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Reames v. Oklahoma ex rel. Okla Health Care Authority, 411 F.3d 1164 (10th Cir. 2005)

A 51 year old nursing home resident assigned her Social Security Disability check to a special needs trust. She then argued that the SSD payment was not subject to Medicaid’s co-pay requirement. The Department rejected her argument, requiring that she pay her SSD (less her personal needs allowance) toward the cost of nursing home care. After a fair hearing decision affirmed the Department, Reames filed suit against the Department. The Court concluded that 1396p(d)(1) and 1396p(d)(4)(A) only protect income that does not pass through the recipient’s hands. Reames attempted to assign her check directly to the trust to prevent it from being counted. However, the assignment fails because 42 U.S.C. § 407(a) prohibits assignment of a Social Security check. The Court rejected Reames argument that, because Section 407 is designed to protect Social Security beneficiaries, that she should be permitted to voluntarily assign her check in contravention of the plain language of the statute.

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