No. 33574 (Amendment): Rule R414-305. Resources

(Amendment)

DAR File No.: 33574
Filed: 04/22/2010 04:55:30 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this change is to update and correct language that excludes as a countable resource the home of an institutionalized person, and to limit nursing home and long-term care services when an individual's home has an equity value of over $500,000.

Summary of the rule or change:

This amendment clarifies that the value of a home does not determine whether the home will be excluded as a countable resource. Nevertheless, it also clarifies that a separate test exists where the full equity value of the home is counted to determine whether the individual may qualify for nursing home or long-term care services. In addition, this amendment clarifies that the Department must exclude as a resource certain properties of American Indians as required under the American Recovery and Reinvestment Act of 2009.

State statutory or constitutional authorization for this rule:

• Section 26-18-3

This rule or change incorporates by reference the following material:

• Updates: 42 CFR 435.840, 10/01/2009
• Removes: 42 CFR 435.843, 10/01/2008
• Updates: 42 CFR 435.845, 10/01/2009

Anticipated cost or savings to:

the state budget:

There is no impact to the state budget because this amendment does not increase Medicaid coverage for any group, does not reduce existing coverage, and does not modify eligibility criteria to determine how many individuals may become eligible for long-term care services.

local governments:

There is no impact to local governments because they do not determine Medicaid eligibility and do not fund long-term care services for Medicaid clients.

small businesses:

There is no impact to small businesses because this amendment does not increase Medicaid coverage for any group, does not reduce existing coverage, and does not modify eligibility criteria to determine how many individuals may become eligible for long-term care services.

persons other than small businesses, businesses, or local governmental entities:

There is no impact to Medicaid providers and Medicaid clients because this amendment does not increase Medicaid coverage for any group, does not reduce existing coverage, and does not modify eligibility criteria to determine how many individuals may become eligible for long-term care services.

Compliance costs for affected persons:

There are no compliance costs for a single Medicaid provider or a Medicaid client because this amendment does not increase Medicaid coverage for any group, does not reduce existing coverage, and does not modify eligibility criteria to determine how many individuals may become eligible for long-term care services.

Comments by the department head on the fiscal impact the rule may have on businesses:

This rule change does not alter coverage and should not have a fiscal impact on business.

David N. Sundwall, MD, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Health
Health Care Financing, Coverage and Reimbursement Policy
288 N 1460 W
SALT LAKE CITY, UT 84116-3231

Direct questions regarding this rule to:

• Craig Devashrayee at the above address, by phone at 801-538-6641, by FAX at 801-538-6099, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

06/14/2010

This rule may become effective on:

06/21/2010

Authorized by:

David Sundwall, Executive Director

RULE TEXT

R414. Health, Health Care Financing, Coverage and Reimbursement Policy.

R414-305. Resources.

R414-305-1. A, B and D Medicaid and A, B and D Institutional Medicaid Resource Provisions.

(1) This section establishes the standards for the treatment of resources to determine eligibility for aged, blind and disabled Medicaid and aged, blind and disabled institutional Medicaid.

(2) To determine eligibility of the aged, blind or disabled, the Department incorporates by reference 42 CFR 435.840, [435.843, ]435.845, [2008]2009 ed., and 20 CFR 416.1201, 416.1202, 416.1205 through 416.1224, 416.1229 through 416.1239, and 416.1247 through 416.1250, 2009 ed. The Department adopts Subsection 1902(k) of the Compilation of the Social Security Laws, 1993 ed., which is incorporated by reference. The Department incorporates by reference Section 1917(d), (e), (f) and (g) of the Compilation of the Social Security Laws in effect January 1, 2009. The Department shall not count as an available resource any assets that are prohibited under other federal laws from being counted as a resource to determine eligibility for federally-funded medical assistance programs. Insofar as any provision of this rule is inconsistent with applicable federal law, the applicable federal law governs over the inconsistent rule provision.

(3) The definitions in R414-1 and R414-301 apply to this rule, in addition:

(a) "Burial plot" means a burial space and any item related to repositories customarily used for the remains of any deceased member of the household. This includes caskets, concrete vaults, urns, crypts, grave markers and the cost of opening and closing a grave site.

(b) "Sanction" means a period of time during which a person is not eligible for Medicaid services for institutional care or services provided under a Home and Community Based waiver due to a transfer of assets for less than fair market value.

(c) "Transfer" in regard to assets means a person has disposed of assets for less than fair market value.

(4) A resource is available when the client owns it or has the legal right to sell or dispose of the resource for the client's own benefit.

(5) Except for the Medicaid Work Incentive Program, the resource limit for aged, blind or disabled Medicaid is $2,000 for a one-person household and $3,000 for a two-person household.

(6) For an individual who meets the criteria for the Medicaid Work Incentive Program, the resource limit is $15,000. This limit applies whether the household size is one or more than one.

(7) The Department bases non-institutional and institutional Medicaid eligibility on all available resources owned by the client, or deemed available to the client from a spouse or parent. Eligibility cannot be granted based upon the client's intent to or action of disposing of non-liquid resources as described in 20 CFR 416.1240, 2009 ed., unless Social Security is excluding the resources for an SSI recipient while the recipient takes steps to dispose of the excess resources.

(8) Any resource or the interest from a resource held within the rules of the Uniform Transfers to Minors Act is not countable. Any money from the resource that is given to the child as unearned income is a countable resource beginning the month after the child receives it.

(9) The resources of a ward that are controlled by a legal guardian are counted as the ward's resources.

(10) Lump sum payments received on a sales contract for the sale of an exempt home are not counted if the entire proceeds are used to purchase a new exempt home within three calendar months of when the property is sold. The individual shall receive one three-month extension if more than three months is needed to complete the actual purchase. Proceeds is defined as all payments made on the principal of the contract. Proceeds does not include interest earned on the principal.

(11) If a resource is potentially available, but a legal impediment to making it available exists, it is not a countable resource until it can be made available. The applicant or recipient must take appropriate steps to make the resource available unless one of the following conditions as determined by a person with established expertise relevant to the resources exists:

(a) Reasonable action would not be successful in making the resource available.

(b) The probable cost of making the resource available exceeds its value.

(12) Water rights attached to the home and the lot on which the home sits are exempt providing it is the client's principal place of residence.

(13) For an institutionalized individual, a home or life estate is not considered an exempt resource.

(14) To determine eligibility for nursing facility or other long-term care services, the Department excludes the value of the individual's principal home or life estate from countable resources if [the individual's equity in the home or life estate does not exceed the equity limit of $500,000 as established in 42 U.S.C. 1396p(f)(1)(A), or as increased according to the provisions of 42 U.S.C. 1396p(f)(1)(C) of the Compilation of the Social Security Laws, and ]one of the following conditions is met:

(i) the individual intends to return to the home;

(ii) the individual's spouse resides in the home;

(iii) the individual's child who is under age 21, or who is blind or disabled resides in the home; or

(iv) a reliant relative of the individual resides in the home.

(15) Even if the conditions in Subsection R414-305-1(14) are met, an applicant or client is ineligible to receive nursing facility services or other long-term care services [If]if the full equity value of the individual's home or life estate exceeds $500,000, or increased value according to the provisions of 42 U.S.C. 1396p(f)(1)(C)[, the individual is ineligible for nursing facility or other long-term care services] unless the individual's spouse, or the individual's child who is under age 21 or is blind or permanently disabled lawfully resides in the home. The individual may qualify for Medicaid to cover ancillary services only.

(16) For A, B and D Medicaid, the Department shall not count up to $6,000 of equity value of non-business property used to produce goods or services essential to home use daily activities.

(17) A previously unreported resource that meets the criteria for burial funds found in 20 CFR 416.1231, may be retroactively designated for burial and thereby exempted effective the first day of the month in which it was designated for burial or intended for burial. The funds cannot be exempted retroactively more than 2 years prior to the date of application. Such resources shall be treated as funds set aside for burial and the amount exempted cannot exceed the limit established for the SSI program.

(18) One vehicle is exempt if it is used for regular transportation needs of the individual or a household member.

(19) The Department excludes resources of an SSI recipient who has a plan for achieving self support approved by the Social Security Administration when the resources are set aside under the plan to purchase work-related equipment or meet self support goals.

(20) An irrevocable burial trust is not counted as a resource. However, if the owner is institutionalized or on home and community based waiver Medicaid, the value of the trust, which exceeds $7,000, is considered a transferred resource.

(21) Business resources required for employment or self-employment are not counted.

(22) For the Medicaid Work Incentive Program, the Department excludes the following additional resources of the eligible individual:

(a) Retirement funds held in an employer or union pension plan, retirement plan or account, including 401(k) plans, or an Individual Retirement Account, even if such funds are available to the individual.

(b) A second vehicle when it is used by a spouse or child of the eligible individual living in the household to get to work.

(23) After qualifying for the Medicaid Work Incentive Program, these resources described in R414-305-1(22) will continue to be excluded throughout the lifetime of the individual to qualify for A, B or D Medicaid programs other than the Medicaid Work Incentive, even if the individual ceases to have earned income or no longer meets the criteria for the Work Incentive Program.

(24) Assets shall be deemed from an alien's sponsor, and the sponsor's spouse, if any, when the sponsor has signed an Affidavit of Support pursuant to Section 213A of the Immigration and Nationality Act on or after December 19, 1997. Sponsor deeming will end when the alien becomes a naturalized U.S. citizen, or has worked 40 qualifying quarters as defined under Title II of the Social Security Act or can be credited with 40 qualifying work quarters. Beginning after December 31, 1996, a creditable qualifying work quarter is one during which the alien did not receive any federal means-tested public benefit.

(25) Sponsor deeming does not apply to applicants who are eligible for Medicaid for emergency services only.

(26) The Department excludes from countable resources the following resources:

(a) Amounts an individual receives as a result of the Making Work Pay credit defined in Section 1001 of the American Recovery and Reinvestment Act of 2009, Pub. L. No. 111 5, 123 Stat. 115 for two months after the month of receipt.

(b) Amounts an individual retains from the economic recovery payments defined in Section 2201 of the American Recovery and Reinvestment Act of 2009, Pub. L. No. 111 5, 123 Stat. 115 for nine months after the month of receipt.

(c) Amounts an individual retains from the tax credit allowed to certain government employees as defined in Section 2202 of the American Recovery and Reinvestment Act of 2009, Pub. L. No. 111 5, 123 Stat. 115 for two months after the month of receipt.

(d) The value of any reduction in Consolidated Omnibus Budget Reconciliation Act (COBRA) premiums provided to an individual under Section 3001 of the American Recovery and Reinvestment Act of 2009, Pub. L. No. 111 5, 123 Stat. 115.

(e) Certain property and rights of federally-recognized American Indians including certain tribal lands[,] held in trust which are located on or near a reservation, or allotted lands located on a previous reservation, ownership interests in rents, leases, royalties or usage rights related to natural resources (including extraction of natural resources), and ownership interests and usage rights in personal property which has unique religious, spiritual, traditional or cultural significance, and rights that support subsistence or traditional lifestyles, as defined in Section 5006(b)(1) of the American Recovery and Reinvestment Act of 2009, Pub. L. No. 111 5, 123 Stat. 115.

(27) Life estates.

(a) For non-institutional Medicaid, life estates shall be counted as resources only when a market exists for the sale of the life estate as established by knowledgeable sources.

(b) For Institutional Medicaid, life estates are countable resources even if no market exists for the sale of the life estate, unless the life estate can be excluded as defined in paragraph 14 of this section.

(c) The client may dispute the value of the life estate by verifying the property value to be less than the established value or by submitting proof based on the age and life expectancy of the life estate owner that the value of the life estate is lower. The value of a life estate shall be based upon the age of the client and the current market value of the property.

 

. . . . . . .

 

KEY: Medicaid, resources

Date of Enactment or Last Substantive Amendment: [January 1], 2010

Notice of Continuation: January 31, 2008

Authorizing, and Implemented or Interpreted Law: 26-18-3

 

---