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The "Fair Hearing" Process

When your spouse enters a nursing home your financial future is at risk.  This is especially so when the spouse at home has a low income.  You should be aware of your rights to qualify the spouse in the nursing home for Medicaid using the “fair hearing” provisions.

The fair hearing process is based upon the Medicaid spousal income rules.  The income rules for a couple are designed to protect the community spouse from being impoverished by the institutionalized spouse’s stay in the nursing home.

The fair hearing procedure is used in conjunction with the resource assessment process and the income rules.  Let us assume that Doris and Fred have the following monthly income: Doris $850 and Fred $600.  Let us further assume they have $50,000 in a savings account.  Le us assume Fred entered the nursing home on July 1st.  When the local caseworker makes a resource assessment determination, $25,000 will be allocated to each spouse.  Fred and Doris could file a Medicaid application and with these resources, but, their application would be denied until their combined countable resources are less than $25,000, plus $1,500.

Doris could complete a Medicaid application for Fred requesting a resource assessment.  Medicaid eligibility would be denied by the caseworker because Fred and Doris have $23,500 of excess assets.  Doris has 30 days to appeal this ruling to an Administrative Law Judge.  The Administrative Law Judge has the authority to set aside the entire $50,000 to Doris.  The local caseworker does not have this authority.

Doris files her appeal by simply writing the caseworker a short note which says: “I appeal the denial of benefits for Fred.”  The caseworker then sends the notice to Indianapolis and a hearing is scheduled in the county in which Doris filed the Medicaid application within 5 or 6 weeks.

The appellate hearing is informal.  The Administrative Law Judge often plays a short prerecorded message about the hearing procedure, swears in the witnesses and the parties present evidence.

Since Doris and Fred only have income of $1,450 per month, she needs the interest from the entire $50,000 to help bring her to the spousal allowance of $1,650.  The Administrative Law Judge is required to set aside the entire $50,000 for Doris!  In addition to the income from the $50,000, Doris will receive a portion of Fred’s income to bring her to the spousal allowance level.

Keith P. Huffman

Member National Academy of

Elder Law Attorneys

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