PSA Payments are Compensated Transfers

Warren Kerner entered into a personal service agreement (PSA) with his son, Jonathan. Pursuant to the agreement, Mr. Kerner would pay Jonathan $9,283 a month and Jonathan would provide Mr. Kerner with daily care in Jonathan’s home. Mr. Kerner was later admitted to a nursing home and he applied to the Monroe County Department of Human Services (DHS) for Medicaid. DHS found that $105,041 in payments to Jonathan were uncompensated transfers during the look-back period and imposed a 13-month penalty period before Mr. Kerner could receive nursing home benefits.

On appeal, the New York Supreme Court annulled DHS’s decision. The Court ruled that although Jonathan didn’t have documentation of the services rendered, it is undisputed that services were indeed rendered. The Court remanded the matter to DHS to determine Mr. Kerner’s eligibility for Medicaid when taking into consideration the fair market value of the services actually rendered.

See Payments Under Personal Service Agreement are Compensated Transfers, ElderLawAnswers, July 6, 2010.