In January of 2007 I worked with an Ohio elder law attorney who had a Medicaid case involving a husband and wife, the Vieths. The institutionalized spouse, Mr. Vieth, entered a nursing home in November of 2006, and was expected to remain there indefinitely. After a resource assessment, Mrs. Vieth wanted to qualify her husband for Ohio Medicaid benefits.
In order to eliminate the spend-down amount, pursuant to my suggestion, Mrs. Vieth purchased two Medicaid Compliant Annuities from Jefferson-Pilot Life Insurance Company. The Medicaid Compliant Annuities were structured over Mrs. Vieth's Ohio Medicaid life expectancy.
With the spend-down amount eliminated, Mr. Vieth submitted a Medicaid application in April of 2007. After reviewing the Medicaid application, the Franklin County Department of Job and Family Services denied eligibility based upon the determination of an improper transfer of resources; specifically, the assets belonging to Mr. and Mrs. Vieth were put into annuities in Mrs. Vieth's name in order to make Mr. Vieth eligible for Medicaid. In support of this, the Department cited the provisions of Ohio Administrative Code 5101:1-39-07.
Based on the legal argument that the Department of Job and Family Services' position was contrary to federal law, the case proceeded to the Court of Appeals in Ohio, Tenth Appellate District. In July of 2009, the Appellate Court decided that the Department of Job and Family Services' position was contrary to the intent of the federal law, and further determined that Mr. Vieth was entitled to receive Medicaid benefits.
When I sold the Medicaid Compliant Annuities in the Vieth case, I was confident that they met the requirements of the Deficit Reduction Act of 2005, and that they were not a transfer of resources. With the recent decision, the case was a great win! With the Vieth decision in place, it is my opinion that more Medicaid Compliant Annuities will be used in Ohio.
To view the complete court decision of Vieth v. Ohio Dept. of Job & Family Services, please click here.
