David Dillingham as guardian ad litem for Charles B. Dillingham v. North Carolina Department of Human Resources

Medicaid Coverage - In August of 1996, Charles Dillingham was admitted to a nursing care facility after suffering a stroke. Mr. Dillingham was 86 years of age. In September 1996, Mr. Dillingham transferred assets worth $126,735.76 to his son, David Dillingham, the petitioner. In November 1996, petitioner applied to the Buncombe County Department of Social Services for Medicaid coverage for his father's long term nursing care. The Department of Social Services denied benefits and imposed sanctions based upon the uncompensated asset transfer. Contending the transfer of assets took place exclusively for a purpose other than to qualify for Medicaid assistance, petitioner appealed to theDivision of Social Services of the North Carolina Department of Human Resources (now North Carolina Department of Health and Human Resources) (hereinafter "DHR"). The Division of Social Services hearing officer issued a tentative decision in which he affirmed the decision of the Buncombe County Department of Social Services. The hearing officer cited the provisions of the North Carolina "Aged, Blind and Disabled Medicaid Manual", otherwise known as the "State Adult Medicaid Manual," § 2240, VIII.B (MA-2240 VIII B). At petitioner's request pursuant to G.S. § 108A-79, the hearing officer's tentative decision was reviewed by the Chief Hearing Officer for the Division of Social Services. Petitioner argued the requirement for "written evidence" contained in the Adult Medicaid Manual and applied by the hearing officer had not been enacted in accordance with the requirements of the Administrative Procedures Act and, thus, was of no consequence. The Chief Hearing Officer entered a Final Decision in which she concluded that it was not clearly and convincingly documented that the transfer was exclusively void of Medicaid considerations. Petitioner petitioned for judicial review of the final agency decision pursuant to G.S. § 108A- 79(k) and G.S. § 150B- 51(b).

Defendant's Verdict - The superior court affirmed DHR's final agency decision.

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Reversed and Remanded by the Court of Appeals of North Carolina. Note that the above cited date is the date of the appellate decision and not the trial date. Reported by C.H.