from the District Court of Albany County The Honorable Tori
R.A. Kricken, Judge
Representing Appellant: Dennis C. Cook, Craig C. Cook, and
Jeffrey C. Dietzel of Cook and Associates, P.C., Laramie,
Wyoming. Argument by Mr. Dennis C. Cook.
Representing Appellee: Peter K. Michael, Wyoming Attorney
General; Misha E. Westby, Deputy Attorney General; Jackson M.
Engels, Senior Assistant Attorney General; Rashell Read,
Assistant Attorney General. Argument by Ms. Westby.
DAVIS, C.J., and BURKE [*] , FOX, KAUTZ, and BOOMGAARDEN, JJ.
Lucile Anderson applied to the Department of Health for
Medicaid nursing home benefits. The Department found Ms.
Anderson eligible for the benefits but suspended her
eligibility as a penalty for her transfer of assets at below
fair market value. Ms. Anderson appealed the length of the
penalty period and lost that challenge. Her sons thereafter
paid the attorney fees and costs she incurred in her appeal,
and she applied to have that payment treated as a return of
assets, which would shorten the penalty period. The
Department denied the application and, following an
evidentiary hearing, its denial was upheld by the
Department's director and the district court. We reverse.
Ms. Anderson presents two issues on appeal, which we restate
as the following single issue:
Did the Department act in accordance with law when it denied
Ms. Anderson's application to have her sons' payment
of her attorney fees treated as a return of assets?
Lucile Anderson is in her late eighties and suffers from
dementia and numerous other medical conditions that make her
unable to care for herself independently. On March 12, 2015,
Ms. Anderson was admitted to the Laramie Care Center, and on
April 10, 2015, she transferred to Spring Wind, an assisted
living facility in Laramie. On October 22, 2015, she applied
for Medicaid benefits.
In her Medicaid application, which she submitted through her
attorney, Ms. Anderson acknowledged that she had transferred
assets in the sixty-month period preceding her
application. She identified cash and real property that
she had transferred to her sons and their wives between the
dates of May 28, 2015 and October 19, 2015, including a
modular home in Laramie and a 472-acre ranch in Colorado,
which she reported were both sold to her son Philip and his
wife for fair market value. Of the assets transferred during
the look-back period, Ms. Anderson reported $83, 476 as
On January 27, 2016, the Department notified Ms. Anderson
that because she had transferred resources at less than fair
market value in the sixty-month period preceding her
application, she was not eligible to receive Medicaid
benefits until January 12, 2020. In making that
determination, the Department rejected Ms. Anderson's
reported value of her uncompensated transfers and instead
found she had transferred $441, 382.60 in assets without fair
Ms. Anderson appealed the Department's calculation, with
the primary dispute being over the fair market value of the
Colorado ranch. An evidentiary hearing was held before the
Office of Administrative Hearings (OAH), and the OAH issued
proposed findings and conclusions of law recommending that
the Department's director uphold the Department's
determination. The Department's director accepted the
proposed decision and entered a final order, which Ms.
Anderson appealed and the district court upheld. Ms. Anderson
did not appeal the district court's ruling.
On March 27, 2017, Ms. Anderson, through her attorney,
informed the Department that her sons had paid her attorneys
$23, 818.63, which was the amount of fees and costs she
incurred in her appeal of the Department's penalty period
determination. Ms. Anderson requested that the Department
treat the payment of those fees as a partial return of the
cash and assets she gave her sons during the look-back period
and reduce the penalty period to account for the return of
On April 6, 2017, the Department denied Ms. Anderson's
request. By letter, the Department stated:
The Department of Health has reviewed your request to reduce
the transfer penalty period for payment of attorney's
fees and costs your client incurred as a result of her (or
her Power of Attorney's) decision to appeal the
Division's calculation of the transfer penalty.
Department of Health Medicaid Rules for Administrative
Hearings, Chapter 4, Section 20 states attorney fees are the
responsibility of the contestant. Regardless of the source of
funds used to pay your attorney's fees and costs, the
contestant is responsible for such payment, and therefore it
may not be considered a gift back to reduce the transfer
On May 4, 2017, Ms. Anderson appealed the denial of her
request, and the matter was referred to the OAH for a
contested case hearing. Following an evidentiary hearing, the
OAH issued proposed findings and conclusions of law
recommending that the Department's director reverse the
Department's denial. The Department filed exceptions to
the OAH-proposed decision and proposed its own findings and
conclusions of law. On July 28, 2017, the Department issued
an Order Entering Final Decision, which upheld the
Department's denial of Ms. Anderson's requested
penalty period reduction.
On August 25, 2017, Ms. Anderson filed a petition for review
of the Department's decision, and on January 24, 2018,
the district court issued an order affirming it. Ms. Anderson
then filed a timely notice of appeal to this Court.
"We review an appeal from a district court's review
of an administrative agency's decision as if the case
came directly from the agency and give no deference to the
district court." State ex rel. Wyo. Dep't of
Workforce Servs., Workers' Comp. Div. v. Lysne, 2018
WY 107, ¶ 11, 426 P.3d 290, 294 (Wyo. 2018) (citing
Morris v. State ex rel. Dep't of Workforce Servs.,
Workers' Comp. Div., 2017 WY 119, ¶ 23, 403
P.3d 980, 986 (Wyo. 2017)). The dispositive issue in this
appeal is a question of law so our review of the
Department's decision is de novo. Lysne, ¶
12, 426 P.3d at 295 (citing Morris, ¶ 25, 403
P.3d at 987) ("We review an agency's conclusions of
law de novo and will affirm only if the agency's
conclusions are in accordance with the law.").
Ms. Anderson contends the Department has changed positions
throughout her appeal, and she urges this Court to reject the
Department's new arguments on appeal. The Department does
not dispute that it has revised its arguments but contends
this is proper because the Court may affirm the
administrative decision on any basis supported by the record.
We agree with Ms. Anderson that the Department's new
argument on appeal is not properly before this Court. We will
first address our reasons for that conclusion, and then we
will turn to the question of whether the Department's
attorney fees rule precluded the payment of Ms.
Anderson's attorney fees from qualifying as a return of
New Arguments on Appeal
The Department's evolving position in this case centers
on its proffered interpretations of the statute governing
Medicaid transfer-of-asset penalties and the bases for
reducing or waiving those penalties. We therefore set forth
the relevant portions of that statute to provide context for
our discussion. Wyo. Stat. Ann. § 42-2-402 provides:
(a) If an institutionalized individual or the
individual's spouse has disposed of, for less than fair
market value, any asset or interest therein within sixty (60)
months before or any time after the first date the individual
has both applied for medical assistance and been
institutionalized, the individual is ineligible for medical
assistance for long-term care services for the period of time
determined under subsection (b) of this section.
(b) For a transfer within the provisions of subsection (a) of
this section, the number of months of ineligibility for
long-term care services shall be the total, cumulative
uncompensated value of all assets transferred within the
sixty (60) month period, divided by the average monthly cost
to a private patient for nursing facility services on the
date of application. . . .
* * * *
(e) An institutionalized individual is not rendered
ineligible for long-term care services due to a transfer
within the provisions of subsection (a) of this section if
the department determines:
(i) The individual intended to dispose of the asset at fair
market value or for other ...