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REV. MAY 3, 2018 NEBRASKA DEPARTMENT OF MEDICAID ELIGIBILITY MANUAL LETTER #43-2018 HEALTH AND HUMAN SERVICES 477-000-032

477-000-032 – Deprivation of Resources

Example 1: Mr. Smith applies for Medicaid on 8/20/18. He has been in a Nursing Home since 6/15. On 3/15/17 he gave $35,000 to his son. The transfer is within the 60-month period prior to the date of his Medicaid application and the penalty begins with the date of application which is 8/20/18. A denial Notice of Action will need to be sent for deprivation of resources stating the penalty period is 7 months. For a notice type, you will need to select “transfer of assets” under sanctions.

$35,000 amount of transfer $35,000 ÷ $5,000 current private pay rate = 7 number of months for penalty period

Example 2: Mr. Smith transferred his ranch with fair market value of $250,000 to his children on 3/15/17. He permanently entered a nursing home on 11/10/15. Mr. Smith applies for Medicaid on 5/14/18 which is within the 60-month period prior to the date of transfer. He is ineligible for 52.08 months beginning with 5/18.

Step A $250,000 amount of transfer $250,000 ÷ $4,800 current private pay rate = 52.08 number of months penalty period

Mr. Smith reapplies for Medicaid in the month a partial penalty of .08 applies. The partial month penalty is converted to a dollar amount and applied to the Share of Cost for that month.

Step B $4,800 private pay cost x 52 month penalty period $249,600 penalty period amount for 52 full months

Step C $250,000 transfer amount -249,600 penalty period amount for 51 full months $400 partial month penalty amount at private pay rate

For the month of application, the partial month penalty amount of $400 would be added to Mr. Smith’s Share of Cost amount as his responsibility for the cost of care. Medicaid will not pay the nursing home the difference between the Medicaid rate and partial month penalty amount.