New York State Department of Social Services, Michael J. Dowling, the present Commissioner of the New York State Department of Social Services, and Erie County.
Wilfred and Adeline Capell, both of whom are now deceased, were married in 1935 in Buffalo, New York. They had three children: Barry, Bryan, and Bruce. Barry Capell predeceased his parents and is survived by two daughters, Holly Capell and Ann Capell (Eden). In 1953, Wilfred and Adeline became title owners of 7666 Arnold Drive in Wheatfield, New York and made this property their marital residence. The deed was duly recorded in the Niagara County Clerk's office (Item 17).
In 1987, as a result of marital difficulties due to the onset of Wilfred's Alzheimer's disease, Wilfred Capell left the marital residence and moved in with Elizabeth and Norman Seaner (Item 17). Soon thereafter, Wilfred's physical and mental health began to deteriorate. In February of 1988, Elizabeth Seaner ("Seaner") petitioned the Supreme Count of Erie County to be appointed conservator of Wilfred Capell's property (Item 17).
On August 3, 1988, Wilfred Capell was admitted to Millard Fillmore Hospital. He was later transferred to the Skilled Nursing Facility of Millard Fillmore, where he remained until his death on May 14, 1994 (Item 17).
Adeline Capell filed for divorce in New York State Supreme Court, Niagara County. On December 28, 1988, a final divorce agreement, providing for the distribution of the marital property, was entered into by oral stipulation (Item 15, exhibit E). On January 31, 1989, Adeline and Wilfred Capell were divorced pursuant to an order of the New York State Supreme Court. The parties stipulated agreement was incorporated but not merged in the divorce decree. Id.
According to the terms of the agreement, Adeline Capell retained a life estate in the property at 7666 Arnold Drive, with the remainder interest to their adult children Barry and Bruce Capell, who were to receive one-third (1/3) each, and their grandchildren, Holly Capell and Ann Capell (Eden), who were to receive one-sixth (1/6) each (Item 15, exhibit E). On January 11, 1989, Adeline Capell signed the deed to 7666 Arnold Drive, transferring her interest in the property as designated in the divorce agreement. However, the deed was not recorded until August 17, 1992 (Item 15, exhibit F).
Meanwhile, on January 3, 1989, the Erie County Department of Social Services granted full medicaid coverage to Wilfred Cape (Item 15, exhibit G). Capell's Medicaid coverage was renewed in 1990 and 1991.
On September 25, 1991, Elizabeth Seaner was appointed conservator of Wilfred Capell's property by the New York State Supreme Court.
On November 2, 1991, Ms. Seaner, on behalf of Wilfred Capell, signed a deed transferring Wilfred Capells' interest in the Arnold Drive property according to the terms of the divorce agreement. However, this deed was also not recorded at that time.
In September of 1992, Adeline Capell died. That same month the Arnold Drive property was sold to Eugene and Sue Robinson (Item 22, exhibit E). Title to the property and the mortgage thereon were recorded in the Robinson's name on December 4, 1992 (Item 15, exhibit J).
On October 10, 1992, Ms. Seaner applied to ECDSS to recertify Wilfred Capell's eligibility for medical assistance benefits for the period beginning December 1, 1992 (Item 22, exhibit L). In a handwritten margin note on the application, Ms. Seaner indicated that the Arnold Drive property had recently been sold for $ 110,000.00. Id.
Prior to the recertification application, the question of the transfer of the Arnold Drive property, and the possible assignment of the sales proceeds, had come to the attention of ECDSS. Because the transfer of the property could have an effect upon Medicaid eligibility, ECDSS initiated a resource investigation of Wilfred Capell. The investigation results, dated September 11, 1992, concluded that title to the Arnold Drive property was in the names of Adeline and Wilfred Capell based upon the 1953 deed (Item 22, exhibit K).
As a result of Ms. Seaner's notation on the application, along with the results of their own investigation, ECDSS informed Ms. Seaner that the recertification application was incomplete. To complete the application, ECDSS required proof of the closing of the sale on the Arnold Drive property, proof of the amount received for the property and proof of the location of the sales proceeds (Item 22, exhibit M). ECDSS warned Ms. Seaner that under New York state law, the department had to make a decision on Wilfred's application within thirty days. Thus, absent a response to their request by November 27, 1992, they would assume that she did not wish to continue the application and it would be denied. Id.
Seaner sent a reply letter, dated November 19, 1992. She explained that Barry Capell had sold the property in September of 1992, after Adeline Capell's death. She did not have Barry Capell's address but knew that he worked at the prison in Elmira. She indicated that although she knew Wilfred Capell's name was on the title to the property, he had not received any of the proceeds from the sale of 7666 Arnold Drive. However, Ms. Seaner did not supply the requested documents, nor did she request more time to do so (Item 22, exhibit E).
ECDSS sent Seaner a notice of intent to discontinue Wilfred Capell's medical assistance as of November 30, 1992, noting specifically Seaner's failure to provide the documents necessary to determine continued eligibility (Item 22, exhibit P). This notice informed Ms. Seaner that if she wanted the medical assistance to continue, she would have to send the required documentation to ECDSS before the cut-off date.
Ms. Seaner sent a note dated November 24, 1992, to ECDSS explaining that she did not have the deed. She again referred the department to Capell's son, Barry (Item 22, exhibit O). Ms. Seaner never supplied the documents nor did she inform ECDSS that Mr. Capell had been legally divorced and that the property had been transferred to his children before the sale to the Robinsons (Item 22, exhibit H pp. 20-21, 25-26). Accordingly, Wilfred Capell's medicaid coverage was discontinued effective November 30, 1992, pursuant to the notice.
The notice of discontinuance informed Ms. Seaner that she had sixty days to request an administrative hearing to appeal the determination. Ms Seaner never requested a hearing (Item 22, exhibit H p. 27). Millard Fillmore requested an administrative hearing by letter dated February 3, 1993, more than sixty days after the notice of discontinuance (Item 22, exhibit Q).
On April 19, 1993, an administrative hearing was conducted by the New York State Department of Social Services (Item 22, exhibit H). In a decision dated April 29, 1993, the Commissioner held that the administrative hearing had not been requested in a timely manner and therefore concluded that he did not have jurisdiction to review the county's determination.
I. SUMMARY JUDGMENT
Summary judgment is appropriate if the pleadings, discovery materials and affidavits on file "show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). In reaching this determination, the court must assess whether there are any material factual issues to be tried while resolving ambiguities and drawing reasonable inferences against the moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986); Coach Leatherware Co., Inc. v. Ann Taylor, Inc., 933 F.2d 162, 166-67 (2d Cir. 1991). A dispute regarding a material fact is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., supra, 477 U.S. at 248; see Bryant v. Maffucci, 923 F.2d 979, 982 (2d Cir.), cert. denied, 502 U.S. 849, 116 L. Ed. 2d 117, 112 S. Ct. 152 (1991).
Once the moving party has met its burden of demonstrating the absence of a genuine issue of material fact, the nonmoving party must come forward with enough evidence to support a jury verdict in its favor, and the motion will not be defeated merely upon a "metaphysical doubt" concerning the facts, or on the basis of conjecture or surmise. Bryant v. Maffucci, supra (citing Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 89 L. Ed. 2d 538, 106 S. Ct. 1348 (1986)). In order to avoid summary judgment, the nonmoving party is under the obligation "to make a sufficient showing on an essential element of [its] case with respect to which [it] has the burden of proof." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986); Burke v. Bevona, 931 F.2d 998, 1001 (2d Cir. 1991). "Entry of summary judgment indicates that no reasonable jury could return a verdict for the losing party." Coach Leatherware, Inc. v. Ann Taylor, Inc., supra, 933 F.2d at 167.
In this case both parties have moved for summary judgment. The facts are not in dispute. Summary judgment is appropriate where, as here, only questions of law remain.
Plaintiffs argue that the recertification procedure followed in Wilfred Capell's case violated the Medicaid Act and the Constitution. Specifically, plaintiffs contend that (1) Mr. Cape should not have been required to provide information concerning the sale of the property at 7660 Arnold Drive, and (2) that ECDSS was required to conduct a collateral investigation when Ms. Seaner informed them she did not have the documents they requested.
Defendants argue that the recertification procedure followed by ECDSS was in compliance with the Medicaid Act and the Constitution. Defendants also argue that plaintiff Millard Fillmore lacks standing. However, because I find that the claims stated in the complaint are without merit as to both plaintiffs, the standing issue need not be addressed.
II. THE RECERTIFICATION PROCESS
A. The Requested Documents
The New York State regulations provide that a recipient of medical assistance must undergo recertification for benefits every twelve months. 18 N.Y.C.R.R. § 360-2.2(e). The burden is on the applicant to establish his or her eligibility. Lavine v. Milne, 424 U.S. 577, 47 L. Ed. 2d 249, 96 S. Ct. 1010 (1976). In assessing eligibility for recertification, ECDSS will consider any resources available to the recipient within a thirty-month "look-back" period.
18 N.Y.C.R.R. § 360-4.4(a)(1). As part of the recertification process, recipients must provide relevant documentation to ECDSS to verify eligibility. 18 N.Y.C.R.R. §§ 360-2.3(a)(2) and 360-2.3(c)(3). Failure to do so can result in a determination of ineligibility. 18 N.Y.C.R.R. § 351.8(a)(2)(ii). St. Francis Hospital v. D'Elia, 71 A.D.2d 110, 422 N.Y.S.2d 104 (2 Dept. 1979), aff'd, 53 N.Y.2d 825, 422 N.E.2d 830, 440 N.Y.S.2d 185 (1981).
Plaintiffs contend that the New York regulation regarding the transfer of resources made within the thirty month look-back period for less than fair market value is relevant to this case. The New York regulation provides as follows:
Any transfer of a resource for less than fair market value made within or after the thirty month period immediately proceeding the date the person becomes an institutionalized person, or the date the institutionalized person applies for [Medical Assistance], whichever is later, shall be presumed to have been made for the purpose of qualifying for nursing care or relative services in a nursing facility . . . . Such a transfer shall result in a period of ineligibility for these services. . . .