Two estate recovery decisions

In In re Estate of Keyes, 310 Mich App 266; 871 NW2d 388 (2015), lv den, ____ Mich ____ (2016), the Court of Appeals held that estate recovery could proceed for the expenses paid for a nursing home admission which began in April 2010, even though the Medicaid beneficiary did not receive the notice required under MCL 400.112g-7 at that time. It was noted that the required information had been included in a May 2012 application. (The court did not specifically note the fact, but MDCH, the agency then administering the Medicaid program, required reapplication every year in order to continue Medicaid coverage. The notice was contained in the reapplication form beginning in 2012, it appears.) 

Last month, the Michigan Supreme Court denied leave to appeal, leaving this decision as established law in Michigan. 

In In re Estate of Gorney, ____ Mich App ____ (2016), issued as a published opinion by the Court of Appeals on February 4, 2016, the court addressed the question of whether the Department of Health and Human Services (which has been administering the Medicaid program since last year's reorganization) could properly assert estate recovery retroactive to July 2010. Gorney was the first named plaintiff in a consolidated appeal involving four different estates opened in four different counties. 

In Gorney, each of the four decedents began receiving Medicaid benefits to pay for long-term care after the estate recovery statute was enacted in 2007. Each of them received, in 2012, an application form for requalification for benefits which included the mandated notice language. In each case, after the death of the beneficiary, the Department sought to pursue estate recovery for benefits paid on and after July 1, 2010. (It is not stated in the opinion why the Department chose that date.) 

As in Keyes, each personal representative sought to invalidate the estate recovery claim based on the failure to provide the required notice when the beneficiary first qualified for Medicaid. The court ruled that Keyes had resolved that issue and rejected the appeals on that point. 

The personal representatives also argued that it was a violation of due process for the state to include benefits paid from July 2010. The evidence showed that the Department had sought Federal approval for its estate recovery program, as required under the Federal Medicaid laws and under the 2007 estate recovery statute, and that that approval was granted in May 2011. On July 1, 2011, the Department "implemented" the program for the first time by instructing its personnel to begin operating the program. 

The court partially agreed with the personal representatives on due process grounds. It found that the estate recovery program could go back to benefits paid from and after July 1, 2011, but could not do so for the one additional year going back to July 1, 2010. 

Thus, we now know that the estate recovery program can seek reimbursement from the estate of a decedent for benefits paid for long-term care services after July 2011, but not before. 

As with Keyes, look for the estates to seek leave to appeal to the Supreme Court.