top of page

Medicaid Applicant’s Irrevocable Trust Is an Available Resource Because Trustee Can Make Distr

  • Writer: Brian A. Raphan, Esq.
    Brian A. Raphan, Esq.
  • Feb 2, 2016
  • 1 min read
medicare denial

An Alabama appeals court rules that a Medicaid applicant’s special needs trust is an available resource because the trustee had discretion to make payments under the trust. Alabama Medicaid Agency v. Hardy (Ala. Civ. App., No. 2140565, Jan. 29, 2016).

Denise Hardy inherited a one-half interest in a house and placed it in an irrevocable trust. The trust instrument stated that the trustee could distribute income to Ms. Hardy at the trustee’s discretion and that the trust was intended to be a special needs trust. Ms. Hardy entered a nursing home and applied for Medicaid. The state determined that the trust was an available resource.

Ms. Hardy appealed, and an administrative law judge agreed that the trust was an available resource. Ms. Hardy appealed to court, arguing that the trust was not available because it was irrevocable and could not be altered. The trial court reversed the state’s decision and ordered the state to pay Ms. Hardy benefits. The state appealed.

The Alabama Court of Civil Appeals reverses, holding the trust is an available resource. According to the court, a trust is an available resource if there is any circumstance under which payments can be made to the beneficiary, and that in this case, “if the house was sold and half of the proceeds of the sale were placed in the trust, the trustee could then make distributions as required by the terms of  [Ms.] Hardy’s trust.”

For the full text of this decision, go to: https://acis.alabama.gov/displaydocs.cfm?no=713449&event=4JX0KDU8D

8 Medicaid Planning Mistakes to Avoid: Click here

Additional Medicaid Planning questions? Click here

Regards,

Brian A. Raphan

Kommentare


MEMBER:

•National Academy of Elder Law Attorneys

•American Bar Association

•New York State Bar Association

•United States District Court N.Y. Southern District

United States District Court NY Eastern District

•State of New York Unified Court System

•National Alliance of Trust & Estate Professionals

•Temple University • Cardozo Law School New York

•AARP Listed Attorney

• CLC Legal Speakers Bureau

•Better Business Bureau

Alzheimers Foundation of America

RAPHAN LAW PARTNERS, LLP   

7 Penn Plaza, 8th floor

(370 7th Avenue)

(7th Ave/31st St.)

New York, New York 10001

 

Tel: 212-268-8200

Fax: 212-244-3075
info@RaphanLaw.com

Twitter.com/NYCelderlawfirm

Elder Law News Blog

 

Legal membership accredited logos
Lawyers of Distinction in New York, Raphan Law
ssl secure website certificate

*Free consultation for new clients only. The information on this site is not, nor is it intended to be legal advice and does not automatically create an attorney/client relationship. 

On negligence and medical malpractice cases we may participate or partner with other counsel with disclosure to potential client before we or such partnering counsel accept the case.

*No mobile information will be shared with third parties/affiliates for marketing/promotional purposes. All OPT-IN requests include text messaging originator opt-in data and consent; this information will not be shared with third parties.           

© 2025  RAPHAN LAW PARTNERS, LLP

bottom of page