Court Opinion

ID: 3175397
Source: CourtListenerOpinion
Date Created: 2016-02-08 08:22:03.56984+00
Date Added: 2024-06-11T12:18:15.118409
License: Public Domain

STATE OF MICHIGAN

                         COURT OF APPEALS

In re Estate of IRENE GORNEY.

DEPARTMENT OF HEALTH AND HUMAN                      FOR PUBLICATION
SERVICES,                                           February 4, 2016

             Plaintiff-Appellant,

v                                                   No. 323090
                                                    Huron Probate Court
ESTATE OF IRENE GORNEY,                             LC No. 13-039597-CZ

             Defendant-Appellee.

In re Estate of WILLIAM B. FRENCH.

DEPARTMENT OF HEALTH AND HUMAN
SERVICES,

             Plaintiff-Appellant,

v                                                   No. 323185
                                                    Calhoun Probate Court
DANIEL GENE FRENCH, Personal                        LC No. 2013-000992-CZ
Representative for the Estate of WILLIAM B.
FRENCH,

             Defendant-Appellee.

In re Estate of WILMA KETCHUM.

DEPARTMENT OF HEALTH AND HUMAN
SERVICES,

             Plaintiff-Appellant,

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v                                                                    No. 323304
                                                                     Clinton Probate Court
ESTATE OF WILMA KETCHUM,                                             LC No. 14-028416-CZ

               Defendant-Appellee.

In re Estate of OLIVE RASMER.

DEPARTMENT OF HEALTH AND HUMAN
SERVICES,

               Plaintiff-Appellant,

v                                                                    No. 326642
                                                                     Bay Probate Court
RICHARD RASMER, Personal Representative of                           LC No. 14-049740-CZ
the Estate of OLIVE RASMER,

               Defendant-Appellee.

Before: JANSEN, P.J., and CAVANAGH and GLEICHER, JJ.

JANSEN, J. (concurring in part and dissenting in part).

        I concur with the majority’s determinations that the notice provided in the
redetermination application was statutorily sufficient, the lack of notice at the time of enrollment
did not violate due process, and the estates did not have a due-process right to the continuation of
a favorable Medicaid law. However, I respectfully dissent from the majority’s determinations
that the Department of Health and Human Services (DHHS) violated the due-process rights of
the decedents by seeking to recover benefits expended between July 1, 2010 and July 1, 2011,
and that the Ketchum Estate may raise the issue whether the DHHS abused its discretion in
seeking recovery in the trial court on remand.

        With regard to the majority’s conclusion that the DHHS violated the decedents’ due-
process rights by seeking to recover benefits expended between July 1, 2010 and July 1, 2011, I
conclude that this Court’s decision in In re Keyes Estate, 310 Mich. App. 266; 871 NW2d 388
(2015) controls the outcome in this case. In Keyes, this Court concluded there was no due-
process violation in spite of the fact that the decedent did not receive notice of the estate
recovery program when she enrolled in Medicaid. Id. at 275. The decedent began receiving
Medicaid benefits in April 2010. Id. at 268. However, the decedent was not notified about the
possibility of estate recovery when she enrolled in Medicaid. Id. at 269. Instead, the decedent’s
son signed a Medicaid application form in May 2012, which acknowledged that the estate was
subject to estate recovery for services paid by Medicaid. Id. The trial court determined that the
estate recovery program violated the decedent’s right to due process since she did not receive
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notice of the estate recovery program when she enrolled in Medicaid. Id. at 275. However, this
Court reasoned that the estate recovery program did not violate the estate’s right to due process
since MCL 400.112g did not require notice at the time of enrollment. Id. This Court
emphasized that the estate received notice and a hearing when it was informed of the estate
recovery program and had the opportunity to contest the issue in the probate court. Id. Thus,
this Court determined that there was no due-process violation in spite of the fact that the
decedent began receiving Medicaid benefits in April 2010. See id.

        Although the issues surrounding the retroactive application of the estate recovery
program were not directly raised in Keyes, the decision nevertheless dictates the outcome in this
case. In Keyes, this Court stated that the decedent began receiving Medicaid benefits in April
2010, and it can be inferred that the Michigan Department of Community Health (now the
DHHS) sought to recover an amount covering the period during which the decedent began
receiving Medicaid benefits. Keyes, 310 Mich. App. at 268. Here, the DHHS sought to recover
for Medicaid benefits paid on behalf of the decedents since July 1, 2010. Thus, this case is
similar to Keyes since this Court in Keyes held that the estate recovery program did not violate
due process in spite of the fact that the decedent began receiving Medicaid benefits in April
2010. See id. at 275. Therefore, I conclude that Keyes dictates the outcome that the estate
recovery program did not violate the decedents’ right to due process. See id.

        Furthermore, even if Keyes did not control the outcome in this case, I do not believe that
the retroactive application of the estate recovery program violated the decedents’ right to due
process. The majority concludes that the Legislature deprived the decedents of their right to
dispose of their property by affecting how the decedents chose to manage their property. “The
Fourteenth Amendment to the United States Constitution and Article 1, § 17 of Michigan’s 1963
Constitution provide that the state shall not deprive a person of life, liberty, or property without
due process of law.” Keyes, 310 Mich. App. at 274. An individual has a vested interest in the use
and possession of real estate. Bonner v City of Brighton, 495 Mich. 209, 226; 848 NW2d 380
(2014). Additionally, a property owner also has a legal right to dispose of his or her property.
Loretto v Teleprompter Manhattan CATV Corp, 458 U.S. 419, 435; 102 S. Ct. 3164; 73 L. Ed. 2d
868 (1982). As explained in Bd of Regents of State Colleges v Roth, 408 U.S. 564, 577; 92 S. Ct.
2701; 33 L. Ed. 2d 548 (1972):

               Property interests, of course, are not created by the Constitution. Rather
       they are created and their dimensions are defined by existing rules or
       understandings that stem from an independent source such as state law—rules or
       understandings that secure certain benefits and that support claims of entitlement
       to those benefits.

        I do not believe that the interest articulated by the majority constitutes a protected
property interest. The decedents were not deprived of the use and possession of their property
during their lives. See Bonner, 495 Mich. at 226. In addition, the decedents were not deprived of
the right to dispose of their property through transfer or sale since the decedents were not
prevented from selling or transferring their property while they were alive. See Loretto, 458 U.S.
at 435. At most, the interest at stake can be characterized as the right to choose how to manage
property or the right to make alternative healthcare arrangements instead of encumbering an
estate. See id. I conclude that there is no existing rule or common understanding establishing

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the right to make alternative healthcare arrangements or the right to choose how to manage
property. See Roth, 408 U.S. at 577. Furthermore, even assuming that there is a due-process right
that was violated when the DHHS applied the estate recovery program retroactively, the right is
personal to the decedents, and it is impossible for the estates to know what alternative
arrangements the decedents would have made. See id. Therefore, I conclude that the decedents
were not deprived of a property interest. See Keyes, 310 Mich. App. at 274.

        I also do not believe that the estates have standing to challenge whether the estate
recovery program violated the decedents’ due-process rights. MCL 700.3703(3) provides,
“Except as to a proceeding that does not survive the decedent’s death, a personal representative
of a decedent domiciled in this state at death has the same standing to sue and be sued in the
courts of this state and the courts of another jurisdiction as the decedent had immediately prior to
death.” (Emphasis added.) In this case, the property interest described in the majority opinion
was personal to the decedents since it involved the decedents’ ability to make decisions
regarding the management of their property. Thus, the property interest was not transferable to
the estates, and the proceedings did not survive the death of the decedents. See id.

        Finally, I disagree with the majority’s conclusion that the Ketchum Estate may challenge
on remand whether the DHHS abused its discretion in seeking estate recovery in violation of
MCL 400.112g(4). MCL 400.112g(4) provides, “The department of community health shall not
seek medicaid estate recovery if the costs of recovery exceed the amount of recovery available or
if the recovery is not in the best economic interest of the state.” As noted by the majority,
“[r]ecovery will only be pursued if it is cost-effective to do so as determined by the department at
its sole discretion.” See Bridges Administrative Manual, BAM 120, p 7 (emphases added).
Thus, the DHHS has the sole discretion to determine whether estate recovery is cost-effective
pursuant to MCL 400.112g(4). See id. Therefore, I do not believe that the DHHS’s decision
regarding the costs of estate recovery is reviewable by the trial court. See id. Accordingly, I
respectfully disagree with the majority that the Ketchum Estate may raise the issue in the trial
court on remand.

      For the reasons discussed above, I conclude that the trial courts erred in denying the
DHHS’s collection attempts. I would reverse and remand for entry of judgment in favor of the
DHHS.

                                                             /s/ Kathleen Jansen

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