Troy v. Hart


FACTS: P. Lettich, a resident of Stella Maris Hospice was receiving Medicare and Medicaid benefits when his sister died intestate. One of Lettich's two sur¬viving sisters, Hart (def), was appointed personal representative of her deceased sister's estate, and although D was aware Lettich was represented by Troy (P), D visited Lettich and helped him execute a disclaimer to his $ 100,000 share of the deceased sister's estate. D did not advise Lettich of the effect of the disclaimer on his Medicaid status and she divided the $100,000 with their other sister. P was notified of the renunciation the fol¬lowing month. Counsel for Lettich filed a petition to rescind the disclaimer and remove D as personal representative of the deceased sister's estate. One day before the deadline to respond to the petition, (defs) attorney visited Lettich and asked him to execute a motion to strike the petition. A social worker intervened and suggested P be consulted. Lettich died shortly thereafter. The court denied P's petition. P appealed. (defs) motion for judgment with respect to P's request to have her removed was granted; P's petition to rescind was dismissed. P appeals.

ISSUE: May a Medicaid recipient disclaim an inheritance?

HOLDING: Yes. -affirmed-

RULE:Maryland law requires that once an individual is eligible for and receiving Medicaid benefits, he must notify the Department of Social Services ("DSS") within 10 working days of changes affecting eligibility.
♦ Lettich failed to notify DSS of his inheritance and thereby violated applicable Medicaid law and deprived both the state and federal governments of an opportunity to reevaluate his eligibility.
♦ A New York court has found in similar circumstances that renunciation of an intestate share is irreconcilable with the concept that public aid is limited and should be reserved for those who have a legitimate need, that a renunciation is essentially equal to a transfer, and should be penalized in the same manner. We adopt the reasoning of the New York court here. If a renunciation would cause a benefits recipient to be disqualified, the renunciation should be treated as a transfer and incur the same penalty that a transfer prior to eligibility would incur. The recipient should be liable for any payments incorrectly paid by the state in consequence of the renunciation.

ANALYSIS: While Lettich's disclaimer is valid, his surviving sisters should take subject to 'any claims the state may have against Lettich's estate for any payments improperly made as a result of Lettich's failure to notify DSS of his acquisition of property.