Douglas H. Wilkins, Justice of the Superior Court
plaintiffs, Jean Maas ("Maas") and Henry and Eva
Hirvi ("Hirvis") (collectively,
"Plaintiffs") brought this declaratory judgment
action against Marylou Sudders, Secretary of the Executive
Office of Health and Human Services and Kim Larkin, Director
of the Board of Hearings of the Office of Medicaid of the
Executive Office of Health and Human Services (collectively,
"Office" or "Defendants"). After the
court consolidated the plaintiffsâ preliminary injunction
motions with a hearing on the merits, the plaintiffs filed a
"Memorandum in Support of Class Certification,
Declaratory Judgment and Preliminary Injunction"
("Motion"), which the defendants have opposed.
After hearing on May 30, 2018, the Motion is ALLOWED IN PART
AND DENIED IN PART.
Partiesâ stipulation, court docket and the uncontested
exhibits establish the following facts. Attached to the
stipulation are copies of the notices of denial of
eligibility that MassHealth mailed to the Plaintiffs, Jean
Maas, Henry E. Hirvi and Eva E. Hirvi, notifying them of its
determination that each of the plaintiffs had countable
assets exceeding the federal and state mandated limits for
Medicaid eligibility. Those denial notices are representative
of the standardized denial notices that MassHealth mails to
an applicant for coverage of long-term care services in a
nursing facility, when MassHealth has determined that the
applicant has more countable assets than federal and state
Medicaid law permits for eligibility.
relevant part, the notice sent to Maas on October 12, 2017
Important! This health-care benefits notice tells you the
decisions we have made about certain programs that you may be
eligible for. Please read the whole notice to find out about
your health-care benefits.
MassHealth Long-Term Care Services in a Nursing Facility
MassHealth has reviewed your application for MassHealth
long-term care services which you filed on 09/06/2017. You
are not eligible for MassHealth long-term-care services for
the following reasons.
and Manual Citation
You have more countable assets than MassHealth benefits
allow. 130 CMR 520.003 520.004.
You must spend $249, 796.96 of your assets. You can spend the
excess assets on your needs, but you cannot give them away.
You must show MassHealth within the next 30 days that you
have lowered your assets to $2, 000 ...
calculation page at the end of this notice shows how we
counted your assets ...
* * *
Counted your Assets
Real Estate Value
Total Asset Amount:
MA Asset Limit for Household (1):
Excess Asset Amount:
notice also contains a similar chart showing how the Office
counted Maasâ income, a statement "how to ask for a fair
hearing" and a "Fair Hearing Request Form."
Maas appealed. On January 16, 2018, she filed this lawsuit.
thorough review of the trust and the denial notice reveals no
distinction between the Mass. trust and the one in Daley
v. Secretary of Executive Office of Health and Human
Services, 477 Mass. 188, 189 (2017) ("We conclude
that neither the grant in an irrevocable trust of a right of
use and occupancy in a primary residence to an applicant nor
the retention by an applicant of a life estate in his or her
primary residence makes the equity in the home owned by the
trust a countable asset for the purpose of determining
Medicaid eligibility for long-term care benefits"). The
Office apparently agreed, as it granted Maasâ application,
after hearing, in a decision dated May 1, 2018. See Appeal
Decision at 8, Def. Opp., Ex. J. ("MassHealth is jumping
over a line of demarcation between income and principal in
violation of the ruling of Daley.") It turns
out, based upon the Officeâs hearing brief dated February 13,
2018 (Comm. Opp., Ex. I) that the Officeâs primary (though
not sole) argument (at 8-10) was that, in practice, the
trustee made principal available for the benefit of the
applicant. It also tried to distinguish Daley and
cited a specific provision of the Mass. Trust (paragraph
3(a)) not cited in the denial notice. Of note, the Officeâs
February 13, 2018 hearing brief came four months after the
denial notice of October 12, 2017.
Hirvisâ notices followed the same format, although they have
a figure of "347, 793.30" for "Other"
assets and excess asset amounts of 386, 437.48 and 387,
920.71 for Henry and Eva Hirvi, respectively, reflecting
differences in the amount in their respective bank accounts.
Because the Hirvi matters are still pending before the
Office, the record does not show what happened after the
denial notice and appeal therefrom.
case, the "Other" assets were trusts. After
commencement of these lawsuits, the Office has amended its
standard notices to show specific amounts for countable
assets attributable to trusts.
Legal Sufficiency of the Notices
Federal Medicaid regulation states:
A notice required under 42 C.F.R. § 431.206(c)(2) ...
(a) A statement of what action the agency ... intends to take
and the effective date of such action;
(b) A clear statement of the specific reasons supporting
the intended action;
(c) The specific regulations that support or the change in
Federal or State law that requires, the action;
(d) An explanation of
(1) The individualâs right to request a local evidentiary
hearing if one is available, or a State agency hearing;
or (2) in cases of an action based on a change in law, the
circumstances under which a hearing will be granted; and
(e) an explanation of the circumstances under which Medicaid
is continued if a hearing is requested.
42 C.F.R. § 431.210 (emphasis added) (the
"regulation"). The referenced regulation applies
"[a]t at the time the agency denies an individualâs
claim for eligibility, benefits or services ..." 42
C.F.R. § 431.206(c)(2). See also 42 C.F.R. §
43.917(a), (b)(2) (Medicaid denial notices must be
"timely and adequate" and must comply with 42
C.F.R. § 431.210). The Medicaid notice provisions are
enforceable against a state Medicaid agency. See Murphy
by Murphy v. Minnesota Dept. of Human Services, 260
F.Supp.3d 1084 (D.Minn. 2017); Guggenberger v.
Minnesota, 198 F.Supp.3d 973, 1023 (D.Minn. 2016).
other things, the Massachusetts regulations require advance
written notice "to permit adequate preparation of the
case." 130 Code Mass.Regs. 610.046(A). Several federal and state
statutes and regulations require proper and efficient
administration of state Medicaid programs "in a manner
consistent with simplicity of administration and the best
interests of ...