Document ID: ./input/supremecourt_opinions/opinions/21pdf/20-1263diff_868c.pdf
Page Number: 20

Cite as:  596 U. S. ____ (2022) 

3 

SOTOMAYOR, J., dissenting 

give the State any claim to the beneficiary’s property.  In 
other words, Medicaid is not a loan.  If a Medicaid benefi-
ciary’s  financial  circumstances  change  and  a  beneficiary 
gains the ability to pay for his or her own medical expenses, 
the beneficiary is not obligated to repay the State for past
expenses, no matter the magnitude of the change in circum-
stances.  Rather, the ordinary consequence is that the indi-
vidual  simply  becomes  ineligible  for  benefits  moving  for-
ward.1
  In Ahlborn, this Court held that the Medicaid provisions 
enabling the State to seek reimbursement from third par-
ties liable for a beneficiary’s medical care (discussed in de-
tail below) establish a narrow exception to the anti-lien pro-
vision.  The exception applies where the beneficiary directly 
sues a tortfeasor for payment of medical costs.2  As a thresh-
old matter, the Court held that a beneficiary’s settlement 
proceeds  qualified  as  beneficiary  “property”  protected  by 
the anti-lien provision unless an exception to that provision 
applied.  Id., at 285–286.  The Court further held that Med-
icaid’s assignment to the State of rights to reimbursement
from  third  parties  “carved  out”  an  “exception  to  the  anti-

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1 Petitioner Gianinna Gallardo has continued to receive Medicaid ben-
efits, despite the proceeds from her tort settlement, because those pro-
ceeds were transferred into a congressionally authorized Special Needs 
Trust, a narrow exception to Medicaid’s asset limits.  See Reply Brief 22, 
n. 6.  Such a trust exists to pay expenses not covered by Medicaid, which 
may include, for example, certain home nursing care or a home ramp for 
a wheelchair.  Upon a beneficiary’s death, all trust assets are transferred 
to the State until the State is fully reimbursed for all medical assistance 
it has furnished.  See §1396p(d)(4)(A); Brief for American Justice Associ-
ation et al. as Amici Curiae 4–7. 

2 The  Ahlborn  Court  “assume[d]”  without  deciding  “that  a  State  can 
fulfill its obligations under the federal third-party liability provisions by 
. . .  placing  a  lien  on  . . .  the  settlement  that  a  Medicaid  recipient  pro-
cures on her own.”  Arkansas Dept. of Health and Human Servs. v. Ahl-
born, 547 U. S. 268, 280, n. 9 (2006); see also id., at 281 (“assuming” that
one of these provisions, §1396k(b), “applies in cases where the State does
not actively participate in the litigation”).