The Michigan Supreme Court held that, in determining whether to issue a protective order transferring all the assets and most of the income of a spouse who had been admitted to a nursing home to his dependent spouse, the probate court had properly considered the availability of Medicaid benefits before the Michigan Department of Health and Human Services (DHHS) made an eligibility determination. In re Estate of Sizick, No. 166921, 2026 WL 770893 (Mich. Mar. 18, 2026).
In March 2021, 82-year-old Jerome Sizick suffered from declining health. He was hospitalized and later admitted to a nursing facility. In May 2021, Jerome’s health insurance was terminated, and he began to privately pay for his care. Jerome’s wife, Janet, petitioned the probate court on his behalf for a protective order under Mich. Comp. Law section 700.5401(3) to transfer all Jerome’s assets and most of his income to her. In the petition, Janet described Jerome’s health issues, including his dementia; the couple’s income; estimates of her future monthly expenses; and Jerome’s estimated payment amount with Medicaid coverage. After the petition had been filed, Jerome applied for Medicaid.
In June 2021, while Jerome’s Medicaid application was pending, the probate court entered a protective order finding that Jerome was unable to manage his property and affairs due to physical and mental deficiencies and that the order was necessary to obtain Jerome’s assets for his dependents. The probate court also entered a support order for Janet that directed Jerome to transfer all his assets and $2,318 per month to her. The DHHS successfully appealed the probate court’s order. The Court of Appeals affirmed in part, vacated in part, and remanded for further proceedings. On remand, in December 2022, the probate court again entered an order for the transfer of assets and a $2,318 per month payment to Janet based on additional evidence she submitted in support of her request. The court backdated its December 2022 order to the date of its June 2021 order. The DHHS again appealed. The Court of Appeals again affirmed in part, vacated in part, and remanded for further proceedings.
In both its opinions, the Michigan Court of Appeals agreed with the probate court that Jerome was unable to manage his own property and affairs. However, it held that it was bound by In re Estate of Schroeder, 966 N.W.2d 209 (Mich. Ct. App. 2020), in which it had held that the probate court could not consider whether Medicaid could meet an individual’s needs without a final determination of their eligibility for Medicaid benefits; as a result, the court found that, in the present case, the probate court had erred in finding that Janet was entitled to support and assets under Mich. Comp. Law section 700.5401(3). In addition, the court of appeals held that the probate court had erred by failing to use updated information about the value of Jerome’s assets and his interest in assets being transferred to Janet. In its second opinion, the court of appeals also found that the probate court had abused its discretion in backdating its December 2022 order to June 2021.
Jerome passed away in April 2024 while Janet’s application for leave to appeal in the Michigan Supreme Court was pending. At his death, Jerome owed $125,231 to the nursing facility, and the facility filed a claim against his estate to recover the amount owed. The court granted Janet’s motion to substitute the personal representative of Jerome’s estate as the petitioner-appellant.
In a unanimous opinion, the Michigan Supreme Court first addressed whether the appeal was moot because of Jerome’s death. Although the DHHS had denied Jerome’s applications for Medicaid benefits, he had requested fair hearings with the Michigan Office of Administrative Hearings and Rules (MOAHR). The court noted that, under federal law, Medicaid benefits can be awarded retroactively to deceased individuals. In Michigan, when a denial of Medicaid benefits is overturned on appeal, the applicant is eligible for retroactive reimbursement. The court therefore determined that the appeal was not moot: There was a live controversy because reinstating the protective order would have a practical legal effect on the pending MOAHR proceedings.
The court then ruled that, when a probate court issues a protective order under section 700.5401(3), the court may consider whether Medicaid benefits may be available to a protected individual before DHHS makes an eligibility determination. Section 700.5401(3) expressly requires the probate court to consider two sets of interests: whether money is needed for the support, care, and welfare of the person seeking the protective order and whether the individual’s dependents need it. The statute does not prioritize either set of interests over the other; rather, it requires the probate court to individually assess each person’s needs. The court thus overruled In re Estate of Schroeder, holding that, because the protective order must account for each individual’s foreseeable future ongoing needs, it must be based on a prospective analysis; further, there was no language in section 700.5401(3) precluding the probate court from considering whether Medicaid benefits are or will be available even if DHHS has not yet determined eligibility. The court determined that Medicaid patient-pay amounts can be estimated using a clearly defined methodology before an application is submitted. In addition, allowing the probate court to consider only Medicaid-related circumstances existing when a protective order is requested would undermine the protections against impoverishment for community spouses provided by the federal Medicare Catastrophic Coverage Act of 1988 (MCCA) by effectively nullifying its judicial mechanism allowing assets transferred to the community spouse via a court order to be excluded from the institutionalized spouse’s eligibility determination.
The court determined that the probate court had properly considered both Jerome’s and Janet’s needs and that sufficient evidence was presented at the 2022 probate court hearing to support the probate court’s order. Accordingly, the court reversed the appellate court’s judgment, reinstated the probate court’s 2022 order, and remanded for further proceedings consistent with its opinion.
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