N.S. v. Div. of Med. Assistance & Health Servs.

• Court: New Jersey Superior Court — Appellate Division
• Writing for the Court: PER CURIAM
• Decision Date: 03 July 2019
• Docket Number: DOCKET NO. A-3562-17T2
• Citation: N.S. v. Div. of Med. Assistance & Health Servs., DOCKET NO. A-3562-17T2 (N.J. Super. App. Div. Jul 03, 2019)
• Parties: N.S., Petitioner-Appellant, v. DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES and ATLANTIC COUNTY BOARD OF SOCIAL SERVICES, Respondents-Respondents.

N.S., Petitioner-Appellant, v. DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICESand ATLANTIC COUNTY BOARD OF SOCIAL SERVICES, Respondents-Respondents.

DOCKET NO. A-3562-17T2

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION

Argued telephonically May 29, 2019

July 3, 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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION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 Sabatino and Mitterhoff.

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

Cari-Ann R. Levine argued the cause for appellant (Cowart Dizzia LLP, attorneys for appellant; Lycette Nelson, on the brief).

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

PER CURIAM

Petitioner N.S.¹ appeals the final agency decision of the New Jersey Division of Medical Assistance and Health Services ("the Division") denying his application for Medicaid benefits. The Division found that N.S. failed to timely provide verifications and documents needed to make an eligibility determination. The Division also determined that N.S. was not entitled to a spousal waiver under 42 U.S.C. § 1396r-5(c)(3). For the reasons that follow, we reverse and remand with direction that the agency process N.S.'s application and determine his eligibility for benefits.

I.

A.

On May 24, 2016, N.S., through his authorized representative, L.P., submitted an application for Medicaid benefits to the Atlantic County Medicaid Long Term Care Unit ("the CWA").² At that time, N.S. was eighty-seven yearsold residing in long-term nursing care at Hammonton Center for Rehabilitation and Healthcare ("Hammonton Center"). Prior to his admission to Hammonton Center in August 2015, N.S. resided with his wife, D.S. At the time of N.S.'s application, D.S. was eighty-six years old.

On the same date the application was submitted, the CWA sent L.P. a written notification that additional documentation was required in order to process the application, including information concerning N.S.'s life insurance, bank statements, and marriage certificate. The CWA also requested information regarding D.S.'s income and resources, social security number, and date of birth.

On June 13, 2016, L.P., on behalf of N.S., appointed Jannell Thomas, the Medicaid coordinator for Hammonton Center, as an authorized representative of N.S. On June 14, 2016, L.P. provided the CWA with some of N.S.'s bank statements, N.S.'s marriage license, and D.S.'s social security number and date of birth. L.P. also informed the CWA that N.S. did not have a life insurance policy and that N.S. paid $900 rent to lease an apartment, but the lease was not in his name. L.P. noted in her correspondence that she "was unable to obtain any additional information from [D.S.]."

On June 21, 2016, a CWA caseworker requested additional documentation, including N.S.'s bank statements from February to June of 2016,and a close out statement and transaction history for N.S.'s certificate of deposit ("CD"), and N.S.'s rental lease. The caseworker also requested quarterly bank statements for all of N.S.'s accounts for the past five years and information regarding N.S.'s income.

On July 21, 2016. L.P. emailed the caseworker cancelled checks and bills for transactions L.P. had made with money from N.S.'s accounts. L.P. noted she was still trying to obtain a transaction image for a December 2014 deposit in question, as well as the lease. The caseworker responded the next day, again requesting information regarding D.S.'s income and resources.

On July 27, 2016, L.P. emailed the caseworker and notified her that the bank would not provide a transaction image for the December 2014 deposit because the account was in N.S.'s name. L.P. informed the caseworker that D.S. could not locate a copy of the lease, but provided the landlord's contact information. L.P. also disclosed that N.S. was self-employed for many years, but "stopped working due to poor health a few years ago." L.P. noted that N.S. purchased a van for his business in 2012. L.P. had paid the insurance on the van after her father had stopped working so that it could remain parked on the street.

On July 28, 2018, the CWA caseworker responded to L.P, requesting information regarding N.S.'s 2016 income and resources and any businessaccounts for N.S.'s business. On August 2, 2016, the CWA sent a letter to L.P. requesting: (1) the date on which N.S.'s business closed, and if it closed within the previous five years, documents regarding the business; (2) D.S.'s income and resource documents; and (3) a transaction image for the December 2014 deposit. The letter informed that these documents must be provided within ten days or N.S.'s application would be dismissed.

On August 4, 2016, L.P. emailed the caseworker and informed her that N.S. did not have a business account. On August 5, 2016, L.P. provided a copy of N.S.'s lease. On August 8, 2016, the caseworker emailed L.P. again asking if N.S. had any business accounts and requesting D.S.'s income and resource information.

L.P. replied via email the same day and indicated that N.S. had been self-employed as a paper wall-scraper, but had not worked during the previous five years due to his age and other health issues. L.P. reiterated: "[N.S.] does not have any bank accounts, nor does he have a business bank account. I have presented you all of his banking information. I can provide you with a signed statement from me if needed." L.P. also indicated that the bank had agreed to release the transaction image for the December 2014 deposit and attached"verification."³ Finally, L.P. requested an extension to obtain any outstanding documentation.

On August 10, 2016, Hammonton Center's attorney sent a letter to the CWA requesting that N.S.'s application be processed without regard to D.S.'s income and resource information. The letter stated that "42 U.S.C. § 1396r-5, known as the 'spousal refusal provision,' prohibits the denial of Medicaid coverage to individuals whose spouses refuse to cooperate with the state." The letter provided that L.P. had been unable to obtain D.S.'s information through no fault of her own, and that Jannell Thomas had sent three letters requesting financial information to D.S. in June and July 2016, but that the letters were returned as unclaimed. The letter also argued that "[a]ny denial of [N.S.]'s application because of his spouse's refusal to provide information would . . . cause an undue hardship on [N.S.]" under 42 U.S.C. § 1396r-5(c)(3).

After receiving the correspondence from Hammonton Center, the CWA caseworker replied via email to L.P. According to the caseworker, it "d[id] not matter how many attempt[s] [Jannell Thomas] made to get information from[D.S.], it does not count. I have to send her notice." The caseworker also stated that the application could not be processed without D.S.'s income and resource information. In addition, the caseworker requested documentation confirming that N.S.'s business was not active.

After L.P. provided D.S.'s address, the CWA sent three notices directly to D.S. requesting the needed information on August 15, 22, and 29, 2016. D.S. did not respond to any of these requests. On August 31, 2016, the CWA sent L.P. a letter advising that the application could not be processed without D.S.'s information because N.S. and D.S. were legally married and had been living together before N.S. was admitted to Hammonton Center. The letter provided that the application would be closed if D.S.'s information was not provided by September 9, 2016. The letter did not address N.S.'s previous request for a spousal waiver based on D.S.'s failure to cooperate.

On September 9, 2016, Hammonton Center's attorney sent the CWA another letter requesting a spousal waiver under 42 U.S.C. § 1396r-5 and that the application be processed without regard to D.S.'s resources. On the same date, the CWA sent written notice to L.P. that N.S.'s application had been denied for failure to provide necessary documentation.

D.S. died on October 2, 2016. N.S. died on November 30, 2016.

B.

L.P. timely requested a fair hearing on N.S.'s behalf. A fair hearing was held on December 5, 2017 before an administrative law judge ("ALJ") in the Office of Administrative Law.

Barbara Paugh, the assistant administrator and supervisor of the Medicaid unit, testified first for the CWA. Paugh testified that at the time of the denial of N.S.'s application, information regarding the following items was outstanding: (1) N.S.'s business accounts or business tax returns; (2) N.S.'s work van; (3) the distribution of funds from N.S.'s CD; and (4) D.S.'s income and resources. Paugh stated that the CWA required images of all checks for all bank accounts, and that N.S. did not provide images for all transactions in question.

Paugh also testified that it was not necessary to forward L.P.'s request for a spousal waiver to the Division because the spouses were living together prior to N.S.'s admission to Hammonton Center and there was no history of spousal abuse. Paugh noted that the CWA generally requires three failed attempts to contact an uncooperative spouse before it transmits a spousal waiver request to the Division.

Jannell Thomas testified for N.S. Thomas testified that she was aware L.P. was having difficulty retrieving D.S.'s information and recommended thatL.P. submit a request a spousal waiver to the CWA. Thomas, who had previously worked for the CWA, sent three letters via certified mail to N.S. because she believed such documentation was necessary to receive a spousal waiver.

L.P. testified primarily...