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TITLE 16 HEALTH AND SAFETY DELAWARE ADMINISTRATIVE CODE 33 When assets have been transferred in amounts and/or frequency that would make the calculated penalty periods overlap, add together the value of all assets transferred to calculate a single penalty period. Fractional periods of ineligibility shall not be rounded down or otherwise disregarded when determining the penalty for a transfer of assets. 10 DE Reg. 1439 (03/01/07) 20350.4.2 Transfers Made So That Penalty Periods Would Not Overlap Repealed 10 DE Reg. 1439 (03/01/07) 20350.5 Return of Assets The penalty period can be shortened to account for assets that are returned. If all assets transferred are returned to the individual, no penalty for transferring assets is assessed. Where a penalty has been imposed and eligibility has been denied, a return of the assets requires a retroactive adjustment back to the beginning of the penalty period. However, the assets that are returned must be counted in determining eligibility and may result in the individual being ineligible for Medicaid because of excess income/resources. In order to void the penalty, all of the asset or its fair market equivalent must be returned. If, for example, the asset was sold by the individual who received it, the full market value of the asset must be returned to the transferor, either in cash or another equivalent value. If only part of an asset or its equivalent value is returned, the penalty period can be modified, but not eliminated. 20350.6 Transfers by a Spouse When a spouse transfers an asset that results in a penalty for the individual (applicant) and then the spouse also applies for Medicaid and is otherwise eligible, the penalty period is apportioned between the spouses. The total penalty imposed on both spouses must not exceed the length of the penalty originally imposed on the individual. 20350.7 Penalty Period When Individual Leaves Institution A penalty period imposed for a transfer of assets runs continuously from the first date of the penalty period (the penalty date), regardless of whether the individual remains in or leaves the institution (or waiver program). If the individual leaves the institution, the penalty period continues to run until the end of the calculated period. If the individual is readmitted, the remaining penalty period (if any) must be imposed. 20350.8 Treatment of Jointly Owned Assets Where an asset is held by an individual in common with another person, or persons, via joint tenancy, tenancy in common, joint ownership, or similar arrangement, the asset is considered transferred by the individual when any action is taken, either by the individual or any other person, that reduces or eliminates the individual's ownership or control of the asset. Under this provision, merely placing another person's name on an account or asset as a joint owner might not constitute a transfer of assets depending upon the specific circumstances of the situation. The individual may still possess ownership rights to the account or asset and therefore have the right to withdraw all of the funds in the account or possess the asset at any time. The account or asset is still be considered to belong to the individual. However, actual withdrawal of funds from the account, or removal of the asset, by the other person removes the funds or property from the control of the individual and this constitutes a transfer of assets. Although the withdrawal of funds is subject to the transfer of assets provision, the individual is provided an opportunity to rebut the presumption. Also, if placing another person's name on the account or asset actually limits the individual's right to sell or dispose of the asset, this would constitute a transfer of assets. In other words, by adding another person's name the individual cannot sell or dispose of the asset without the other person's consent. For example, an individual has sole ownership of real property and adds another person's name as joint tenancy. He can no longer dispose of the property by himself. He has to have the other person’s consent to do so. 20350.9 Treatment of Income as an Asset Under OBRA 93, income, in addition to resources, is defined as an asset for transfer (and trust) purposes. Where an individual's income is given or assigned in some manner to another person, this is considered a transfer of assets for less than fair market value. In determining whether income has been transferred, do not scrutinize an individual's spending habits during the 60 month look-back period. Absent evidence to the contrary, assume that ordinary household income was legitimately spent on the normal costs of daily living. Attempt to determine whether the individual has transferred lump sum payments actually received in a month. Such payments, while counted as income in the month received for eligibility purposes, are counted as resources in the following month if they are retained. Therefore, disposal of such lump sum payments before they can be counted as resources could constitute an uncompensated transfer of assets.