Honorable Lorraine M. Aronson
Department of Income Maintenance
110 Bartholomew Avenue
Hartford, Connecticut 06106
Dear Commissioner Aronson:
You recently requested the opinion of the Attorney General on several questions relating to the impact of the federal Medicare Catastrophic Coverage Act of 1988 (MCCA), Pub.L. 100-360, on your department’s determinations of eligibility for assistance under the Title XIX medical assistance program (“Medicaid”). Before stating your questions and our opinion, it is necessary to provide background on how Medicaid eligibility determinations were affected by MCCA.
The Department of Income Maintenance is authorized to administer the Medicaid Program in Connecticut pursuant to Conn. Gen. Stat. e 17-134a, which requires the program to be administered in accordance with the requirements of federal law. In 1988 the Medicare Catastrophic Act made significant changes in the requirements of federal law applicable to the treatment of income and resources of spouses when one of the spouses is institutionalized and is an applicant for assistance.1 Prior to the MCCA, only the income and the resources belonging to the institutionalized spouse were considered in determining his/her eligibilty for assistance. Section 303 of MCCA added section 1924 to the Social Security Act, 42 U.S.C. e 1396r-5, which requires the eligibility of the institutionalized spouse to be determined by reference to the couple’s combined countable resources owned by either of the spouses individually or jointly at the beginning of the most recent continuous period of institutionalization. Specifically, MCCA requires the institutionalized spouse’s eligibility to be determined by reference to the couple’s combined countable resources minus a permitted “community spouse resource allowance”. 42 U.S.C. e 1396r-5(c)(2). The permitted community spouse resource allowance is equal to the greater of $12,000 or one-half of the couple’s combined resources; however, the community spouse resource allowance may not exceed $60,000. 42 U.S.C. e 1396r-5(f)(2). As a result, an institutionalized spouse may now be determined ineligible for Medicaid as a result of the community spouse’s ownership of resources.
Section 1924 of the Act, as amended by MCCA, however, provides as an exception to the foregoing rule that:
The institutionalized spouse shall not be ineligible by reason of resources determined under paragraph (2) to be available for the cost of care where —
(A) the institutionalized spouse has assigned to the State any rights to support from the community spouse;
(B) the institutionalized spouse lacks the ability to execute an assignment due to physical or mental impairment but the State has the right to bring a support proceeding against a community spouse without such assignment…
42 U.S.C. e 1396r-5(c)(3).
The questions that you have posed relate to what extent the foregoing “assignment of support rights” exception applies in Connecticut as a result of Connecticut’s statutory support obligations.
You first inquire whether Conn. Gen. Stat. e 17-82b and e 17-82e “have legal sufficiency to cover the assignment of assets or does it only cover support rights to income?” Our understanding of your question is that you are asking whether Conn. Gen. Stat. e 17-82b and e 17-82e provide the State of Connecticut with the statutory right to bring a support proceeding on behalf of an incompetent, institutionalized spouse in order to allow eligibility to be granted pursuant to the statutory exception provided by 42 U.S.C. e 1396r-5(c)(3). It is our opinion that Conn. Gen. Stat. e 17-82b and e 17-82e do not constitute state law statutory rights of support that would allow DIM to grant eligibility under the foregoing exception.
Regulations implementing MCCA have not been promulgated by the Secretary of the Department of Health and Human Services. However, it is the Secretary’s administrative interpretation that:
You (the states) must assess your own state laws to determine what laws give rise to support rights and the amount of medical costs community spouses are asked to cover and whether you are limited to seeking support in the amount community spouses’ resources exceed spousal allowances.
Health and Human Services, Health Care Administration, State Medical Manual, e 3260.1.
Under the applicable rules of statutory construction, the administrative interpretation of the Secretary must be deferred to as long as it is reasonable. Chevron U.S.A. v. National Resources Defense Council, 467 U.S. 837, 845, 104 S.Ct. 2778, 2783 (1984). To be entitled to deference as a reasonable administrative interpretation, the agency must explain “the rationale and factual basis for its decision”. Bowen v. American Heart Ass’n., 476 U.S. 610, 627, 106 S.Ct. 2101, 2113 (1986) (plurality opinion).
In our opinion, the Secretary’s interpretation is reasonable and is entitled to deference. The Act requires both spouses’ combined resources to be applied to the cost of care required by the institutionalized spouse, less the permitted community spouse resource allowance. The Secretary’s interpretation therefore properly implements legislative intent by recognizing that eligibility may be granted under the foregoing “assignment of support rights” exception when the support rights of the institutionalized spouse can ensure that the resources belonging to the community spouse are properly contributed to the cost of care, up to the limitation contained in MCCA.
Conn. Gen. Stat. e 17-82b and 17-82e do not constitute state statutory rights of support that are enforceable against a community spouse to obtain resources that would allow Medicaid eligibility to be granted under the “assignment of support rights” exception. Conn. Gen. Stat. e 17-82b provides that by applying for assistance “…the applicant shall assign to the commissioner the right of support, present, past and future, due all persons seeking assistance….” By virtue of a marital relationship, a community spouse is a legally liable relative obligated to support his/her institutionalized spouse. Conn. Gen. Stat. e 4-68a(c).
However, the extent of the obligation of a community spouse to support an institutionalized spouse who is a recipient of public assistance is specifically defined by Conn. Gen. Stat. e 17-82e(a), which provides that the Commissioner of Income Maintenance:
Shall investigate the financial condition of each legally liable relative, as defined in section 4-68a, and shall make a determination as to the financial ability of each such relative in accordance with the uniform contribution scale established by the commissioner of administrative services in accordance with said section 4-68a, and shall notify in writing each such relative of the amount each is found able to contribute toward such support, and each such relative shall be liable in said amount from the date of such notice, retroactive to the date of granting of assistance, unless and until such support responsibility shall be otherwise fixed by a court of competent jurisdiction (emphasis added).
An implementing regulation promulgated by the Commissioner of Administrative Services provides for a uniform contribution scale:
“…determined by subtracting two hundred per cent of the amount of Federal poverty income guidelines, adjusted for family size, as published in the Federal Register, from the taxable income of the legally liable relative, and then assessing twenty-five percent of the sum representing the difference as the contribution due from the legally liable relative.” Reg. Conn. Agencies, e 4-68a-2 (emphasis added).
The regulation limits the obligation of the community spouse to provide support to a percentage of his/her income that exceeds two hundred per cent of poverty income. It does not provide for an obligation to support based upon the resources owned by the community spouse. Similarly, Income Maintenance has adopted a policy, which has the force of regulation by virtue of Conn. Gen. Stat. e 17-3f. This policy provides that:
C. Claim Against Spouses and Against Parents of Children who are Institutionalized or Receiving Community-Based Services
1. The Department’s claim against a parent or spouse of an institutionalized recipient, or against an otherwise separated spouse of a recipient, or against the parent of a child receiving community-based services is equal to twenty-five percent of the difference between the following:
a. the previous year’s federal taxable income of the spouse or parent; and
b. two hundred percent of the corresponding year’s Federal Poverty Level amount for the size of a family which would consist of the legally liable relative and the number of dependents reported on his or her federal income tax return.
Department of Income Maintenance, Uniform Policy Manual, e 7520.05 C.
Therefore, it is our opinion that e 17-82b and e 17-82e do not constitute authority for the State to initiate support proceedings on behalf of an incompetent institutionalized spouse that would permit Income Maintenance to grant Medicaid eligibility on his/her behalf pursuant to 42 U.S.C. 1396 r-5(c)(3), since the implementing regulation and Policy Manual provision limit the support obligation to a percentage of the income of the community spouses.
You have also noted that the application form used by the Department contains a clause wherein the applicant “assigns to the State all of the support rights which I have against any person on behalf of any family member for whom I am applying or receiving assistance”. You have inquired whether this clause in the standard application form has “…the legal sufficiency for the Department to pursue the assets of the spouse of the applicant/recipient regardless of what he or she may have done with his or her assets?”
It is our opinion that this clause does not confer any greater rights upon the Department to seek support against community spouses than the rights of support provided in state statute at e 17-82b and e 17-82e. This conclusion is based on Conn. Gen. Stat. e 17-82b which provides for a statutory assignment of support in the event of an application for assistance, and further provides that “Notice of such assignment shall be conspicuously placed on such application….” Accordingly, the assignment of support rights that appears uniformly upon the standard application form utilized by the Department must be interpreted consistently with e 17-82b and e 17-82e. New Haven v. United Illuminating Co., 168 Conn. 473, 485 (1975), (related statutory provisions may provide guidance on the meaning of a word). As noted supra, in part one of this opinion, Conn. Gen. Stat. e 17-82b and e 17-82e, as implemented by Reg. Ct. St. Ag. e 4-68a-2, limit the support obligation of a community spouse to a percentage of the community spouse’s income and do not constitute statutory assignments of support rights sufficient to allow a support proceeding to be brought based upon the resources owned by a community spouse. Furthermore, interpreting the clause appearing on the standard application form as only providing an assignment of support rights against the income of the community spouse is necessary in order to be consistent with the agency’s official implementation in its Uniform Policy Manual of the statutes (1978). Heslin v. Connecticut Law Clinic of Trantolo & Trantolo, 190 Conn. 510, 520 (1983). Accordingly, it is our advice that this clause in the application form does not constitute an assignment of support rights sufficient to grant eligibility on behalf of the institutionalized spouse pursuant to 42 U.S.C. e 1396r-5(c)(3). The clause on the standard application form only authorizes the Department of Income Maintenance to pursue support from the income of the applicant’s spouse, in accordance with Conn. Gen. Stat. e 17-82b and e17-82e as implemented by Reg. Conn. Agencies, e4-68a-2.
Finally, you have asked what must the Department do to make the assignments legally sufficient if the Connecticut assignment statutes are not sufficient to allow the granting of Medicaid eligibility on behalf of the institutionalized spouse? Our advice is that if the Department determines, as a matter of policy, that it is desirable to grant assistance to an institutionalized spouse under such circumstances, an amendment to state regulations is required authorizing the maintenance of support rights against the community spouse’s resources. This could be accomplished by the Department of Administrative Services amending the implementing regulation to provide for the required contribution of support based upon resources owned by the legally liable relative. In order to comply with federal law, any such regulatory amendment must limit the amount of the claim against the community spouse’s resources to the amount that is required to be contributed in accordance with MCCA.2
For your consideration, it should be pointed out that the adoption of such a policy would require the State to “pay and chase”. This means assistance would be granted to institutionalized spouses who would ordinarily be ineligible for assistance in accordance with the general rules of eligibility established by MCCA, subject to claims for support then being pursued against the community spouse in order to compel the requisite contribution of resources held in the name of the community spouse. Although MCCA permits Medicaid eligibility to be granted to the institutionalized spouse under such circumstances, we are aware of no provision in federal law that requires a state, to adopt state statutory or regulatory support obligations authorizing the maintenance of support actions against the resources held by the community spouse.
Very truly yours,
CLARINE NARDI RIDDLE
Assistant Attorney General
1 The terms “resources” and “income” are not specifically defined in the federal Medicaid Act. However, the Act, requires the states to utilize the rules applicable to the evaluation of eligibility for assistance that are employed in the comparable cash assistance program. 42 U.S.C. e 1396 a(a)(10). In the case of Medicaid provided to institutionalized aged, blind or disabled individuals, the comparable program is the federal Supplemental Security Income (SSI) program. 42 C.F.R. e 435.721. Comprehensive regulations implementing SSI have been adopted defining income, 20 C.F.R. e 416.102 et seq., and resources, 20 C.F.R. e 416.1201 et seg. For purposes of this opinion, the important distinction between “income” and “resources” is that items received in cash or kind are considered to be income in the month received, and “… if retained until the first moment of the following month are subject to the rules for counting resources at that time”. 20 C.F.R. e 416.1207(d). The Department of Income Maintenance has adopted policies having the force of regulation, Conn. Gen. Stat. e 17-3f, which define “income” and “resources” in a manner that is consistent with the foregoing federal requirements. DIM, Uniform Policy Manual 4000 et seq. and 5000.01 et seq.
2 Although not the subject of your request for an opinion, our research has disclosed an area where revisions to state regulations are required. MCCA amended the Medicaid Act by requiring the diversion of so much of the institutionalized spouse’s income as may be necessary to provide the community spouse with an inflation-adjusted monthly needs allowance to be set by the State at least equal to the “appliable percent” (122% – 150%, phased in between 1989 and 1992) of poverty level of a family of two, not to exceed $1,500. 42 U.S.C. e 1396r-5(d)(2). However, the uniform contribution scale adopted by the Department of Administrative Services (DAS) pursuant to Conn. Gen. Stat. e 4-68a, which Income Maintenance is required to utilize, Conn. Gen. Stat. e 17-82e, does not allow the community spouse to retain $1,500 for his or her needs. Specifically, the DAS regulations establish a minimum floor of 200% of poverty level ($11,540 annually in 1988), Reg. Conn. Agencies, e 4-68a-2, which is lower than the maximum community spouse maintenance allowance ($1,500 x 12 = $18,000 annually in 1988). Reg. Conn Agencies, e 4-68a-2. It is therefore required that the regulation be amended, at least insofar as it applies to spouses of institutionalized Medicaid recipients, in order to allow the community spouse to retain an amount of monthly income that is at least equal to the monthly needs allowance in accordance with the requirements of MCCA.