A Pennsylvania trial court finds that the state may seek repayment of a Medicaid overpayment from the son of a Medicaid recipient rather than from the Medicaid recipient’s estate. Maloy v. Dept. of Public Welfare (Pa. Commw. Ct., No. 1575 C.D. 2009, June 10, 2010). Charles Maloy was admitted to a nursing home and began receiving Medicaid benefits. His son, Charles Maloy II, became his guardian. As guardian, Charles transferred one-half of Mr. Maloy’s property to himself and took out two mortgages on the property. When the state discovered the transfer and the mortgages, it determined that Mr. Maloy was no longer eligible for benefits and that it had overpayed him. While the state was preparing its claim, Mr. Maloy died, so the state requested repayment from Charles. Charles did not dispute the overpayment, but argued that the state should request the overpayment from Mr. Maloy’s estate, not from him. The administrative law judge determined the state could seek repayment from Charles, and Charles appealed. The Pennsylvania Commonwealth Court affirms, holding that the state could seek repayment from Charles. The court finds that “not only is the collection of repayment from Charles II expressly authorized, but it seems entirely appropriate, given that it was his actions that led to the overpayment.”
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Transferee Ordered to Reimburse Medicaid for Overpayment
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