#25536, #25902-aff in pt & rev in pt-JKK

2012 S.D. 24

                                      IN THE SUPREME COURT
                                              OF THE
                                     STATE OF SOUTH DAKOTA

                                                     ****

                                           (#25536)
                               IN RE: POOLED ADVOCATE TRUST

                                                     ****

                          APPEAL FROM THE CIRCUIT COURT OF
                            THE SEVENTH JUDICIAL CIRCUIT
                          PENNINGTON COUNTY, SOUTH DAKOTA

                                                     ****

                                THE HONORABLE JEFF W. DAVIS
                                          Judge

BECKY A. JANSSEN
Special Assistant Attorney General
Pierre, South Dakota                                               Attorneys for appellant South
                                                                   Dakota Department of Social
                                                                   Services.

THOMAS E. SIMMONS of
Gunderson, Palmer, Nelson
 & Ashmore, LLP
Rapid City, South Dakota                                           Attorneys for appellee Pooled
                                                                   Advocate Trust, Inc.

---------------------------------------------------------------------------------------------------------------------

                                                    (#25902)

FRED MATTHEWS and
GLADYS MATTHEWS,                                                    Appellants,

v.

SOUTH DAKOTA DEPARTMENT
OF SOCIAL SERVICES,                                                Appellee.
                                     ****

                       APPEAL FROM THE CIRCUIT COURT OF
                         THE SEVENTH JUDICIAL CIRCUIT
                       PENNINGTON COUNTY, SOUTH DAKOTA

                                     ****

                        THE HONORABLE JANINE M. KERN
                                   Judge


KRISTI VETRI
Belleville, Illinois                        Attorney for appellants Matthews.


BECKY A. JANSSEN
Special Assistant Attorney General
Pierre, South Dakota                        Attorneys for appellee South
                                            Dakota Department of Social
                                            Services.


                                            ARGUED ON JANUARY 10, 2012

                                            OPINION FILED 03/28/12
#25536, #25902

KONENKAMP, Justice

[¶1.]        Pooled Advocate Trust, Inc. (PATI), the managing corporation for a

Medicaid pooled trust, brought a declaratory judgment action on Medicaid eligibility

issues associated with the trust and named the South Dakota Department of Social

Services (DSS) as a necessary party. The circuit court granted summary judgment

and declaratory judgment for PATI. Fred Matthews and Gladys Matthews

transferred assets to the pooled trust. When Fred and Gladys subsequently applied

for Medicaid long-term care benefits, DSS imposed a penalty period because they

were over age 65 at the time of the transfers. After DSS notified PATI of this policy,

PATI petitioned for further relief, seeking a declaration that DSS could not impose

penalty periods for transfers made by pooled trust beneficiaries age 65 or older. The

circuit court granted PATI’s petition. In addition, Fred and Gladys appealed DSS’s

application of a penalty period, but an administrative law judge (ALJ) upheld the

decision and another circuit court affirmed the ALJ’s ruling. DSS appeals Circuit

Court Judge Jeff W. Davis’s order granting PATI’s petition for further relief (Appeal

#25536). Fred and Gladys appeal Circuit Court Judge Janine M. Kern’s affirmance

of the ALJ’s ruling (Appeal #25902).

                              Declaratory Judgment

[¶2.]        PATI is a nonprofit, South Dakota corporation created to manage the

Pooled Advocate Trust dated October 28, 2004 (trust or pooled trust). An

irrevocable trust created for the benefit of disabled South Dakota residents, the

trust was established in an attempt to meet Medicaid’s criteria for pooled trusts




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#25536, #25902

under 42 U.S.C. § 1396p(d)(4)(C). Great Western Bank of Rapid City, South Dakota

is the trustee.

[¶3.]         To join the trust, a potential beneficiary completes a joinder agreement

and application and pays a one-hundred-dollar fee. If the application is approved,

the beneficiary’s transfers are attributed to a trust sub-account that remains

separate from other beneficiaries’ sub-accounts. Funds from the sub-accounts are

comingled for investment and management purposes. During a beneficiary’s

lifetime, the trustee may distribute funds to supplement the beneficiary’s needs to

the extent that Medicaid or other programs do not provide for them.

[¶4.]         In November 2004, after executing a declaration of trust, PATI

petitioned for court supervision of the trust under SDCL 21-22-9. The circuit court

granted the petition and entered an order assuming supervision over the trust. At

the time, the trust had no beneficiaries and was funded with one dollar.

[¶5.]         On the same day the court granted the petition for supervision, PATI

brought an action for declaratory judgment. PATI named DSS as a necessary party

and sought the following relief: (1) a final judgment and decree that the trust

complies with federal and state law regarding Medicaid pooled trusts and that

beneficiaries’ transfers of assets or property to the trustee will not constitute

transfers for purposes of Medicaid eligibility; (2) a final judgment and decree that

the trust assets will not be considered an income resource available to beneficiaries

for purposes of Medicaid eligibility; (3) a final judgment and decree that the income

generated by the trust will not be considered an income resource available to

beneficiaries for purposes of Medicaid eligibility; and (4) a final judgment and


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#25536, #25902

decree that DSS cannot claim a lien against the assets, property, or income of the

trust by virtue of Medicaid benefits provided to the beneficiary except where a

beneficiary’s sub-account is not retained by the trust. DSS answered, alleging that

PATI failed to state a claim upon which relief may be granted.

[¶6.]        In June 2005, PATI and DSS stipulated to the filing of cross motions

for partial summary judgment. PATI and DSS disputed the legality of certain trust

provisions concerning the disposition of sub-account funds following the death of a

beneficiary. The parties reserved any other issues not addressed by the cross

motions for summary judgment. After briefing, the court ruled for DSS. It

concluded that DSS must be reimbursed from a deceased beneficiary’s sub-account

before funds are distributed to the South Dakota Community Foundation but that

funds from the sub-account may be placed back into the trust for the remaining

trust beneficiaries. The court ordered reformation of the trust so that it would

conform to the court’s decision.

[¶7.]        In November 2005, PATI moved for summary judgment and

declaratory judgment. PATI asserted that the court had essentially ruled on the

merits of PATI’s complaint and that the only remaining contested issues were

whether the complaint stated a claim upon which relief may be granted and

whether PATI had standing to bring the declaratory judgment action. In March

2006, PATI and DSS stipulated to the granting of PATI’s motions. Accordingly, the

court granted PATI summary judgment and declaratory judgment in April 2006.

The court ordered that “the trust, as reformed, complies with the law, that transfers

to the trust will not be penalized for Medicaid eligibility purposes so long as a


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#25536, #25902

beneficiary meets the requirements set forth in the trust as reformed, 1 and that

amounts in a Trust Sub-Account will not be considered available resources for

Medicaid eligibility purposes.” At this time, the trust still had no beneficiaries.

[¶8.]         Fred, age 91, and Gladys, age 89, husband and wife, both disabled,

entered a nursing home in February 2009. A few months later, Fred and Gladys

sold their home to their daughter for $100,000, with an initial payment of $50,000.

The couple deposited the money into their joint bank account. Fred’s monthly

income totaled $5,677, comprised of social security benefits, veteran’s benefits, and

pension proceeds. At that time, an individual with a monthly income exceeding

$2,022 was ineligible for certain Medicaid benefits. Because Fred’s monthly income

exceeded the Medicaid limit, Fred established a Medicaid income trust. Medicaid

income trusts allow individuals with monthly incomes exceeding the Medicaid limit

to place the income into a trust, subject to certain conditions, to avoid Medicaid

ineligibility. Fred created this income trust by removing Gladys’s name from their

joint bank account. Fred later deposited $8,618.05, the proceeds from his life

insurance policy, into his Medicaid income trust because the cash surrender value of

a life insurance policy was considered a countable resource for Medicaid eligibility

purposes.

[¶9.]         In June 2009, Fred and Gladys applied for sub-accounts with the

pooled trust, and PATI granted their applications. Fred transferred $50,200 from



1.      Under the declaration of trust, there are only two requirements to become a
        trust beneficiary. A potential beneficiary must be: (1) disabled; and (2) a
        South Dakota resident. The pooled trust does not impose an age requirement
        or limit.

                                          -4-
#25536, #25902

his Medicaid income trust to PATI. PATI distributed half the funds to Fred’s pooled

trust sub-account and the other half to Gladys’s pooled trust sub-account. Fred

later deposited his life insurance policy cash proceeds from his Medicaid income

trust into his pooled trust sub-account. In addition, Gladys deposited $6,000 from

her savings account into her pooled trust sub-account.

[¶10.]         In September 2009, Fred and Gladys separately applied for Medicaid

long-term care benefits. While their applications were pending, they received the

remaining proceeds from the sale of their home, $50,883.57. They divided the

proceeds equally and deposited the funds into their separate pooled trust sub-

accounts. Thus, between June and September 2009, Fred and Gladys deposited a

total of $115,701.62 into the pooled trust.

[¶11.]         On October 9, 2009, DSS issued a notice of action to Fred indicating

that his application for Medicaid assistance had been denied because “funds

deposited into [his Medicaid income trust] have been used for a purpose that

exceeded the authorized purposes for which funds can be distributed from the trust

under Medicaid rules and under the terms of the trust itself.” 2 Given this, DSS

deemed Fred’s Medicaid income trust a non-qualifying trust and any income placed

into that trust was countable income for Medicaid eligibility purposes. Because

DSS counted all income and resources associated with Fred’s Medicaid income

trust, Fred’s income and resources exceeded Medicaid’s eligibility limits.




2.       DSS denied Fred’s application for Medicaid assistance because he did not
         follow the conditions placed on his Medicaid income trust. The decision was
         not directly based on Fred’s participation in the pooled trust.

                                          -5-
#25536, #25902

[¶12.]         On November 5, 2009, DSS issued a notice of action to Gladys

indicating that she was eligible for medical-only benefits (which does not cover

nursing home care) but not for long-term care benefits. DSS advised Gladys that

due to the transfers of assets to the pooled trust of $115,701.62, Gladys was subject

to a Medicaid transfer penalty period during which DSS would not pay Gladys’s

long-term care costs. 3 DSS noted that the penalty period would end October 1,

2011, and Gladys may thereafter be eligible for long-term care assistance. Both

Fred and Gladys requested administrative hearings to challenge these decisions.

The hearings were scheduled for December 2009.

[¶13.]         A few days after Gladys received her notice of action from DSS, on

November 9, 2009, DSS informed PATI via email that DSS “has determined that

transfers to a pooled trust by an individual age 65 or older will be treated as a

transfer for less than fair value for Medicaid eligibility purposes.” The next day,

PATI petitioned for further relief on declaratory judgment under SDCL 21-24-12.

PATI asserted that the doctrine of res judicata and the 2006 judgment barred DSS

from imposing an age limitation, because in 2006 the court ordered that transfers to

the trust would not be penalized for Medicaid eligibility purposes. PATI also

asserted that the relevant Medicaid statutes do not impose an age restriction for

transfers to the pooled trust for purposes of Medicaid eligibility and that a pooled

trust may be funded by beneficiaries of any age. PATI asked the court to require

DSS to show cause why the relief requested should not be granted.



3.       DSS’s decision regarding Gladys’s application for Medicaid assistance was
         directly based upon Gladys’s participation in the pooled trust.

                                          -6-
#25536, #25902

[¶14.]       The circuit court entered an order to show cause and set a hearing on

PATI’s petition for further relief. The trustee submitted an affidavit indicating that

the trust currently had seventeen beneficiary sub-accounts and a market value of

approximately $1,650,000. The trustee also stated that three sub-accounts were

funded after the beneficiary had reached age 65. The court held a hearing on

PATI’s petition for further relief on December 14, 2009. At the hearing, DSS

mentioned a United States Department of Health and Human Services, Centers for

Medicare and Medicaid Services (CMS) policy regarding pooled trust transfers by

individuals over age 65. CMS is the federal agency responsible for administering

and overseeing federal Medicaid standards. PATI argued that the age limitation

issue was already decided in the 2006 proceedings. The court granted PATI’s

petition for further relief. It “barred [DSS] from imposing a Medicaid divestment

penalty based on a beneficiary’s age at the time a beneficiary funds a sub-account

with the [pooled trust] for that beneficiary’s benefit.” The court’s order also stated:

             Having determined that this matter involves issues previously
             adjudicated, the Court does not reach any analysis of federal
             Medicaid eligibility law. This Court refrains from issuing any
             specific ruling as to the Medicaid eligibility of any particular
             trust beneficiary because determinations on whether or not an
             individual qualifies for assistance under the South Dakota
             Medicaid Program are to be made by the Department, consistent
             with this order and applicable law, and no individual Medicaid
             applicant’s eligibility is properly before this Court.

The court did not issue findings of fact or conclusions of law. In a letter to DSS and

PATI regarding the order, the court again stated that “the 65 years of age is not

relevant to PATI transfers” and that the court “refrained from issuing any specific




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#25536, #25902

ruling as to Medicaid eligibility of any particular trust beneficiary. Those decisions

are to be made by the Department under the South Dakota Medicaid Program.”

[¶15.]       DSS moved the court to reconsider its order and filed a brief in

support. It discussed and attached a copy of a 2008 CMS memorandum. In part,

the memorandum stated that “only trusts established for a disabled individual 64 or

younger are exempt from application of the transfer of assets penalty provisions.”

The memorandum explained that “[i]f States are allowing individuals age 65 or

older to establish pooled trusts without applying the transfer of assets provisions,

they are not in compliance with the statute. [F]ederal statute requires the

application of the transfer rules in this situation; it [is] not a decision for each State

to make.” DSS argued that this memorandum demonstrated the mandatory nature

of the penalty periods.

[¶16.]       PATI filed a responsive brief, but DSS filed its notice of appeal on

January 22, 2010, before the circuit court could rule on DSS’s motion to reconsider.

DSS appeals the circuit court’s December 2009 order granting PATI’s petition for

further relief. This Court stayed DSS’s appeal until Fred and Gladys exhausted

their administrative remedies.

                               Administrative Appeal

[¶17.]       Fred’s and Gladys’s cases were joined and an administrative hearing

was held in February 2010. Before the hearing, Gladys provided the ALJ with a

copy of the circuit court’s December 2009 order and DSS provided a copy of the 2008

CMS memorandum. Fred and Gladys urged the ALJ to consider the declaratory

orders. But despite these orders, the ALJ upheld DSS’s imposition of a Medicaid


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#25536, #25902

transfer penalty period on Gladys, concluding that the transfers made by Fred and

Gladys, who were both over 65 at the time of the transfers, subjected them to the

transfer penalty. The ALJ’s opinion did not refer to the declaratory judgment action

and relied primarily on the CMS memorandum. Fred and Gladys appealed the

ALJ’s ruling to the circuit court.

[¶18.]       Judge Kern issued a memorandum decision, concluding that Fred

waived his right to appeal DSS’s imposition of a transfer penalty because he

originally challenged DSS’s notice of action, which indicated only that his Medicaid

income trust was being inappropriately used and did not refer to the transfer

penalty. Although the ALJ’s decision on Fred’s Medicaid eligibility was based on

the improper transfer of assets to the pooled trust, Fred did not challenge the

subsequent transfer penalty for his transfers to the pooled trust.

[¶19.]       As to Gladys, Judge Kern affirmed the ALJ’s ruling and stated that

“[b]oth the federal and state statute allow for the imposition of a long-term care

eligibility penalty for the transfer of assets for less than fair-market value within

the statutory period when the benefited individual was not under age 65 at the time

of the transfer, and the fact that such a transfer took place is not in dispute.” Fred

and Gladys appeal the circuit court’s affirmance of the ALJ’s ruling upholding

DSS’s imposition of a Medicaid penalty period.

                   Decision on Declaratory Judgment Appeal

             1. Standard of Review

[¶20.]       Because there is some disagreement, we first address the applicable

standards of review. In the appeal on the 2009 declaratory order, DSS asserts that


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#25536, #25902

the de novo standard of review applies as it does in all declaratory judgment

actions. PATI responds that the abuse of discretion standard of review should apply

because DSS is challenging an order granting further relief on a declaratory

judgment action, not the final declaratory judgment. 4 “This Court reviews

declaratory judgments as we do any other order, judgment, or decree” giving no

deference to a circuit court’s conclusions of law under the de novo standard of

review. Fraternal Order of Eagles No. 2421 of Vermillion v. Hasse, 2000 S.D. 139, ¶

8, 618 N.W.2d 735, 737 (citing SDCL 21-24-13). Although granting further relief in

a declaratory judgment action is permissive rather than mandatory, see SDCL 21-

24-12, the circuit court was answering a question of law in interpreting its prior

order, thus our review is de novo. Jurisdiction, res judicata, and statutory

interpretation are also questions of law examined under the de novo standard of

review. O’Neill Farms, Inc. v. Reinert, 2010 S.D. 25, ¶ 7, 780 N.W.2d 55, 57; W.

Consol. Coop. v. Pew, 2011 S.D. 9, ¶ 20, 795 N.W.2d 390, 396; Farmer v. S.D. Dep’t

of Revenue and Regulation, 2010 S.D. 35, ¶ 6 n.4, 781 N.W.2d 655, 659 n.4.

               2. Issue Preclusion: Res Judicata and “Law of the Case”

[¶21.]         PATI argues that the doctrine of res judicata bars DSS’s attempt to

litigate the age limitation issue: DSS already litigated that issue in the 2006

proceeding and DSS could have litigated the issue in the 2009 proceeding. First,

PATI notes that the circuit court ruled that PATI’s petition for further relief

“involve[d] issues previously adjudicated[.]” PATI contends that “the issue of



4.       PATI cites Lakeside Realty, Inc. v. Life Scape Homeowners Ass’n, 202 S.W.3d
         186, 190 (Tex. App. 2005) to support this argument.

                                          -10-
#25536, #25902

whether long term care Medicaid eligibility for Trust beneficiaries can be restricted

based on beneficiaries’ age is identical to the issues addressed in the prior

adjudication which led to the issuance of the judgment.” Then, PATI argues that

“[a]lthough [DSS] did not specifically advance an argument that it could impose

Medicaid transfer penalties on older beneficiaries of the Trust [in the 2006

proceeding], it knew that it could have advanced that argument because it referred

to the issue in a brief filed with the Court.” 5 Alternatively, PATI asserts that the

“law of the case” doctrine bars DSS’s litigation of the age limitation issue.

[¶22.]         DSS responds that res judicata does not apply because the circuit court

lacked subject matter jurisdiction “to issue any order which has the effect of

determining Medicaid eligibility and which allows individuals to bypass DSS and

administrative procedures to obtain Medicaid eligibility.” DSS argues that Fred

and Gladys avoided the obligation to exhaust their administrative remedies because

the circuit court improperly ruled on the relevant eligibility issues for them. DSS

also argues that the court’s orders wrongly shifted the burden of proof because the

orders required DSS to show why beneficiaries do not qualify for Medicaid




5.       Specifically, PATI refers to DSS’s brief in support of summary judgment filed
         on July 22, 2005. The 2005 summary judgment proceeding addressed only
         the parties’ dispute over the trust provision regarding funds remaining upon
         a beneficiary’s death (i.e., transfers to the trust and Medicaid eligibility were
         not at issue). In this brief, DSS differentiated special needs trusts and pooled
         trusts under Medicaid law. In doing so, DSS stated that “[u]nder the pooled
         trust provision, if the beneficiary is 65 or older there may be transfer
         penalties.” PATI argues that this statement demonstrates that DSS knew of
         its age limitation argument and could have asserted it in the 2006
         proceedings.

                                            -11-
#25536, #25902

assistance when state law places the burden on an applicant to prove eligibility for

such assistance.

[¶23.]        Res judicata generally bars not only attempts to relitigate matters

actually litigated, but also all other matters that should have been asserted in the

earlier proceeding. In re Estate of Siebrasse, 2006 S.D. 83, ¶ 16, 722 N.W.2d 86, 90.

The “law of the case” doctrine, on the other hand, stands for the general rule that “a

question of law decided by the supreme court on a former appeal becomes the law of

the case, in all its subsequent stages, and will not ordinarily be considered or

reversed on a second appeal when the facts and the questions of law presented are

substantially the same.” Id. “The ‘law of the case’ doctrine is the weaker corollary

of the doctrines of res judicata, collateral estoppel[,] and stare decisis and is

intended to prove some degree of certainty where those doctrines could not yet

apply.” Id.

[¶24.]        As we previously noted:

              Although the principles of the law of the case doctrine and res
              judicata are similar, their application differs. The law of the
              case rule involves the effect of a previous ruling within one
              action on a similar issue of law raised subsequently within the
              same action. The rules of res judicata apply to previous rulings
              in an action on a similar determination in a subsequent action.

Id. Thus, “[w]here successive appeals are taken in the same case there is no

question of res judicata, because the same suit, and not a new and different one, is

involved.” Id.

[¶25.]        This case does not involve successive appeals. But PATI claims that

the circuit court’s 2006 order bars DSS’s litigation of the age limitation issue and

DSS’s appeal of the 2009 order. The 2006 and 2009 orders were issued in the same

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declaratory judgment action. Therefore, because this case does not involve the

preclusive effect of a previous ruling in a subsequent action, we employ the “law of

the case” doctrine rather than res judicata.

[¶26.]       “The ‘law of the case’ doctrine is intended to afford a measure of

finality to litigated issues.” Grynberg Exploration Corp. v. Puckett, 2004 S.D. 77, ¶

21, 682 N.W.2d 317, 322. This doctrine has many policy considerations: “(1) to

protect settled expectations of the parties; (2) to insure uniformity of decisions; (3)

to maintain consistency during the course of a single case; (4) to effectuate the

proper and streamlined administration of justice; and (5) to bring litigation to an

end.” In re Estate of Jetter, 1999 S.D. 33, ¶ 20, 590 N.W.2d 254, 258. We have

cautioned, however, that “the ‘law of the case’ [doctrine] should not be used to

perpetuate an erroneous decision[.]” Grynberg, 2004 S.D. 77, ¶ 21, 682 N.W.2d at

322. Indeed, the doctrine “is not a rigid rule, and will not be invoked on a second

appeal if the prior decision is palpably erroneous and if it is competent for the court

to correct it on the second appeal.” Siebrasse, 2006 S.D. 83, ¶ 17, 722 N.W.2d at 91.

Furthermore, “a court may reopen a previously resolved question if the evidence on

remand is substantially different or if a manifest injustice would otherwise result.”

Id.

[¶27.]       In this case, the narrow question whether beneficiaries age 65 or older

will be subject to a penalty period as a result of transfers to a pooled trust was not

decided in the circuit court’s 2006 ruling. Although the court ordered that

“transfers to the trust would not be penalized for Medicaid eligibility purposes,” this

broad ruling did not directly address age limitations. Still, there is merit in PATI’s


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argument that DSS knew of the age limitation issue in 2006 because DSS

mentioned the policy in a 2005 brief. Yet the trust had no beneficiaries at that

time. With no particular individual beneficiary and accompanying Medicaid

eligibility concern presented to the court, the issue was not fully and fairly litigated.

In addition, the 2008 CMS memorandum made the mandatory nature of the

transfer penalties more apparent. In that memorandum, CMS warned that states

must apply the penalty periods to pooled trust transfers made by beneficiaries age

65 or older or risk noncompliance with federal Medicaid law. The 2008

memorandum warranted a new examination of the court’s ruling regarding

transfers to the pooled trust for Medicaid eligibility purposes. Unfortunately, the

circuit court did not have the opportunity to consider this memorandum because the

appeal by DSS stayed further proceedings.

[¶28.]         Accordingly, we do not apply the “law of the case” doctrine here

because its application would not serve the doctrine’s many policy considerations.

The narrow Medicaid eligibility issue before us today was not previously decided in

2006. And the 2008 CMS memorandum may constitute new evidence supporting

DSS’s penalty period policy. Judicial economy, finality, certainty, and uniformity

cannot outweigh the interests of justice in this case because, as we explain in detail

below, the unambiguous language of the relevant statutes supports DSS’s

imposition of a penalty period for transfers made by pooled trust beneficiaries age

65 or older.

[¶29.]         Two other concerns also bear on our decision not to apply the “law of

the case” doctrine. First, under the South Dakota Medicaid Program, Medicaid


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eligibility is determined in the first instance by DSS. Not only did the circuit court

rule on issues affecting Medicaid eligibility, but the court also required DSS to

make all future eligibility decisions “consistent with [its 2009] order and applicable

law.” Thus, while the court was not ruling on Medicaid eligibility for a specific

beneficiary, the court was effectively making future individual Medicaid eligibility

decisions. Yet the unambiguous language of the applicable statutes demonstrates

that DSS cannot make Medicaid eligibility decisions consistent with both the circuit

court’s 2009 order and applicable law because the statutes require penalty periods

and the court order prohibits penalty periods.

[¶30.]       Second, while the 2009 order did not involve individuals directly

appealing agency decisions (i.e., Fred and Gladys did not directly appeal to the

circuit court), PATI filed its petition for further relief immediately after DSS

imposed a penalty period on Fred and Gladys, seeking a general declaration that

DSS cannot apply penalty periods based on age. PATI’s petition for further relief

asked the circuit court to rule, and the court did rule, on the specific Medicaid

eligibility issue that Fred and Gladys were appealing to the ALJ. Indeed, had the

ALJ honored the court’s order granting further relief, Fred’s and Gladys’s

administrative appeal would have been prematurely decided by the circuit court.

[¶31.]       We do not ignore PATI’s competing policy arguments. PATI’s lawyers

acted proactively, doing everything possible to arrange a trust for the benefit of its

future beneficiaries by seeking court supervision and filing a declaratory judgment

action. DSS, by stipulation and inaction, led PATI to believe that it could represent

to its beneficiaries age 65 or over that they could permanently divest themselves of


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assets without jeopardizing their Medicaid eligibility. While this is also a form of

injustice, we conclude that it does not outweigh our interest in reaching the correct

legal conclusion. 6

               3. Statutory Analysis

[¶32.]         When interpreting a statute, we “begin with the plain language and

structure of the statute.” State ex rel. Dep’t of Transp. v. Clark, 2011 S.D. 20, ¶ 10,

798 N.W.2d 160, 163.

               The purpose of statutory construction is to discover the true
               intention of the law, which is to be ascertained primarily from
               the language expressed in the statute. The intent of a statute is
               determined from what the Legislature said, rather than what
               the courts think it should have said, and the court must confine
               itself to the language used. Words and phrases in a statute
               must be given their plain meaning and effect. When the
               language in a statute is clear, certain, and unambiguous, there
               is no reason for construction, and this Court’s only function is to
               declare the meaning of the statute as clearly expressed.

Id. ¶ 5.

[¶33.]         The United States Congress enacted Medicaid in 1965. Mulder v. S.D.

Dep’t of Soc. Servs., 2004 S.D. 10, ¶ 7, 675 N.W.2d 212, 215. “Medicaid is a

cooperative State and Federal program designed to provide health care to needy

individuals.” Id. If states choose to take part in the Medicaid program, “they must




6.       Res judicata and the “law of the case” doctrine are supported by nearly
         identical policy considerations. See Brown v. Felsen, 442 U.S. 127, 132, 99 S.
         Ct. 2205, 2209, 60 L. Ed. 2d 767 (1979); see also Dakota, Minn. & E. R.R.
         Corp. v. Acuity, 2006 S.D. 72, ¶ 15, 720 N.W.2d 655, 660. Even if the orders
         here had occurred in separate actions, we would not apply res judicata for
         many of the same reasons we do not apply the “law of the case” doctrine,
         specifically because it would not serve the doctrine’s policy considerations and
         would defeat the ends of justice.

                                           -16-
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develop a State plan that complies with the Federal Medicaid act and its

regulations.” Id. South Dakota participates in the Medicaid program and charges

the Secretary of DSS “with the responsibility of promulgating rules to determine

eligibility and the extent of benefits available to applicants.” Id. (citing SDCL 28-6-

1 and 28-6-3.1). These rules can be found in the Administrative Rules of South

Dakota (ARSD) Title 67, Article 46. Id.

[¶34.]       Long-term care assistance is an optional category of Medicaid

coverage. 42 U.S.C. § 1396a(a)(10)(A)(ii)(V). South Dakota elected to provide long-

term Medicaid coverage. ARSD 67:46:01:02(6). To determine eligibility for long-

term care assistance, DSS is required to review an applicant’s income and

resources. ARSD 67:46:02:03. DSS must also determine whether an applicant has

transferred any assets within a look-back period. 42 U.S.C. § 1396p(c); ARSD

67:46:05:06. If an applicant has transferred assets for less than fair market value

during that time, he or she may be ineligible for Medicaid long-term care assistance

for a certain penalty period. 42 U.S.C. § 1396p(c); ARSD 67:46:05:06; ARSD

67:46:05:09. Although an applicant is ineligible for long-term care benefits during

the penalty period, the applicant may be eligible for medical-only benefits during

that time. ARSD 67:46:05:09.03.

[¶35.]       Certain Medicaid eligibility rules apply to trusts. See 42 U.S.C. §

1396p(d). Three types of trusts are generally exempt from these Medicaid trust

rules — special needs trusts, Medicaid income trusts, and pooled trusts. See 42

U.S.C. § 1396p(d)(4); ARSD 67:46:05:17. This case involves pooled trusts.




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#25536, #25902

[¶36.]       A pooled trust is “[a] trust containing the assets of an individual who is

disabled (as defined in [42 U.S.C. § 1382c(a)(3)])[.]” 42 U.S.C. § 1396p(d)(4)(C). A

pooled trust must be “established and managed by a nonprofit association.” 42

U.S.C. § 1396p(d)(4)(C)(i). In addition, “[a] separate account [must be] maintained

for each beneficiary of the trust, but, for purposes of investment and management of

funds, the trust pools these accounts.” 42 U.S.C. § 1396p(d)(4)(C)(ii). Finally, the

“[a]ccounts in the trust [must be] established solely for the benefit of individuals

who are disabled[.]” 42 U.S.C. § 1396p(d)(4)(C)(iii). Disabled individuals of any age

may establish sub-accounts within pooled trusts. See 42 U.S.C. § 1396p(d)(4)(C).

Cf. 42 U.S.C. § 1396p(d)(4)(A) (providing that only disabled individuals “under age

65” may participate in Medicaid special needs trusts).

[¶37.]       When taking into account certain transfers of assets for purposes of

Medicaid eligibility and penalty periods, Medicaid provides an exception for certain

transfers of assets to trusts. See 42 U.S.C. § 1396p(c)(2)(B)(iv). Under this

exception, “[a]n individual shall not be ineligible for medical assistance [for

disposing of assets for less than fair market value on or after the look-back date] to

the extent that . . . the assets were transferred to a trust (including a trust

described in [42 U.S.C. § 1396p(d)(4)]) established solely for the benefit of an

individual under 65 years of age who is disabled[.]” 42 U.S.C. § 1396p(c)(2)(B)(iv)

(emphasis added). Therefore, under Medicaid, pooled trusts are exempt from the

general trust rules outlined in 42 U.S.C. § 1396p(d) and transfers of assets into

pooled trusts by those under 65 years of age are exempt from the transfer penalty




                                          -18-
#25536, #25902

period rules outlined in 42 U.S.C. § 1396p(c)(1). 42 U.S.C. §§ 1396p(d)(4)(C) and

1396p(c)(2)(B)(iv).

[¶38.]       Here, the parties do not dispute that PATI and the pooled trust satisfy

Medicaid’s requirements for a pooled trust under 42 U.S.C. § 1396p(d)(4)(C). The

parties also do not dispute that individuals over the age of 65, like Fred and Gladys,

may participate in and establish sub-accounts with a Medicaid pooled trust. What

the parties do dispute, however, is whether a penalty period applies for Medicaid

eligibility purposes when beneficiaries over age 65 transfer assets into the pooled

trust. We conclude that under the unambiguous statutory language, transfers of

assets for less than fair market value into pooled trusts by beneficiaries age 65 or

older will be subject to a transfer penalty period for Medicaid eligibility purposes.

[¶39.]       PATI repeatedly asserts that an age limitation cannot be “read into” 42

U.S.C. § 1396p(d)(4)(C), the statute that provides the requirements for a Medicaid

pooled trust. PATI notes that unlike the statute regarding Medicaid special needs

trusts, the pooled trust statute does not contain an “under age 65” limitation. This

is accurate — as far as it goes. Under 42 U.S.C. § 1396p(d)(4)(C), a disabled

individual 65 or older may participate in a pooled trust and establish a sub-account

in that trust. But PATI must differentiate between participation in a pooled trust

and subsequent penalty periods and delays in eligibility for transfers to the trust.

While an individual age 65 or older may participate in a Medicaid pooled trust, he

or she will be subject to a penalty period and a delay in Medicaid eligibility for

certain benefits if he or she transfers assets to the trust for less than fair market

value. 42 U.S.C. §§ 1396p(d)(4)(C) and 1396p(c)(2)(B)(iv).


                                          -19-
#25536, #25902

[¶40.]       PATI also argues that funds in a pooled trust are not available to an

applicant for Medicaid eligibility purposes. PATI cites Norwest Bank of N.D., N.A.

v. Doth, 159 F.3d 328 (8th Cir. 1998) to support this argument. In that case, the

Eighth Circuit Court of Appeals found that under 42 U.S.C. § 1396p(d)(4), funds in

a Medicaid special needs trust “are not deemed to be available to [a Medicaid]

application or recipient for the purpose of determining [Medicaid] eligibility or the

amount of benefits.” Id. at 332. We agree that 42 U.S.C. § 1396p(d)(4) exempts

special needs trusts, pooled trusts, and Medicaid income trusts from the general

trust rules found in 42 U.S.C. § 1396p(d). Yet the Eighth Circuit did not hold that

these three types of trusts are wholly exempt from the transfer penalty rules found

in 42 U.S.C. § 1396p(c). And while 42 U.S.C. § 1396p(c)(2)(B)(iv) creates an

exception for trust transfers from the transfer penalty rules, the statute limits the

exception to trusts established for an individual under age 65. Therefore, we find

PATI’s argument and reliance on the Eighth Circuit case unpersuasive.

[¶41.]       PATI further contends that penalizing beneficiaries age 65 or older

who transfer assets to a Medicaid pooled trust makes their participation in a pooled

trust a nullity, rendering the pooled trust exception meaningless. Essentially, PATI

asks “Why would Congress allow individuals 65 or older to participate in pooled

trusts if they will nevertheless be subject to a transfer penalty under another

statute?” PATI argues that these beneficiaries should not be denied benefits and

often cannot wait out the penalty period. First, we must differentiate between

being denied Medicaid long-term care assistance and being subject to a delay in

eligibility for Medicaid long-term care assistance via a penalty period. DSS’s policy


                                         -20-
#25536, #25902

does not deny a pooled trust beneficiary Medicaid assistance. The policy merely

imposes a mandatory penalty period during which time the applicant is not eligible

for long-term care assistance. The applicant may nevertheless qualify for medical-

only coverage during the penalty period (as Gladys did), and after the penalty

period expires, the applicant may thereafter be eligible for long-term care

assistance. Moreover, even if PATI were correct in claiming that our interpretation

of the statutory language leads to a problematic result, we must confine our

decision to the plain language of the statutes. See People ex rel. J.L., 2011 S.D. 36,

¶ 4, 800 N.W.2d 720, 722. For whatever reason, the penalty period exception for

trust transfers is limited to transfers made to trusts established for individuals

under age 65, and we confine our decision to this language.

[¶42.]       In addition, we cannot accept PATI’s claim that “subjecting [the pooled

trust statute] to divestment penalties under [the penalty period statute] would read

an age limit into [the pooled trust statute], nullifying it for people with disabilities

who have passed age 64 because they typically cannot afford to wait out the five-

year ‘look-back’ period.” “The Medicaid program is not to be used as an estate

planning tool.” Striegel v. S.D. Dep’t of Soc. Servs., 515 N.W.2d 245, 247 (S.D.

1994)(emphasis in original). Medicaid provisions are “designed to assure that

individuals receiving nursing home and other long-term care services under

Medicaid are in fact poor and have not transferred assets that should be used to

purchase the needed services before Medicaid benefits are made available.” Id.

Therefore, while we acknowledge the impact of a five-year delay in long-term care




                                           -21-
#25536, #25902

assistance, this provision was designed to preserve Medicaid benefits for those who

truly lack the assets or resources to financially secure long-term care.

               4. Agency Interpretation

[¶43.]         “Congress conferred on the Secretary [of Health and Human Services]

exceptionally broad authority to prescribe standards for applying certain sections of

the [Medicaid] Act.” Schweiker v. Gray Panthers, 453 U.S. 34, 43, 101 S. Ct. 2633,

2640, 69 L. Ed. 2d 460 (1981). CMS, a branch of the Department of Health and

Human Services, focuses on Medicare and Medicaid services. “As the [United

States] Supreme Court recently noted, even relatively informal HCFA (now CMS)

interpretations, such as letters from regional administrators, ‘warrant[] respectful

consideration’ due to the complexity of the [Medicaid] statute and the considerable

expertise of the administering agency.” Cmty. Health Ctr. v. Wilson-Coker, 311 F.3d

132, 138 (2d Cir. 2002) (quoting Wis. Dep’t of Health & Family Servs. v. Blumer, 534

U.S. 473, 497, 122 S. Ct. 962, 151 L. Ed. 2d 935 (2002)). 7 The South Dakota

Medicaid Program and administrative rules must comply with federal Medicaid law

and any CMS regulations. See Mulder, 2004 S.D. 10, ¶ 7, 675 N.W.2d at 215.

[¶44.]         In a CMS memorandum from Gale P. Arden, Director of Disabled and

Elderly Health Programs Group at the Center for Medicaid and State Operations in



7.       Even more recently, the Supreme Court wrote: “The Medicaid Act commits to
         the federal agency the power to administer a federal program. And here the
         agency has acted under this grant of authority. That decision carries weight.
         After all, the agency is comparatively expert in the statute’s subject matter.
         And the language of the particular provision at issue here is broad and
         general, suggesting that the agency’s expertise is relevant in determining its
         application.” Douglas v. Indep. Living Ctr. of S. Cal., Inc., et al., ___ U.S. ___,
         ___, 132 S. Ct. 1204, 1210, ___ L. Ed. ___ (2012).

                                             -22-
#25536, #25902

Baltimore, the transfer penalty and pooled trust statutes at issue in this case were

clarified. See Memorandum from Gale P. Arden to Jay Gavens, Acting Assoc.

Regional Adm’r, Div. of Medicaid and Children’s Health (Apr. 14, 2008). In part,

the memorandum stated:

             Although a pooled trust may be established for beneficiaries of
             any age, funds placed in a pooled trust established for an
             individual age 65 or older may be subject to penalty as a
             transfer of assets for less than fair market value. When a
             person places funds in a trust, the person gives up ownership of
             the funds. Since the individual generally does not receive
             anything of comparable value in return, placing funds in a trust
             is usually a transfer for less than fair market value. The statute
             does provide an exception to imposing a transfer penalty for
             funds that are placed in a trust established for a disabled
             individual. However, only trusts established for a disabled
             individual 64 or younger are exempt from application of the
             transfer of assets penalty provisions . . . .

Id. (emphasis added). CMS issued this memorandum because “it was brought to

[its] attention that in many States . . . individuals age 65 or older are establishing

pooled trusts, but the States may not be applying the transfer of assets penalty

provisions as required by statute.” Id. The memorandum explained that “[i]f States

are allowing individuals age 65 or older to establish pooled trusts without applying

the transfer of assets provisions, they are not in compliance with the statute.

[F]ederal statute requires the application of the transfer rules in this situation; it

[is] not a decision for each State to make.” 8 Id. One month later, the Boston

Regional Office of CMS issued a memorandum to all state Medicaid agencies in its



8.    In 2010, DSS amended its administrative rules to directly reflect CMS’s
      interpretation of the transfer penalty statutes. See ARSD
      67:46:05:32.03(3)(e). The amendment became effective July 1, 2010.


                                          -23-
#25536, #25902

region, reciting identical language and asking all states to review their pooled trust

provisions and ensure that the state provisions comply with federal standards. 9 See

Memorandum from Richard R. McGreal, Assoc. Regional Adm’r, Ctrs. for Medicare

and Medicaid Servs., to All Medicaid State Agencies (May 12, 2008).

[¶45.]         CMS also discussed pooled trusts and transfer penalties in its State

Medicaid Manual (SMM). 10 The SMM provides information regarding policies and

procedures to state Medicaid agencies. SMM, Foreword § A. The contents of the

SMM are binding on state Medicaid agencies. SMM, Foreword § B. In the

eligibility requirements section, CMS notes under the pooled trusts sub-section

that:

               Establishing an account in [a pooled trust] may or may not
               constitute a transfer of assets for less than fair market value.
               For example, the transfer provisions exempt from a penalty
               trusts established solely for disabled individuals who are under
               age 65 or for an individual’s disabled child. As a result, a special
               needs trust established for a disabled individual who is age 66
               could be subject to a transfer penalty. 11

9.       At oral argument, PATI’s counsel said that South Dakota was in the Denver
         CMS region, and thus the CMS memo from the Boston region was not
         binding on DSS in South Dakota. Nevertheless, the memo from Gale P.
         Arden at CMS headquarters in Baltimore specifically stated that the memo
         would be provided to all the other CMS Regional Offices to refresh the
         understanding of their staffs.
10.      Centers for Medicare & Medicaid Services, The State Medicaid Manual,
         http://www.cms.gov/Manuals/PBM/itemdetail.asp?filterType=none&filterByD
         ID=99&sortByDID=1&sortOrder=ascending&itemID=CMS021927&intNumP
         erPage=10 (last modified Sept. 8, 2005). For simplicity purposes, citations
         will be to the sections of the manual only without full URL citations.

11.      Some authorities often use the term “special needs trusts” to generally
         describe the three types of trusts created for the benefit of disabled
         individuals under 42 U.S.C. § 1396p(d)(4)(A) through (C). However, as both
         the statutes and the SMM indicate, a special needs trust (42 U.S.C. §
         1396p(d)(4)(A)) is different from a pooled trust (42 U.S.C. § 1396p(d)(4)(C)).
                                                                       (continued . . .)
                                            -24-
#25536, #25902


SMM, Chapter 3: General and Categorical Eligibility Requirements, § 3259.7(B)

(emphasis added).

[¶46.]         In addition, the Social Security Administration reached the same

conclusion in its Program Operations Manual System (POMS), “the publicly

available operating instructions for processing Social Security claims[.]” Wash.

State Dep’t of Soc. and Health Servs. v. Guardianship Estate of Keffeler, 537 U.S.

371, 385, 123 S. Ct. 1017, 1025, 154 L. Ed. 2d 972 (2003). “While these

administrative interpretations are not products of formal rulemaking, they

nevertheless warrant respect[.]” Id. Under a section reviewing the requirements

for pooled trusts, POMS states that “[t]here is no age restriction under this

exception. However, a transfer of resources to a trust for an individual age 65 or

over may result in a transfer penalty.” 12

[¶47.]         We find these agency interpretations of the relevant Medicaid statutes

to be reasonable, and thus, we give them credence. These interpretations of the

pooled trust and penalty period statutes bolster our reading of the unambiguous




__________________
(. . . continued)
         In this note, CMS is likely using the term “special needs trust” generally to
         describe a pooled trust because this note follows the pooled trust section and
         a similar note follows the preceding special needs trust section.

12.      Program Operations Manual System, § SI 01120.203,
         https://secure.ssa.gov/apps10/poms.nsf/lnx/0501120203 (last updated Oct. 27,
         2011).


                                             -25-
#25536, #25902

statutory language requiring penalty periods for transfers of assets for less than fair

market value into pooled trusts by beneficiaries age 65 or older. 13

               5. Legislative History

[¶48.]         PATI argues that the legislative history demonstrates that pooled

trusts are not only exempt as a resource for Medicaid eligibility purposes but the

trusts are also exempt from transfer penalty periods. “This Court does not,

however, review legislative history when the language of the statute is clear.”

Bertelsen v. Allstate Ins. Co., 2009 S.D. 21, ¶ 15, 764 N.W.2d 495, 500. Because we

conclude that the statutory language is unambiguous and the agency

interpretations of the statutes are reasonable, we do not explore this argument.

                         Decision on Administrative Appeal

[¶49.]         In the administrative appeal, Fred and Gladys challenge the circuit

court’s affirmance of the ALJ’s ruling on DSS’s imposition of a Medicaid transfer

penalty period. We review an administrative appeal in accord with SDCL 1-26-37.

“A review of an administrative agency’s decision requires this Court to give great

weight to the findings made and inferences drawn by an agency on questions of

fact.” Snelling v. S.D. Dep’t of Soc. Servs., 2010 S.D. 24, ¶ 13, 780 N.W.2d 472, 477.

We will reverse an agency’s decision only if it is “clearly erroneous in light of the

entire evidence in the record.” Id. However, statutory interpretation and other

questions of law within an administrative appeal are reviewed under the de novo




13.      At least one court agrees with our holding. See Ctr. for Special Needs Trust
         Admin., Inc. v. Olson, No. 1:09-cv-072, 2011 WL 1562516, at *8 (D.N.D. Apr.
         25, 2011).

                                          -26-
#25536, #25902

standard of review. Id. Therefore, in light of the foregoing authority and because

the parties do not dispute the facts in these cases, we apply the de novo standard of

review to this administrative appeal.

[¶50.]       Fred and Gladys argue that the circuit court erred in affirming the

ALJ’s decision. Given our holding that penalty periods can be applied to transfers

of assets for less than fair market value into pooled trusts by beneficiaries age 65 or

older, the only relevant issue remaining is whether Fred’s and Gladys’s transfers to

the trust were transfers for “less than fair market value.” Fred and Gladys contend

that a transfer of assets by one individual to a pooled trust established for another

person age 65 or older, or a third-party trust transfer, is a divestment. But they

contend that a transfer made by a pooled trust beneficiary for the sole benefit of the

beneficiary is not a divestment under Medicaid. Fred and Gladys believe

that an individual who transfers assets to a pooled trust receives value in return

because he or she retains equitable ownership of the trust funds. They claim that

in transferring their assets to the pooled trust, they “merely exchanged legal

ownership for equitable ownership” and that the value they received for their

transfers was the benefit of the goods and services purchased by the trust.

[¶51.]       We disagree that only third-party transfers to pooled trusts constitute

divestments under Medicaid or that the transfer penalties only apply when a third

party transfers assets to a pooled trust for the benefit of a pooled trust beneficiary.

Under 42 U.S.C. § 1396p(d)(4)(C), a pooled trust is “[a] trust containing the assets of

an individual who is disabled . . . .” (Emphasis added.) While parents,

grandparents, legal guardians, or courts may establish a pooled trust for a disabled


                                          -27-
#25536, #25902

beneficiary, these third parties may not fund the pooled trust with third-party

assets. See 42 U.S.C. § 1396p(d)(4)(C)(iii). Thus, when a third party places his or

her own assets into a pooled trust for the benefit of a pooled trust beneficiary, the

trust would not qualify as an Medicaid pooled trust in the first place.

[¶52.]       We also disagree with Fred and Gladys that their transfers to the

pooled trust were transfers for fair market value. While the SMM states that

pooled trust account transfers “may or may not constitute a transfer of assets for

less than fair market value[,]” the Arden CMS memorandum states that a pooled

trust transfer is usually a transfer for less than fair market value because the

beneficiary typically does not receive anything in return. In addition, contrary to

Fred’s and Gladys’s assertion, a pooled trust transfer that is for the sole benefit of a

beneficiary is not necessarily a transfer for fair market value. The SMM defines

“fair market value” as “an estimate of the value of an asset, if sold at the prevailing

price at the time it was actually transferred.” SMM, Chapter 3: General and

Categorical Eligibility Requirements, § 3258.1(A)(1). Following this definition, the

SMM notes that “[f]or an asset to be considered transferred for fair market value or

to be considered to be transferred for valuable consideration, the compensation

received for the asset must be in a tangible form with intrinsic value.” Id. (emphasis

added).

[¶53.]       Fred and Gladys claim that the value they received for their transfers

was the benefit of the goods and services purchased by the trust. They note the

following language from the SMM:




                                          -28-
#25536, #25902

             Resources placed in [a pooled trust] for a disabled individual are
             subject to the imposition of a penalty under the transfer of
             assets provisions unless the transfer is specifically exempt from
             penalty as explained in §3258.10 or unless the resources placed
             in the trust are used to benefit the individual, and the trust
             purchases items and services for the individual at fair market
             value.

SMM, Chapter 3: General and Categorical Eligibility Requirements, § 3259.7(B)(2)

(emphasis added). Yet Fred and Gladys identify no items or services purchased for

them by the trust, nor do they establish that these purchases were for fair market

value. Furthermore, under the trust document, the decision to distribute funds to a

beneficiary lies solely within the trustee’s discretion. That is, there is nothing

guaranteeing that a beneficiary’s transfer will be used to benefit that beneficiary.

Therefore, we conclude that Fred’s and Gladys’s transfers were transfers for less

than fair market value.

                                     Conclusion

[¶54.]       The “law of the case” doctrine does not apply in this case because the

narrow age limitation issue was not previously litigated and because application of

the doctrine would not support the doctrine’s policy considerations and would

perpetuate an erroneous ruling. Considering the unambiguous language of the

statutes, coupled with the reasonable agency interpretations, we conclude that

transfers of assets into pooled trusts by beneficiaries age 65 or older may be subject

to a transfer penalty period for Medicaid eligibility purposes.

[¶55.]       We affirm the administrative appeal (#25902) and reverse the

declaratory judgment (#25536).




                                          -29-
#25536, #25902

[¶56.]          GILBERTSON, Chief Justice, and ZINTER and SEVERSON, Justices,

and BARNETT, Circuit Court Judge, concur.

[¶57.]          BARNETT, Circuit Court Judge, sitting for WILBUR, Justice,

disqualified.




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