G.O. v. STATE OF NEW JERSEY DEPARTMENT OF HUMAN SERVICES, DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES, et al.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-3646-04T23646-04T2

G.O.,

Petitioner-Appellant,

v.

STATE OF NEW JERSEY DEPARTMENT

OF HUMAN SERVICES, DIVISION OF

MEDICAL ASSISTANCE AND HEALTH

SERVICES, and COUNTY OF ATLANTIC,

DEPARTMENT OF HUMAN SERVICES,

Respondents-Respondents.

__________________________________

 

Submitted August 29, 2006 - Decided September 18, 2006

Before Judges Payne and Gilroy.

On appeal from the Department of Human Services, Division of Medical Assistance and Health Services, Agency Docket No. HMA-4414-04.

Slater, Tenaglia, Fritz & Hunt, attorneys for appellant (Christopher R. Fritz, on the brief).

Zulima V. Farber, Attorney General, attorney for respondent State of New Jersey Department of Human Services, Division of Medical Assistance and Health Services (Michael J. Haas, Assistant Attorney General, of counsel; Julie Hubbs, Deputy Attorney General, on the brief).

William P. Busch, Jr., Assistant County Counsel, attorney for respondent County of Atlantic, joins in the brief of respondent State of New Jersey Department of Human Services, Division of Medical Assistance and Health Services.

PER CURIAM

Petitioner, G.O., appeals from a final administrative decision issued by the Division of Medical Assistance and Health Services of the Department of Human Services (Division) on February 7, 2005, declaring petitioner ineligible for Medicaid benefits from June 1, 2003, through April 30, 2004. We affirm.

On December 12, 2002, petitioner was found in his unheated home by Adult Protective Services and was admitted to Shore Memorial Hospital, Somers Point, suffering various diseases, including dementia. On January 6, 2003, the hospital filed a verified complaint and order to show cause seeking to have petitioner declared an incapacitated person and for the appointment of a permanent guardian, pursuant to Rule 4:86-1 to 4:86-12. The order to show cause appointed John Ridgeway, Esq., as petitioner's temporary guardian, authorizing him to: 1) submit all necessary documentation for Medicaid coverage; 2) liquidate petitioner's resources; and 3) make payment in connection with petitioner's placement in a long-term care facility.

On January 23, 2003, the Division approved petitioner for Track I long-term nursing facility placement contingent upon the County of Atlantic, Department of Human Services (Atlantic County), determining him financially eligible for Medicaid benefits. On the same date, Ridgeway applied for petitioner's admission into Ocean Point. The application required Ridgeway as the responsible party "to apply for Medicaid for the resident . . . . The responsible party agrees to take all necessary steps to ensure that the process is accomplished promptly." On or about January 24, 2003, Ridgeway filed an application for Medicaid benefits on behalf of petitioner with Atlantic County. The application disclosed that petitioner owned a home at 953 Philadelphia Avenue, Egg Harbor City, but it did not disclose any bank accounts in the name of, or for the benefit of, petitioner.

On January 27, 2003, petitioner was discharged from the hospital and admitted into Ocean Point. In January 2003, Frank Kelly, a friend and neighbor of petitioner, acting as petitioner's attorney-in-fact, opened a bank account in petitioner's name for the deposit of petitioner's social security benefit checks.

On March 7, 2003, an order of judgment was entered, determining petitioner incapacitated as a result of unsoundness of mind, and appointed Frank Kelly as the permanent guardian of the petitioner and his property. However, neither the Division, nor Atlantic County were notified of the change in guardians.

On May 16, 2003, Kelly sold petitioner's home, and placed the entire net proceeds of sale, $12,667.36, into a second bank account in the name of petitioner with Kelly acting as power of attorney. On December 19, 2003, Atlantic County forwarded written notification directly to petitioner at his home address, set forth on the Medicaid application advising that: "You have not provided sufficient documentation for the processing of your Medicaid application. If you do not respond to our office within ten days of [December 19, 2003], your Medicaid will be terminated."

On April 22, 2004, Atlantic County notified petitioner that his case was denied because the agency had not received the documentation required to complete his application. After receiving the missing documentation, Atlantic County issued a notice on May 19, 2004, determining petitioner financially eligible for Medicaid for the months of February through May, 2003, but ineligible for Medicaid benefits as of June 1, 2003, because he had excess countable resources as a result of the proceeds from the sale of his home. On April 30, 2004, the final $7,000 from the sale of petitioner's home was paid out from petitioner's bank account. As a result, Atlantic County issued a notice dated June 2, 2004, declaring petitioner eligible for Medicaid benefits as of May 1, 2004, because his countable resources had fallen below the Medicaid eligibility limits of $2,000.

Petitioner appealed the determination of eligibility, and requested a Fair Hearing on the matter. On June 4, 2004, the matter was referred by the Division to the Office of Administrative Law (OAL) as a contested matter. On November 3, 2004, a hearing on petitioner's administrative appeal was conducted before an Administrative Law Judge (ALJ).

On December 27, 2004, the ALJ issued his initial decision, determining petitioner eligible for Medicaid benefits from June 1, 2003, to April 30, 2004, notwithstanding the amount of his financial resources. The ALJ determined petitioner eligible because Atlantic County had not responded to his application within sixty days, N.J.A.C. 10:71-2.3(a), had not served written notification within the time proscribed by N.J.A.C. 10:71-2.3(d), setting forth the reasons that the processing of the application was being delayed; and that the agency had failed to affirmatively assist petitioner with the application, N.J.A.C. 10:71-2.2(c). The ALJ concluded that the agency's failure to comply with the regulatory requirements constituted "grounds to authorize retroactive Medicaid eligibility" for the period of time that petitioner had resources in excess of the $2,000.

On February 7, 2005, the Director of the Division issued a final administrative decision reversing the ALJ's initial decision, stating:

The Initial Decision points to no statute, regulation, or legal precedent that the remedy for such a delay in processing [the application] is to grant eligibility when the applicant is ineligible. Rather, the remedy is to process the application and apply the rules of eligibility to the applicant's resources and income.

Accordingly, the Division found that petitioner was ineligible for Medicaid benefits from June 1, 2003, after petitioner had received the proceeds from the sale of his home, to April 30, 2004, when the account was paid down, and his financial resources fell below $2,000.

On appeal, petitioner argues:

POINT I.

THE FINAL AGENCY DECISION IS ARBITRARY, CAPRICIOUS[,] AND UNREASONABLE IN LIGHT OF THE NUMEROUS VIOLATIONS OF ITS OWN ADMINISTRATIVE REGULATIONS AND THE RESULTING PREJUDICE SUFFERED BY PETITIONER AS A CONSEQUENCE THEREOF.

A. RESPONDENTS FAILED TO PROCESS PETITIONER'S APPLICATION TIMELY PURSUANT TO N.J.A.C. 10:71-2.3(a).

B. RESPONDENTS FAILED TO ADVISE PETITIONER REGARDING ELIGIBILITY REQUIREMENTS AND THE APPLICATION PROCESS PURSUANT TO N.J.A.C. 10:71-2.2(c).

C. PETITIONER WAS SEVERELY PREJUDICED BY RESPONDENT'S DELAY IN ACTING UPON THE MEDICAID APPLICATAION AND FAILURE TO ADVISE PETITIONER CONCERNING ELIGIBILITY REQUIREMENTS.

The judicial role in reviewing decisions of an administrative agency is limited. "[T]he appropriate standard of review to be applied by an appellate court reviewing the final decision of an administrative agency is for the court to examine the record to determine whether sufficient or substantial credible evidence exists therein to support the agency decision." Dore v. Bedminister Tp. Bd. of Educ., 185 N.J. Super. 447, 453 (App. Div. 1982). Accordingly, "[o]ur function is to determine whether the administrative action was arbitrary, capricious or unreasonable." Burris v. Police Dep't, Tp. of W. Orange, 338 N.J. Super. 493, 496 (App. Div. 2001) (citing Henry v. Rahway State Prison, 81 N.J. 571, 580 (1980)). The precise issue is "'whether the findings made could reasonably have been reached on sufficient[,] credible evidence present in the record,' considering 'the proofs as a whole,' with due regard to the opportunity of the one who heard the witnesses to judge of their credibility." Close v. Kordulak Bros., 44 N.J. 589, 599 (1965) (quoting State v. Johnson, 42 N.J. 146, 162 (1964)). "Furthermore, should there be substantial evidence in the record to support more than one result, it is the agency's choice which governs." Dore, supra, 185 N.J. Super. at 453. Although we must give deference to "an administrative agency charged with interpretation of the law, we are not bound by the agency's legal opinions." Levine v. State, Dep't of Transp., 338 N.J. Super. 28, 32 (App. Div. 2001).

The arguments raised on appeal are the same arguments asserted below. After analyzing the record, in light of the arguments presented and applicable principles of law, we conclude that the decision of the Division is correct. We affirm substantially for the reasons stated by the Board in its final decision. We add the following comment. In reversing the initial decision, the Director determined that the ALJ had improperly applied the doctrine of equitable estoppel against the State. We concur. Office of Personnel Mgmt. v. Richmond, 496 U.S. 414, 433-34, 110 S. Ct. 2465, 2476, 110 L. Ed. 2d 387, 404-05 (1990); Johnson v. Gohl, 357 F.3d 403, 409-10 (3rd Cir. 204).

Affirmed.

 

Improperly captioned by the parties as G.O. v. State of New Jersey Department of Human Services, Division of Medical Assistance and Health Services, and Atlantic County Board of Social Services.

Shore Health Services Corporation t/a Ocean Point Healthcare Center, a long-term nursing facility, appeals on behalf of petitioner with permission from his guardian, Frank Kelly.

To qualify for Medicaid Only benefits, an individual's countable resources cannot exceed $2,000. N.J.A.C. 10:71-4.5(c).

In petitioner's brief, he states that benefits are sought in the amount of $75,248.06. However, this case only concerns eligibility, not the non-payment of Ocean Point's statement for services rendered.

(continued)

(continued)

9

A-3646-04T2

RECORD IMPOUNDED

 

September 18, 2006