Zander v. Adams

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Zander v. Adams

State: Illinois

Court: 1st District Appellate

Docket No: 1-09-0979 Rel

Case Date: 03/15/2010

Preview:FIRST DIVISION March 15, 2010

No. 1-09-0979 BETTE I. ZANDER, Plaintiff-Appellant, v. CAROL L. ADAMS, Secretary, The Department of Human Services CARMELA A. GARDNER, Chief Bureau of Assistance Hearings, The Department of Human Services, and BARRY MARAM, Director, The Department of Healthcare and Family Services, Defendants-Appellees. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) Appeal from the Circuit Court of Cook County. No. 08 CH 23123

The Honorable Leroy K. Martin, Jr., Judge Presiding.

JUSTICE GARCIA delivered the opinion of the court. Plaintiff Bette I. Zander appeals from an administrative decision of the Illinois Department of Human Services (Department) imposing a penalty period during which the plaintiff is ineligible for Medicaid assistance. confirmed the Department's decision. The circuit court Mrs. Zander, an elderly

resident of a long-term care facility, assigned her beneficial interest in an Illinois land trust to her three daughters more than 36 months prior to applying for benefits. She argues that

period was sufficiently long to shield her from a penalty for transferring her assets under Department regulations. The

Department ruled that Mrs. Zander was required to wait 60 months before applying for assistance.

1-09-0979 We find the Department properly imposed a penalty on Mrs. Zander because the transfer of beneficial interest constituted a noncash or property disbursement from a revocable trust under Department regulations. Accordingly, we affirm. BACKGROUND On June 10, 2003, at the age of 79, Mrs. Zander began living in a group care facility in Illinois. On December 4, 2003, Mrs.

Zander created the Zander Land Trust to which she transferred three parcels of real estate she owned in the County of McDonough, McComb, Illinois. One of Mrs. Zander's daughters,

Karen Kae Skiles, served as trustee of the Zander Land Trust. The trust entitled Mrs. Zander to 100% of "the earnings, avails and proceeds of said real estate." However, under the terms of

the trust, the beneficiary had no "right, title or interest in or to any portion of real estate as such, either equitable or legal." Less than two weeks later, on December 16, 2003, Mrs.

Zander executed an assignment of beneficial interest in the Zander Land Trust transferring all of her beneficial interest to her three daughters. On January 23, 2007, approximately 37 months after the beneficial interest in the Zander Land Trust was transferred to Mrs. Zander's three daughters, the Department received Mrs. Zander's application for Medicaid assistance. The Department

found Mrs. Zander eligible for Medicaid, but imposed a penalty period of ineligibility from October 1, 2006, to June 30, 2014 2

1-09-0979 (later adjusted to February 28, 2011), based on the transfer of beneficial interest in the trust, which the Department found was a nonallowable transfer of assets subject to review within 60 months of the application. Administrative Hearing On October 19, 2007, a formal hearing was held on the Department's denial of Medicaid assistance to cover the cost of Mrs. Zander's nursing home care. According to Mrs. Zander's main

brief, "At the time she applied for medical assistance in January, 2007, Mrs. Zander believed that her gift to her daughters by assignment of beneficial interest would not affect her eligibility as it had occurred more than 36 months prior to her application." Before a hearing officer, Ms. Skiles, the

trustee of the Zander Land Trust, testified she had neither collected any income nor distributed any real estate from the trust. In its decision, the Department set forth provisions of the Illinois Administrative Code (Code) (89 Ill. Adm. Code

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