Norwest Bank of North Dakota v. Doth

Declaratory judgment action by trustee of supplemental needs trust established by a Medicaid recipient seeking a determination that medical assistance liens filed by the Minnesota Department of Human Services against recipient's causes of action accruing as a result of an accident were unenforcable. Norwest was the trustee of two supplemental needs trusts created pursuant to the provisions of 42 U.S.C. 1396p(d)(4)(A). The beneficiaries of the trusts received serious and disabling injuries as passengers in automobile accidents. Both sought assistance under the Social Security Administration's Medicaid program. Both assigned to the State of Minnesota "any medical care payments that I have a right to under automobile or health care insurance." Both also agreed to "cooperate with the state in any legal action brought against a third party for payment of medical expenses." Claims were filed against certain tortfeasores as a result of both accidents. Both cases were settled for the maximum amount of insurance available, $110,00 in one case and $140,000 in the other. The DHS liens equaled approximately $72,000 and $56,000 respectively. The settlement proceeds were placed in the trusts pending the determination of whether DHS was entitled to the funds. Medicaid is a jointly financed federal-state program established under Title XIX of the Social Security Act, 42 U.S.C. 1396.

Judgment holding that medicaid lien not avoidable.

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Affirmed by the United States Court of Appeals, Eighth Circuit. See: 159 F.3d 323 (8th Cir. 1998). The date shown above is the date of the appellate court decision and not the district court decision date.