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17.1 Divestment Defined Divestment is the act of transferring ownership of assets or income and receiving less than fair market value FMV in return. Applicants or members seeking Medicaid-covered long-term care services are subject to a set of special rules about transferring assets and income. Wisconsin refers to these as “divestment rules.” If someone subject to divestment rules transfers an asset and/or income and is seeking Medicaid coverage of long-term care services (see 17.1.1 Applicable Health Care Programs), the transfer must be evaluated (see 17.2 Evaluation of Transfers for Divestment). Divestment rules do not apply to the applicants or members listed in 17.1.2 Excluded Applicants and Members. Divestment rules apply even if someone else transfers the applicant or member’s assets or income. Divestments can be made by: • An institutionalized person. • An institutionalized person’s spouse. • A person, including a court or an administrative body, with legal authority to act in place of or on behalf of the institutionalized person or the person's spouse. • A person, including a court or an administrative body, acting at the direction or upon the request of the institutionalized person or the person's spouse. This includes relatives, friends, volunteers, and authorized representatives. Note: An Institutionalized Person is someone who meets one of the following criteria: 1. Participates in a Home and Community-Based Waivers program 2. Has resided in a medical institution for 30 or more consecutive days for a purpose other than receiving residential substance use disorder treatment 3. Is likely to reside in a medical institution for 30 or more consecutive days for a purpose other than receiving residential substance use disorder treatment, as attested to by the medical institution. An exception to the 30-day period is that a resident of an IMD for a purpose other than receiving residential substance use disorder treatment is considered an institutionalized person until they are discharged. The 30-day period includes situations in which the person resides in more than one medical institution during 30 or more consecutive days. Example 1: Don enters a nursing home and applies for Institutional Medicaid. Don’s daughter, Stacy, donates his boat and all the money in his savings account to charity. Divestment rules apply to this transfer even though Don did not make the gift himself. 17.1.1 Applicable Health Care Programs Divestment rules apply to long-term care services provided through the following programs: • Adult Community Waivers programs, regardless of the member’s form of Medicaid. ◦ Family Care. ◦ Family Care Partnership. ◦ PACE. ◦ IRIS programs. • Institutional Medicaid.