Introduction
Medicaid applications can be denied for many reasons, and there are many ways to respond. At Eldercare Resource Planning, we can help applicants who have been denied find the response that will help them get the long-term care they need. We also have the experience and expertise to know when a mistake from the state has led to a Medicaid denial, and how to handle that delicate situation. From deciphering denial letters to taking charge at appeal hearings, our unique approach can help turn denials into approvals.

Reasons for Medicaid Denial

The applicant being over their asset limit or income limit for eligibility are the most common reasons for Medicaid denials, but they are far from the only ones. Applicants can also be denied because:
• Their application is incomplete or contains mistakes.
• They inappropriately transferred assets during the Look-Back Period.
• They missed the deadline for providing documents or information requested by state Medicaid offices.
• They do not meet Medicaid’s citizenship or immigrant criteria.
• They have not properly used a qualifying financial tool such as a Qualified Income Trust or a Medicaid Asset Protection Trust.

It’s also possible for a Medicaid application to be denied incorrectly by the state. Recognizing this kind of mistake takes the kind of comprehensive know-how you will find at Eldercare Resource Planning. We also understand how to communicate these findings to the state with the proper amount of courtesy and urgency.

Decoding Medicaid Denial Letters

If the application is denied, the applicant will receive a denial letter. States are legally obligated to respond to Medicaid applications within 45 days, or 90 days if the application calls for a disability determination, but states can file for extensions.

The denial letter will include the reason or reasons why the application was denied, and it will cite the specific state policies that led to the denial. However, the clarity and accuracy of the letter and the state’s reasoning can vary drastically by state and case. In some states, the denial letter may simply say the applicant was over resources, but not specify if it was assets or income or by how much. Or the application could be denied for failure to provide documents, but the letter won’t say which documents. We have even come across denial letters that claimed the applicant was denied for being over resources when in fact they were denied for a different reason. Sorting through the explanation in the denial letter is one of the services we provide that can save denied applicants time and headaches.

The denial letter will also let the applicant know they have a right to a fair hearing to appeal the denial. The letter will explain how to request an appeal hearing, how long the applicant has to make that request and that they have the right to represent themselves or hire a representative, such as a Certified Medicaid Planner or an Elder Law Attorney.

Clarifying or Additional Information Requests

Before receiving an official denial letter, which may also be called a notice of action, Medicaid applicants might receive an informal request for information from the state. This could be a phone call or a written communication asking for a missing document or piece of information that is necessary for the Medicaid application. It might also be asking to correct a minor mistake on the application. These requests will come with a deadline. If the applicant or their representative responds in time with the correct information, the application could be approved. If they miss the deadline, the application will be denied.

The nature and frequency of these requests can vary by state and caseworker. Some states or caseworkers might send multiple requests with detailed instructions and wait patiently for responses. Some states or caseworkers may only send one request with minimal details, or they may not send one at all, before denying an application.

Possible Responses to Medicaid Denials

Depending on the denial and the state, we will recommend one of three possible paths in response to a denial:
1. Informal communication with the caseworker
2. Request a fair hearing to appeal the denial
3. Reapply

If the state made an error in denying the application, we can informally communicate with the caseworker and respectfully explain their error, complete with policy citations and verifying documents. An informal approach might also be appropriate if an applicant was denied for failure to provide documents and those documents can be easily provided, but it depends on the state. Some might be more lax in their methods and leave the case open so a document could be added and a denial could turn into an approval, but states are within their rights to immediately close the case after a denial and make the applicant reapply.

At Eldercare Resource Planning, we only wait a few days for a response to these informal communications before making a formal request to the state for a fair hearing to appeal the denial. This is to expedite coverage for our clients, but also because some states will not take action unless a formal request for appeal is made. Plus, even if the state does eventually respond to the informal communication, the request for appeal can be retracted if the late response leads to an approval, or the appeal hearing may be needed anyway and requesting sooner will lessen the wait for a hearing date.

Once the request for an appeal has been made, we’ve found that the state reverses the denial more than half of the time before the hearing ever takes place. This is because most states would rather avoid the appeal hearing altogether, and the official request triggers a deeper review which leads to the state finding its mistake. But some states take no action until the actual appeal hearing.

States are supposed to take action on appeals within 90 days, but this can vary depending on how long it took to file the appeal and how many appeals are pending in the state. In cases where clients are in significant need of coverage, it’s possible to file for an expedited appeal that can lead to a hearing within seven days if granted. The appeal process and our role in them is detailed below.

When It’s Time to Reapply
If the denied applicant was, in fact, ineligible for Medicaid when they submitted their application, they will have to reapply. Some reasons for ineligibility, such as violating the Look-Back Period, will lead to a denial and a penalty period of ineligibility. This means the applicant has to wait until their penalty period is over, which could be months or years, before re-applying. In other denial cases there is no waiting period to reapply.

When we work with clients who need to reapply because they were ineligible, we will do a comprehensive review of their application and overall financial situation, and their medical condition if necessary, so we can help them find an alternative pathway to eligibility. This might include lowering their countable income with the Medically Needy Pathway or a Qualified Income Trust. It could mean reducing countable assets by spending down or purchasing a Medicaid Compliant Annuity. It could include moving to a state with more lenient financial or medical criteria. We can also help clients reapply who have been denied because they made a mistake on their application or failed to provide documents.

Fair Hearing to Appeal the Denial

Appeal hearings are conducted over the telephone with representatives from the state, including the caseworker, an impartial hearing officer or judge, and the appealing applicant or their representatives. Eldercare Resource Planning clients do not need to attend these appeal hearings because our planning specialists will have the legal authority to represent them, and those specialists will be supported by our Director of Medicaid Services at all appeal hearings.

It can take anywhere from a week to several months to an appeal to be fully resolved, although the hearings themselves are typically completed in a matter of hours. However, these hearings can be complex and quarrelsome, and using a professional like a Certified Medicaid Planner or an Elder Law Attorney to represent the applicant is strongly recommended.

Retroactive Coverage

If the appeal is upheld and the applicant is approved, their Medicaid benefits will be effective as of the same date they would have been if the original decision was an approval. This is the same in every state. So, it’s important for appealing applicants to keep all of their medical bills from this time period so Medicaid can cover them retroactively.