Forsyth County Bd. of Social Services v. Division of Social Services by Everhart

• Citation: 317 N.C. 689,346 S.E.2d 414
• Decision Date: 12 August 1986
• Docket Number: No. 194PA85,194PA85
• Court: North Carolina Supreme Court
• Parties: , Medicare & Medicaid Guide P 36,720 FORSYTH COUNTY BOARD OF SOCIAL SERVICES and Forsyth County Department of Social Services v. DIVISION OF SOCIAL SERVICES, and Division of Medical Assistance, North Carolina Department of Human Resources, and Alexander Hines (deceased), by William EVERHART, Representative for Applicant.

Page 414

346 S.E.2d 414

317 N.C. 689, Medicare & Medicaid Guide P 36,720

FORSYTH COUNTY BOARD OF SOCIAL SERVICES and Forsyth County

Department of Social Services v. DIVISION OF SOCIAL SERVICES, and Division of Medical

Assistance, North Carolina Department of Human

Resources, and Alexander Hines

(deceased), by William

EVERHART,

Representative

for Applicant.

No. 194PA85.

Supreme Court of North Carolina.

Aug. 12, 1986.

Bruce E. Colvin, Winston-Salem, for petitioner-appellee.

Turner, Enochs & Sparrow, P.A. by Wendell H. Ott and Thomas E. Cone, Greensboro, for respondent-appellant Hines.

North Carolina Legal Services Resource Center by Pam Silberman, East Central Community Legal Services by Jane Wettach, Raleigh, and Legal Services of the Southern Piedmont by Douglas Sea, Charlotte, for amicus curiae Alliance for Social Security Disability Recipients.

FRYE, Justice.

The dispositive issue in this case is whether the petitioners had standing to bring the suit. For the reasons set forth in this opinion, we conclude that they did not.

On 19 May 1981, one Alexander Hines was found in a comatose state while at work and was taken to North Carolina Baptist Hospital. There he was diagnosed as having a large intracerebral hemotoma in the right frontal region of the brain with intraventricular hemorrhage. Surgery was to no avail, and Hines remained comatose in a "persistent vegetative state" until he died on 7 October 1981. His medical care expenses totaled $45,145.14.

On 8 June 1981, Hines' sister, Della Black, submitted an application for Medicaid to the Forsyth County Department of Social Services (County Department) on behalf of Hines. The County Department learned that Hines had an interest in some real property located in Georgia and valued for taxation at $2,377. The Department contacted Hines' brother in Georgia who informed them that Jim Walter Homes in Jessup, Georgia, was holding the deed to the property because of the nonpayment of a second mortgage. The property consisted of a house and lot. The house was a deteriorating prefab structure that was abandoned and uninhabitable. The property was subject to unpaid taxes amounting to $951 and a possible second mortgage that the County Department was unable to verify. Although contacted on several occasions by the County Department, Hines' sister, brother, and ex-wife were unable to assist the County Department in obtaining any further information about the property. The County Department held the Medicaid application pending for twelve months and then notified Hines' sister, Della Black, on 8 June 1982, that the application was denied "based on inability to obtain information on which to base eligibility following the 12 month pending requirement."

On 11 June 1982, William Everhart, financial counselor at North Carolina Baptist Hospital, was appointed personal representative for Hines relative to Hines' eligibility for Medicaid benefits. Everhart requested a local appeal hearing which was held on 11 August 1982. At this hearing, Everhart and Della Black, Hines' sister, testified that Hines had been comatose throughout his hospitalization until his death. The hospital never had an opportunity to ask Hines whether the Georgia property was income-producing or to secure any information regarding any liens on the property. Della Black testified that she was unable to provide any information on the Georgia property. The programs supervisor who conducted this hearing affirmed the County Department's denial on 16 August 1982.

Everhart, acting in his capacity as Hines' representative, appealed the local appeal hearing decision to the Division of Social Services, North Carolina Department of Human Resources. At this hearing it was again shown that Hines had remained in a comatose state and never regained consciousness throughout his hospitalization. Also offered in evidence was a URESA order for the support of Hines' dependent children dated 24 February 1977 and a letter from a Georgia attorney indicating that no money had been received by Hines' former wife in Georgia on this order, and a deed of trust on the Georgia property dated 26 May 1960. The state hearing officer determined that the County Department's decision to deny the application was incorrect and reversed the decision. The hearing officer relied on an earlier agency determination dated 7 October 1981 to the effect that a comatose patient unable to act in his own behalf cannot be held accountable for the lapse of time before the appointment of a guardian and that the cash value of certain insurance policies was not readily available within the meaning of the Medicaid regulations when an applicant was in a comatose state at the time of eligibility determination.

Upon petitioners' petition for review of the decision of the Department of Human Resources, Judge Peter Hairston, presiding in Forsyth Superior Court, set aside the order of the state hearing officer on the ground that "the decision was erroneous and unsupported by substantial evidence." Although all defendants initially gave notice of appeal from Judge Hairston's judgment, rendered on 19 August 1983, ultimately all except respondent Hines withdrew their appeal.

The Court of Appeals in an unpublished opinion affirmed Judge Hairston's decision, 327 S.E.2d 69. Respondent accordingly petitioned this Court for discretionary review on 8 April 1985. His petition was allowed on 13 August 1985.

Respondent and amicus curiae contend that petitioners' action should be dismissed because petitioners lack standing to bring this action. Although they raise this question for the first time on appeal and would normally be barred by N.C.R.App.P. 16, questions of subject matter jurisdiction may properly be raised at any point, even in the Supreme Court. Askew v. Tire Co., 264 N.C. 168, 141 S.E.2d 280 (1965); see N.C.R.Civ.P. 12(b)(3); see also Stuart v. Hunsucker, 38 N.C.App. 414, 248 S.E.2d 567 (1978), cert. denied, 296 N.C. 583, 254 S.E.2d 32 (1979).

Petitioners brought this action before the superior court pursuant to N.C.G.S. § 108A-79(k) (Cum.Supp.1985), which provides that "[a]ny ... county board of social services ... who is dissatisfied with the final decision of the Department [of Human Resources] may file ... a petition for judicial review in superior court of the county from which the case arose." On its face, this section appears to give petitioners standing to contest the Department of Human Resources' award of Medicaid benefits to an applicant.

However, the Medicaid program is a cooperative federal-state program established by Congress in 1965 for the purpose of enabling the states to furnish medical assistance to certain classes of needy people. Lackey v. Department of Human Resources, 306 N.C. 231, 235, 293 S.E.2d 171, 175 (1982). Participation by the State is optional, but those...