The MassHealth Board of Hearings ruled in favor of Attorney Sarah Hartline’s client last week in a case involving a transfer of assets from a nursing home resident to her son and a question of whether the transfer was done with the intent to qualify for MassHealth benefits, which would result in a significant disqualification period.
Background
The case involved a nursing home resident, now adjudicated incapacitated by the courts, who held two joint accounts—one with each of her sons, one of whom was now deceased. The living son accessed and closed both accounts, withdrawing a total of $96,000 and deposited those funds into a personal account. Over the course of several months, all of the resident’s other assets were spent down on her care at the nursing home, leaving her without any funds to pay for care and in need of MassHealth benefits to cover the nursing home costs. The living son failed to participate in court proceedings to appoint a guardian and conservator for his mother, and also refused to participate or cooperate in the process of applying for MassHealth benefits for his mother.
Initial Decision by MassHealth
MassHealth initially held that the withdrawal of funds by the son from both accounts were disqualifying transfers resulting in significantly disqualification period (262 days), a period of time where the MassHealth applicant would neither be able to pay privately for her nursing home care (due to all other funds having been spent down) nor would she be eligible for MassHealth coverage for the nursing home costs.
With Attorney Hartline’s assistance, the conservator was able to reverse one of the two withdrawals—the withdrawal from the account held jointly by the applicant and her deceased son. Given that the living son had no legal access to that account, the bank was able to reverse the withdrawal and those funds were paid over to the nursing home. However, with regard to the account held jointly between the applicant and her living son, the living son had all legal rights to access and withdraw those funds, so the conservator had no legal recourse.
Appeal
At the appeal hearing, Attorney Hartline successfully argued that the MassHealth applicant lacked the capacity and knowledge needed to be complicit in the transfers. Further, the evidence submitted clearly demonstrated that the son’s actions were undertaken for his personal benefit and regardless of the effect on his mother and her application for MassHealth benefits.
MassHealth regulations state that the agency will not impose a period of ineligibility for transferring resources if the nursing home resident demonstrates to the agency’s satisfaction that “(1) the resources were transferred exclusively for a purpose other than to qualify for MassHealth; or (2) the nursing-facility resident or spouse intended to dispose of the resource at either fair-market value or for other valuable consideration.”
Important Takeaways
Many seniors see joint ownership of bank accounts as a convenient way to allow an adult child to help manage their funds. However, as is evident from this case, joint ownership presents significant risks, especially in the context of MassHealth eligibility. In addition, the case demonstrates the importance of speaking with an elder law attorney prior to a complete spend-down of assets so that any transfers in funds can be done within the MassHealth rules so as not to cause disqualification.
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