Bullet: Spousal Refusal:
Who Wins? Who Loses?
Tuesday, April 18, 2006
LTC Comment: On
the eve of the Medicaid planners' (NAELA's) national meeting in Washington, D.C.
to lobby for loopholes, their most lucrative method to put millionaires on
Medicaid is under attack from the media in New York. Details after the ***news.*** [omitted]
LTC BULLET: SPOUSAL
REFUSAL: WHO WINS?
LTC Comment: Our
thanks to LTCi producer and Center member Arthur Rudnick of White Plains, NY for
bringing the following article to our attention:
Carl Campanile, "Suozzi Socking it to Medicaid
Millionaires," New York Post, April 10, 2006, copies available from The
Post for $3.95 here
"The party's over for Medicaid millionaires in Nassau
County who illegally stuck taxpayers with hundreds of thousands of dollars in
medical bills to care for their sick spouses, according to bombshell law suits
obtained by The Post. . . .
"It works like this:
"First, the ill spouse transfers all his assets to his
or her spouse or a sibling. Then
the patient applies for Medicaid for nursing-home care. The healthy spouse then invokes 'spousal refusal' to dodge
paying for the care, after disclosing financial assets.
"But the independent spouse is still legally liable to
pay medical bills of a loved one--if authorities enforce the law.
Investigations are spotty.
"Nassau County is among the most aggressive in hunting
down Medicaid millionaires who mooch off taxpayers.
"In New York City, a spokeswoman for the Law
Department said she was unaware of any recent cases filed in the city.
"Details of the Nassau cases were obtained by The
Post under the Freedom of Information Law."
Here are the "big-buck 'moochers'" cited in the
Joseph Manganaro, Atlantic Beach; Worth:
$1.85 million; Sued for $82,681 in nursing-home costs for wife Rosalyn.
Theresa Menkes, Port Washington; Worth:
$1.80 million; Sued for $27,509 in nursing costs for husband Harry.
Charles Rehman, East Meadow; Worth:
$1.83 million; Sued for $27,509 in nursing costs for wife Gloria.
Claire Stein, Great Neck; Worth: $1.42
million; Sued for $83,871 in care for husband Benjamin.
Florence Belfer, Highland, N.J.; Worth:
$1.59 million; Sued for $202,489 in nursing care for husband Ben.
Doris Pizzino, Valley Stream; Worth:
$1.28 million; Sued for $80,221 in care for husband Michael.
Catherine Chase, Massapequa; Worth:
$1.05 million; Sued for $24,937 in care for husband Arthur.
Dorothy Regan, Great Neck; Worth: $1.1
million; Sued for $29,108 in care for husband Peter.
Viva Lubicich, Woodbury; Worth: $1.07
million; Sued for $12,384 in care for husband William."
much for the Medicaid planners' oft-repeated insistence that they don't put
millionaires on Medicaid.
LTC Comment: Of
all the shameful techniques Medicaid planners use to line their own pockets at
the expense of public welfare, none is more despicable than "spousal
refusal." It is precisely this
and other similar practices that led NAELA to close its conferences to
non-attorneys in order to avoid scrutiny and criticism by the media.
But you can find the truth easily enough.
Just do an internet search for "spousal refusal."
Include the quote marks. Read
some of the content that pops up.
In a little more detail than the New York Post
article gave, here's how spousal refusal works. A couple, or more likely the well spouse and heirs, consult a
Medicaid planning attorney about a chronically infirm husband or wife.
Grandpa or grandma needs nursing home care but the responsible family
members would rather not pay their fair share under the law.
The lawyer says "no problem, here's what you can
do." Just transfer everything
you own from the ill spouse's name to the well spouse's name and apply for
Medicaid for the now-impoverished sick spouse.
(Medicaid allows interspousal asset transfers without triggering any
eligibility penalty.) When Medicaid
asks for the well spouse's share of the cost of care, "just say no."
Under federal law, to wit the Social Security Act, Medicaid cannot refuse
to cover the sick spouse's nursing home bills just because the well spouse
refuses to pay. "It's a great deal which you're a sucker not to
take" is the Medicaid planners' sales pitch.
Rest assured, Congress never intended this rule to be used
to dodge the program's cost-sharing and spend down requirements in this way.
It was designed instead to protect infirm elders from losing their
Medicaid eligibility because of expropriation by a criminally irresponsible
spouse. Therefore, Medicaid
requires the ill spouse to assign to the state his or her rights to support from
the well spouse when spousal refusal occurs.
The state then has the right to sue the well spouse to recover the stolen
wealth. But, unfortunately, some
states don't take that action as often as they should because of the political
sensitivity of "chasing" the well spouse.
(The worst abusers are New York and Florida.)
That's how it works. For
all the details on spousal refusal including extensive quotes from two of its
biggest practitioners (New York elder law attorneys both of whom are past
presidents of NAELA) see "LTC
Bullet: They're Baaack, Part IV: 'Abandon
Your Spouse . . . Get Medicaid,'" October 31, 2001, http://centerltc.com/bullets/archives2001/310.htm
and "NAELA Presentation Excerpts and CLTCF Comments," http://centerltc.com/bullets/current/naela.htm.
Now, who wins and who loses?
THE WINNERS: The
well spouse who keeps all the couple's wealth.
The heirs who get the money sooner or later. The lawyer who charges hundreds of dollars for every hour it
takes to perpetrate this legalistic swindle.
NAELA, which trains, supports, and publicizes the Medicaid planners and
benefits from their membership and conference fees.
THE LOSERS: The
sick spouse who can no longer purchase quality care in the private marketplace
at the most desirable level and in the best available venue, but is rather
dependent on whatever public welfare can afford and is willing to provide.
Nursing home and other long-term care providers who are
routinely paid inadequately by Medicaid, often less than the cost of providing
the care, with the result that access and quality suffer for everyone, Medicaid
and private-pay residents alike.
The poor, who lack the "key money" to buy their
way into the best long-term care facilities which are readily available to the
wealthy clients of Medicaid planners. Ironically,
Medicaid is supposed to be their safety net, but the poor are the worst victims
of the program's problems of access, quality, reimbursement, discrimination and
Responsible taxpayers who not only have to support the
Medicaid LTC safety net, but are somehow expected to buy private insurance
against a risk the Medicaid planners are getting wealthy by covering at a
fraction of the cost of LTCi and after the insurable event occurs.
LTC insurance producers and reverse mortgage lenders whose
markets are co-opted by unethical lawyers who skim their wealth from Medicaid by
promoting spousal refusal and dozens of similar techniques of artificial
QUERY: If you
are in that last category . . . if you're an AMG (altruistic, masochistic
genius) trying to sell a product the government and Medicaid planners are giving
away, then ask this question:
What is my company doing to stop this abuse, give Medicaid
back to the poor, and make by product saleable and my job doable?
An acceptable answer would be "We support the Center
for Long-Term Care Reform."
But if the answer is "nothing," as it most likely
will be, then demand that something be done.
To support the Center for Long-Term Care Reform is the most effective,
least expensive action that your LTCi carrier or reverse mortgage lender can
If your company is already a supporter of the Center, then
you're part of the solution.
If not, have them contact us and join.
Employees and agents of corporate members of the Center receive all the
benefits of membership without having to pay dues individually.
We've made great progress lately fighting the charlatans of long-term care but we can't do it alone. Join the fight for rational long-term care public policy.