Thompson v. DEPARTMENT OF CHILD. AND FAM., 5D02-1016.

• Decision Date: 24 January 2003
• Docket Number: No. 5D02-1016.,5D02-1016.
• Citation: 835 So.2d 357
• Parties: Stella THOMPSON, Appellant, v. DEPARTMENT OF CHILDREN AND FAMILIES, Appellee.
• Court: Florida District Court of Appeals

835 So.2d 357

Stella THOMPSON, Appellant, v. DEPARTMENT OF CHILDREN AND FAMILIES, Appellee.

No. 5D02-1016.

District Court of Appeal of Florida, Fifth District.

January 24, 2003.

David H. Jacoby, Palm Bay, for Appellant.

Eric D. Dunlap and William D. Rowland, Orlando, for Appellee.

PETERSON, J.

Stella Thompson appeals a final order of the Department of Children and Families (DCF) that denied Ms. Thompson's application for Medicaid Institutional Care Program (ICP) benefits.

Ms. Thompson, a 71-year-old woman suffering from a leg infection, transferred from a Virginia hospital to a Florida nursing home. At the hearing that led to the denial of ICP benefits, we note that no evidence was presented that Ms. Thompson's health would ever allow her to live outside of a nursing home. Indeed, it was reported that her health continues to deteriorate.

Ms. Thompson's sister, Josephine Greene, also lives in Florida near the nursing home caring for her sister. Three months after her sister's arrival in Florida, Ms. Greene used the power of attorney granted to her by her sister to purchase for her sister a life estate in a condominium apartment owned and occupied by herself. The life estate was for the term of Ms. Thompson's life, was purchased by a transfer of $18,250 from Ms. Thompson to Ms. Greene and the stated purpose of the purchase "was to ensure that [Ms. Thompson] would always has [sic] a place to live."

Ms. Greene then applied for ICP benefits on behalf of her sister in order to pay for the nursing home room and board. DCF denied the benefits when it interpreted the $18,250 depletion of Ms. Thompson's assets as an improper transfer that was accomplished in order to meet the financial eligibility requirement of the ICP. It was DCF's view that Ms. Thompson failed to demonstrate that the fair market value of the life estate purchased in her sister's condominium had a significant value approaching the price paid of $18,250.

A hearing was requested and held following the initial denial at which time Ms. Thompson's professional appraiser testified in support of the purchase price of $18,250. The appraisal was flawed in its assumption that Ms. Thompson is of "average health" and that there is an "open market" for life estates.¹ The hearing officer found that although Ms. Thompson acquired some value for her purchased life estate, that value was not substantively shown. Neither was there any evidence to establish what proceeds would be expected if the life estate were to be sold on the open market in the geographical area. The final order resulting from the hearing concluded that "there was insufficient proof that the transfer occurred solely for a reason other than to become Medicaid eligible."

The Medicaid program was enacted in 1965 as a cooperative federal-state endeavor designed to provide health care to needy individuals. 42 U.S.C. § 1396; Atkins v. Rivera, 477 U.S. 154, 156, 106 S.Ct. 2456, 91 L.Ed.2d 131 (1986). The program provides 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, 100 S.Ct. 2671, 65 L.Ed.2d 784 (1980). States are not required to participate in the program, but once a state chooses to adopt the program it must establish a plan conforming with the requirements of the federal statute. Id. Florida has elected to participate in the program and has assigned DCF the task of administering the program. § 409.901.920, Fla. Stat. (2002); 65 Fla.Admin.Code R. 65A-1.701.

After the Medicaid program was enacted, a field of legal counseling arose involving asset protection for future disability. The practice of "Medicaid Estate Planning," whereby "individuals shelter or divest their assets to qualify for Medicaid without first depleting their life savings," is a legal practice that involves utilization of the complex rules of Medicaid eligibility, arguably comparable to the way one uses the Internal Revenue Code to his or her advantage in preparing taxes. See generally Kristin A. Reich, Note, Long-Term Care Financing Crisis—Recent Federal and State Efforts to Deter Asset Transfers as a Means to Gain Medicaid Eligibility, 74 N.D. L.Rev. 383 (1998). Serious concern then arose over the widespread divestiture of assets by mostly wealthy individuals so that those persons could become eligible for Medicaid benefits. Id.; see also Rainey v. Guardianship of Mackey, 773 So.2d 118 (Fla. 4th DCA 2000). As a result, Congress enacted several laws to discourage the transfer of assets for Medicaid qualification purposes.²See generally Laura Herpers Zeman, Estate Planning: Ethical Considerations of Using Medicaid to Plan for Long-Term Medical Care for the Elderly, 13 Quinnipiac Prob. L.J. 187 (1988). Recent attempts by Congress imposed periods of ineligibility for certain Medicaid benefits where the applicant divested himself or herself of assets for less than fair market value. 42 U.S.C. § 1396p(c)(1)(A); 42 U.S.C. § 1396p(c)(1)(B)(i); Fla. Admin. Code R. 65A-1.712(3).³ More specifically, if a transfer of assets for less than fair market value is found within 36 months⁴ of an individual's application for Medicaid, the state must withhold payment for various long-term care services, i.e., payment for nursing home room and board, for a period of time referred to as the penalty period.⁵ Fla. Admin. Code R. 65A-1.712(3). Medicaid does not, however, prohibit eligibility altogether. It merely penalizes the asset transfer for a certain period of time. See generally Omar N. Ahmad, Medicaid Eligibility Rules for the Elderly Long-Term Care Applicant, 20 J. Legal Med. 251 (1999).

Ms. Thompson contends that because her expert witness testimony on fair market value was the only one presented, the hearing officer should have ruled in her favor citing to Thomas v. Florida Department of Children and Families, 707 So.2d 954 (Fla. 4th DCA 1998). The trier of fact, however, may accept or reject all or any part of an expert's testimony and is in no way bound by uncontroverted expert opinion testimony. E.g., Weygant v. Fort Myers Lincoln Mercury, Inc., 640 So.2d 1092 (Fla.1994) (a jury may reject expert medical testimony when there exists relevant conflicting lay testimony); Easkold v. Rhodes, 614 So.2d 495 (Fla.1993) (jury may give expert opinion testimony whatever weight that it finds the testimony deserves); Tolley v. Dep't of Health and Rehabilitative Servs., 667 So.2d 480 (Fla. 5th DCA 1996) (the trier of fact may accept or reject all or any part of an expert's testimony); Gordon v. Smith, 615 So.2d 843 (...