Asset May Be Available Resource for Medicaid Even if the Resource Cannot Be Sold (Converted to Cash)

An Ohio appeals court has ruled that a Medicaid applicant's real property may be counted as excess resources even though the applicant was unable to sell the  property. Communicare v. Ohio Department of Job and Family Services (Ohio Ct. App., 8th Dist., No. 106874, Sept. 19, 2019).

Mohsen Fanous owned three pieces of real property that were collectively valued at around Sixteen thousand dollars ($16,000.00). He was, apparently, unable to find anyone willing to pay anything for the properties. When he applied for Medicaid benefits, the state denied his application, finding that the properties put him over the Medicaid resource limit and that it could not verify his other resources.

Mr. Fanous appealed, arguing that the properties should not have been considered as countable resources because he was not able to sell them. Because Ohio law defines resources to includes property that the applicant has an ownership interest in and has the legal ability to convert to cash, the trial court dismissed the appeal, and Mr. Fanous appealed again.

The Ohio Court of Appeals, Eighth District, affirmed, holding that the state properly denied Mr. Fanous's application due to excess resources. According to the court, "whether [Mr.] Fanous was able to find a purchaser is a wholly different consideration from what the regulation contemplated, namely whether [Mr.] Fanous had the legal authority to sell the properties in the first place."  Because Mr. Fanous had the legal authority to sell the properties, the value of the properties were considered an available resource, notwithstanding that he could not convert the property to cash.  

This case represents why Medicaid often puts applicants and their families between a "rock and a hard place."  The applicant is unable to liquidate the assets for cash necessary to pay for long-term care, and the applicant is otherwise unable to pay for long-term care.  Often. the reality is that family members, such as children or grandchildren, are "forced" to pay for the applicant's long-term care.