Medicaid Policy
Medicaid Policy
Previous Policy (575)
Previous Policy (371)
Aged, Blind, Disabled, Family, Non-Institutional and Non-Waiver Programs
Do not apply a penalty period for the transfer of any asset unless the individual wants Medicaid coverage for institutional care or Home & Community-Based Waiver services.
If an individual has transferred an asset for less than fair market value, tell him that he may be ineligible for institutional care. If the transfer occurred on or after August 11, 1993, the individual could be ineligible for an indefinite period of time. Record the transfer in a prominent place in the case record for future reference and retain any verifications of the transfer in the case record.
Long-term Care
A transfer of assets is when the individual or the individual’s spouse gives away assets or income for less than fair market value during the look-back period.
The look back period is based on the date of application and goes back 60 months from the date of application.
Apply a penalty period if the individual or spouse transferred assets or income for less than fair market value in the 60 months before the date of application. Medicaid will not pay for long-term care services during the penalty period. Long-term care services are nursing home services, including room and board, and long-term care services provided under a home and community based waiver. The penalty only applies to the time a person is in a nursing home or receiving waiver services. The penalty does not apply to the time someone is in the hospital prior to going into the nursing home.
Penalties for transferring assets do not apply to New Choices Waiver Community Group or New Choices Waiver Spenddown Group. Only New Choices Waiver Special Income Group is subject to transfer penalties.
Individuals can also face a penalty period based on transfers made by a spouse after eligibility has been established for the institutionalized or waiver-eligible spouse (575-1).
When the individual or spouse give money to someone and claims it is payment for services the person provided in the past, we consider the payment a transfer. Unless the individual verifies that a signed written contract, describing what services the person will do, what the individual will pay for the services, and when and how such payments will be made, was in place before the services were provided, these payments will be treated as a transfer for less than fair market value. Treat prepayment of services in excess of one month's worth of services, even under a contract, as a transfer of assets.