A nursing home should not have to throw a resident out on the street to show undue hardship. There is no reason. There are other ways to prove undue hardship without rendering an elderly resident homeless.

The New York State Department of Health has argued that a nursing home should have to evict one of its residents in order to meet a mandatory prerequisite before the resident becomes eligible for Medicaid’s undue hardship exception. Thankfully the court disagrees.

Thanks to the New York Appellate Division, Second Department case Matter of Tarrytown Hall Care Center v. McGuire, it seems clear that evicting a resident of a nursing home is not a mandatory prerequisite to qualify for Medicaid’s undue hardship exception. In Matter of Tarrytown Hall Care Center v. McGuire, the court held that a resident whom a nursing home did not attempt to evict is nevertheless eligible for the undue hardship exception to a Medicaid penalty period because the resident was insolvent and unable to recover the assets, and because no other nursing home would accept her.

In Matter of Tarrytown Hall Care Center v. McGuire, Margaret Traino lived at Tarrytown Hall Care Center from June 2008 until her death in April 2011. She was insolvent and subject to a Medicaid penalty period due to a transfer of assets for less than fair market value. The nursing home applied to the state to receive Medicaid reimbursement for the penalty period under the undue hardship exception. The state denied the nursing home’s application, ruling that the facility failed to show that Ms. Traino was unable to receive appropriate medical care without Medicaid because it did not attempt to evict Ms. Traino. The nursing home appealed.

The New York Supreme Court, Appellate Division, annulled the state’s decision and held that there is no requirement that a nursing home commence an eviction proceeding in order to prove undue hardship. According to the court, the nursing home showed that Ms. Traino “was unable to obtain appropriate medical care without the provision of Medicaid by offering proof that the decedent was insolvent and unable to recover transferred assets, and that no nursing facility which could provide her with the necessary level of care would accept her.

This case will hopefully prevent nursing homes and residents from having to jump through a ridiculous hoop that is nothing but a burden to the nursing home and harmful to the resident.