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Louisiana Medicaid Eligibility Manual Eligibility Factors

Issued May 16, 2022

Page 4 of H-1620 Revised/added text indicated by underscore

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Example 1: Ruth is a resident of a medical care facility. She has no spouse . Her qualified $90,000 LTCP policy has been paying for her care. When Ruth applies for LTC Medicaid, she verifies that her LTCP policy has paid out $80,000 in policy benefits. Ruth's total resources equal $81,000. You will deduct the $80,000 disregard leaving her with $1000 in countable resources. If Ruth were to pass away at this point, $80,000 of her resources would be protected from estate recovery.

A year later, Ruth’s eligibility for Medicaid is reviewed. Ruth verifies that she has exhausted her LTCP policy benefits, which has paid out the full $90,000. The worker determines that Ruth's total resources equal $91,000. Since $90,000 has been paid out by Ruth’s policy, an additional $90,000 in resources is disregarded. Ruth continues to qualify for Medicaid since she is still below the resource limit. If Ruth were to pass away, $90,000 of her resources would be protected from estate recovery.

Example 2: Emma had been residing in a nursing home and had been eligible for Medicaid for the past 2 years. Her $90,000 LTCP policy had been paying for a portion of her care. As of her last Medicaid review, the policy had paid out $70,000, an amount disregarded in determining her continued Medicaid eligibility. Ten months after her last review, Emma died. Emma’s representatives verify that her policy paid out an additional $10,000. Emma’s estate can protect a total of $80,000 from estate recovery.

The resource disregard can be applied to reduce or eliminate a transfer penalty on resources that the policyholder transferred without compensation. Any uncompensated transfer, or a portion thereof, not offset by the amount of the disregard, will result in a transfer penalty period.

The transferred resource does not affect an applicant/beneficiary’s eligibility for Medicaid vendor payment if the value does not exceed the value of the resource disregarded. The value of the transfer will result in a reduction or elimination of the resource disregard for Medicaid eligibility and estate recovery protection under LTCP.