Applying for Medicaid in New Jersey can feel overwhelming, especially for nursing home residents and their families who are already coping with illness, disability, or long-term care costs. The law recognizes that reality. County welfare agencies are not supposed to sit back and wait for applicants to navigate the process alone. They have an affirmative duty to assist.
Two recent Appellate Division decisions reinforce that principle. In both cases, the court concluded that county agencies failed to meet their obligations under New Jersey Medicaid regulations, resulting in unfair denials or penalties for vulnerable applicants.
The Law: Counties Must Assist Medicaid Applicants
Medicaid is a jointly funded federal and state program that provides medical coverage for eligible individuals. New Jersey participates through the New Jersey Medical Assistance and Health Services Act, N.J.S.A. 30:4D-1 et seq. County welfare agencies process Medicaid applications at the local level. N.J.S.A. 30:4D-7; N.J.A.C. 10:71-2.2(a).
Many people assume that Medicaid eligibility is entirely the applicant's responsibility. That is only half true. Under N.J.A.C. 10:71-2.2(c), a county welfare agency has "direct responsibility" in the application process. It must inform applicants about eligibility requirements, assist them in exploring eligibility, and identify resources and services that may help them obtain benefits. I have written before about the county's regulatory obligations in the application process, including the requirement under N.J.A.C. 10:71-2.2(c) that caseworkers assist applicants in exploring their eligibility. The applicant must also cooperate and provide information, but the regulations create a shared process rather than an adversarial one. N.J.A.C. 10:71-2.2(e).
Federal regulations likewise prohibit a Medicaid agency from denying eligibility for missing information unless it first seeks the necessary information and provides proper notice. 42 C.F.R. § 435.952(d).
The two recent cases arose from counties losing sight of those obligations.
Burlington County Failed to Pursue a Spousal Waiver
The first case, E.H. v. Division of Medical Assistance and Health Services, involved a nursing home resident whose husband could not be located. Federal law contains "spousal impoverishment" protections designed to prevent Medicaid rules from unfairly harming married couples. See 42 U.S.C. § 1396r-5. In some situations, New Jersey permits a "spousal waiver" when a spouse is missing, uncooperative, or otherwise unavailable. The waiver allows Medicaid eligibility to be evaluated without requiring information that the applicant cannot reasonably obtain. I explained the waiver and its limits in my earlier post on the Medicaid spousal waiver.
The applicant’s DAR — the representative whose role I described in my post on why a DAR form can make or break a Medicaid appeal — filed her first Medicaid application with the Burlington County Board of Social Services in April 2022. The county then requested a spousal waiver from the state. The first application was ultimately denied after required verification documents were not provided, including information DMAHS requested in connection with the pending spousal-waiver request. When the applicant filed a second application, her representative informed the county that neither the applicant nor her children knew where the husband was and specifically asked whether the county had any information regarding his whereabouts. The county denied the application without renewing the waiver request to the state. The applicant then requested a fair hearing, and both the administrative law judge and DMAHS sided with the county, concluding that the county had satisfied its obligation to assist and that the application was properly denied for failure to provide the requested information.
The Appellate Division concluded that the county failed to satisfy its duty to assist. The county already knew the spouse could not be located, had previously initiated the waiver process, and was the only party that possessed communications from the State concerning what was needed to continue that process. Under those circumstances, the county was required to provide meaningful assistance, including renewing the spousal-waiver request.
The court's reasoning deserves to be quoted, because it identifies the structural problem:
[the county's position] effectively treats the spousal-waiver process as unavailable unless the applicant first produces the very spouse-related information the waiver is designed to address. The waiver process would have little practical meaning if [the county] could decline to invoke it solely because the applicant could not supply information whose unavailability prompted consideration of the spousal waiver in the first place. It would be a proverbial 'catch 22.'
Because the county never offered a reasoned basis for not renewing the waiver request, the penalty period was arbitrary and capricious, and the court vacated it.
Middlesex County Ignored Repeated Requests for Help
The I.L. v. Middlesex County Board of Social Services opinion, issued eight days later, opens with a sigh you can hear. It was written by the same two judges who had decided E.H. and they began:
Once again, we are asked in the present appeal to determine whether a county welfare agency (CWA) met its statutory obligation to assist an applicant. Once again, we conclude a CWA failed to meet the minimum requirements of its statutory obligation.
The case involved an elderly nursing home resident who applied for Medicaid in December 2023 and requested retroactive coverage beginning in October 2023. Middlesex County waited more than three months before issuing its only request for information. The applicant's designated authorized representative then supplied large amounts of documentation and repeatedly emailed the county asking whether anything else was needed. According to the court, at least nine follow-up emails were sent over several months seeking updates and asking whether any deficiencies remained. The county never responded.
The application was eventually denied because the county claimed supporting documentation was missing for two small cash deposits totaling $410 from 2019. Yet the county never specifically informed the representative that those deposits were the problem, despite numerous opportunities to do so. Its own witness admitted the request for information never explicitly requested documentation regarding those two deposits and acknowledged the agency never responded to the representative's repeated inquiries.
The Appellate Division was plainly frustrated. The court emphasized that the duty to assist is an ongoing obligation, not something satisfied by sending a single broad request for information and later issuing a denial. Once the county identified a specific deficiency, it had an obligation to tell the applicant what was missing and give a reasonable opportunity to correct it. The court also noted:
if a DAR, who is specially trained in Medicaid eligibility applications, cannot complete an application successfully, there is little hope for an elderly or infirm applicant to navigate this process, particularly when the CWA has decreed the only method of communication will be by email, which will often go unanswered. A confused applicant has no ability to speak with the CWA to get his or her questions answered.
The court described the county's conduct as a failure to adhere to "basic norms of fairness and transparency" and reminded government agencies that they must "turn square corners" when dealing with the public. The denial was vacated, and the court ordered retroactive Medicaid coverage beginning October 1, 2023. Unlike many Medicaid appeals, the court did not simply remand for further consideration. It directed that retroactive coverage be awarded, reflecting just how clear it viewed the county's failure to satisfy its obligations.
Why These Cases Matter
These decisions do not eliminate an applicant's responsibility to provide documents and cooperate with the Medicaid process. Applicants still bear significant obligations under N.J.A.C. 10:71-2.2(e).
But the cases confirm an equally important rule: county agencies cannot remain silent when they know what is missing, ignore requests for guidance, or refuse to utilize procedures designed to help applicants overcome circumstances beyond their control.
For families confronting long-term care costs, Medicaid eligibility often depends on obtaining years of financial records, locating family members, and responding to complex agency demands. New Jersey's regulations require county agencies to participate in that process fairly and actively.
Read together, the two decisions are not about two caseworkers having two bad years. The same two judges decided both cases, which is precisely why the second opinion opens the way it does. The failures were different — Burlington County would not pursue the one mechanism that existed for its applicant's problem; Middlesex County would not answer an email — but the posture underneath was identical: the county knew what was missing, the applicant did not, and the county treated its own silence as the applicant's fault.
The practical lesson in both cases is about notice and paper. The counties' duty was triggered because the applicants' side put the problem in writing: we cannot find the spouse; we cannot produce his records; is anything else needed; can you help? An applicant who simply lets a deadline pass in silence is in a far weaker position.
If you or a family member are facing a Medicaid application with a missing, uncooperative, or unverifiable spouse, document the problem for the county early and in writing, and ask expressly for a waiver. These decisions give that request legal weight. And whatever the obstacle is put that in writing and keep a copy of everything.
I will close with a candid assessment, because I doubt these decisions will change anything. In my experience, the counties are highly adverse to assisting applicants, and their default response to incomplete verification information is a denial or a termination, not help. The duty to assist has been in the regulations all along, and it took E.H. three applications, a fair hearing, and an appeal — over several years — to get a court to enforce it; I.L. did not live to see her vindication at all. Applicants who do not have the stamina or the representation to litigate that far will continue to be denied. The law on the books is clear, whether the county will ever follow the law is another question.