In Ohio a Medicaid Lien Can Be Placed Against a Life Estate to Real Property Even After the Death of the Medicaid Recipient

An Ohio appeals court recently ruled that a deceased Medicaid recipient's life estate does not extinguish at death for the purposes of Medicaid estate recovery. Accordingly, the state may place a lien on the property after the death of the life tenant. Phillips v. McCarthy (Ohio Ct. App., 12th Dist., No. CA2015-08-01, May 16, 2016).

Lawrence Hesse transferred ownership in his farm to his three daughters, retaining a life estate for himself. Mr. Hesse later moved to a nursing home and received Medicaid benefits for one year before he died. After his death, the state filed a lien on the property for Medicaid benefits paid on Mr. Hesse's behalf.

Mr. Hesse's daughters filed a quiet title action against the state, arguing that because Mr. Hesse's life estate extinguished when Mr. Hesse died, the state could not assert a lien against the property after his death. The trial court granted summary judgment to the state, and Mr. Hesse's daughters appealed.

The Ohio Court of Appeals affirmed, holding that the state could place a lien on the property after Mr. Hesse died. According to the court, with regard to Medicaid estate recovery "a life estate interest held by a Medicaid recipient does not extinguish upon his or her death. Rather, for purposes of Medicaid recovery, a life estate interest endures post mortem and represents a quantifiable asset which the state may encumber by virtue of a properly filed lien."

Although this holding might seem irrational, it was the obvious intent of House Bill 66 passed in 2005.  I wrote about the effects of this "seemingly" innocuous change in the law over eleven years ago:

The new law also expands the State’s rights to place liens on property. As part of the State Budget bill passed on June 30, 2005, the State of Ohio now has authority to place a lien on the assets of the Medicaid recipient or the recipient's spouse...The liens, which are being placed on these properties, are akin to the "Liens for the Aged" process which was in place in many states in the 1950s and 1960. These laws were ultimately rejected by courts on various constitutional grounds. There is no guarantee that a challenge to the current law will meet with similar success. More importantly, for every family that challenges these liens, other families will simply repay the state, or the spouse will sell the family home which may result in insufficient funds to continue living independently. 

The new law also turns upside-down traditional property rights. Traditionally, right and title to property held jointly with a right of survivorship or pursuant to a transfer on death designation [or conveyed subject to a life estate] vested in the survivor (or beneficiary as the case may be) at the time of death. This “vesting” is apparently thought to create a hardship for the state, since it could undermine its lien rights. As a result, in order to prevent the vesting at death, the statute actually redefines death as follows:

• “Time of death” shall not be construed to mean a time after which a legal title or interest in real or personal property or other asset may pass by survivorship or other operation of law due to the death of the decedent or terminate by reason of the decedent's death.” See O.R.C.§5111.11 (A)(5).

So, for the purposes of the State of Ohio, a person does not "die" upon physical demise, and property interests that traditionally "vested" in and to another person upon death never really vest so long as the State also has an interest in the property.  

I have for more than a decade encouraged clients to adopt modern and more effective property transfers utilizing irrevocable trusts.  "I told you so," rings hollow and ominous given the consequences for Ohioans that want to pass to their heirs the assets they have worked so hard to protect.  

Hospice Owner Accused of Instructing Nurses to Kill Patients by Overdose

McKnight's reports that the owner of a Texas hospice company has come under fire for allegedly encouraging employees to overdose patients and hasten their death in order to avoid the federal reimbursement cap for hospice stays.

Brad Harris, 34, owner of Novus Health Care Services Inc., allegedly told a nurse to overdose three patients on drugs such as morphine, and instructed another employee to give a patient four times the maximum dose allowed, according to an FBI affidavit obtained by a Dallas television station. In another instance, Harris texted an employee of the Frisco, TX-based company “you need to make this patient go bye-bye.”

The FBI affidavit was written in February, but not publicly released until this week. No charges have been filed against Harris or Novus as of press time, and Harris remains free. The FBI declined to comment on the investigation, the Dallas Morning News reported.

The affidavit also accuses Harris of telling other healthcare executives that he sought out “patients who would die within 24 hours,” and of making comments like “if this f— would just die.” While at least one employee refused to comply with Harris' instructions, it's unclear if any patients were harmed.

The FBI's affidavit says Harris was motivated to find patients whose hospice stays were forecasted to be short, or even speed up patients' deaths, in order to skirt the payment caps placed on hospice care by Medicare and Medicaid.

Another employee said Harris would frequently decide which patients would be moved to and from home care, despite not being medically certified; Harris is an accountant by trade. Harris would have employees sign transfer papers with the names of doctors employed by the company, according to the affidavit.

"If a patient was on hospice care for too long, Harris would direct the patient be moved back to home health, irrespective of whether the patient needed continued hospice care,” the affidavit reads.

Horrific. 

Senior Supplements Safety-Survey Suggests More Than 15% of Seniors Taking Potentially Fatal Combinations of Prescriptions and Over-the-counter Supplements and Medications

Emily Mongan, Staff Writer for McKnight's, citing a recent study, warns that one in six seniors are ingesting prescription or over-the-counter drugs and dietary supplements, with potentially deadly results

Researchers at the University of Illinois at Chicago interviewed thousands of seniors in 2005 and 2011. They found more than 15% of seniors took potentially fatal combinations of prescription medications, over-the-counter drugs and supplements in 2011, compared to 8.4% in 2005.

The study also found the number of older adults taking at least five prescription drugs increased more than 30% over the six years. Use of over-the-counter medication among seniors dipped slightly from 44% to 38%, while the use of dietary supplements increased from 52% to 64%.

The growing use of multiple prescription drugs and supplements brings a “hidden, and increasing, risk of potentially deadly drug interactions” in seniors, lead researcher Dimo Qato told HealthDay.

Many of the dangerous interactions involved heart drugs and dietary supplements, like omega-3 fish oil, which are more widely used today than they were five years ago, Qato said. Other drugs, including some blood thinners, heart drugs and tranquilizers, may be negatively impacted by supplements like St. John's wort, which is often taken for depression.

Results of the study were published online in JAMA Internal Medicine.

Hospice Patients in SNFs Less Likely to be Visited by Professional Staff the Last Two Days of Life

Medicare patients who received hospice care in a nursing home setting were less likely to be visited by professional staff in the last two days of life, according to a new study.  The study, published online in JAMA Internal Medicine, found that 16.5% of hospice patients in nursing homes had no visits from professional hospice staff in the last two days of life, compared to 10.6% of patients not in nursing homes.  Smaller hospice programs, and those based in nursing homes, were less likely to provide visits in the last two days of life, the study found. 

 Researchers also noted differences in visits based on patient characteristics. Close to 15% of black patients had no visits on their last two days, compared to 12% of white patients. One in five patients who died on a Sunday also did not have a visit from professional hospice staff in their last two days of life.

The authors noted that their study did not take into account the severity of the symptoms of the hospice patients, or family preferences for visits. The results still pinpoint disparities in hospice care, researchers said, which is especially relevant as the Centers for Medicare and  Medicare Services evaluates reforms.

Source: McKnight's.

Beware Social Security Scam

The Social Security Administration posted  a warning on its blog about a scam involving phishing.  According to the post, the scam begins with an email misrepresenting itself as a government-sponsored program "protecting" consumers from identity theft and financial fraud. 

According to the blog:

The subject line says 'Get Protected,' and the email talks about new features from the Social Security Administration (SSA) that can help taxpayers monitor their credit reports, and know about unauthorized use of their Social Security number. It even cites the IRS and the official-sounding 'S.A.F.E Act 2015.' It sounds real, but it’s all made up.

The blog post offers a couple of tips to identify communications a scam. If the email ended up in your junk folder, it could be a scam. Also, the post suggests you mouse over the URL and see if it is really from SSA, or from a .com site instead.

Always remember-if in doubt, don't click on the link and don't provide personal information.