Medicaid Applicant Can't Protest Treatment of Separated Spouse's Assets When He Is Individually Over the Asset Limit

A federal district court dismisses a Medicaid applicant’s claim that the state improperly attributed his estranged wife's assets to him, explaining that the applicant was over the state's $2,000 asset limit without taking his wife's assets into account.  Evangelical Good Samaritan Society v. Valenti (D.S.D., So. Dist., No. 4:14-CV-04174-VLD, April 18, 2016).

Howard Johnson and his wife, Geralda, executed a separation agreement in 1995 but were never divorced.  In 2014, Mr. Johnson, by then a nursing home resident, was denied Medicaid benefits due to financial ineligibility.  The denial included an assessment of Mrs. Johnson's assets.  Mr. Johnson appealed the state's denial, claiming that it should not have taken Mrs. Johnson's assets into account when assessing his application, but he lost at the administrative level.  The administrative law judge determined that the state was required to consider Mrs. Johnson's assets as well as Mr. Johnson's.

Mr. Johnson filed suit against the South Dakota Department of Social Services (DSS) in federal court, claiming that the state's interpretation of federal Medicaid law was flawed.  DSS responded with a motion to dismiss, arguing that the court did not have subject matter jurisdiction to hear the case because Mr. Johnson himself was financially ineligible for Medicaid since he personally owned assets worth more than $2,000, mooting his argument regarding the treatment of his wife's assets.  The court gave Mr. Johnson the opportunity to address the state's contention, but he did not respond.

The U.S. District Court for the District of South Dakota, Southern Division, grants the state's motion to dismiss.  The court explains that "Howard was, at the relevant time, ineligible for Medicaid benefits because he held assets in his own name which placed him above the eligibility limits . . . federal question jurisdiction never existed in the first place because DSS's denial of Medicaid benefits to Howard was never in conflict with federal law.  In any case, the court is satisfied that jurisdiction does not now exist because there is no 'injury traceable to the defendant and likely to be redressed by a favorable judicial decision.’"

To read the full text of the court's decision, click here.  

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