A top official with the federal Health Care Financing Administration said yesterday that he will investigate whether the D.C. government legally can seize the savings of mentally retarded wards of the city in order to make them eligible for federal Medicaid benefits.
Everett Bryant, administrator for the agency's region covering the District and surrounding states, said that he never has heard of any jurisdiction taking such action before, and that city officials may be violating federal law by attempting a crash program of seizing retarded wards' bank accounts.
Attorneys for the city went to court Thursday in an effort to make those city wards who have sizable private bank accounts eligible for Medicaid by reducing their bank account balances to less than $2,500, the program's cutoff for personal assets. By making its wards eligible for Medicaid, the city could ask the federal government to help pay for their care at private facilities, saving the city millions of dollars.
Bryant said that under federal rules, most states encourage patients to spend more money on medicine and other necessities in order to qualify for Medicaid benefits. But he added that that this spending usually involves regular income, not wholsesale reductions in assets, as is being proposed by District officials.
The District is seeking to seize tens of thousands of dollars from mentally retarded residents of Forest Haven, as well as from other wards of the city who have accumulated money in savings accounts over the years by holding jobs at Forest Haven or with private companies.
Reed Tuckson, the newly installed chief of the city's Mental Retardation and Developmental Disability Administration, was called into a meeting yesterday by Deputy Mayor Thomas Downs to discuss the action.
Officials said that Downs instructed Tuckson to explore ways of setting the seized monies aside so they could be used to help the patients, rather than being deposited in the city's general coffers.
An official with Tuckson's agency said that this alternative already is being explored.
George Smith, deputy director of the mental retardation administration, said that officials reached their decision to proceed with the action after consulting over a two-month period with attorneys in the D.C. Corporation Counsel.
The action was approved, he said, by Audrey Rowe, the city's commissioner for social services.
Smith said that the agency has identified 135 mentally retarded wards at Forest Haven and other community-based facilities who currently are not qualified for Medicaid benefits because of their assets.
He said that one of the patients has approximately $40,000 in savings.
Of the 365 patients at Forest Haven who, under terms of a federal court order, must be moved out of the facility by 1987, 92 are ineligible for Medicaid because they do not meet the $2,500 cutoff. They are scheduled to be among the 100 patients transferred to private facilities each year until Forest Haven is closed, he said.
Officials of the agency currently are devising ways for individual patients to spend as much of their savings as possible on televisions, radios and clothing, for example, before their assets are seized in court.
Tuckson and Smith defended the plan, saying that the patients will receive better care in the Medicaid facilities.