P.N. VS. DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES (DEPARTMENT OF HUMAN SERVICES, DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES), A-2025-15T2

P.N., a resident of an assisted-living facility, sought Medicaid; a paralegal made a phone inquiry in Oct 2013 but no formal application resulted then.
A pre-administrative screening showed physical eligibility; counsel requested a formal appointment in March 2014; an appointment was scheduled for June 13, 2014.
P.N. submitted a written Medicaid application on June 13, 2014 but failed to provide numerous required verifications (bank statements, bills, income documents).
DMAHS notified counsel that missing income verification had to be provided by November 21, 2014; the application was denied on November 26, 2014 for failure to verify eligibility.
An Administrative Law Judge affirmed the denial, finding P.N. failed to provide requested verifications and her resources would have exceeded limits; the final agency decision was issued November 17, 2015.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether DMAHS improperly denied Medicaid by treating the incomplete June 2014 application as ineffective	P.N. argued the agency acted arbitrarily and capriciously and should be estopped from denying benefits retroactive to Oct 2013 based on the earlier phone inquiry	DMAHS argued the phone call did not constitute a formal application and the June 2014 written application lacked required verifications, justifying denial	The court held DMAHS’s denial was not arbitrary: phone inquiry did not substitute for a formal application and denial for failure to provide verifications was proper
Whether retroactive eligibility to Oct 2013 was required	P.N. sought retroactive coverage to the Oct 2013 call or otherwise argued agency should examine all facts for retroactivity	DMAHS pointed to regulation requiring an application month to trigger retroactive coverage and the absence of a proper application earlier	The court rejected retroactivity: regulations tie retroactive eligibility to the month of application, not a phone call

R.S. v. Div. of Med. Ass't & Health Servs., 434 N.J. Super. 250 (App. Div.) (standard of review for agency action)
Russo v. Bd. of Trs., Police & Firemen's Ret. Sys., 206 N.J. 14 (NJ 2011) (administrative review standard)
E.S. v. Div. of Med. Assistance & Health Servs., 412 N.J. Super. 340 (App. Div.) (burden to show agency action arbitrary)
Matter of Estate of Brown, 448 N.J. Super. 252 (App. Div.) (Medicaid eligibility requires meeting income and resource standards)
Harris v. McRae, 448 U.S. 297 (U.S. 1980) (federal funding conditions require compliance with statutes/regulations)
N.E. v. Div. of Med. Assistance & Health Servs., 399 N.J. Super. 566 (App. Div.) (Medicaid is last-resort assistance)