Handout 1 - School of Government - University of North Carolina at ...

settlement or other recovery by the recipient. In this case, because DMA’s claim was for less than one
third of the settlement amount, the court ordered full reimbursement.
The trustee of the settlement appealed and the court of appeals affirmed. In Arkansas DHS v.
Ahlborn, 547 U.S. 268 (2006), the U.S. Supreme Court held that the state could not recover an amount
higher than the portion of the settlement that represented medical expenses, in a case in which the parties
had stipulated to what that portion was. In Andrews, the trustee argued that when a settlement does not
specify the amount that represents medical expenses, the court must conduct a hearing to determine what
portion of the settlement amount that is.
Held: Affirmed.
Affirming the court of appeals, which had affirmed the trial court, the N.C. Supreme Court held that
1. Ahlborn “did not require a specific method for determining the portion of a settlement that represents
the recovery of medical expenses.”
2. N.C. law provides that the portion of a settlement that represents payment for medical expenses, when
that is not specified, is “the lesser of the State’s past medical expenditures or one-third of the
plaintiff’s total recovery.”
3. North Carolina’s approach is reasonable and consistent with the holding in Ahlborn.
Medicaid Appeals
Meza v. DHHS, ___ N.C. App. ___, 668 S.E.2d 571 (10/21/08).
http://www.aoc.state.nc.us/www/public/coa/opinions/2008/070407-1.htm
Facts: The appellant had sought judicial review of a final DHHS determination that only the first days of
two hospital stays qualified as treatment for medical emergencies and that because she was an unqualified
alien, she was not eligible for Medicaid for the additional days in the hospital. The superior court
considered the evidence, made findings of fact and conclusions of law, reversed the administrative
decision, and ordered DHHS to provide appellant with Medicaid coverage for the full length of both
hospital stays.
Held: Affirmed.
The court of appeals considered only whether the superior court had applied the correct standard of review
and affirmed, relying in part on G.S. 108A-79(k), which says that the superior court properly may take
testimony and “examine into the facts of the case, to determine whether the final decision is in error under
federal and State law, and under [applicable] rules and regulations . . . .” The court declined to consider
the merits because error was not assigned to any of the superior court's findings or conclusions
Dissent: Judge Steelman dissented on the basis that the superior court should have applied the “whole
record” test when reviewing the administrative decision.
Martin v. North Carolina Dept. of Health and Human Services, ___ N.C. App. ___, 670 S.E.2d 629
(1/6/09).
http://www.aoc.state.nc.us/www/public/coa/opinions/2009/080259-1.htm
Facts: The superior court reversed the DHHS final agency decision (which upheld the county DSS
decision) terminating petitioner’s Medicaid for Qualified Beneficiary Part B (MQB-B), an eligibility
category for those who need help paying their Medicare Part B premiums. The agency decision was based
on state guidance that because petitioner’s husband was not eligible for Medicare, petitioner’s income
should be evaluated in relation to her as an individual, not in relation to a family of two.
Held: Affirmed.
The court of appeals affirmed the superior court’s reversal, finding that the state’s interpretation was
contrary to the plain language of the federal statute and, the court noted, contrary to the state’s final
decision in a previous similar case.
18