MGE 215913 (02/14/2025)
Irr. burial trust over $4,500 was countable, except for cost of casket

Preliminary Recitals

Pursuant to a petition filed on November 14, 2024, under Wis. Stat. § 49.45(5), and Wis. Admin. Code § HA 3.03(1), to review a decision by the Milwaukee Enrollment Services regarding Medical Assistance (MA), a hearing was held on January 8, 2025, by telephone.

The issue for determination is whether the agency correctly terminated Petitioner’s enrollment in Medicaid effective November 1, 2024 due to being over the asset limit.

There appeared at that time the following persons:

PARTIES IN INTEREST:

Petitioner:
—

Respondent:
Department of Health Services
1 West Wilson Street, Room 651
Madison, WI 53703
By: Stacy Green
Milwaukee Enrollment Services
1220 W Vliet St
Milwaukee, WI 53205

ADMINISTRATIVE LAW JUDGE:
Nicole Bjork
Division of Hearings and Appeals

Findings of Fact

1. Petitioner (CARES # —) is a resident of Washington County and was enrolled in Medicaid.
2. On July 26, 2024, Petitioner submitted a healthcare renewal to continue receiving MA. The case was pending for asset verification.
3. On August 14, 2024, the agency received asset verification, which confirmed that Petitioner had three irrevocable burial trusts in the amounts of $500, $8163.82, and $3000 each, totaling $11,663.82.
4. On October 14, 2024, the agency sent a notice to Petitioner informing her that her enrollment in MA was going to be terminated effective November 1, 2024, because she was over the asset limit. Regulations stipulate that up to $4500 in irrevocable trusts are exempt. Since Petitioner’s trusts total $11,663.82, she is over the $4500 exempt amount and the remainder must be considered an asset. Further, the cost of the casket is also exempt, which is $1910. Removing the exemptions of $1910 and $4500 from the $11,663.82, Petitioner’s countable assets were $5253.82, which is over the asset limit of $2000.
5. Petitioner filed an appeal. Petitioner’s representative testified on her behalf. She noted that she arranged the trusts with the funeral home and that she assumed that they would not count as assets since only the funeral home can access those funds.

Discussion

The issue for hearing is whether the agency correctly counted a portion of the value of an irrevocable funeral trust resulting in a determination that Petitioner’s assets exceeded the program limit for eligibility effective November 1, 2024.

A single individual applying for Medicaid benefits must have less than $2000 in countable assets to be eligible for benefits. Wis. Stats., § 49.47(4)(b)3g; Medicaid Eligibility Handbook (MEH), § 39.4. In its determination dated October 14, 2024, the agency terminated Petitioner’s Medicaid enrollment because it found Petitioner’s assets exceeded the program limit. The agency counted as assets $11,663.82 in irrevocable burial trust assets. It relied on Medicaid Eligibility Handbook (MEH) 16.5.1 to count the portion of the irrevocable burial trust exceeding $4,500. After subtracting the exempt casket cost, this resulted in counted assets in the amount of $5253.82, which exceeded the counted asset limit of $2,000.

MEH 16.5.1 states, in relevant part:

Per Wisconsin law, when a person makes a pre-need agreement with a funeral provider to purchase funeral or burial products and services (not including burial spaces), all payments made under the agreement are trust funds, including interest and dividends, until the person’s death. For Medicaid purposes, Wisconsin law stipulates that such trusts may be made irrevocable as to the first $4,500 of the funds paid under the agreement. The irrevocable amount of such a trust is referred to as an irrevocable burial trust and is an exempt asset. If the total value of an otherwise irrevocable pre-need agreement with a funeral provider exceeds $4,500, the amount over $4,500 is revocable and is a countable asset. Interest and dividends, if any, are exempt only if they accrue to irrevocable burial trusts and the trust agreement specifies that they are irrevocable.

Petitioner’s representative testified credibly that the entirety of the irrevocable burial trust was unavailable to Petitioner and should not be counted as an asset. She expressed that the trusts were set up by a funeral director and they relied on those trusts being set up accurately.

Petitioner’s representative did not dispute any aspect of the agency’s calculations, rather she disagrees with exempting only $4,500 of the burial trust. The agency has no discretion to make the determination that she requests. The relevant rules in the MEH are clear. The agency agrees that value of the burial trust in question was unavailable to petitioner and was intended to be irrevocable. It must apply the rules, which limit the value of an irrevocable burial trust that may be exempted to $4,500. I find that the agency applied the law correctly in this matter.

While I sympathize with Petitioner’s position, I also lack the discretion to alter this determination. It is the long-standing policy of the Division of Hearings & Appeals that its assigned administrative law judges do not possess equitable powers, and cannot base a ruling upon an idea of what is deemed fair. See, Wisconsin Socialist Workers 1976 Campaign Committee v. McCann, 433 F. Supp. 540, 545 (E.D. Wis. 1977). This office must limit its review to the law as set forth in statutes, federal regulations, and administrative code provisions. Under law, she is not eligible; no exception applies, and I am without any equitable powers to direct any remedy beyond the remedies available under law. Because Petitioner’s countable assets exceeded $2,000, I must uphold the agency’s decision.

As stated by the agency representative at hearing, Petitioner’s representative is advised to contact the agency or an attorney regarding this matter to determine whether some other action may be taken that is favorable to Petitioner.

Conclusions of Law

The agency correctly limited the asset exemption applied to Petitioner’s irrevocable burial trust to $4500, based on MEH 16.5.1, correctly treated the additional value as revocable resulting in assets above the $2,000 limit. The agency correctly found petitioner ineligible for Medicaid effective November 1, 2024.

THEREFORE, it is

Ordered

That this appeal is dismissed.

[Request for a rehearing and appeal to court instructions omitted.]