MGE 216012 (02/18/2025)
Inst. MA backdated nearly a year due to inadequate notice of denial, inability to verify

Preliminary Recitals

Pursuant to a petition filed on November 22, 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 22, 2025, by telephone. The hearing in this matter also addressed two companion appeals (MAP-215784 and MQB-215783). Separate decisions will be issued for those appeals.

The issue for determination is whether Petitioner is entitled to MA benefits under the Institutional Long-Term Care Medicaid program prior to her enrollment date of July 1, 2024.

There appeared at that time the following persons:

PARTIES IN INTEREST:

Petitioner:
—

Petitioner’s Representative:
Attorney Andrew Hawes
Stotler Hayes Group, LLC
297 Willbrook Blvd
Pawleys Island, SC 29585

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:
Wendy I. Smith
Division of Hearings and Appeals

Findings of Fact

1. Petitioner (CARES # —) is a 64-year-old resident of Milwaukee County and has been living at — (—), a skilled nursing facility located in Milwaukee, since November 1, 2023.
2. Petitioner suffers from significant physical and cognitive impairment, schizophrenia, dysphagia, and other medical conditions. An examining psychologist found her to be permanently incapacitated due to degenerative brain disorder and serious and persistent mental illness as of October 6, 2024.
3. Petitioner applied for MA on October 30, 2024, and the agency found her eligible for Nursing Home Long-Term Care with a three-month backdated enrollment date of July 1, 2024.
4. Petitioner previously applied for healthcare benefits on November 17, 2023, and reported living in her home, not in an institutional setting. The agency requested verification information about her assets in a letter dated December 9, 2023. Petitioner did not submit the requested information by the stated deadline and was subsequently denied for Medicaid BadgerCare Plus, and Medicaid Purchase Plan.
5. Petitioner reapplied on March 13, 2024. Her application reported that she lived in a nursing facility at —. She also reported income from Social Security benefits and a prepaid debit card with a value of $350.00. The application requested backdated coverage.
   1. The agency requested verification information to determine her eligibility for Nursing Home Long-Term Care in a letter dated March 18, 2024. The deadline for supplying proof of the prepaid debit card asset was April 12, 2024.
   2.  In a notice dated April 15, 2024, Petitioner’s application for the Medicaid Purchase Plan, Medicare Savings Program, and Family Planning Services were denied. This notice did not list “Medicaid” or “Nursing Home Long-Term Care” as a program under which Petitioner was being denied.
   3. On April 18, 2024, the agency processed a letter from —, — Business Office Manager, dated April 12, 2024, which stated:
      “The patient listed above [Petitioner] has been unable to obtain a statement from her pre paid deit [sic] card. She is unable to go and obtain it herself and her friend has not been able to stop and obtain it. Can we please do something else for this patient? She gets her SS and that is her only income. She is still paying rent at her apartment she shares as her goal is to return there.”
   4. The agency took no action because the letter did not state that there was a legal obstacle preventing Petitioner from accessing the information.
6. Petitioner reapplied on May 22, 2024, in which she again reported living in a nursing facility at —. She reported income from Social Security benefits and her prepaid debit card with a value of $65.74. The application requested backdated coverage.
   1. On May 30, 2024, the agency processed a — statement for an account number ending in — submitted showing a balance of $65.74. This statement did not include the name of the account owner.
   2. The agency requested verification information to determine her eligibility for Nursing Home Long-Term Care in letters dated June 19, 2024, and June 28, 2024. The deadline for supplying proof of the prepaid debit card asset and — account was July 9, 2024. Petitioner did not produce any additional documentation by the deadline.
   3. In a notice dated July 23, 2024, Petitioner’s application for Medicaid Purchase Plan, Medicare Savings Program, and Family Planning Services were denied. This notice did not list “Medicaid” or “Nursing Home Long-Term Care” as a program under which Petitioner was being denied.
7. Petitioner reapplied on July 31, 2024, in which she again reported living in a nursing facility at —. She reported income from Social Security benefits and a checking account at — with a current balance of $65.74. The application requested backdated coverage.
   1. On the same day of her application, — submitted a letter to the agency clarifying that Petitioner does not have two financial accounts—the — account number ending — is the same as her prepaid debit card.
   2. The agency requested verification information to determine her eligibility for Nursing Home Long-Term Care in a letter dated August 14, 2024. The deadline for supplying proof of her rent and checking account was September 3, 2024. No documentation was provided by Petitioner by the deadline.
   3. In a notice dated September 4, 2024, Petitioner’s application for Medicaid Purchase Plan, Medicare Savings Program, and Family Planning Services were denied. This notice did not list “Medicaid” or “Long-Term Care Services” as a program under which Petitioner was being denied.
   4. Another denial notice was issued for the Medicaid Purchase Plan, Medicare Savings Program, and Family Planning Services on September 24, 2024.
8. During her period of residence at —, Petitioner has not had a legal representative available to her to assist her with accessing information relating to her financial affairs. — made several unsuccessful attempts to gain access to information necessary to fully verify her income and assets.
9. — is currently in the process of seeking guardianship over Petitioner.
10. Petitioner now appeals to the Division of Hearings and Appeals with a request to backdate Petitioner’s MA enrollment to November 1, 2023.

Discussion

In this case, Petitioner argues that her multiple applications for MA were subject to processing and notice errors, that the agency failed to assist Petitioner with obtaining required verification, and that the agency failed to inform Petitioner or her representatives of the actions that needed to be taken in order to resolve the verification issue, such as initiation of guardianship proceedings. While she eventually was able to gain eligibility for Nursing Home Long-Term Care, her effective date was only able to be backdated to July 1, 2024. Petitioner argues that due to these errors, her enrollment was improperly delayed and that she should be awarded backdated coverage to November 1, 2023, or to the earliest date that is determined fair and just.

Timeliness of Appeal

The first question is whether the Division of Hearings and Appeals (DHA) has jurisdiction to decide an appeal for backdated coverage. A person receiving or applying for MA may appeal certain agency actions, such as the denial of an application for benefits, reduction, suspension, or termination of benefits, or a determination of the amount, sufficiency, and eligibility date of benefits. Wis. Admin. Code HA § 3.03(1). Generally, an appeal concerning MA must be filed within 45 days of the action or failure to act. Wis. Stat. § 49.45(5)(a); Wis. Admin. Code, § HA 3.05(3)(a). Language concerning the right to appeal and the time limit must be included on all department eligibility determinations. Wis. Admin. Code HA § 3.04. If an appeal is untimely, the DHA lacks jurisdiction to consider the petitioner’s position on the merits.

Petitioner’s appeal was received by the DHA on November 22, 2024—a year past Petitioner’s requested backdated eligibility demand of November 1, 2023.

First, Petitioner alleges that she did not receive adequate notice of a denial for Nursing Home Long-Term Care and therefore should not be expected to adhere to an appeal deadline when notice was legally deficient. State Medicaid agencies are required to provide notice to applicants of the specific reasons supporting an eligibility denial. See 42 C.F.R. § 431.210. A notice is not adequate if it does not expressly identify the program for which benefits are denied. I agree with Petitioner that nearly all of her past denial notices were deficient.

Petitioner’s very first MA application on November 17, 2023, is an exception in that she did not request institutional MA, and the notice specifically denied her eligibility in the Medicaid program (and BadgerCare Plus and MAPP). The first application cannot serve as a basis for backdated coverage both because Petitioner was adequately advised of the deadline for appeal and her instant appeal is long past the 45-day deadline, and because that application did not request Nursing Home Long-Term Care services as Petitioner indicated that she was living at home at that time.

However, following that application, she applied three more times (March 13, 2024, May 22, 2024, July 31, 2024) and indicated she was living in a nursing home. None of the three denial notices sent for those applications included a specific denial for Nursing Home Long-Term Care or Medicaid. There were specific denials for the MAPP, Medicare Savings Program, and Family Planning Services, but not for the program for which Petitioner requested long-term coverage of a nursing facility. With no express denial, an applicant is left wondering whether she may be still pending for Nursing Home Long-Term Care eligibility.

This ambiguity was resolved when Petitioner finally received an eligibility approval for Nursing Home Long-Term Care by letter dated November 18, 2024. Petitioner’s appeal was promptly filed thereafter within 45 days of the action date. As Petitioner’s appeal is also presented as a challenge to the effective date of the November 18, 2024, approval, I find that the appeal is timely and the DHA has jurisdiction to consider Petitioner’s request for backdated coverage.

Request for Backdated Coverage

As stated above, the earliest application in which Petitioner sought benefits for long-term care services is her application dated March 13, 2024. Prior to that application, the agency had no indication that Petitioner resided in a nursing facility or was requesting long-term care services.

Petitioner alleges that the agency failed to provide adequate assistance to her in completing the verification process in that March 2024 application. Institutional Long-Term Care Medicaid is a health insurance program available for individuals who require care in an institutional setting, such as a nursing home, and who meet certain other non-financial and financial eligibility criteria. Medicaid Eligibility Handbook (ME Handbook) § 27.1, et. seq. Applicants that require long-term care in an institutional setting may be eligible if they satisfy income and asset limitations. Id. at § 27.5.

The agency is required to determine an applicant’s eligibility through a verification process to accurately identify an applicant’s income and assets. See id. at §§ 15.1, 16.1; Wis. Admin. Code DHS § 102.03. The agency may use all available data exchanges to verify information, but the member has primary responsibility for providing verification. ME Handbook at § 20.5. However, If the applicant or recipient is not able to produce verifications, or requires assistance to do so, the agency may not deny assistance but shall proceed immediately to verify the data elements. Wis. Admin. Code DHS § 102.03(1).

In such a case, agency policy requires:

Assist the member in obtaining verification if he or she has difficulty in obtaining it.

Use the best information available to process the application or change within the time limit and issue benefits when the following two conditions exist:

1. The member does not have the power to produce verification, and
2. Information is not obtainable timely even with your assistance.

In this situation, seek verification later. When you have received the verification, you may need to adjust or recoup benefits based on the new information. Explain this to the member when requesting verification.

Id.

Petitioner suffers from cognitive impairment so extensive that she was recently found mentally incapacitated by a psychologist. While this determination was not established at the time of her March 2024 application processing, Petitioner’s representative did ask for assistance in helping Petitioner comply with the agency’s verification requests concerning her assets.

By letter dated April 12, 2024, — of — informed the agency that Petitioner was unable to retrieve the requested statement for Petitioner’s prepaid debit card. At this time, the agency did not take action on this explicit request for help, apparently because —’s letter did not state there was a legal obstacle to accessing the information. There is no evidence that the agency communicated to Petitioner how it could assist Petitioner in completing the verification or advise if the agency required guardianship proceedings to be initiated. The agency’s representative at the hearing could not cite a specific policy which required only proof of legal obstacle to prevent closure of an application for failure to verify. The agency made no effort to contact Petitioner’s representative to inquire about her circumstances, at which point the agency surely would have been advised of her cognitive impairment and inability to obtain verification information.

According to the agency’s representative at the hearing, the agency was unable to independently verify Petitioner’s debit card balance through its AVS system. The agency also claims that it wouldn’t have been able to access account information if it contacted the bank directly. That may be so, but in a case such as this where Petitioner was unable to obtain verification information and not expected to be able to in a timely manner even with assistance due to incapacity, the agency should have either (1) further pended her application to allow for providing guidance to her representative and assistance or (2) sought verification of her asset later, granted her eligibility, and sought recoupment of unentitled benefits, if discovered later. Id. at § 20.5.

Based on the record before me, had those actions taken place, Respondent would have been eligible for Nursing Long-Term Care Services as of the March 13, 2024, application. Failure to process her application in accordance with program rules and agency guidance resulted in improper delay of her enrollment. As such, this matter is remanded to the agency to backdate her enrollment to December 1, 2023, the earliest date that could have been granted to her based on her March 13, 2024, application.

Conclusions of Law

The agency improperly processed Petitioner’s March 13, 2024, application for MA, resulting in improper delay in her Institutional Long-Term Care enrollment date. Petitioner is entitled to backdated coverage to December 1, 2023, in accordance with her request for backdated coverage in the March 13, 2024, application.

THEREFORE, it is

Ordered

That the case is remanded to the agency to take all administrative actions to backdate Petitioner’s enrollment date for Institutional Long-Term Care to December 1, 2023, and issue a written notice to Petitioner within 10 days of the date of this decision.

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