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Aged, Blind and Disabled Manual Policy Manual Number: 110.050 Section: Financial Eligibility Requirements Chapter: ABD Countable and Excluded Resources

September 1, 2026 Division of TennCare 8 A prepaid contract that has been declared irrevocable by a court of law is an excluded asset. It is a countable asset if it has not been declared irrevocable by a court of law.

ii. Agreements established between 7/1/1981 and 7/1/1995

The entire value of the prepaid contract is excluded as a resource if the contract contains the following statement: “This contract is irrevocable and the funds paid hereunder are not refundable.”

iii. Agreements established 7/1/1995 or later

A prepaid burial contract under which is a trust or an insurance arrangement is established by the funeral provider is excluded if it meets the following conditions:

• Both the individual and the funeral home representative have signed the document; • An itemized list of the services provided under the contract is provided; • The price of all major services is specified; • The total dollar amount of the agreement is specified; • The individual was neither a minor or legally declared incompetent when the agreement was signed; and • The agreement specifies in writing that the money is not refundable under any circumstances.

Review an excluded irrevocable burial contract under the Transfer of Assets and Penalty Periods policy for individuals applying for Institutionalized Medicaid. If the individual is receiving Fair Market Value (FMV) for all services specified under the contract, then the burial contract does not constitute a transfer of assets for less than FMV.