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White v. Kansas Health Policy Authority, 40 Kan.App.2d 971, 198 P.3d 172

Facts

Charles L. White, a disabled individual, was the beneficiary of a discretionary trust created by his parents, Charles B. and Ola White, in 1997. The trust was intended to provide supplemental support to White beyond government benefits. After the trust was modified in 2005 to comply with a legislative amendment requiring specific references to Medicaid, the Kansas Health Policy Authority determined that the trust disqualified White from receiving Medicaid benefits. This decision was contested, leading to a series of hearings and ultimately a judicial review.

On August 28, 1997, Charles B. and Ola White (the settlors) created the Charles L. White Trust (White Trust). Charles L. White is the son of the settlors and was born October 2, 1950. White is disabled.

Issue

The main legal issue was whether the District Court erroneously interpreted the provisions of K.S.A. 2007 Supp. 39–709(e)(3) regarding the requirements for a discretionary trust to be considered an exempt resource for Medicaid eligibility.

The primary issue is whether the district court erroneously interpreted the provisions of K.S.A. 2007 Supp. 39–709(e)(3) concerning when a discretionary trust is an available resource for Medicaid eligibility purposes.

Rule

Under K.S.A. 2007 Supp. 39–709(e)(3), a discretionary trust must make specific reference to Medicaid, medical assistance, or Title XIX of the Social Security Act to be considered an exempt resource for Medicaid eligibility, but this language does not need to be contemporaneous with the creation of the trust.

Under the plain language of K.S.A. 2007 Supp. 39–709(e)(3), a discretionary trust instrument must make specific reference to Medicaid, medical assistance, or Title XIX of the Social Security Act, in order for the trust to be an exempt resource for Medicaid eligibility purposes.

Analysis

The court analyzed the statutory language and determined that the requirement for contemporaneous language only applied to the intent of the trust to be supplemental to public assistance, not to the specific references to Medicaid. The original trust included language indicating it was supplemental to public assistance, and the subsequent modification to include references to Medicaid was deemed sufficient to meet the statutory requirements.

The specific question here is whether 'contemporaneous' in K.S.A.2007 Supp. 39–709(e)(3) modifies both the provisions that follow or whether it is only applicable to 'language that states an intent that the trust be supplemental to public assistance.'

Conclusion

The Court of Appeals affirmed the District Court's decision, ruling that the White Trust was properly modified to comply with the statutory requirements, thus making White eligible for Medicaid assistance.

The district court correctly concluded that the trust did not disqualify White from receiving Medicaid assistance.

Who won?

Charles L. White prevailed in the case because the court found that the trust modification met the statutory requirements for Medicaid eligibility, allowing him to receive benefits.

The district court concluded that the White Trust had been properly modified to be exempt for Medicaid eligibility purposes and that this modification satisfied the language of the 2004 statutory amendment.

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