COMMONWEALTH OF KENTUCKY, CABINET FOR HEALTH AND FAMILY SERVICES APPELLANT
ESTATE OF LENNIE COOPER APPELLEE
FROM PULASKI CIRCUIT COURT HONORABLE DAVID A. TAPP, JUDGE
ACTION NO. 15-CI-00884
FOR APPELLANT: Lucas Roberts Frankfort, Kentucky
FOR APPELLEE: Jay McShurley Somerset, Kentucky
BEFORE: JONES, KRAMER AND K. THOMPSON, JUDGES.
Commonwealth of Kentucky, Cabinet for Health and Family
Services, appeals from an order of the Pulaski Circuit Court
ruling that 907 Kentucky Administrative Regulation (KAR)
1:005 did not preclude a reduction in the period of
disqualification from Medicaid benefits. Because we conclude
the regulation precluding reimbursement by the Cabinet for
payments made for a Medicaid covered service does not apply
to those made while an application is pending, we affirm.
August 2012, Lennie Cooper became a resident of Somerwoods
Nursing and Rehabilitation in Somerset. At the same time, she
gifted real estate valued at $80, 000 and $79, 785.09 from a
bank account to her daughter, Marion Cooper. An application
for Long Term Care Medicaid benefits was filed on
Lennie's behalf on September 21, 2012.
Department of Medicaid Services (the Agency), the
Cabinet's internal agency that directly administers the
Medicaid programs, issued a Medicaid Coverage Denial Notice
dated October 22, 2012. The denial notice advised that
Medicaid coverage was being denied as mandatory verification
was not returned, specifically, a Qualifying Income Trust.
However, this denial was mailed to the wrong address and
neither Lennie, Marion, nor Lennie's attorney received a
copy of the notice of denial.
27, 2013, Lennie's attorney made a written request to the
Agency regarding the status of the Medicaid application and
was provided a copy of the notice of denial dated October 22,
2012. Lennie then requested a fair hearing on August 22,
2013. A hearing was held on November 18, 2013.
hearing officer found that the denial was mailed to an
incorrect address so that proper notification of the denial
was not received and gave Lennie the opportunity to provide
the required verification to process the application. On
August 20, 2014, Medicaid benefits for Lennie were approved
retroactive to June 2014. Lennie died on July 31, 2014.
Lennie's Medicaid application was pending and before the
approval of Medicaid benefits, Marian paid the nursing home
$120, 880 from non-Medicaid funds for Lennie's care from
her admission in September 2012 through May 2014. In July
2014, Lennie's attorney provided the Agency with
documentation of payments made by Marian to the nursing home
for Lennie's care. Although the Agency processed the
claim with an August 1, 2012 application date, Lennie was
only approved for benefits effective June 2014, on the basis
that private payments ended in May 2014. Lennie's estate
appealed arguing that the start date for benefits should have
been earlier than June 2014.
hearing was conducted on April 21, 2015. On May 6, 2015, the
hearing officer issued a recommended order affirming the
Agency's action. As framed by the hearing officer, the
issue presented was whether the Medicaid disqualification
period was correctly computed pursuant to 907 KAR 20:030. As
applicable here that regulation provides:
(3) Transfer of resources on or after February 8, 2006.
(a) If an institutionalized individual applies for Medicaid,
a period of ineligibility for NF services, ICF IID services,
or 1915(c) home and community ...