Hughes v. Colbert

A nursing home resident and her community spouse (husband) were penalized based on husband’s purchase of an annuity for himself using funds from his IRA. The district court granted summary judgment in favor of the director of the Ohio Department of Job and Family Services, holding that 42 U.S.C. 1396r-5(f)(1) precluded the transfer of assets because it exceeded husband’s community spouse resource allowance. Section 1396p(c) requires a state to impose a transfer penalty (a period of restricted coverage) if either spouse disposed of assets for less than fair market value during the look-back period. The Sixth Circuit reversed, reasoning that the transfer occurred before the Ohio agency determined that wife was eligible for Medicaid coverage and section 1396p(c)(2)(B)(i) permits an unlimited transfer of assets “to another for the sole benefit of the individual’s spouse.” View "Hughes v. Colbert" on Justia Law