Spousal Refusal? Only if you’re Willing to defend the resulting law suit!

Last month, a New York trial court entered judgment against a woman who refused to contribute to her spouse’s nursing home expenses, finding that because she had adequate resources to do so, an implied contract was created between her and the state entitling the state to repayment of Medicaid benefits it paid on the spouse’s behalf. Banks v. Gonzalez (N.Y. Sup. Ct., Pt. 5, No. 452318/15, Aug. 8, 2016).

Evelyn Gonzalez’ spouse was admitted to a nursing home and received $28,235.56 in Medicaid benefits from the Department of Social Services of the City of New York.  At the time of her spouse’s Medicaid application, Ms. Gonzalez’ assets exceeded the community spouse resource allowance.  However, she signed a declaration refusing to make her income or resources available to pay for her spouse’s care.

After a letter to Ms. Gonzalez demanding repayment of the cost of Medicaid benefits paid on behalf of her spouse went unanswered, the agency filed suit.  Ms. Gonzalez did not respond to the summons and complaint nor to the agency’s motion for default judgment.

The Supreme Court of New York, New York County, grants the motion and enters default judgment against Ms. Gonzalez for the cost of benefits provided to her spouse.  The court notes that in cases such as this where Ms. Gonzalez has the income and resources but refuses to contribute to her spouse’s care, state law creates an implied contract between her and the state allowing recovery of the cost of the benefits provided during the preceding 10 years.

The moral of the story, here, is that spousal refusal can be a viable asset preservation technique, but if you opt to use it, you’d better be willing to vigorously defend the resulting law suit by the state, against you for breaching the implied contract to provide for your spouse.  

This lesson illustrates how crucial it is that your specific circumstances be carefully analyzed and that you be provided with the information necessary to make the right choice for YOU, not what an attorney thinks you NEED.  If you value independence of thought and judgment, and are looking for a law firm to partner to counsel you and guide you through the confounding aspects of elderlaw and the intense confusion surrounding nursing homes and medicaid, contact us today to start learning what you don’t even know you don’t know.