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Example 9 Dan transfers ownership of his lake house (not homestead property) to his daughter, Cile, as a gift. Two years later, Dan and his daughter realize that this transfer affects his future eligibility for Medicaid, so Cile signs the lake house back over to Dan. Later that year, Dan applies for Long Term Care services. No divestment penalty period is imposed for the transfer of his lake house to his daughter because ownership was returned to him prior to his application. 17.2.4 Determining Fair Market Value Fair market value FMV is an estimate of the price an asset has when sold on the open market. The FMV is based on the time an asset is transferred and not when the transfer is reported to or evaluated by the IM agency. The FMV of real property can be established by: • Assessment Property tax assessments or appraisals may document a property’s FMV if both the IM agency and applicant or member agree that it accurately represents the FMV. • Statements from Realtors Statements from one or more realtors giving the FMV. • Comparative Market Analysis Prepared by a realtor, a Comparative Market Analysis estimates the FMV of the applicant or member’s property by evaluating the recent sale prices of comparable properties. If the IM agency requests this document, the agency must pay for it. The applicant or member has the right to file a fair hearing if they disagree with the FMV of the property determined by the IM agency. Example 1 Paul applied for institutional Medicaid this month and reported transferring ownership of his house to a friend three years ago. Today, the house is worth $70,000, but three years ago, the value of the house was $54,000. The FMV is $54,000 for divestment purposes as that is the value Paul could have received if he had sold it three years ago. 17.2.5 Institutionalized Person When determining whether a divestment is allowable or not, an institutionalized person is defined as someone who participates in a Home and Community-Based Waivers program or who resides in a medical institution. See details in SECTION 17.1 DIVESTMENT DEFINED. 17.2.6 Allowed Divestments 17.2.6.1 Transfers Made for a Purpose Other Than to Qualify for Medicaid A divestment that occurred in the look back period or any time after does not affect eligibility if the person who divested can show that the divestment was not made with the intent to qualify for Medicaid. The person must present evidence that shows the specific purpose and reason for making the transfer and establish that the resource was transferred for a purpose other than to qualify for Medicaid. Verbal assurances that they were not trying to become financially eligible for Medicaid are not sufficient. Take into consideration statements from physicians, insurance agents, insurance documents, and bank records that confirm the person's statements.