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Division of Welfare and Supportive Services F-410 Medical Assistance Manual TRANSFER OF ASSETS 23 Oct 01 MTL 04/23 GENERAL RULE

F-410 GENERAL RULE

If an institutionalized individual, his/her spouse, or their legal representative has given away, sold or disposed of assets for less than fair market value, it is presumed the asset was disposed of for the purpose of becoming eligible for or to remain eligible for Medicaid.

F-410.1 Look-Back Period

a. Asset Transfers Prior to February 8, 2006

Asset transfers must be evaluated during the 36-month 'look-back' period beginning the month of application; OR if the individual is/was Medicaid eligible at the time he/she began receiving HCBW or long term care (LTC) services, the 36-month 'look-back' period begins with the month the HCBW or LTC Services began.

Asset transfers must also be evaluated any time after the individual begins receiving HCBW or LTC services or any time after the individual applies for Medicaid.

The 'look-back' period is extended to 60 months when there is a transfer of assets involving a trust. If, in the case of a revocable trust, a portion is disbursed to someone other than the grantor or for the benefit of the grantor, that portion is treated as a transfer of assets. If, in the case of an irrevocable trust, all or a portion of the trust cannot be disbursed to or on behalf of the individual, that portion is treated as a transfer of assets.

b. Asset Transfers On or After February 8, 2006

The Deficit Reduction Act (DRA) provides that for any transfer of assets made on or after February 8, 2006, the look-back period is 60 months from the date the individual applied for Medicaid and was institutionalized or began receiving HCBW services.

Asset transfers must also be evaluated at any time after the individual begins receiving HCBW or LTC services.

F-415 TREATMENT OF INCOME AS ASSETS

When an individual's income is given or assigned in some manner to another person, such a gift or assignment can be considered a transfer of assets for less than fair market value.

If income or the right to receive income has been transferred, a penalty period must be imposed. If the income is a single lump sum, the penalty period is calculated on the basis of the amount of the payment. If a stream of income or the right to such income is transferred, a determination of value will be made by the Chief of Eligibility and Payments and based on an actuarial projection of the individual's life expectancy.