The cost of a prearranged burial plan is not an allowable expense that may be deducted from a Medicaid applicant's countable assets. Marzilli v. Rhode Island Dept. of Human Services (R.I. Super. Ct., C.A. No. P.C.96-6571, May 20, 2003).
Frederic Marzilli was appointed conservator of the estate of Barbara Pope, a nursing home resident. On February 14, 1995, the probate court approved Mr. Marzilli's request to prepay Ms. Pope's funeral expenses for $6,496.00. On October 11, 1995, Mr. Marzilli applied for Medicaid benefits on Ms. Pope's behalf. The application requested retroactive benefits for August and September 1995. On October 23, 1995, Mr. Marzilli entered into a contract with a funeral home for the cost of Ms. Pope''s funeral.
The Department of Human Services (DHS) denied Ms. Pope's application for Medicaid benefits beginning August 1, determining that her assets of $13,039 as of the date of her application rendered her financially ineligible. However, DHS provided for the benefits to start on November 1, when her assets had been reduced to the allowable limit of $4,000. Mr Marzilli appealed, arguing that because the probate court approved his expenditure of the money for the prepaid funeral, it was an allowable expense that could be used to reduce Ms. Pope's assets to the allowable limit. He maintained that the probate court''s authorization of the purchase qualified as a court-ordered transfer and thus permitted Ms. Pope to rebut the presumption that the purchase was made exclusively to establish eligibility for nursing home benefits. DHS countered that burial expenses are not among the approved expenses set out in its policy manual.
The Rhode Island Superior Court affirms. The court rules that the DHS policy manual does not include prepaid burial plans as an allowable asset-reduction expense and holds that the probate court did not order Mr. Marzilli to buy the burial plan; he was simply authorized to do so after petitioning the court. "As the conservator of Ms. Pope''s estate," the court writes, "the appellant had the choice of using the money to prepay for a burial plan or pay for her nursing home care." The court further rules that even assuming that the prepaid burial expenses qualified as an allowable asset-reducing expense, Ms. Pope would still not be entitled to receive Medicaid benefits for the time period requested because the resource reduction policy is not retroactive.
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