C.G. v. Div. of Med. Assistance & Health Servs.

• Decision Date: 16 September 2019
• Docket Number: DOCKET NO. A-3898-17T4
• Parties: C.G., Petitioner-Appellant, v. DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES, and ATLANTIC COUNTY BOARD OF SOCIAL SERVICES, Respondents-Respondents.
• Court: New Jersey Superior Court — Appellate Division

C.G., Petitioner-Appellant, v. DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES,and ATLANTIC COUNTY BOARD OF SOCIAL SERVICES, Respondents-Respondents.

DOCKET NO. A-3898-17T4

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION

Submitted September 9, 2019

September 16, 2019

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

Before Judges Fasciale and Moynihan.

On appeal from the New Jersey Department of Human Services, Division of Medical Assistance and Health Services.

SB2, Inc., attorneys for appellant (Laurie M. Higgins, on the briefs).

Gurbir S. Grewal, Attorney General, attorney for respondent New Jersey Department of Human Services, Division of Medical Assistance and Health Services (Melissa H. Raksa, Assistant Attorney General, of counsel; Jacqueline R. D'Alessandro, Deputy Attorney General, on the brief).

PER CURIAM

C.G. appeals from a March 19, 2018 final agency decision by the Department of Human Services Division of Medical Assistance and Health Services (DMAHS) upholding an initial determination by an administrative law judge (ALJ) denying C.G.'s Medicaid application for failure to provide necessary financial verifications.¹ DMAHS concluded that the failure to produce that information prevented the county welfare agency (CWA) from completing a required eligibility determination. We affirm.

In July 2015, C.G.'s daughter-in-law (A.S.G.) filled out C.G.'s application. In March 2017, after it resolved C.G.'s request for a spousal waiver, the CWA processed C.G.'s name using its Asset Verification System (AVS). That uncovered a discrepancy between who had been the rightful owner of a TD bank account. A.S.G. submitted information saying C.G.'s son owned it, but the AVS report indicated C.G. was the owner. The CWA requested bank account statements, beginning in October 2013.

In May 2017, FCC (which became C.G.'s designated representative) responded partially by producing a statement covering only September 2015 to October 2015. That statement conflicted with the one submitted by A.S.G., which showed that C.G.'s name and pension information had been deleted. On the statement that FCC produced, C.G.'s pension income appeared, but that information was missing on the Medicaid application.

In May and June 2017, the CWA renewed its request for the verifications. On July 5, 2017, the CWA notified FCC that it would deny the application unless FCC submitted the verifications within ten days. FCC failed to comply with the deadline, and the CWA denied C.G.'s application on July 27, 2017. In September 2017, C.G. purportedly subpoenaed information. In early December 2017, C.G.'s counsel produced additional documentation to the CWA.

One week later, the ALJ conducted a hearing. The ALJ found that no exceptional circumstances existed warranting the late submission of the requested information. The ALJ concluded, based on the record before the CWA, that C.G. failed to produce the requested information in accordance with N.J.A.C. 10:71-2.2(e) and N.J.A.C. 10:71-3.1(b); that the CWA appropriately processed the application; and that the CWA correctly denied the application. DMAHS then rendered the decision under review.

On appeal, C.G. asserts DMAHS issued an arbitrary decision. C.G. says it failed to access an available Income and Eligibility Verification System (IEVS), which C.G. says would have shown his pension information.² C.G. argues that the CWA did not help him obtain the verifications, and that the ALJ erred by refusing to consider the late submission. C.G. requests that we vacate the final decision and remand to the CWA to "re-determine [C.G.'s] eligibility for Medicaid."

We begin by addressing our standard of review and general governing legal principles. This court's review of DMAHS's determination is limited. Barone v. Dep't of Human Servs., Div. of Med. Assistance & Health Servs., 210 N.J. Super. 276, 285 (App. Div. 1986) (explaining that "we must give due deference to the views and regulations of an administrative agency charged with the responsibility of implementing legislative determinations"); see also Wnuck v. N.J. Div. of Motor Vehicles, 337 N.J. Super. 52, 56 (App. Div. 2001) (stating "[i]t is settled that [a]n administrative agency's interpretation of statutes andregulations within its implementing and enforcing responsibility is ordinarily entitled . . . deference") (second alteration in original) (citations and internal quotation marks omitted).

We have previously stated that "[w]here [an] action of an administrative agency is challenged, a presumption of reasonableness attaches to the action of an administrative agency[,] and the party who challenges the validity of that action has the burden of showing that it was arbitrary, unreasonable or capricious." Barone, 210 N.J. Super. at 285 (citation and internal quotation marks omitted). "Delegation of authority to an administrative agency is construed liberally when the agency is concerned with the protection of the health and welfare of the public." Ibid. Thus, our task is limited to deciding

(1) whether the agency's decision offends the State or Federal Constitution; (2) whether the agency's action violates express or implied legislative policies; (3) whether the record contains substantial evidence to support the findings on which the agency based its action; and (4) whether in applying the legislative policies to the facts, the agency clearly erred in reaching a conclusion that could not reasonably have been made on a showing of the relevant factors.

[A.B. v. Div. of Med. Assistance & Health Servs., 407 N.J. Super. 330, 339 (App. Div. 2009) (citation omitted).]

The Medicaid program was created when Congress added Title XIX to the Social Security Act, 42 U.S.C. §§ 1396 to 1396w-5, "for the purpose of providing federal financial assistance to States that choose to reimburse certain costs of medical treatment for needy persons." Harris v. McRae, 448 U.S. 297, 301 (1980). Participation in the Medicaid program is optional for states, however, "once a State elects to participate, it must comply with the requirements of Title XIX." Ibid. The New Jersey Medical Assistance and Health Services Act, N.J.S.A. 30:4D-1 to -19.5, authorizes New Jersey's participation in the Medicaid program.

The Commissioner of the New Jersey Department of Human Services has the power to issue regulations dealing with eligibility for medical assistance. N.J.S.A. 30:4D-7. DMAHS is a division of the Department of Human Services that operates the Medicaid program in New Jersey. N.J.S.A. 30:4D-4. The CWA grants or denies applications for Medicaid benefits. N.J.A.C. 10:71-3.15. Pursuant to this regulation, the CWA must determine "income and resource eligibility." N.J.A.C. 10:71-3.15(a). N.J.A.C. 10:71-4.1(b) defines resource to include:

[A]ny real or personal property which is owned by the applicant (or by those persons whose resources are deemed available to him or her, as described in N.J.A.C. 10:71-4.6) and which could be converted tocash to be used for his or her support and maintenance. Both liquid and non[-]liquid resources shall be considered in the determination of eligibility, unless such resources are specifically excluded under the provisions of N.J.A.C. 10:71-4.4(b).

The regulation explains that a resource must be "available" to be considered in determining eligibility. N.J.A.C. 10:71-4.1(c). A resource is "available" when: "1. [t]he person has the right, authority or power to liquidate real or personal property or his or her share of it; 2. [it is] deemed available to the applicant ([pursuant to] N.J.A.C. 10:71-4.6 . . . ); or 3. [it arises] from a third-party claim or action" under certain circumstances. Ibid. The value of the resource is "defined as the price that the resource can reasonably be expected to sell for on the open market in the particular geographic area minus any encumbrances (that is, its equity value)." N.J.A.C. 10:71-4.1(d). The regulation explains that "[t]he CWA shall verify the equity value of resources through appropriate and credible sources." N.J.A.C. 10:71-4.1(d)(3). "Resource eligibility is determined as of the first moment of the first day of each month." N.J.A.C. 10:71-4.1(e).

In delineating the responsibilities in the application process, the regulation states that the applicant...