A case law in New Jersey addressed a challenge to the postponement of a penalty period of ineligibility by the Commissioner of the New Jersey Department of Human Services. The plaintiff in this case was a woman over the age of sixty five who resided in a nursing home. Over several years, she made gifts to various family members in $12,000.00 increments. The amount of these gifts totaled $192,000. Then she applied for Medicaid benefits. The County Board of Social Services informed Plaintiff that a penalty period of 30 months from the date of Medicaid eligibility would have otherwise been available due to Plaintiff’s transfers. Subsequently, her family members returned $89,000 of the gifts. With these returned transfers, Defendants modified Plaintiff’s Medicaid ineligibility.
Medicaid benefits are meant to provide medical assistance only to those persons “whose income and resources are insufficient to meet the costs of necessary medical services. Generally speaking, Medicaid applicants are required to exhaust all available resources before becoming eligible for benefits. Federal law dictates that where a period of ineligibility is imposed, such a period can only begin to run when an applicant is otherwise eligible for Medicaid benefits.
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