Haas Shows Law Changing Medicaid Transfer Rules Never Passed House

The Clerk of the U.S House of Representatives has added fuel to the fire over the passage of the Deficit Reduction Act of 2005 (DRA). The new revelations could end up burning the new law, which places severe new restrictions on the ability of the elderly to transfer assets before qualifying for Medicaid coverage of nursing home care.

House Clerk Karen Haas released a chronology of events and documents showing that the DRA, which President Bush signed into law February 8, 2006, never passed the U.S. House. Those documents were filed in federal court August 25 by Alabama ElderLawAnswers member attorney Jim Zeigler, who has sued the government seeking to overturn the DRA on the grounds that it is unconstitutional.

Zeigler, who represents senior citizens seeking nursing home eligibility, says the House Clerk's documents are a 'confession' and 'admission' that the act is not constitutional.

A discrepancy between the House and Senate versions of the DRA apparently emerged when the Senate enacted a version of the bill allowing Medicare to pay beneficiaries for oxygen care for 13 months, but the House passed a version allowing for a 36-month payment -- an estimated $2 billion difference. A Senate clerk later discovered the error and changed the language to what the Senate originally approved. The Speaker of the House and President Pro Tem of the Senate then certified the bill as passed and sent it to the President for his signature, in apparent violation of the constitutional requirement that before a bill can be enacted into law by the President, it must pass both the House and Senate in identical form.

The House Clerk's documents were first released to two members of Congress May 16. The two had requested information on procedures by which the Senate passed one version and the House another of the budget bill.

Three other suits challenging the DRA have been dismissed following motions by the government. Zeigler says 'the admissions by the House Clerk dramatically improve my chances of getting this illegal act nullified.'

Zeigler objects to the act because of a change in the start date of penalties against nursing home patients who made gifts during the previous five years. 'When a nursing home resident drops below $2,000 in savings and could qualify for Medicaid coverage, a penalty is then inflicted requiring repayment for all gifting in the past five years. There is no source of funds from which the patient can pay for five years of gifting. This is the 'Put Granny on the Street' Law,' Zeigler said.

Read more on the controversy over the DRA in this Elder Law Answers article.