*** The Health Care Programs Manual (HCPM) has been replaced by the Minnesota Health Care Programs Eligibility Policy Manual (EPM) as of June 1, 2016. Please refer to the EPM for current health care program policy information. ***
Effective: June 1, 2011 |
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19.25.15.05 - Homestead Real Property |
Archived: June 1, 2016 (Previous Versions) |
This section provides policy detail regarding homestead real property.
Homestead Real Property Exclusion.
MinnesotaCare (MCRE) and MA Method A.
Long-Term Care Facility (LTCF).
A homestead is defined as, ”the home which is owned by and is the usual residence of the client along with all the surrounding land and any buildings on that land, provided the land is not separated from the home by any property owned by others. The shelter can be real or personal property.”
Example:
Buddy lives in a mobile home which he owns. He rents a lot in a mobile home park and his mobile home is not attached to a foundation.
Action:
Buddy’s mobile home is not real property, but it is his homestead.
Example:
Demetrius owns and lives in his house in Big City, MN.
Action:
The house and the lot it is on are his homestead.
Example:
Joan owns and lives in a farmhouse that is across the highway from the 40 acres of land that she farms. The barn and silo are located on the 40 acres.
Action:
The farmhouse and the 40 acres of land, barn and silo are considered the homestead, because the 40 acres are separated by a public right-of-way.
Example:
Luis owns and lives in a farmhouse that is on 40 acres of land which he farms. He also owns and farms 100 acres of land that is on the other side of his neighbor’s property.
Action:
The farmhouse and the 40 acres are the homestead. The other 100 acres are non-homestead real property.
Homestead Real Property Exclusion
It is not necessary for clients to own the shelter that is their usual residence if they own the land on which the shelter is located. The land meets the definition of homestead and is excluded if the homestead exclusion applies, for example, if the client lives on his or her own land in a mobile home that someone else owns.
Note: Public rights-of-way that separate property from the home do not affect the exclusion.
Homestead exclusion policies specific to each program are described below.
Exclude the homestead as an asset for a client who is living in the community.
A homestead that is temporarily unoccupied may continue to be excluded if the client intends to return to the home and it is unoccupied for either of the following reasons:
l Due to employment, illness, or an employability plan approved by the county human service agency which includes education, training, or job search within the state, but outside the immediate geographic area.
l Because it is not habitable due to casualty or natural disaster. Exclude the homestead during periods it is unoccupied only if the applicant or enrollee intends to return.
For clients living in a long-term care facility (LTCF) see Long-Term Care Facility (LTCF) Residents.
Exclude the homestead owned and occupied by a client, or by a client’s spouse, or the client’s disabled or dependent child.
The following factors must both be met for a client, who is living in the community to have the homestead be excluded:
l The client has an ownership interest in the homestead.
l The client, or dependent relative, resides in the homestead and considers it his or her principal home.
Note: Continue to exclude the home when the client is not currently residing in the home, but intends to return to it.
Example:
LaVonda owns a home in Greater City, MN but is currently staying in the Twin Cities during the week to finish her Masters in Astrophysics. She intends to return to Greater City, MN and her home when the school year ends.
Action:
Exclude LaVonda’s home as her homestead because she is the owner and, intends to return to the home at the end of the school year.
For clients living in a long-term care facility (LTCF) see Long-Term Care Facility (LTCF) Residents.
Long-Term Care Facility (LTCF) Residents
For clients residing in a LTCF, exclude the homestead using the criteria described below that will extend the exclusion over the longest period of time. If the property does not meet any of the criteria review it as Non-Homestead Real Property.
1. Exclude the homestead from the asset limit for the first six full calendar months the client resides in the LTCF if the client is expected to remain in the LTCF permanently.
Do not apply the homestead exclusion when a person requests MA payment of LTC services after residing in a LTCF for six full calendar months or more. Evaluate the property as Non-Homestead Real Property.
Example:
Ted was admitted to the hospital on June 15. On July 3 he was admitted to a nursing home for a permanent stay.
Action:
Exclude his homestead for June and for the next six months beginning with July, the first full month of institutionalization.
Provide written notice 30 days in advance of the expiration of the homestead exclusion informing the client that the equity value of the property will be counted toward the asset limit unless a reasonable effort to sell the property is made.
2. Exclude the homestead for as long as the LTCF resident intends to return home and can reasonably be expected to return home.
l Request a written statement of the client's intent to return home.
l Determine if the LTCF resident can reasonably be expected to return home.
n Obtain a doctor’s statement indicating when the person can reasonably be expected to return home if the client's stated intent contradicts his or her health or condition, or the information about the anticipated length of stay on the Physician's Certification Statement (DHS-1503).
n Document that MA or other sources will meet the cost of care if the client will require services upon returning home. Eligibility for MA or coverage of the services through Medicare or other private health insurance is acceptable verification.
Example:
Betty entered an LTCF on October 16 after she broke her hip. Her home was excluded through the following April. (the first six full months of institutionalization). The DHS-1503 indicates an anticipated discharge date of August 1. Betty has made arrangements with a niece to help with cleaning and yard work when she returns home.
Action:
Exclude the homestead for October as the initial partial month of LTCF residency. Exclude the homestead for November through April because it is the first six months of institutionalization. Continue to be exclude the homestead because Betty intends to return to the home, and the DHS-1503 confirms that she can be expected to return to the home. Review the exclusion in August.
3. Exclude the homestead for as long as it is the residence of one or more of the following relatives of the LTCF resident:
l Spouse.
l Child under 21.
l Disabled child of any age.
The child can become disabled at any age for this exclusion. Use the MA definition of disability. See MA Basis: Disability and Disability Determinations.
Example:
Horace, age 80, resides in a LTCF. His daughter Louella had a heart attack and became unable to work at age 55. She receives RSDI disability payments and lives in Horace’s home.
Action:
Exclude the homestead for as long as Louella lives there because she is Horace’s disabled child.
l Sibling.
To qualify for this exclusion the sibling must have lived in the home for at least one year immediately before the date of the client's admission to the LTCF and must have an equity interest in the home.
Example:
Emma and her sister Esther purchased a home together after they were both widowed. Emma contributed $40,000 toward the purchase of the home and Esther contributed $10,000. Four years after they purchased the home, Esther entered an LTCF and applied for MA. Her stay is expected to be permanent.
Action:
Exclude the homestead for Esther because Emma lived there for more than one year before Esther entered the LTCF and has an equity interest in the home. Continue to exclude the homestead as long as Emma continues to live in the home and has an equity interest in it.
l Child over 21 or grandchild. To qualify for this exclusion the child or grandchild must meet both of the following:
n Lived in the home for at least two years immediately before the date of the client's admission to the LTCF.
n Provided verifiable care to the client to permit the client to live at home instead of in an LTCF. Require a physician’s statement to verify that the adult child or grandchild provided such care.
Example:
Georgette enters a LTCF from the home she shared with her adult daughter, Carol. Georgette is expected to remain in the LTCF permanently. Carol has lived in the home all her life but does not have an ownership interest. Carol states she took over most of the household responsibilities and expenses when her mother became unable to care for herself.
Action:
Request a physician’s statement to confirm that Carol was needed in the home to care for Georgette. Exclude the homestead beyond the first six months of LTCF residence if the doctor verifies that Carol provided care that allowed Georgette to remain at home. Carol must continue to live in the home to maintain the exclusion.
Certain applicants and enrollees receiving MA payment of long-term care (LTC) services also have a limit on the amount of equity they have in their home. See LTC/EW Home Equity Limit for more information.