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Effective: October 1, 2007 |
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19.40ar2 - Transfers (Archive) |
Archived: September 1, 2008 |
The transfer of an asset or income without adequate compensation may result in a period of ineligibility for all or some MA and GAMC services. These provisions do not apply to MinnesotaCare or GHO.
This section of the manual details the policy needed to evaluate transfers and determine potential ineligibility for services.
How Do You Discover a Transfer?
What Are the Steps in Processing a Transfer?
A transfer occurs when a person or the person's spouse gives away, sells, conveys ownership, and/or reduces control, or disposes of any asset or income or an interest in an asset or income.
Examples of transfers may include:
l Transferring the remainder interest in a life estate to another person.
l Annuitizing an annuity.
l Reducing or eliminating the person or the spouse's ownership or control of income or assets held in common with another person or persons.
l Placing an asset into joint ownership with another person, reducing or eliminating the client’s or the client's spouse's ownership, control or right to sell or dispose of the asset.
Example:
June owns her house with a net value of $100,000. Her sister moves into the house and June decides to put the house in both of their names. June’s sister does not reimburse June for any of the equity. June’s sister now has joint ownership of the house.
Action:
This is a transfer of an asset because it reduces the ownership of the house for June. She now owns only $50,000 of the equity of the house. The other $50,000 was transferred to her sister.
l Any action that results in a person or the person's spouse not receiving income or assets to which the person is entitled, unless:
n The person cannot afford to take action to obtain the asset or income.
n The cost of taking the action is more than the asset or income is worth.
Examples of this type of transfer include:
m Waiving the right to or refusing to accept an inheritance, which is also known as refusing to elect against a will. The client may refuse an inheritance if doing so will result in greater income or assets.
Example:
Lester’s father died and left his estate to Lester. The estate included a dilapidated house and barn valued at $40,000. If Lester chose to accept the inheritance he would have to pay $50,000 in back taxes. Lester refused the inheritance.
Action:
This is not a transfer because the back taxes exceed the value of the property.
m Waiving pension income or diverting it to a trust or similar device for the benefit of another.
Example:
Angela assigned her pension income to go directly into a trust fund for her child. She does not have access to the income when it is in the trust.
Action:
This is a transfer of income.
m Refusing to take affordable legal action to obtain court-ordered payments that are not being paid, such as child support and alimony.
m Not accepting or taking action to obtain a right to personal injury settlements.
l Diverting personal injury settlements by the defendant into a trust or similar legal device to be held for the benefit of the plaintiff, unless the exception for a disabled person applies.
l Purchasing any of the following on or after July 1, 2006:
n A loan, mortgage or promissory note .
n A life estate interest in another person's home.
See Purchases as Transfers for more information on these types of transfers.
The term ”r;improper transfer” is often used to describe a transfer that results in a transfer penalty. Transfers can result in penalty if the client:
l Did not receive adequate compensation. These transfers are called uncompensated transfers.
l Made the transfer to obtain or maintain eligibility for GAMC or for payment of LTC or waiver services.
Note: These provisions also apply to transfers made by a community spouse after the LTC or EW spouse has been approved to receive MA payment for LTC services.
See Transfers Made for Purposes Other Than to Qualify for MA for information on how a client can prove that a transfer was not done to obtain or maintain eligibility and Transfer Exceptions for information on uncompensated transfers that are exempt from penalty.
Several other factors determine whether a particular uncompensated transfer will result in a penalty. See What are the Steps in Processing a Transfer?
How Do You Discover a Transfer?
Health care applications ask if anyone has transferred income or assets. The client must answer this question to be eligible for MA or GAMC.
Do not:
l Request information from a client regarding transfers unless there is evidence which indicates transfers have occurred, or the client or client’s representative have reported a transfer.
l Assume at application that a transfer has occurred.
l Automatically request information such as bank statements or tax returns for the months of the lookback period.
There must be information reported and evidence presented before any such information is requested.
What Are the Steps in Processing a Transfer?
There are specific steps to follow when any of the following people make a transfer on behalf of the client or the client's spouse:
l The client.
l The client’s spouse.
l The client's representative on behalf of the client or client’s spouse.
Note: This includes a court or administrative body with legal authority to act in place of or on behalf of the person or spouse.
l A person, court or administrative body acting at the direction of or at request of the client or spouse.
The steps are:
1. Determine if the transfer meets a transfer exception.
2. Determine the transfer date.
3. Determine if the transfer took place during the lookback period.
4. Determine the uncompensated value of the transfer. This step calculates whether a client has received adequate compensation.
5. Determine the transfer penalty for transfers with an uncompensated value that took place during the lookback period.
6. Apply the transfer penalty unless the county grants a waiver of transfer penalty.
There are no transfer provisions for MinnesotaCare or GHO.
The policy in this section is for transfers occurring on or after July 1, 1988. For transfers made before July 1, 1988, please see Archived Transfer Information.
A transfer penalty results in ineligibility for the following MA long-term care covered services for the length of the penalty period:
l Skilled nursing facility care.
l Nursing facility care in an inpatient hospital.
l Intermediate care facility services.
l Services provided through the following home and community-based waivers:
n CADI.
n CAC.
n DD.
n EW.
n TBI.
The person remains eligible for all other MA-covered services.
A person is ineligible for all GAMC services during the transfer penalty period.