Assistance and Health Services (N.J. OAL Docket No. 2998-2013, Jan. 28, 2014). To read my blog post and/or the case, click here: NJ Resident Found Eligible For Medicaid Despite Making A Gift And Owning An $80,000 Annuity

4. Arkansas Dept. of Human Services v. Pierce– Spouse’s Retirement Account Is Available Resource for Purposes of Medicaid Eligibility

According to the Arkansas Supreme Court, the state may count a spouse’s retirement account as an available resource when determining a Medicaid applicant’s eligibility. Arkansas Dept. of Human Services v. Pierce (Ark., No. CV-13-870, May 29, 2014). To read the case, click here: Arkansas Dept of Human Servs. v. Pierce

5. Galletta v. Velez– Veterans Pension Benefits Not Countable As Income in Medicaid Eligibility Determination 

Veterans pension benefits may not be counted as income for the purpose of determining Medicaid eligibility if the benefit is the result of “unusual medical expenses,” a U.S. district court has ruled. Galletta v. Velez (D. N.J., No. 13-532 (RBK/AMD), June 3, 2014). To read my blog post and/or the case, click here: NJ Federal Court Awards Medicaid, Excluding Entire VA Pension Benefit from Countable Income

6. Peterson v. Lake– Transfer of House in Exchange for Promissory Note Is Not Subject to Penalty

A U.S. district court held that a Medicaid recipient who transferred his house to his daughter in exchange for a promissory note does not incur a transfer penalty and that the promissory note is not an available asset.  Because the promissory note cannot be converted to cash, the court held that the note is not an available resource. Peterson v. Lake (U.S. Dist. Ct., W.D. Okla., No. CIV-13-1235-W, June 30, 2014). To read the case, click here: Peterson v. Lake

7. In re Estate of Peterson – State Can Recover From Entire Value of Property in Which Medicaid Recipient Had Life Estate

The Idaho Supreme Court ruled that the state may recover Medicaid benefits from the entire value of a property that a Medicaid recipient transferred to his daughter while retaining a life estate for himself. In re Estate of Peterson (Idaho, No. 40615, Aug. 13, 2014). To read the case, click here: In re Estate of Peterson

8. Aplin v. McCrossen– Penalty Period Does Not Begin Until Medicaid Applicant Spends Down Returned Assets

A federal district court ruled that the state can recalculate a Medicaid applicant’s penalty period when transferred assets are returned, holding that federal Medicaid law does not directly address the issue. Aplin v. McCrossen (U.S. Dist. Ct., W.D. N.Y., No. 12-CIV-6312-FPG, Aug. 25, 2014). To read the case, click here: Aplin v. McCrossen

9. O’Leary v. Thorn– Medicaid Applicant’s Irrevocable Trust Is Not Countable Resource

A Massachusetts trial court ruled that an irrevocable trust that contained a provision allowing the trustee to distribute the principal to others for the benefit of the beneficiary is not a countable resource for purposes of Medicaid eligibility. O’Leary v. Thorn (Mass. Super. Ct., No. WOCV2013-02013A, Sept. 18, 2014). To read the case, click here: O’Leary v. Thorn

10. Weiss v. Suffolk County Dept. of Social Services – Medicaid Applicant’s Penalty Period Not Reduced by Use of Transferred Assets to Pay Facility

A New York appeals court determined that a Medicaid applicant’s penalty period should not be reduced even though the applicant’s daughter used some of the transferred money to pay for her mother’s assisted living facility. Weiss v. Suffolk County Dept. of Social Services (N.Y. Sup. Ct., App. Div., 2nd Dept., No. 2013-09464, 5418/13, Oct. 1, 2014). To read the case, click here: Matter of Weiss v Suffolk County Dept of Social Services

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