The primary issue we face in this appeal is whether an irrevocable trust created with funds received from the settlement of a malpractice action brought on behalf of a mentally retarded individual by his conservator-parents is properly included as an asset under Iowa Administrative Code rule 441-75.9(1) (1997) for the purpose of determining eligibility for state Medicaid benefits. The Department of Human Services (Department) found the trust was an available resource and the amount of the trust exceeded the' applicable resource limits proscribed by federal Medicaid law for determining whether an applicant was sufficiently needy to be entitled to Medicaid benefits by the department. On judicial review, the district court upheld the denial of benefits. On our review, we find the Department correctly applied federal and state law in concluding the trust in this case constituted a prohibited Medicaid qualifying trust. We therefore affirm the decision to cancel Medicaid benefits to David M. Strand.
I. Background Facts and Proceedings.
David M. Strand (David Jr.) was born to David L. (David Sr.) and Marcia L. Strand on April 8, 1976. David Jr. sustained extensive brain damage during the delivery process. Consequently, he has been profoundly mentally retarded since birth. David Sr. and Marcia filed a malpractice action against the doctor who delivered David Jr. and the hospital. The lawsuit was eventually settled, and a conservator-ship was created to manage the settlement funds. David Sr. and Marcia were appointed as conservators. In 1982 David Sr. and Marcia entered into a trust agreement with First Northwestern Trust Co. of Nebraska to manage the settlement funds. Pursuant to court order, the conservator-ship reimbursed David Sr. and Marcia $14,668.63 for medical expenses they incurred in connection with David Jr.’s permanent disability after his birth.
*98 Under the trust agreement, the bank was named trustee. David Jr. was named beneficiary. David Sr. and Marcia were named grantors and residuary beneficiaries. The trust agreement granted the trustee “sole discretion” to distribute as much of the principal as the trustee believed necessary for David Jr.’s benefit. The only restriction imposed on the trustee’s discretion was that written court approval be obtained prior to expending any funds from the trust.
In 1985 the trust was amended to permit the trustee to distribute up to $2000 each year to David Jr. without court approval. The trustee had to obtain prior court approval if the trustee desired to distribute more than $2000 in any year. This sum was in addition to other payments the trustee was specifically authorized to distribute, such as health insurance policy premiums for David Jr. Furthermore, the trust was amended to authorize the trustee to reimburse David Sr. and Marcia $1658.80 for an Odessey bicycle they purchased for David Jr. In the years that followed, additional disbursements were made for a variety of uses. The purchases ranged from the construction of a swimming pool for the Strands’ home for $11,435.70 on May 24, 1994, to family vacations, furniture, clothing, toys, and other household items. Trust funds were also used for the personal care and support of David Jr.
David Jr. has continuously lived with his parents in the family home since birth. Instead of placing David Jr. in a residential care facility, Marcia has lovingly been his primary caregiver. The Iowa Foundation for Medical Care has certified David Jr. to be in need of long-term care in an intermediate care facility for the mentally retarded (ICF/MR).
Due to his disability, David Jr. receives social security income (SSI). On December 11, 1997, Marcia applied, on behalf of David Jr., for state supplemental assistance under the “Medicaid waiver services” provisions. The department provides Medicaid waiver services to disabled individuals who wish to receive care in their own home instead of in a medical institution. See id. r. 441 — 83 (preamble). These services are referred to as “waiver services” because only those individuals who have received a waiver of the federal requirement of residing in a medical institution are entitled to Medicaid benefits. Id. Moreover, an individual whose primary disability is mental retardation (MR) must satisfy certain eligibility criteria, including financial resource limits delineated under federal law, and demonstrate a need for one of the home and community-based services (HCBS) provided under the state Medicaid MR waiver program. Id. r. 441-83.61 (1998).
In the application for waiver services, Marcia revealed the irrevocable trust as a resource. The Department initially approved Marcia’s application, and David Jr. began receiving Medicaid benefits. The Department assumed the trust funds did not exceed the applicable federal resource limits of $2000 for categorically needy programs such as MR waiver services. 1 20 C.F.R. § 416.1205(c) (1985) (resource limi *99 tations). At the time of the Department’s review, the trust principal totaled $304,702.52. Upon learning Marcia planned to build a HCBS home with trust funds to accommodate David Jr.’s disability, however, the Department further investigated the trust agreement. The Department subsequently determined the entire trust corpus was a resource that could be made available to David Jr. at any time by the trustee. Because $304,702.52 far exceeded the eligibility resource limits of $2000, the Department deemed David Jr. ineligible for state Medicaid benefits. The Department then canceled David Jr.’s Medicaid benefits for MR waiver services, effective March 1,1999. 2
Marcia timely appealed the Department’s decision. A hearing was later held before an administrative law judge (ALJ). The ALJ held the irrevocable trust established for David Jr. constituted a Medicaid qualifying trust (MQT) under Iowa Administrative Code rule 441-75.9(1) (1997). Like the Department, the ALJ found the trust agreement provided unfettered discretion to the trustee, resulting in the availability of the entire trust corpus to David Jr. The ALJ also concluded David Jr.’s trust was not exempt from treatment as a MQT. See id. (“Trusts ... established prior to April 7, 1986, solely for the benefit of a mentally retarded person who resides in an intermediate care facility for the mentally retarded, are exempt.”). The ALJ rejected Marcia’s contention that her home was the functional equivalent of an ICF/MR under the MR waiver services program, thereby entitling her to exempt status. Lastly, the ALJ preserved Marcia’s argument that rule 441-75.9(1) is unconstitutional because it unfairly treats mentally retarded persons residing in an ICF/MR differently from those living at home. 3
Marcia’s subsequent request for an exception to the state Medicaid regulations pursuant to rule 441-75.23(5)(d) was also denied by the ALJ. See id. r. 441-75.23(5)(d) (An exception exists to the medical assistance eligibility rules if “[t]he denial of eligibility would work an undue hardship as set forth in 75.15(3).”). She then filed a petition for judicial review. In addition to the two issues ruled on by the ALJ, Marcia raised several new issues. For the first time, she claimed the Department was bound by its initial determination that the trust was not a MQT. Additionally, Marcia developed her constitutional challenge in greater detail, specifically raising an Equal Protection Clause violation.
The district court denied the judicial review petition. It found the ALJ correctly applied federal and state law in concluding the trust established with the medical malpractice settlement funds constituted a MQT. Additionally, the court agreed the ICF/MR exemption of rale 441-75.9(1) did not apply. The district court did not ad *100 dress the constitutional or estoppel arguments, and Marcia did not request an enlargement of the ruling.
Marcia appeals. She contends the district court erred in finding rule 441-75.9(1) applied to the trust in this case, and in failing to grant an exemption. Although these issues were raised before and decided by the ALJ and district court, the Department contends Marcia is now advancing arguments different from those raised in the underlying proceedings to support the two issues. Marcia again raises the estoppel and constitutional challenges set forth in the petition for judicial review. However, she is now alleging a Due Process Clause violation as well as an Equal Protection Clause infraction. Because these latter issues were not properly presented below, the Department asserts, they are not preserved for appellate review.
II. Standard of Review.
We review a decision by a district court on a petition for judicial review of an individual’s eligibility for Medicaid benefits for errors at law.
See TLC Home Health Care, L.L.C. v. Iowa Dep’t of Human Servs.,
III. Preservation of Error.
We must first address the Department’s contention that Marcia failed to preserve error on some of the issues now raised on appeal. It is a well-recognized principle of appellate review that “issues must ordinarily be both raised and decided by the district court before we will decide them on appeal.”
Meier v. Senecaut III,
We find the principal issues in this case,whether the trust was a MQT and whether the trust was exempt due to David Jr.’s residence in the functional equivalent of an ICF/MR, were properly preserved for our review. Both of these issues were the foundation of the litigation and were presented to, and addressed by, the administrative agency and the district court.
On the other hand, the estoppel and unconstitutional challenges are not properly before us. Although Marcia raised an estoppel argument in the petition for judicial review, this issue was not raised before the agency or addressed by the district court in its ruling. Likewise, Marcia raised the equal protection issue before the agency and district court, but the district court did not address the issue
*101
in its ruling. Additionally, this appeal marks the first time Marcia raised a Due Process Clause violation. Because the district court failed to rule on the estoppel and constitutional challenges, Marcia should have requested the district court enlarge its factual findings and legal conclusions. Al-K
hattat,
IV. Eligibility for Medicaid Benefits.
The eligibility of an applicant for public assistance benefits who is the beneficiary of an irrevocable trust has been debated in the law for some time. The source of the dispute relates to the needs-based test for Medicaid eligibility, which means Medicaid coverage is denied if an applicant has assets that exceed a certain level.
Ronney v. Dep’t of Soc. Servs.,
In 1986, Congress attempted to close the “loophole” in the federal Medicaid act by promulgating provisions prohibiting individuals with considerable means from utilizing the law of trusts to secure eligibility for public welfare benefits.
Lebow,
[A] “medicaid qualifying trust” is a trust, or similar legal device, established (other than by will) by an individual (or an individual’s spouse) under which the *102 individual may be the beneficiary of all or part of the payments from the trust and the distribution of such payments is determined by one or more trustees who are permitted to exercise any discretion with respect to the distribution to the individual.
42 U.S.C. § 1396a(k)(2) (1986). However, the amendment explicitly exempted trusts established before April 7, 1986 “solely for the benefit of a mentally retarded individual who resides in an intermediate care facility for the mentally retarded.”
Martin v. Kansas Dep’t of Soc. & Rehab. Servs.,
Notwithstanding, Congress repealed section 1396a(k) in 1993 and substituted even tighter restrictions by enacting section 1396p(d).
See
42 U.S.C. § 1396p(d) (1993);
Ramey,
(2)(A) For purposes of this subsection, an individual shall be considered to have established a trust if assets of the individual were used to form all or part of the corpus of the trust and if any of the following individuals established such trust other than by will:
(i) The individual.
(ii) The individual’s spouse.
(iii) A person, including a court or administrative body, with legal authority to act in place of or on behalf of the individual or the individual’s spouse.
42 U.S.C. § 1396p(d)(2)(A) (emphasis added). Thus, if a conservator or other representative of an individual establishes a trust with an individual’s assets, the individual is considered to have formed the trust.
See id.
§ 1396p(d)(2)(A)(in). Lastly, Congress specifically stated this amendment to the federal Medicaid provisions only applies to trusts established after the effective date of the enactment, i.e., August 10, 1993.
Cohen,
Against this backdrop, we turn to consider our state law governing Medicaid benefits, and its relationship to the federal provisions. Iowa’s medical assistance act is found in Iowa Code chapter 249A. Section 249A.4 directs the department director to promulgate rules and policies implementing the medical assistance act.
Torner,
The Iowa administrative rules essentially follow the 1986 and 1993 federal amend- *103 mente. Iowa Administrative Code rule 441-75.9(1) embodies the 1986 definition of MQT, and also delineates the exemption for those trusts established before April 7, 1986 for mentally retarded persons residing in an ICF/MR. However, rule 441-75.9(1) expressly limits the application of this rule to trusts established on or before August 10, 1998. The 1993 amendment is found in Iowa Administrative Code rule 441-75.24 and only applies to trusts established after August 10, 1993. The provisions of rule 441-75.24 are nearly identical to those of section 1396p(d). Because these provisions apply only to trusts created after August 10, 1993, we confine our review to consideration of the 1986 federal amendment and rule 441-75.9.
Although Marcia concedes rule 441-75.24 does not apply to this case, she claims rule 441-75.9 does not apply either because the 1986 amendment it is based upon was repealed when Congress enacted section 1396p(d). In essence, Marcia contends the repeal by Congress in 1993 and the reenactment of a new statute means there is no statute governing trusts created prior to 1993, which renders the Iowa regulation invalid as inconsistent with the federal requirements.
We have previously held that “[t]he simultaneous repeal and reenactment of all or part of a legislative act” is a completely different situation than a mere repeal.
State ex rel. Iowa Air Pollution Control Comm’n v. City of Winterset,
‘Where a statute is repealed by a new statute which relates to the same subject matter, and which re-enacts substantially the provisions of the earlier statute, and the repeal and re-enactment occur simultaneously, the provisions of the original statute which are re-enacted in the new statute are not interrupted in their operation by the so-called repeal; they are regarded as having been continuously in force from the date they were originally enacted.”
Id. (quotation omitted). Applying this principle, we conclude the 1986 amendment remains in effect for trusts created before August 10, 1993, and our statutory law governing such trusts is therefore not inconsistent with federal law.
The overwhelming majority of states that have considered this issue have reached the same result.
See, e.g., Ramey,
Having found rule 441-75.9 applies to this case, we must next determine whether the trust constitutes a MQT that would render David Jr. ineligible for Medicaid benefits. Marcia argues the trust in this case was not a MQT because it was established by them, not David Jr. A MQT is a trust established by a person under which the person is the beneficiary of payments from the trust. Iowa Admin. Code r. 441-75.9(1). Yet, the person who furnishes the consideration for the trust is deemed to have established the trust, even if the trust was actually created, in form, by someone else.
Forsyth v. Rowe,
We conclude the trust was established by David Jr. and therefore constitutes a MQT.
See Forsyth,
However, our analysis does not end here. We must next determine the amount of funds available to David Jr. under the trust agreement. The department only considers resources in excess of the $2000 federal eligibility requirement that are “available” to an applicant under the MQT when assessing an applicant’s eligibility for Medicaid benefits. Iowa Admin. Code r. 441-75.9(2);
see Williams,
Both trust income and principal are “available” resources. Iowa Admin. Code r. 441-75.9(2). In evaluating the availability of the principal, the department considers “the maximum amount that
may be permitted
under the terms of the trust
assuming the full exercise of discretion by the trustee
.... ”
Id.
r. 441-75.9(2) (emphasis added). Thus, the maximum amount capable of distribution under a trust is deemed an available resource to the beneficiary, regardless of whether the trustee actually exercises his or her discretion.
See Forsyth,
We therefore disregard the limitation on the trustee’s discretion in this case to obtaining prior court approval
See Cohen,
Alternatively, Marcia contends the trust falls within the exemption of rule 441-75.9(1) for trusts created before April 7, 1986, for mentally retarded children residing in an ICF/MR. Although the trust was created in 1982, David was not, and has never, resided in an ICF/MR. Nevertheless, Marcia contends the exemption should apply because their family home is the functional equivalent of an ICF/MR. .Marcia bases this argument on the Medicaid MR waiver services provisions of rule 441-83, which permit the provision of Medicaid benefits to certain mentally retarded individuals residing at home instead of a residential care facility. Because state Medicaid provisions deem their home to be an ICF/MR for MR waiver services, Marcia contends, so should we for purposes of the MQT provisions.
We decline to extend the exemption of rule 441-75.9(1) for several reasons. First, we can find no provision in rule 441-83 referring to the “functional equivalent” of an ICF/MR. Thus, we do not know whether the department does in fact consider homes receiving MR waiver services as the functional equivalent of an ICF/MR. In fact, the testimony of the department’s Medicaid policy specialist in this case indicated the department believes otherwise. Specifically, the Medicaid policy specialist testified she did not believe the Strands’ home was the functional equivalent of an ICF/MR because if it was an ICF/MR, HCBS would be unnecessary. The purpose of HCBS is to provide services ordinarily provided at an ICF/MR that the family caregiver is unable to offer at home. Moreover, the fact that David Jr. is not required to reside in an ICF/MR to receive MR waiver service benefits does not preempt the MQT provisions. Otherwise, the exemption of rule 441-75.9(2) would be superfluous.
Additionally, the Strands’ home simply does not rise to the level of an ICF/MR. Iowa Administrative Code rule 441-83.60 defines an ICF/MR as:
[A]n [1] institution that is [2] primarily for the diagnosis, treatment, or rehabilitation of persons who are mentally retarded and provides, [3] in a protected residential setting, [4] ongoing evaluation, planning, 24 hour supervision, coordination and integration of health or related services to help each individual function at the greatest ability and [5] is an approved Medicaid vendor.
The federal statute employs a similar, but more detailed, explanation. See 42 U.S.C. § 1396d(d). Clearly, the Strands’ home cannot satisfy all, or any, of the elements. Accordingly, the claim for an exemption under rule 441-75.9(1) is denied.
We recognize the Strands may not be an affluent family, and may have not acted with the intent to defraud the government in creating the trust in this case. Yet, David Jr. would clearly be ineligible for Medicaid benefits if his funds were not held in trust.
See Ronney,
*107 V. Conclusion.
We conclude the trust in this case was a MQT under Iowa Administrative Code rule 441-75.9(1). As conservator, Marcia was acting on behalf of David Jr. when they created the trust with his settlement funds. Because the entire trust corpus was available to David Jr., he was ineligible for Medicaid benefits. Furthermore, the trust is not entitled to an exemption from treatment as a MQT. We deem any additional arguments not specifically addressed unpreserved for our review. The district court correctly denied the petition for judicial review.
AFFIRMED.
Notes
. Under Iowa's medical assistance plan for the needy, “an individual whose income exceeds federally prescribed limits is barred from receiving benefits.”
Torner by Torner v. State,
. David Jr. was also denied benefits under the general medically needy program because of excess resources. Iowa Admin. Code r. 441-75.1(35)(⅛)(1). The financial resource limit for a household applying for medically needy benefits is $10,000. However, because the Strands do not specifically raise the issue of entitlement to benefits under the medically needy program in this appeal, we need not address this portion of the Department's decision.
. In challenging the constitutionality of the rule at the hearing before the ALJ, it appears Marcia was attempting to advance an equal protection violation argument. Specifically, Marcia's attorney told the ALJ he believed "there at least arguably could be a question of ... whether or not Mr. Strand is being treated equally under the privileges and immunity clause of the United States Constitution between himself and those individuals residing in an [ICF].''
. For a detailed overview of the general origi-nations of the federal-state cooperative Medicaid program, see
TLC Home Health Care, L.L.C.,
. In particular, the new restrictions provided:
(B) In the case of an irrevocable trust—
(i) if there are any circumstances under which payment from the trust could be made to or for the benefit of the individual, the portion of the corpus from which, or the income on the corpus from which, payment to the individual could be made shall be considered resources available to the individual ....
42 U.S.C. § 1396p(d)(3)(B)(i) (emphasis added).
. Notwithstanding, Marcia contends the 1986 law does not apply to the trust in this case because Congress did not intend the law to apply retroactively or to trusts created solely for the benefit of disabled children. We find both arguments to be without merit. In promulgating the 1986 amendment, Congress specifically stated that the MQT provisions were to be given retroactive effect.
Cohen,
We also reject Marcia's claim that the trust should not be categorized as a MQT because it was not created with the intention to qualify an otherwise ineligible person for Medicaid benefits. As noted, the overriding purpose of the 1986 and 1993 amendments was to prevent otherwise ineligible individuals from creating self-settled trusts to satisfy federal resource limits. Yet, the actual intent of the settler in establishing the trust is irrelevant to the Department's analysis of an application for benefits. Iowa Admin. Code r. 441-75.24(l)(d )(1) ("This rule shall apply without regard to: (1) The purposes for which a trust is established.”);
accord Lebow,