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18.4 Spousal Impoverishment Assets

18.4.1 Spousal Impoverishment Assets Introduction

18.4.2 Asset Assessment

18.4.3 Calculate the CSAS

18.4.4 Asset Test

18.4.5 Undue Hardship

18.4.6 Asset Transfer

18.4.6.1 Asset Transfer Period

18.4.6.1.1 Leaves Institution or becomes ineligible during the 12 month transfer period.

18.4.6.2  Institutionalized Spouse is Eligible after the 12 month transfer period  

18.4.6.2.1 Leaves Institution for 30 or more days then Re-institutionalized

18.4.6.2.2 Loses Medicaid Eligibility But Remains Institutionalized

18.4.1 Spousal Impoverishment Assets Introduction

Count the combined assets of the institutionalized person and his/her community spouse .  (Note: Disregard prenuptial agreements.  They have no effect on spousal impoverishment determinations.)  Add together all countable, available (See 16.1 Assets Introduction) assets the couple owns.

 

Do not count the following assets:

 

  1. Homestead property.  If the institutionalized person and the community spouse each owns home property and meets the criteria in 16.8.1.3 Exempt Home Property exempt the institutionalized person’s home, but not the community spouse's home.

 

Example 1:  One spouse is in a nursing home, the other lives in the community.  They have lived apart for 10 years. The institutionalized person owns a home and intends to return.  The community spouse owns a different home.  The home that each spouse owns is the principal residence of that spouse. The institutionalized person's home is an exempt asset.  The community spouse's home is not exempt.

 

If they both own homes and the institutionalized person’s home is not exempt, count the institutionalized person’s home, but exempt the spouse’s home.  Both homes cannot be exempt simultaneously.

 

  1. One vehicle, regardless of value or purpose.  If the AG has more than one vehicle, disregard one vehicle totally, regardless of value or purpose.  Then, for the remaining vehicles, follow the EBD rules for vehicles (See 16.7.9 Vehicles).

 

  1. Any/all assets designated for burial purposes are exempt.  Any unreasonable amount should be supported by documentation of the burial related costs or contract.  

 

Do not allow applicants and recipients to simply state that they are setting aside an unreasonable amount of cash (e.g., $1,000,000) as their burial fund for unspecified funeral expenses. If they can document the funeral expense that they expect to incur, it can be totally exempt regardless of its cost.

 

For example, ask the member to document that they have arranged to purchase a $100,000 casket or that a funeral home will provide them with a $75,000 funeral along with an itemized listing of the funeral goods and services that will be provided.

 

This differs from EBD burial policies for non-institutionalized persons and institutionalized persons without a community spouse (See 16.5 Burial Assets).  

 

  1. Household goods and personal items, regardless of their value.

 

  1. All assets not counted in determining EBD MA eligibility.

 

  1. IRA’s of an ineligible community spouse (See 16.7.21 Retirement  Benefits).

 

18.4.2 Asset Assessment

The IM Agency must make an assessment of the total countable assets of the couple at the:

  1. Beginning of the person’s first continuous period of institutionalization of 30 days or more, or

  2. Date of the first request for community waivers, whichever is earlier.  

 

Complete an asset assessment using the F-10095 “Medicaid Asset Assessment” when someone applies, even if s/he had one done in the past, to get the most current asset share.   

 

If the member was not married on the first date of institutionalization or waivers request, apply the policy from the point s/he is married.  If s/he has remarried since the first date of institutionalization or waivers request, apply the policy from the date s/he got married to his/her current spouse.

 

The IM agency must also do an asset assessment at any other time the institutionalized person or his/her spouse requests it.

 

The IM agency should inform the person for whom an assessment is being made what documentation is required.  S/he must document ownership interest in and the value of any available assets the couple had at the time of his/her first period of continuous institutionalization.  The same documentation procedures are used as when an application is filed (See 20.1 Verification Introduction).

18.4.3 Calculate the CSAS

The community spouse asset share (CSAS) is the amount of countable assets greater than $2,000 that the community spouse, the institutionalized person, or both, can possess at the time the institutionalized person applies for MA.

 

IF the total countable assets of the couple are:

Then the CSAS is:

$231,840 or more

 $115,920

Less than $231,840 but

greater than $100,000

½ of the total countable assets of the couple

$100,000 or less

$50,000

 

CARES will send each member of the couple a letter that states the couple’s total countable assets, the CSAS, how much the institutionalized spouse must transfer to the community spouse, the date by which the transfer must be made, and the institutionalized person’s asset limit.

18.4.4 Asset Test

When the institutionalized person applies for MA, compare the total countable assets of the couple to $2,000 plus the greater of:

  1. CSAS, or

  2. An amount ordered by a court, or fair hearing.

 

If assets at the time of application are equal to or less than this amount, the institutionalized person is eligible.  If they are more, s/he is not eligible.

18.4.5 Undue Hardship

The institutionalized person will not be denied MA if the IM Agency determines that the ineligibility caused by excess assets creates undue hardship for him/her.  Undue hardship means an immediate, serious impairment to the institutionalized person's health.

18.4.6 Asset Transfer

After the institutionalized person is found eligible, s/he may transfer assets to the community spouse.  The maximum amount s/he can transfer is the CSAS (or a greater amount ordered by a court or a fair hearing). If the community spouse already has some assets, the institutionalized person can transfer assets which when added to the community spouse's assets equal the CSAS (or an amount ordered by a court or a fair hearing).

 

S/he isn't allowed to transfer assets for less than fair market value to anyone other than the community spouse.

18.4.6.1 Asset Transfer Period

The institutionalized spouse must transfer the assets to the community spouse by the next regularly scheduled review (12 months).  If his/her assets are above $2,000 on the date of the next scheduled review, s/he will be determined ineligible.  S/he will remain ineligible until his/her assets no longer exceed the $2000 Medicaid asset limit.   

 

Example 2:  Robert was first institutionalized September 2006.  Lucinda, Robert's wife, remained in the community.  The couple passed the joint asset test and Robert was determined eligible in September 2006.  The couple's total combined assets were $42,000, $32,000 of which were owned solely by Robert.  Robert had until the next scheduled review (September 2007) to get his total assets under the $2000 Medicaid asset limit.

  

By September 2007 Robert had only transferred $23,000 to Lucinda.  Robert still had $9,000 in assets.   Robert became ineligible October 2007, and will remain ineligible as long as his assets remain over $2000.  

18.4.6.1.1 Leaves Institution or becomes ineligible during the 12 month transfer period.

If the institutionalized spouse during the 12 month transfer period:

 

  1. Leaves the institution for 30 days or more and becomes institutionalized again, or

  2. Becomes ineligible for Medicaid and then becomes eligible for Medicaid once again.

 

The time allowed to transfer assets does not start over again.

18.4.6.2 Institutionalized Spouse is Eligible after the 12 month transfer period  

18.4.6.2.1 Leaves Institution for 30 or more days then Re-institutionalized  

If the institutionalized spouse remains in the institution and MA eligible after the expiration of the 12 month transfer period, but then leaves the institution for 30 days or more, and subsequently becomes institutionalized once again for 30 days or more, s/he would be subject to all spousal impoverishment rules upon becoming re-institutionalized.

Including:

 

Example 3:  Peter was institutionalized and determined MA eligible in March of 2002.  Janice, Peter's wife, remained in the community.    In February 2003 Peter's assets were below $2000.  Peter remained  MA eligible and institutionalized  through May 2003.  In June 2003, Peter left the nursing home and joined Janice in their home in the community.  His Medicaid eligibility ended on June 30, 2003.

 

In August 2003 Peter inherited $100,000.  In September 2003, Peter's condition worsened and he was institutionalized again and applied for MA.   All spousal impoverishment rules would be applied to Peter's September 2003 application.  His eligibility would be based on a joint asset test, and if eligible he would have12 months to transfer assets in his name that exceed $2000 to his wife.

18.4.6.2.2 Loses Medicaid Eligibility But Remains Institutionalized

If the institutionalized spouse remains in the institution and remains Medicaid eligible after the 12 month transfer period but subsequently becomes ineligible and remains institutionalized, spousal impoverishment asset rules would not be applicable if s/he should reapply.

If the institutionalized person reapplies for Medicaid, her/his asset limit would be $2000 and the spouse's assets would not be counted.   

If eligible, s/he would still be allowed to allocate some of her/his income to the community spouse.

 

Example 4:  Gregory was institutionalized in December 2007.  Gregory and his wife, Marcia, who remained in the community,  passed the joint asset test. Gregory was found eligible and allowed until  November 2008 to get under the $2000 asset limit.  By November 2008 Greg had transferred enough assets to Marcia to get under the asset limit.  

 

In March 2009, while Gregory remained institutionalized, he refused to sign over to Medicaid a health insurance payment check.  His Medicaid eligibility was discontinued March 31, 2005 for failure to cooperate with TPL requirements. Greg has never left the institution and now reapplies for Medicaid on June 3, 2009.  Since Greg never left the institution for 30 days or more since his original Medicaid spousal impoverishment application was approved (December 2007), the assets of his community spouse are not counted when determining eligibility for the application filed June 2009.  Greg's asset limit for this application is $2000.00.

 

 

 

 

This page last updated in Release Number: 13-01

Release Date: 08/28/13

Effective Date: 01/01/13