Tags: Supreme | Court | Supports | Tough | Medicaid | Rules

Supreme Court Supports Tough Medicaid Rules

Wednesday, 20 February 2002 12:00 AM

In a 6-3 ruling, the justices upheld Wisconsin's interpretation of how a couple's income is evaluated. Most states have similar rules for resolving a couple's assets, so Wednesday's ruling will have far-reaching implications.

At issue in the case is the "spousal impoverishment" provisions of the 1988 Medicare Catastrophic Coverage Act, which are part of the federal Medicaid statute.

Under the provisions, if a couple must live apart because one spouse is confined to an institution, usually a nursing home, the spouse living at home can reserve some assets to meet minimum monthly needs when the institutionalized spouse becomes eligible for Medicare.

For the home spouse to gain an increase in his living allowance, which is sheltered under federal law, the home spouse must show at a state hearing that his income will fall short of the minimum allowed under the federal law.

Though it sounds complicated, it's really robbing Peter to pay Paul. A home spouse has to shelter enough assets so that the institutionalized spouse can be poor enough to qualify for Medicaid.

Wisconsin, like most states, uses an "income-first" method in determining whether the home spouse may get a higher living allowance.

Under that method, the state first considers whether an institutionalized spouse can still transfer income to a home spouse, even after the former qualifies for Medicaid.

How this works out is obvious in the case of Irene Blumer, which brought Wednesday's Supreme Court decision.

She was admitted to a nursing home in 1994. In December 1996, she applied for Medicaid through her husband, Burnett Blumer.

Green County, Wis., calculated that the couple had assets of $145,644 in 1994 when Mrs. Blumer was institutionalized. The county set one half of that aside for Blumer's assets, or his "resource allowance." However, in 1996, the couple had set aside assets totaling $89,335, more than $14,000 above their "resource allowance" calculated in 1994.

When Mrs. Blumer requested a state hearing to raise the allowance, it was denied. The Blumers were then forced to spend resources that she would have preferred to save for her husband before Wisconsin would declare her Medicaid-eligible.

She went to state court, contending that the state's "income-first" method was out of step with federal law. A state appeals court agreed, and Wisconsin asked the Supreme Court for review.

In her majority opinion reversing the state appeals court Wednesday, Justice Ruth Bader Ginsburg said the court concluded "that neither the act's text nor its structure forbids the 'income-first' method Wisconsin follows."

Justice John Paul Stevens, joined by Justices Antonin Scalia and Sandra Day O'Connor, dissented, saying he would have upheld the state appeals court.

(No. 00-952, Wisc. Dept. of Health and Family Services vs. Blumer)

Copyright 2002 by United Press International.

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In a 6-3 ruling, the justices upheld Wisconsin's interpretation of how a couple's income is evaluated. Most states have similar rules for resolving a couple's assets, so Wednesday's ruling will have far-reaching implications. At issue in the case is the spousal...
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Wednesday, 20 February 2002 12:00 AM
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