Nursing homes often develop a tense relationship with the fiduciaries that represent their residents' interests. Trustees, guardians, and agents (attorneys-in-fact) should be aware that a nursing home, or any other institution, might lose confidence of the fiduciary and seek his or her replacement. A recent New Jersey case concerned the legal dispute that arose when the nursing home sought to replace a resident's court-appointed guardian.
A public guardian was appointed for Y.M., a nursing home resident. The guardian applied for Medicaid on Y.M.'s behalf. The state denied the application, and the guardian appealed, but then withdrew the appeal and submitted a new application.
The nursing home filed a motion to remove the public guardian and replace the guardian with one of two other individuals. The nursing home argued that the public guardian had made errors in the Medicaid application and failed to set up a qualified income trust (QIT) for Y.M., which resulted in the denial of the Medicaid application. Y.M. argued that the alternate guardians suggested by the nursing home had a conflict of interest. The trial court denied the nursing home's motion, and the nursing home appealed.
A New Jersey appeals court ruled against the nursing home's effort to remove the resident's guardian. The nursing home filed a motion to remove the resident's court-appointed public guardian because the resident's initial Medicaid application, prosecuted by the guardian, was denied. The appellate court ruled that the denial of the Medicaid application was not proof that the guardian was not acting in the resident's best interest. In the Matter of Y.M. (N.J. Super. Ct., App. Div., No. A-4532-16T4, June 8, 2018). According to the court, "aside from the payment of Y.M.'s debt to the facility, [the nursing home] provided no other information to convince the judge Y.M. was dissatisfied with [the public guardian]."
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