Formal Opinion No.

Hon. Cesar A. Perales Commissioner, New York State Department of Social Services

Your counsel has asked whether statutory amendments must be made to the New York Social Services Law to conform certain State medical assistance eligibility requirements with amendments to the Social Security Act made by section 303(a) of the Medicare Catastrophic Coverage Act of 1988 ("MCCA") (PL 100-360). This request indicates the United States Secretary of Health and Human Services may withhold compliance sanctions under section 303(g)(5) of the MCCA upon application of the Department of Social Services if State legislation must be enacted to implement the new Federal requirements.

The specific amendments to the Social Security Act concern "transfers of assets" affecting medical assistance eligibility, and are found as section 303(b) of the MCCA which amend section 1917(c) of the Social Security Act (42 U.S.C. § 1396p). Corresponding State requirements governing transfers of assets are statutory and codified as section366(5) of the New York Social Services Law. The recent Federal legislation relieves a state from the consequences attributable to failure to comply with "additional requirements" of the MCCA in the event implementation of these provisions requires state legislation.

We have compared the version of section 366(5) of the Social Services Law enacted by chapter 56 of the Laws of 1982 in response to earlier Federal requirements to the new requirements of the MCCA. This comparison reveals several areas of State law not conforming to the 1988 Federal amendments including different or shorter time periods for consideration of transfers and related ineligibility prescribed by current State law, and inclusion of certain resources as transferred assets under the new Federal requirements not considered as disqualifying transfers under State law now in effect. Action by the New York State Legislature is necessary in order to implement the amendments to 42 U.S.C. § 1396p by section 303(b) of the MCCA.

The Governor has now signed into law chapter 558 of the Laws of 1989 which amends section 366(5) of the Social Services Law to provide new medical assistance eligibility requirements applicable to transfers made on or after October 1, 1989. These recent amendments provide a thirty-month period for consideration of transfers, and other requirements corresponding to the amendments to the Social Security Act by the MCCA.

For purposes of the extent of protection from Federal compliance action available under section 303(g)(5) of the MCCA, a session of the New York Legislature spans an entire calendar year. The time available to New York under the terms of this statute for State legislative action without Federal compliance sanctions would therefore extend until December 31, 1989 as this date is the end of the first full legislative session beginning after the date of enactment of the MCCA.

We conclude that section 303(b) of the Medicare Catastrophic Coverage Act of 1988 contains requirements beyond State law, preceding chapter 558 of the Laws of 1989, applicable to the effect of transferring assets on medical assistance eligibility. These additional Federal requirements require legislative consideration before implementation in New York.