Palomba-Bourke v. Commissioner of Social Services ( 2014 )

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MARY PALOMBA-BOURKE v. COMMISSIONER
OF SOCIAL SERVICES
(SC 19044)
Rogers, C. J., and Palmer, Zarella, Eveleigh, McDonald and Espinosa, Js.
Argued January 8—officially released June 17, 2014
Jeffrey R. Lindequist, with whom was Scott A.
Storms, for the appellant (plaintiff).
Hugh Barber, assistant attorney general, with whom,
on the brief, was George Jepsen, attorney general, for
the appellee (defendant).
Opinion
EVELEIGH, J. The plaintiff in this administrative
appeal, Mary Palomba-Bourke, appeals from the judg-
ment of the trial court affirming the decision of the
administrative hearing officer, in favor of the defendant,
the Commissioner of Social Services (department).1 The
plaintiff contends on appeal that the department failed
to apply the correct eligibility and availability of assets
criteria when evaluating the application for Medicaid
benefits submitted by the plaintiff’s spouse, Daniel
Bourke. We disagree and, accordingly, we affirm the
judgment of the trial court.
Bourke applied to the department for Medicaid bene-
fits in 2009 and, in 2010, the department informed
Bourke that, based on its review of the combined assets
of both Bourke and the plaintiff, Bourke was not cur-
rently eligible to receive Medicaid benefits. The plaintiff
then sought an administrative hearing to contest the
department’s determination of Bourke’s eligibility.2 The
hearing officer denied her appeal of the department’s
decision, and the plaintiff appealed to the Superior
Court.3 The Superior Court dismissed her appeal. This
appeal followed.4
The relevant facts in the present case are undisputed,
and are recounted in the decisions of both the adminis-
trative hearing officer and the Superior Court. On Sep-
tember 10, 1968, the plaintiff’s husband at the time,
Edward Palomba, created the Edward A. Palomba resid-
ual trust (trust), and, upon his death on September 5,
1976, the plaintiff was made a beneficiary of the trust.
The trust was intended to permit the trustees to provide
for, in their sole discretion, the education and support
of Palomba’s children, and for the support of the plain-
tiff. As of April, 2010, the principal of the trust was equal
to $514,977.17. In 2000, the plaintiff married Bourke.
Bourke, who is not a beneficiary of the trust, entered
a long-term care facility on February 2, 2009, while
the plaintiff continued to reside in the community. On
August 3, 2009, Bourke applied for Medicaid benefits,
and on June 9, 2010, the department conducted its analy-
sis of the combined assets of the plaintiff and Bourke
and concluded that, based on the total value of their
combined assets, Bourke was not at that time eligible
for Medicaid benefits. Specifically, the department con-
cluded that, including the value of the trust, the couple’s
combined assets totaled $655,624.61. Pursuant to state
regulation; see Dept. of Social Services, Uniform Policy
Manual § 4005.10 (A) (2) (a) (Uniform Policy Manual);5
Bourke, as the individual applying for benefits, could
not hold more than $1600 in assets, and that the plaintiff,
as a ‘‘community spouse’’6 could not have greater assets
than the applicable ‘‘community spouse protected
amount’’ (protected amount),7 which the hearing officer
found to be $109,540. Thus, because the department
determined that the couple’s combined assets exceeded
$111,140,8 it concluded that Bourke was not eligible for
Medicaid benefits.
The plaintiff contested the department’s determina-
tion and sought an administrative hearing to challenge
it. Specifically, the plaintiff objected to the department’s
decision to count the value of the trust when determin-
ing the total value of the assets available to Bourke.
The plaintiff claimed that, in including the value of the
trust in Bourke’s available assets, the department was
following the rules created by the Medicare Cata-
strophic Coverage Act of 1988 (catastrophic coverage
act), Pub. L. No. 100-360, § 303 (c), 102 Stat. 683, 762,
regarding the availability of spousal assets, and not the
rules governing asset valuation that were in effect either
at the time that the trust was created in 1968 or when
the trust became irrevocable due to Palomba’s death
in 1976.
At the administrative hearing, the hearing officer
rejected the plaintiff’s argument. The hearing officer
concluded that the plaintiff and Bourke met the defini-
tion of ‘‘[catastrophic coverage act] spouses’’ as defined
in § 0500 of the Uniform Policy Manual,9 and that, as a
result, the calculation method for determining the
assets available to a Medicaid applicant found in
§ 4025.67 (A) of the Uniform Policy Manual applied.
Pursuant to § 4025.67 (A), the value of the nonexcluded
assets10 owned by a community spouse, after sub-
tracting the protected amount, are ‘‘deemed’’11 available
to the institutionalized spouse for purposes of the insti-
tutionalized spouse’s eligibility determination. As a
result, the hearing officer concluded that, because the
plaintiff conceded that the trust principal was available
to the plaintiff, the department was correct to include its
value as an asset when determining Bourke’s Medicaid
eligibility. The plaintiff appealed this decision to the
trial court on the same basis, and the trial court affirmed
the hearing officer’s decision, finding that the cases
cited by the plaintiff in support of her position were
all distinguishable, and relying, instead, ‘‘on the general
rule that when one applies for Medicaid, the applicant is
subject to whatever statutes are then in effect regarding
assets in existence at the time of institutionalization or
application.’’ This appeal followed.12
The sole issue on appeal is whether the trial court
properly affirmed the hearing officer’s determination
that the availability and eligibility rules of the cata-
strophic coverage act apply to the trust and thus, that
it should be considered an asset of Bourke for purposes
of his Medicaid eligibility.13 The plaintiff claims that by
applying the provisions of the catastrophic coverage
act, a law which came into effect after the trust in the
present case became irrevocable, the hearing officer
and reviewing Superior Court have frustrated the intent
of the trust’s settlor and have also acted contrary to
what the plaintiff contends is settled Connecticut law
regarding the applicability of the catastrophic coverage
act to trusts that were in existence prior to the enact-
ment of the law.
We begin with the appropriate standard of review.
‘‘Judicial review of [an administrative agency’s] action
is governed by the Uniform Administrative Procedure
Act [General Statutes § 4-166 et seq. (UAPA)] . . . and
the scope of that review is very restricted. . . . With
regard to questions of fact, it is neither the function of
the trial court nor of this court to retry the case or to
substitute its judgment for that of the administrative
agency. . . .
‘‘The substantial evidence rule governs judicial
review of administrative fact-finding under UAPA. Gen-
eral Statutes § 4-183 (j) (5) and (6). Substantial evidence
exists if the administrative record affords a substantial
basis of fact from which the fact in issue can be reason-
ably inferred. . . . This substantial evidence standard
is highly deferential and permits less judicial scrutiny
than a clearly erroneous or weight of the evidence stan-
dard of review. . . . The burden is on the [plaintiff]
to demonstrate that the [agency’s] factual conclusions
were not supported by the weight of substantial evi-
dence on the whole record. . . .
‘‘Even as to questions of law, [t]he court’s ultimate
duty is only to decide whether, in light of the evidence,
the [agency] has acted unreasonably, arbitrarily, ille-
gally, or in abuse of its discretion. . . . Conclusions of
law reached by the administrative agency must stand
if the court determines that they resulted from a correct
application of the law to the facts found and could
reasonably and logically follow from such facts. . . .
Ordinarily, this court affords deference to the construc-
tion of a statute applied by the administrative agency
empowered by law to carry out the statute’s purposes.
. . . Cases that present pure questions of law, however,
invoke a broader standard of review than is ordinarily
involved in deciding whether, in light of the evidence,
the agency has acted unreasonably, arbitrarily, illegally
or in abuse of its discretion. . . . Furthermore, when
a state agency’s determination of a question of law has
not previously been subject to judicial scrutiny . . .
the agency is not entitled to special deference.’’ (Cita-
tions omitted; internal quotation marks omitted.) MacD-
ermid, Inc. v. Dept. of Environmental Protection, 257
Conn. 128, 136–37, 778 A.2d 7 (2001).
Given the nature of the plaintiff’s claim, namely, that
the rules in effect prior to 1988 regarding the availability
of assets and the eligibility of a Medicaid applicant for
medical benefits should apply to the trust in the present
case, ‘‘[o]ur analysis begins with an overview of the
[M]edicaid program. The program, which was estab-
lished in 1965 as Title XIX of the Social Security Act
and is codified at 42 U.S.C. § 1396 et seq. ([M]edicaid
act), is a joint federal-state venture providing financial
assistance to persons whose income and resources are
inadequate to meet the costs of, among other things,
medically necessary nursing facility care. . . . The fed-
eral government shares the costs of [M]edicaid with
those states that elect to participate in the program,
and, in return, the states are required to comply with
requirements imposed by the [M]edicaid act and by
the secretary of the Department of Health and Human
Services. . . . Specifically, participating states are
required to develop a plan, approved by the [S]ecretary
of [H]ealth and [H]uman [S]ervices, containing reason-
able standards . . . for determining eligibility for and
the extent of medical assistance to be provided. . . .
‘‘Connecticut has elected to participate in the [M]ed-
icaid program and has assigned to the department the
task of administering the program. . . . Pursuant to
General Statutes §§ 17b-262 and 17b-10, the department
has developed Connecticut’s state [M]edicaid plan and
has promulgated regulations that govern its administra-
tion. See Uniform Policy Manual, supra.
‘‘The [M]edicaid act requires that a state’s [M]edicaid
plan make medical assistance available to qualified indi-
viduals. 42 U.S.C. § 1396a (a) (10). The term medical
assistance means payment of part or all of the cost of
. . . care and services . . . [including] nursing facility
services . . . . 42 U.S.C. § 1396d (a); see Catanzano
v. Wing, 103 F.3d 223, 229 (2d Cir. 1996). Participating
states are required to provide coverage to certain
groups and are given the option to extend coverage to
various other groups. The line between mandatory and
optional coverage primarily is drawn in 42 U.S.C.
§ 1396a (a) (10) (A): mandatory coverage is specified
in 42 U.S.C. § 1396a (a) (10) (A) (i); and optional cover-
age is set forth in subsection (a) (10) (A) (ii). In [M]edic-
aid parlance, individuals who qualify for [M]edicaid
benefits pursuant to those subsections are referred to
as the categorically needy because, in general, they are
eligible for financial assistance under Titles IV-A (Aid
to Families with Dependent Children) or XVI (Supple-
mental Security Income for the Aged, Blind, and Dis-
abled) of the Social Security Act.
‘‘Under the [M]edicaid act, states have an additional
option of providing medical assistance to the medically
needy—persons who . . . lack the ability to pay for
their medical expenses but do not qualify as categori-
cally needy solely because their income exceeds the
income eligibility requirements of the applicable cate-
gorical assistance program. . . . The medically needy
become eligible for [M]edicaid, if the state elects to
cover them, by incurring medical expenses in an
amount sufficient to reduce their incomes below the
income eligibility level set by the state in its [M]edicaid
plan. See 42 U.S.C. § 1396a (a) (17) (in determining
eligibility, state must take costs . . . incurred for medi-
cal care into account); see also 42 C.F.R. § 435.301.
Only when they spend down the amount by which their
income exceeds that level, are [medically needy per-
sons] in roughly the same position as [categorically
needy] persons . . . [because then] any further expen-
ditures for medical expenses . . . would have to come
from funds required for basic necessities. Atkins v.
Rivera, [477 U.S. 154, 158, 106 S. Ct. 2456, 91 L. Ed.
2d 131 (1986)]. Connecticut has chosen to cover the
medically needy. . . .
‘‘The [M]edicaid act, furthermore, requires participat-
ing states to set reasonable standards for assessing an
individual’s income and resources in determining eligi-
bility for, and the extent of, medical assistance under
the program. 42 U.S.C. § 1396a (a) (17) . . . . The
resources standard set forth in Connecticut’s state
[M]edicaid plan for categorically needy and medically
needy individuals is $1600. General Statutes §§ 17b-264
and 17b-80 (c); Uniform Policy Manual, supra, § 4005.10
. . . . Consequently, a person who has available
resources; see 42 U.S.C. § 1396a (a) (17) (B); in excess
of $1600 is not eligible to receive benefits under the
Connecticut [M]edicaid program even though the per-
son’s medical expenses cause his or her income to fall
below the income eligibility standard.’’ (Citations omit-
ted; footnotes omitted; internal quotation marks omit-
ted.) Ahern v. Thomas, 248 Conn. 708, 713–16, 733 A.2d
756 (1999).
The enactment of the catastrophic coverage act was
also ‘‘intended, in part, to ease the financial burden
placed on a community spouse under the prior statutory
regime that required the institutionalized spouse to
spend down a large portion of the couple’s resources,
and thus impoverish the community spouse, before
becoming eligible for [M]edicaid. . . . Under the cata-
strophic [coverage] act, a community spouse is entitled
to receive a community spouse resource allowance
. . . . The resource allowance is protected from the
institutionalized applicant’s health care obligations and
does not count against the applicant’s financial eligibil-
ity.’’ (Citations omitted; footnote omitted; internal quo-
tation marks omitted.) Burinskas v. Dept. of Social
Services, 240 Conn. 141, 148–49, 691 A.2d 586 (1997).
The plaintiff’s specific contention on appeal is that,
prior to the enactment of the catastrophic coverage act
in 1988, the assets that were included in a given Medic-
aid applicant’s eligibility determination were only ‘‘such
income and resources as are, as determined in accor-
dance with standards prescribed by the Secretary [of
Health and Human Services], available to the applicant
. . . .’’ 42 U.S.C. § 1396a (a) (17) (B). The plaintiff’s
position is that, under the rules governing eligibility and
availability determinations in effect before the cata-
strophic coverage act was enacted, the trust would not
have been considered by the department when
determining Bourke’s eligibility for Medicaid benefits,
because Bourke is not a beneficiary of the trust and,
thus, it would not be considered ‘‘available’’ to him. Cf.
Wilczynski v. Harder, 323 F. Supp. 509, 515 (D. Conn.
1971) (noting that, when determining eligibility, among
other things, ‘‘[t]he state may not consider income or
assets not actually available to the applicant, 42 U.S.C.
§ 1396a [a] [17] [B]’’); Rowland v. Maher, 176 Conn.
57, 61–63, 404 A.2d 894 (1978) (noting that only assets
actually available to applicant may be considered in
determining eligibility, finding $2000 entry fee elderly
patients paid to nursing home did not qualify as ‘‘avail-
able asset’’).
Pursuant to the provisions providing for the treat-
ment of income included in the catastrophic coverage
act, the department determines what assets and income
are considered ‘‘available’’ to an institutionalized
spouse in a very different way. Instead of focusing solely
on the resources and assets that are available to the
individual, the department is required to look at the
income and assets available to both the institutionalized
spouse and the community spouse. See 42 U.S.C.
§ 1396r-5 (c) (1) (B) and (2); see also Uniform Policy
Manual, supra, § 4025.67.14 Thus, when a married couple
qualify as ‘‘[catastrophic coverage act] spouses,’’ and
either spouse subsequently applies for Medicaid bene-
fits, whether that spouse is determined to be eligible
for such benefits depends on whether the total amount
of nonexcluded assets and resources available to either
spouse, exceed the combined amount of the protected
amount and the asset limit that applies to the institution-
alized spouse. If the combined nonexcluded assets of
the community spouse and the institutionalized spouse
are found to exceed the permitted amount, the institu-
tionalized spouse will not be eligible for Medicaid bene-
fits. See Uniform Policy Manual, supra, § 4005.05 (D).
The plaintiff contends that Connecticut courts,
including this court, have previously construed the cata-
strophic coverage act so as not to give it retroactive
effect—in other words, the plaintiff’s position is that
Connecticut courts have determined that the eligibility
and availability methods in effect on the date that a
particular trust is established or becomes irrevocable
should apply. In support of her position, the plaintiff
relies primarily on the Superior Court case, Hazelton
v. Wilson-Coker, Superior Court, judicial district of New
Britain, Docket No. CV-02-051711-S (September 19,
2003) (Bear, J.) (35 Conn. L. Rptr. 505), a case that
placed great weight on two previous decisions of this
court, Ahern v. Thomas, supra, 248 Conn. 708, and
Skindzier v. Commissioner of Social Services, 258
Conn. 642, 784 A.2d 323 (2001). The plaintiff claims
that the decision in Hazelton correctly interpreted the
aforementioned decisions of this court to hold that it
is unlawful to apply the eligibility and availability provi-
sions of the catastrophic coverage act to a trust estab-
lished before it was signed into law. See Hazelton v.
Wilson-Coker, supra, 506-509.
The department, in response, claims that the cases
cited by the plaintiff do not stand for any general rule
that Connecticut law requires trusts to be treated
according to the relevant Medicaid statutes in effect
at the time that the trust was established or became
irrevocable. Rather, the department claims, the decision
of the Superior Court in Hazelton represents an incor-
rect, overly broad generalization of the holdings of
Skindzier and Ahern, both of which: (1) dealt with
different, more specialized provisions of the cata-
strophic coverage act; and (2) sought to determine
whether to apply provisions contained in the cata-
strophic coverage act, or provisions included in a later
law, the Omnibus Budget Reconciliation Act of 1993,
Pub. L. 103-66, § 13611 (e), 107 Stat. 312, 627.15 Instead,
the department asserts that this court should follow
the approach of the hearing officer and the trial court
in this matter, both of which found that: (1) Hazelton,
Skindzier, and Ahern were distinguishable; and (2)
those laws regarding eligibility and availability that
were in effect when Bourke applied for Medicaid bene-
fits govern the treatment of the plaintiff’s interest in
the trust. We agree with the department.
In this case, the relevant provision created by the
catastrophic coverage act, 42 U.S.C. § 1396r-5; see Medi-
care Catastrophic Coverage Act of 1988, Pub. L. 100-
360, § 303, 102 Stat. 683, 754–64; has an effective date
with entirely different language than that found in
§ 13611 (e) of the Omnibus Budget Reconciliation Act
of 1993. Instead of indicating that it applies to all assets
established after a particular date, 42 U.S.C. § 1396r-5
(c) (1) (B) indicates that ‘‘[a]t the request of an institu-
tionalized spouse . . . at the beginning of the first con-
tinuous period of institutionalization (beginning on or
after September 30, 1989) of the institutionalized spouse
and upon the receipt of relevant documentation of
resources, the State shall promptly assess and docu-
ment the total value [of the resources to the extent
either the institutionalized spouse or the community
spouse has an ownership interest] and shall provide a
copy of such assessment and documentation to each
spouse . . . .’’ In addition, 42 U.S.C. § 1396r-5 (c) (2)
provides in relevant part: ‘‘In determining the resources
of an institutionalized spouse at the time of application
for benefits under this subchapter, regardless of any
State laws relating to community property or the divi-
sion of marital property—(A) except as provided in
subparagraph (B),16 all the resources held by either the
institutionalized spouse, community spouse, or both,
shall be considered to be available to the institutional-
ized spouse. . . .’’ (Footnote added.) Furthermore, 42
U.S.C. § 1396r-5 (a) (1) provides that ‘‘[i]n determining
the eligibility for medical assistance of an institutional-
ized spouse . . . the provisions of this section super-
sede any other provision of this subchapter (including
sections 1396a [a] [17] and 1396a [f] of this title) which
is inconsistent with them.’’ (Emphasis added.) Thus,
the plain language of 42 U.S.C. § 1396r-5 unambiguously
indicates that this section—and its included methodol-
ogy for determining what assets are deemed ‘‘available’’
to an applicant—are intended to apply to all applica-
tions for Medicaid benefits occurring after September
30, 1989, without reference to the date that a particular
asset or resource came into existence. Thus, because
Bourke applied for Medicaid benefits after September
30, 1989, the provisions contained in the catastrophic
coverage act related to determining the extent to which
the assets of a community spouse are considered ‘‘avail-
able’’ to an applicant, and whether such an applicant
is eligible for Medicaid benefits applied to Bourke and
the plaintiff.
This interpretation of the effective date of the provi-
sions of 42 U.S.C. § 1396r-5 is bolstered by reference to
the department’s Uniform Policy Manual, which defines
‘‘[catastrophic coverage act] spouses’’ in its glossary of
terms as ‘‘spouses who are members of a married couple
one of whom becomes an institutionalized spouse on
or after September 30, 1989, and the other spouse
becomes a community spouse.’’ Uniform Policy Manual,
supra, § 0500. Another section of the Uniform Policy
Manual provides that, in the case of ‘‘[catastrophic cov-
erage act] spouses,’’ the assets of the community spouse
are deemed to be assets of the institutionalized spouse
to the extent that they exceed the protected amount.
See Id., § 4025.67 (A).
We do not find persuasive the plaintiff’s argument
that Connecticut case law has set a precedent for
applying the Medicaid provisions governing the avail-
ability of assets and eligibility requirements in effect at
the time that a given asset was established. Although,
in her argument, the plaintiff emphasizes the impor-
tance of the reasoning of the Superior Court in
Hazelton, we turn first to this court’s earlier decisions
in Ahern and Skindzier, as the court in Hazelton relied
primarily on certain passages from those decisions as
the basis for its reasoning. See Hazelton v. Wilson-
Coker, supra, 35 Conn. L. Rptr. 506–508. In Ahern, this
court was tasked with determining whether the trial
court had improperly reversed the determination of the
hearing officer and finding that the principal of a self-
settled trust created by the plaintiff in that case prior
to applying for Medicaid benefits was not includable in
the plaintiff’s available resources. See Ahern v. Thomas,
supra, 248 Conn. 710–12. At issue was whether the self-
settled trust fell within the definition of a ‘‘[M]edicaid
qualifying trust,’’ a circumstance which would have ren-
dered the trust an asset ‘‘available’’ to the plaintiff, and
would have, in turn, rendered the plaintiff ineligible for
Medicaid benefits. (Internal quotation marks omitted.)
Id., 712 and n.8. This court ultimately concluded that
the trust did not qualify as an available resource to the
plaintiff; id., 743; but that is not the aspect of our deci-
sion in Ahern that is relevant to the present case.
Instead, the portion of Ahern relevant to the present
case is the portion of the opinion where this court
decided a preliminary issue: whether the provisions
related to Medicaid qualifying trusts enacted in either
1988 or 1993 applied. Id., 720–22; Hazelton v. Wilson-
Coker, supra, 507–508. Specifically, in Ahern, this court
noted that the case ‘‘[did] not involve the construction
or application of the trust treatment provisions set forth
at 42 U.S.C. § 1396p (d) of the [M]edicaid act. Those
provisions were enacted in 1993 in an effort to further
tighten the ‘availability’ loophole of 42 U.S.C. § 1396a
(a) (17). . . . Although the transfer provisions set forth
at [42 U.S.C.] § 1396p (d) of the [M]edicaid act super-
sede the [M]edicaid qualifying trust provisions set forth
at 42 U.S.C. § 1396a (k) (1988), the transfer provisions
apply only to trusts established after August 11, 1993,
and do not apply to trusts, such as the one at issue
. . . established prior to that date. See [Dept. of Health
and Human Services, Health Care Financing Adminis-
tration, State Medicaid Manual (January–May, 1988)]
§ 3259.2; see also Uniform Policy Manual, supra,
§ 4030.80 (C) and (D).’’ (Citations omitted.) Ahern v.
Thomas, supra, 720–22.
In Skindzier, this court similarly decided an issue
distinct from the one we are asked to decide in the
present case. In that case, the issue was whether the
plaintiff was eligible for Medicaid benefits in light of
the fact that her deceased husband had created two
testamentary trusts of which the plaintiff was a benefi-
ciary. Skindzier v. Commissioner of Social Services,
supra, 258 Conn. 643–44. These trusts were funded by
property owned by the plaintiff’s spouse at his death.
Id., 644. The primary issue in Skindzier was whether the
creation of these testamentary trusts by the plaintiff’s
husband constituted a ‘‘disqualifying transfer of assets’’
pursuant to 42 U.S.C. § 1396p (c) that would have ren-
dered the plaintiff ineligible for Medicaid benefits for
a period of time. Id., 652–53. This court, relying on
the text of 42 U.S.C. § 1396p (d) (2) (A), found that
testamentary trusts were specifically exempted from
the provisions of § 1396p (c), and thus that the plaintiff
was not rendered ineligible for Medicaid benefits. Id.,
646–47, 654–56.
In Hazelton, at issue was whether the corpus of a
testamentary trust created by the plaintiff’s great uncle
and naming her as a beneficiary should have been con-
sidered ‘‘ ‘available’ ’’ to the plaintiff’s spouse for pur-
poses of his Medicaid eligibility. See Hazelton v. Wilson-
Coker, supra, 35 Conn. L. Rptr. 505. In that case, the
trial court concluded that, because the trust at issue
had been created in 1985, ‘‘[t]he [h]earing [o]fficer and
the [d]epartment should have applied pre-1986 stan-
dards and rules of availability . . . .’’ (Internal quota-
tion marks omitted.) Id., 507. The court explained that,
‘‘[a]fter Ahern, [the department] knew or should have
known that [it] was required to determine and apply
federal law as it existed on the date of the creation of
an irrevocable inter vivos trust. After Skindzier, [the
department] knew or should have known that [it] was
required to determine and apply federal law as it existed
on the date of the creation of a testamentary trust, e.g.,
the testator’s date of death.’’ Id., 509.
We conclude that the conclusions drawn in Hazelton
from this court’s earlier decisions in Ahern and Skind-
zier are based on a misconception of the issues this
court decided in those earlier cases. In neither Ahern
nor Skindzier did this court make any determination
as to whether the general rules regarding the treatment
of income and resources of an institutionalized spouse
should depend on when particular assets or resources
were established. Rather, Ahern dealt specifically with
the applicability of provisions related to self-settled
trusts and specifically, whether the self-settled trust in
that case met the definition of a ‘‘[M]edicaid qualifying
trust,’’ and was thus available to the settlor, who had
applied for Medicaid benefits. (Internal quotation marks
omitted.) Ahern v. Thomas, supra, 248 Conn. 712 and
n.8, 720–28, 743. Skindzier dealt with the applicability
of certain transfer of asset provisions that have no bear-
ing on the present case. Skindzier v. Commissioner
of Social Services, supra, 258 Conn. 644–47, 652–54,
661–62. In both cases, the court decided that particular
statutory provisions either did or did not apply, not on
the basis of any existing statewide policy or law, but
because of the effective date provision of the 1993 Med-
icaid amendments, which stated quite specifically that
the effective date of the relevant provisions was August
11, 1993. Id., 652–53; Ahern v. Thomas, supra, 720–22.
In summary, the determinations that this court made
in Skindzier and Ahern, regarding the applicability of
specific Medicaid provisions, were not based on a rec-
ognition that, when determining the availability of a
given asset or the eligibility of a given Medicaid appli-
cant, state law or policy requires assets to be treated
in accordance with the relevant Medicaid provisions
that were in effect at the time that the assets were
created or established. Rather, this court’s conclusions
regarding the applicable law in those cases resulted
from the effective date provisions of the relevant Medic-
aid provisions at issue. See Omnibus Reconciliation Act
of 1993, Pub. L. 103-66, § 13611 (e), 107 Stat. 312, 627;
Skindzier v. Commissioner of Social Services, supra,
258 Conn. 652–53, 658, citing Ahern v. Thomas, supra,
248 Conn. 721; Ahern v. Thomas, supra, 721, citing
Uniform Policy Manual, supra, § 4030.80 (C) and (D);
see also Uniform Policy Manual, supra, § 4030.80. To
the extent that the decision in Hazelton is inconsistent
with this opinion, Hazelton is overruled. Accordingly,
we conclude that the trial court correctly concluded
that the department did not act arbitrarily or abuse its
discretion in finding that the trust, which was available
to the plaintiff, was deemed to be an asset of Bourke’s
pursuant to the relevant Medicaid provisions in effect
at the time that Bourke applied for Medicaid benefits.
The judgment is affirmed.
In this opinion the other justices concurred.
1
The Commissioner of Social Services acts on behalf of the Department
of Social Services and references in this opinion to the department include
the commissioner.
2
Either the applicant or, if he or she is married, the applicant’s spouse,
has the right to an administrative hearing if either spouse is dissatisfied
with the department’s assessment of spousal assets. See Dept. of Social
Services, Uniform Policy Manual § 1570.05 (D) (4) (A).
3
The plaintiff filed an administrative appeal with the trial court in accor-
dance with General Statutes § 4-183 of the Uniform Administrative Proce-
dure Act.
4
The plaintiff appealed to the Appellate Court, and we transferred her
appeal to this court pursuant to General Statutes § 51-199 (c) and Practice
Book § 65-1.
5
‘‘Pursuant to General Statutes §§ 17b-262 and 17b-10, the department
has developed Connecticut’s state [M]edicaid plan and has promulgated
regulations that govern its administration.’’ (Footnote omitted; internal quo-
tation marks omitted.) Skindzier v. Commissioner of Social Services, 258
Conn. 642, 649, 784 A.2d 323 (2001).
6
The term ‘‘community spouse’’ is defined to mean ‘‘[a] community spouse
is an individual who resides in the community, who does not receive home
and community based services under a Medicaid waiver, who is married to
an individual who resides in a medical facility or long term care facility or
who receives home and community based services . . . under a Medicaid
waiver.’’ Uniform Policy Manual, supra, § 0500.
7
The term ‘‘community spouse protected amount’’ is defined to mean ‘‘the
amount of the total available non-excluded assets owned by both [cata-
strophic coverage act] spouses which is protected for the community spouse
and is not counted in determining the institutionalized spouse’s eligibility
for Medicaid.’’ Uniform Policy Manual, supra, § 0500. The term ‘‘[catastrophic
coverage act] spouses’’ is defined to mean ‘‘spouses who are members of
a married couple one of whom becomes an institutionalized spouse on or
after September 30, 1989, and the other spouse becomes a community
spouse.’’ Id.
8
This number is obtained by adding the value of assets a Medicaid appli-
cant is entitled to hold, $1600, to the protected amount, $109,540.
9
See footnote 7 of this opinion for the definition of ‘‘catastrophic coverage
act spouses.’’
10
The department’s uniform policy manual provides in relevant part that
‘‘[t]here are certain assets which an assistance unit may own, but which
the [d]epartment does not require the unit to convert to cash or otherwise
use for support and maintenance. Such assets, called excluded assets, do
not affect the unit’s eligibility for assistance. . . .’’ Uniform Policy Manual,
supra, § 4020.
11
The department’s uniform policy manual provides that ‘‘[d]eemed assets
are assets which are owned by individuals who are not members of the
assistance unit, but which are considered available to the unit.’’ Uniform
Policy Manual, supra, § 4025.05 (A) (1).
12
The plaintiff has identified four issues on appeal: (1) ‘‘Did the [depart-
ment] apply the correct eligibility and availability criteria when determining
[Bourke’s] eligibility . . . for Medicaid benefits?’’ (2) ‘‘Did the [department]
err in including the corpus of the [trust] in the spousal assessment of assets
when determining [Bourke’s] eligibility . . . for Medicaid benefits?’’ (3)
‘‘Did the [department] err in determining that the provisions of the cata-
strophic coverage act apply when considering the availability of the [trust]
to [Bourke]?’’; and (4) ‘‘Did the [department] err in determining that the
provisions of the [catastrophic coverage act] apply retroactively to trust
assets created prior to the enactment of that legislation?’’ The plaintiff,
however, does not make separate arguments for each of these identified
issues, and each of them share the same foundational issue, namely, whether
the provisions of the catastrophic coverage act apply to the trust, even
though it was created and rendered irrevocable long before the catastrophic
coverage act was signed into law. We thus construe the issue presented to
us: Did the trial court properly affirm the department’s decision deeming the
testamentary trust an asset available to Bourke pursuant to the catastrophic
coverage act, where the plaintiff contends that Connecticut law requires
that the trust asset be construed under the availability and eligibility criteria
in effect at the time the trust was created?
13
We note, preliminarily, that in most cases such as this one, when
determining whether a trust is an includable asset to a Medicaid applicant,
an additional issue must normally be decided: whether the trust is actually
considered to be available to the relevant beneficiary or beneficiaries of
the trust in question. Under Connecticut law, ‘‘only assets actually available
to a medical assistance recipient may be considered . . . . Assets held in
trust are considered available if the beneficiary has the legal right to compel
distributions.’’ (Citation omitted; emphasis in original; internal quotation
marks omitted.) Corcoran v. Dept. of Social Services, 271 Conn. 679, 692,
859 A.2d 533 (2004), quoting Zeoli v. Commissioner of Social Services, 179
Conn. 83, 94, 425 A.2d 553 (1979), citing General Statutes (Rev. to 2003)
§ 17b-261 (c). In the present case, the plaintiff has conceded that the trust
is available to her. Therefore, we focus only on the question of whether the
trust, which is an asset available to the plaintiff, is also deemed available
to Bourke for purposes of the department’s determination on Bourke’s
eligibility for Medicaid benefits.
14
Title 42 of the United States Code, § 1396r-5 (c), provides in relevant
part: ‘‘(1) . . . (B) At the request of an institutionalized spouse or commu-
nity spouse, at the beginning of the first continuous period of institutionaliza-
tion (beginning on or after September 30, 1989) of the institutionalized
spouse and upon the receipt of relevant documentation of resources, the
state shall promptly assess and document the total value [of the resources
to the extent either the institutionalized spouse or the community spouse
has an ownership interest] and shall provide a copy of such assessment
and documentation to each spouse and shall retain a copy of the assessment
for use under this section. If the request is not part of an application for
medical assistance under this subchapter, the State may, at its option as a
condition of providing the assessment, require payment of a fee not
exceeding the reasonable expenses of providing and documenting the assess-
ment. At the time of providing the copy of the assessment, the State shall
include a notice indicating that the spouse will have a right to a fair hearing
under subsection (e) (2) of this section.
(2) . . . In determining the resources of an institutionalized spouse at
the time of application for benefits under this subchapter, regardless of any
State laws relating to community property or the division of marital
property—
(A) except as provided in subparagraph (B), all the resources held by
either the institutionalized spouse, community spouse, or both, shall be
considered to be available to the institutionalized spouse, and
(B) resources shall be considered to be available to an institutionalized
spouse, but only to the extent that the amount of such resources exceeds
the amount computed under subsection (f) (2) (A) of this section (as of
the time of application for benefits).’’ Section 4025.67 of the department’s
uniform policy manual is Connecticut’s implementation of this federal
statute.
15
Section 13611 (e) (2) of the Omnibus Budget Reconciliation Act of 1993
provides in relevant part: ‘‘The amendments made by this section shall not
apply . . . (B) with respect to assets disposed of on or before the date of
the enactment of this [a]ct, or (C) with respect to trusts established on or
before the date of the enactment of this [a]ct.’’
16
Subparagraph (B) of 42 U.S.C. § 1396r-5 (c) (2) provides: ‘‘[R]esources
shall be considered to be available to an institutionalized spouse, but only to
the extent that the amount of such resources exceeds the amount computed
under subsection (f) (2) (A) of this section (as of the time of application
for benefits).’’