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• The promissory note, loan, or mortgage prohibits the cancellation of the balance upon the death of the lender.95 In the case of a promissory note, loan, or mortgage, that does not satisfy the requirements above and is established on or after 11-1-09, the value of such contract considered as an improper transfer will be the outstanding balance due as of the date of the individual’s application for Medicaid or date of LTC admission, whichever is later. In the case of HCBS, the balance to be used is the amount as of the date of the Cost Comparison Budget approval. When determining if the loan is actuarially sound, refer to the person’s age on the Life Expectancy Table as of the date the loan is established. If the loan cannot be repaid within the person’s life expectancy, it is not actuarially sound and is therefore an improper transfer. The interest amount of the loan payments is countable income. 2640.10.25.35 TREATMENT OF CONTINUING CARE RETIREMENT COMMUNITY ENTRANCE FEES A Continuing Care Retirement Community (CCRC) or similar life care community typically provides a variety of living arrangements, from independent living through skilled nursing care. In many cases, potential residents must provide extensive information about their finances, including their assets and income, before being accepted for admission. In addition, they must pay substantial entrance fees and sign detailed contracts before moving to the community. Effective with contracts entered into on and after November 1, 2009, entrance fees paid by an individual to a CCRC, or similar life care community, are counted as an available non-exempt resource of the individual for Medicaid eligibility determinations when all of the following 3 conditions apply97: 1. The person has the ability to use the entrance fee, or the contract provides that the entrance fee may be used, even in part, to pay for care if the person’s other resources or income are insufficient to pay for their care. It is not necessary for the CCRC to provide a full, lump sum refund of the entrance fee to the residents. If even a portion of the fee can be refunded or applied to pay for care as required, this condition would be met. 2. The person is eligible for a refund of any remaining entrance fee when the person dies or terminates the contract and leaves the community. In order to meet this second condition, it is not necessary for the residents to receive a refund of the entrance fee or deposit. This second condition is met if the resident could receive a refund were the contract to be terminated or if the resident dies. 3. The entrance fee does not confer an ownership interest in the continuing care retirement community or life care community. Ownership interest generally means the right to possess and convey property. Therefore, the residents will be required to verify whether or not they have an ownership interest in a CCRC or life care community by presenting documentation from the facility to that effect. If the CCRC or life care