News Item

sb2 Secures Decisive Precedent

Recent DE appellate ruling confirms that a nursing facility has standing to pursue Medicaid benefits on behalf of its residents by virtue of a written authorization statement assigning this right.

On August 29, 2012, the Superior Court of Delaware issued a decision holding that a long-term care facility had standing to pursue an administrative appeal of a denial of a Medicaid application on behalf of one of its residents pursuant to a written authorization statement that assigned the facility the right to pursue the resident’s eligibility for Medicaid benefits.  This decision provides critical support to sb clients nationwide in their pursuit of Medicaid benefits for their residents.
In this case, sb2’s client, a nursing facility in Delaware, filed a Medicaid application on behalf of its resident.  This resident was incompetent and had no family members or legal agents available to assist in the Medicaid eligibility process.  The application was subsequently denied, but shortly thereafter, sb was successful in securing a guardian to represent the resident’s interests in appealing the denial of her Medicaid application.  In furtherance of the appeal submitted by sb, the resident, by and through her court-appointed guardian, executed a written authorization statement assigning her right to pursue Medicaid benefits to inter alia the facility and sb2  At the fair hearing held on the appeal, the resident’s guardian further ratified the facility’s authority to pursue Medicaid benefits on behalf of the resident.  Nonetheless, the agency hearing officer dismissed the appeal on the grounds that the facility lacked standing to assert the resident’s right to appeal.
In reversing the hearing officer’s decision and ruling in favor of sb’s client, the Superior Court set forth three key legal conclusions.  First, the nature of the assignment in sb’s authorization statement is not only permissible, it is also desirable in that it facilitates a nursing facility’s pursuit of benefits it would ultimately be entitled to anyway under the Medicaid regulations. Second, because the federal Medicaid regulations—and most of their state counterparts, for that matter—expressly permit an applicant to have anyone of their choice assist them in the Medicaid application process and in no way limit this 
designation, a nursing facility stands in place of the applicant and has the right to be heard at a fair hearing pursuant to a valid authorization.  The fact that a facility has an interest in the matter—being compensated for the care and services it has provided to the applicant—does not disqualify it from being able to fully advance the resident’s interests simultaneously.  Last, the Superior Court recognized that, absent clear authority stating otherwise, an agency must abide by the applicant’s wishes, or that of their legal agent.
sb2 has encountered many facilities that have run into similar opposition to their standing to pursue Medicaid appeals on behalf of their residents.  Some state agencies simply refuse to recognize the authority of a nursing facility to act on behalf of its residents, even when that authority is clearly set forth in writing.  This decision illustrates the advantage of employing a well-worded written instrument in the pursuit of Medicaid benefits.  Additionally, it demonstrates that challenging agency action in this area can yield positive results that pave the way for other facilities to pursue Medicaid benefits for their residents..
sb2 considers this ruling a major win for long-term care facilities throughout the country and believes that our clients will be able to utilize its findings in achieving future success.