The State Reaffirms Medicaid Communication 10-02 in Medicaid Communication 10-06

In Medicaid Communication 10-02, the state denied reverse half-a-loaf as a viable planning technique based upon language in the Federal Statute 42 U.S.C. Section 1396p(c)(2)(C).
Medicaid Communication 10-06 reaffirms the position previously taken, that reverse half-a-loaf planning is not a viable planning opportunity, but grandfather's the planning technique for Medicaid applications prior to May 2010 for assets returned prior to May 26, 2010.
My position is that the state is still incorrect in their interpretation. My blog "State Incorrectly Interprets Transfer Penalty Period in Medicaid Communication 10-02" illustrates how Medicaid Communications 10-02 and 10-06 contradict comment 7 to the OBRA '93 regulations, which contains language explicitly allowing for give-backs.
It is thus my opinion that reverse half-a-loaf planning remains a justifiable planning technique, regardless of date, because of the language in the OBRA '93 comment and the less restrictive state comment which would control over the more restrictive federal statute.
Members of the Elder law bar are considering challenging the state's position based upon the above argument.

Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post 113