Court Opinion

ID: 9569134
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:10:48.390457+00
Date Added: 2024-06-11T11:49:31.400064
License: Public Domain

FISHER, Circuit Judge,
dissenting.
The majority concludes that the Department of Public Welfare cannot treat the annuity that Mrs. James purchased on September 12, 2005, as an available resource in determining Mr. James’s Medicaid eligibility. I respectfully dissent. I believe that in order to appraise the amount of available resources, our focus must be on the date of Mr. James’s admission to the nursing home.
I find the circumstances presented in this case to be distinguishable from an instance where an annuity exists prior to the date of institutionalization. On August 10, 2005, Mr. James was admitted into the Summit Health Care facility and, as of that date, the Jameses had a total of $381,443 in available resources. On September 20, Mr. James filed the Resource Assessment form which called for a list of the Jameses’ total resources, “singly or jointly-owned,” as of the date of admission into the nurs*220ing home. The $250,000 annuity in contention did not exist on August 10. Rather, Mrs. James purchased the annuity over a month later on September 12, several days prior to Mr. James filing his application for Medicaid. The annuity provided a vehicle for the Jameses to reallocate their resources after Mr. James began receiving care at the facility which, in my opinion, does not change the fact that as of August 10, Mr. James had excess resources for Medicaid eligibility purposes. It would be a different scenario if Mrs. James had an already-existing annuity at the date of her spouse’s institutionalization, though that did not occur in this case.
Accordingly, I would find that an annuity which replaces cash existing at the time of institutionalization can be a marketable resource under 42 U.S.C. § 1396r-5, but the record is insufficient to make any decision as to the marketability of Mrs. James’s annuity. First, the record is inadequate to resolve the parties’ dispute over the implications of the anti-assignment clause in the annuity. While it appears that under Pennsylvania contract law anti-assignment clauses are enforceable if sufficiently justified, see CGU Life Insurance Co. of America v. Metropolitan Mortgage & Securities Co., Inc., 131 F.Supp.2d 670, 679 (E.D.Pa.2001), the record fails to account for how any potential assignment would occur. Findings would need to be made as to the rights that the anti-assignment clause seeks to protect for proper application of Pennsylvania contractual enforcement principles.
Additionally, the record is underdeveloped regarding the Department’s argument that Mrs. James’s annuity is liquid. The Department offers the declaration of Mr. Goodman, an employee of J.G. Went-worth, stating that J.G. Wentworth would pay $170,000 for the rights to payments from the annuity. However, there is no indication in the record that Mrs. James could convert her annuity to cash within twenty days as required under 20 C.F.R. § 416.1201(b). The Department’s argument that the annuity has market value does not equate to a finding of liquidity. As demonstrated by 20 C.F.R. § 416.1201(c)(1), automobiles and land are characterized as nonliquid yet those examples carry a market value. Further, although the declaration states that J.G. Wentworth “would require” the annuity owner to “recognize a full sale of their rights” and to enter into “a number of contractual agreements,” the declaration fails to answer whether the annuity issuer could refuse to recognize the assignment or explain the details of those additional contractual agreements that would be required. In sum, I would remand to the District Court for additional factfinding relevant to the annuity’s marketability.