COA: Expenses apply under penalty period

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The Indiana Court of Appeals ruled in favor of a woman who wanted her out-of-pocket payments to a nursing facility allowed as a spend-down expense, finding the Indiana Family and Social Services Administration's denial of her request would penalize her twice.

In Bernice M. Reedy, by her next best friend Mentoria Headdy v. Indiana Family and Social Services Administration, No. 53A01-0806-CV-294, the Court of Appeals had to determine if Reedy's out-of-pocket nursing facility payments could be an allowable spend-down, or out-of-pocket expense, while she was serving out a transfer penalty period. Reedy entered a nursing home in 2005 and applied for Medicaid in 2006. For one year, her coverage wouldn't include payments for nursing facility services because she had improperly transferred money to become eligible for Medicaid; Reedy would have to pay for her care out-of-pocket during that time. Reedy also received medical assistance under Medicaid but was required to spend-down more than $3,000 a month before Medicaid would cover her other health-related services such as prescriptions.

The FSSA rejected Reedy's request to have her out-of-pocket nursing facility expenses applied toward her monthly spend-down, which was affirmed by an administrative law judge at a hearing.

The FSSA believed Reedy couldn't apply her out-of-pocket expenses while on a transfer penalty period, but there is no statute, administrative code provision, or case that addresses this issue, wrote Judge Michael Barnes. The appellate court's review of the administrative law judge's decision shows no statutory interpretation.

The Court of Appeals examined 405 Ind. Admin. Code 2-3-10(f), which defines which incurred medical expenses submitted to the county office will be credited toward the spend-down; nursing facility services and rehabilitative services are included on the list.

While under the transfer penalty, the spend-down only applies toward Medicaid's coverage of Reedy's non-nursing facility expenses, so the court "fails to see how applying the nursing facility expenses to Reedy's spend-down 'cancels out' the transfer penalty as the FSSA suggests," Judge Barnes wrote.

"Similarly, under the FSSA's approach, being subject to a transfer penalty subjects an individual to an additional punitive measure by effectively raising the spend-down to the amount of the calculated spend-down plus the individual's nursing facility expenses. The State points to no support for this double punishment, and without such we will not impose the extra burden on Reedy," he wrote.


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  1. I have a degree at law, recent MS in regulatory studies. Licensed in KS, admitted b4 S& 7th circuit, but not to Indiana bar due to political correctness. Blacklisted, nearly unemployable due to hostile state action. Big Idea: Headwinds can overcome, esp for those not within the contours of the bell curve, the Lego Movie happiness set forth above. That said, even without the blacklisting for holding ideas unacceptable to the Glorious State, I think the idea presented above that a law degree open many vistas other than being a galley slave to elitist lawyers is pretty much laughable. (Did the law professors of Indiana pay for this to be published?)

  2. Paul Hartman of Burbank, Oh who is helping Sister Fuller with this Con Artist Kevin Bart McCarthy scares Sister Joseph Therese, Patricia Ann Fuller very much that McCarthy will try and hurt Patricia Ann Fuller and Paul Hartman of Burbank, Oh or any member of his family. Sister is very, very scared, (YES, I AM) This McCarthy guy is a real, real CON MAN and crook. I try to totall flatter Kevin Bart McCARTHY to keep him from hurting my best friends in this world which are Carolyn Rose and Paul Hartman. I Live in total fear of this man Kevin Bart McCarthy and try to praise him as a good man to keep us ALL from his bad deeds. This man could easy have some one cause us a very bad disability. You have to PRAISAE in order TO PROTECT yourself. He lies and makes up stories about people and then tries to steal if THEY OWN THRU THE COURTS A SPECIAL DEVOTION TO PROTECT, EX> Our Lady of America DEVOTION. EVERYONE who reads this, PLEASE BE CAREFUL of Kevin Bart McCarthy of Indianapolis, IN My Phone No. IS 419-435-3838.

  3. Joe, you might want to do some reading on the fate of Hoosier whistleblowers before you get your expectations raised up.

  4. I had a hospital and dcs caseworker falsify reports that my child was born with drugs in her system. I filed a complaint with the Indiana department of health....and they found that the hospital falsified drug screens in their investigation. Then I filed a complaint with human health services in Washington DC...dcs drug Testing is unregulated and is indicating false positives...they are currently being investigated by human health services. Then I located an attorney and signed contracts one month ago to sue dcs and Anderson community hospital. Once the suit is filed I am taking out a loan against the suit and paying a law firm to file a writ of mandamus challenging the courts jurisdiction to invoke chins case against me. I also forwarded evidence to a u.s. senator who contacted hhs to push an investigation faster. Once the lawsuit is filed local news stations will be running coverage on the situation. Easy day....people will be losing their jobs soon...and judge pancol...who has attempted to cover up what has happened will also be in trouble. The drug testing is a kids for cash and federal funding situation.

  5. (A)ll (C)riminals (L)ove (U)s is up to their old, "If it's honorable and pro-American, we're against it," nonsense. I'm not a big Pence fan but at least he's showing his patriotism which is something the left won't do.