June 1 2017 was a bad day for Medicaid planners who pinned their hopes on the Court of Appeals to reverse a string of losses. The Court issued three opinions, all unpublished. Two of them are substantive losses; the third a pyrrhic victory.
In the combined cases of Hegadorn v DHHS (click here to read the case), the COA held that DHHS is correct that assets placed in a “Solely for the Benefit” Trust are countable resources for determining eligibility of a married couple; and by doing so put a final nail in the coffin of the once beloved planning tool. Ah the good old days. Note: the Hegadorn case was subsequently approved for publication.
In Estate of Calvin Bacon (click here to read the case), the COA upheld the bizarre manner in which DHHS used policy to undermine the value of the statutory hardship exception to estate recovery. Click here to read the concurring opinion which suggests a panel to resolve a perceived conflict with this outcome and the outcome in Ketchum.
In Estate of Marian Cary (click on name to read the case) the Court upheld a trial court’s decision that it was ok to spend $46,000 on legal fees fighting with DHHS over an estate recovery claim that the estate disallowed. The COA notes that at the time the issue was litigated, estate recovery cases were new and the COA had not issued its controlling decisions. That means, while it was ok at that time, it would not be ok now. There was a dissent which said the trial court did not create an adequate record. Click here to read the dissent.