No Change To Medicaid Penalty Period Unless All Funds Returned

When a women in New Jersey sold her house she transferred half the proceeds to nephews in order to reduce her assets to qualify for Medicaid. However, the act was discovered and a 387 penalty was imposed, which restricted her ability to enroll, prompting a nephew to return $17,000 in order to reduce the penalty period.

In C.C. v. Division of Medical Assistance and Health Services, the court held that complete restitution of the transferred funds must occur before reconsideration of the penalty period is allowed. The court stated that federal and New Jersey law clearly requires all funds to be returned before the penalty can be reevaluated.

See State Cannot Modify Penalty Period Unless All Transferred Assets Are Returned, Elder Law Answers, June 2, 2015.