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Medical Services Policy Manual, Section H

H-300 Transfer of Resources

H 304 Transfers to Trusts

A Home and Community Based Waiver applicant/recipient who transfers resources for less than fair market value will be ineligible for all Waiver Medicaid benefits and services for a period of time as specified at MS H-308. H-304 Transfers to Trusts MS Manual 01/01/19 A transfer to a trust occurswhen an individual, the individual’s spouse or the representative of either the individual or spouse transfers the ownership of the individual’s resources to the corpus of a trust. “Trust” means a trust, or similar legal device, established other than by will by an individual or an individual’s spouse under which the individual may be a beneficiary of all or part of the payments from the trust, and the distribution of suchpayments is determined by one ormore trustees or other fiduciaries who are permitted to exercise any discretion with respect to the distribution to the individual, and shall include trusts, conservatorships, and estates created pursuant to the administration of a guardianship. “Grantor” means the individual, institution or entity that established, created or funded the trust and shall also include fiduciaries as 1) defined by Arkansas Code 28-69-201 and third parties as contemplated by 2) Arkansas Code 20-77-301, et seq. Definition of a Trust. TRUSTS ESTABLISHED PRIOR TO 8/11/93 1. State Law All transfers to trusts established on or before August 10, 1993, are governed by the terms of Act 1228 of 1993 and by federal law in #2 below. Act 1228 of 1993 provides the following guidelines: A provision in a trust, other than a testamentary trust, which limits the availability of, or provides directly or indirectly for the suspension, termination or diversion of the principal, income or beneficial interest of either the grantor or the grantor’s spouse in the event that the grantor or grantor’s spouse should apply for medical assistance or require medical, hospital or nursing care or long term custodial, nursing or medical care shall be void as against the public policy of the State of Arkansas, without regard to the irrevocability of the trust or the purpose for which the trust was created and without regard to whether the trust was created pursuant to court order. 2. Federal Law The following federal policy was applicable to trusts established prior to 8/11/93.