|
Effective: December 1, 2006 |
|
|
19.45.05ar1 - Asset Assessment Determination (Archive) |
Archived: February 1, 2008 |
The purpose of the asset assessment determination is to estimate the community spouse asset allowance prior to MA application. This allows the couple an estimate of total assets the community spouse may retain if the Long-Term Care Spouse applies for MA.
The actual determination of the community spouse asset allowance will be completed at the time of the MA application.
Evaluate Effective Date Assets.
Determine the Community Spouse Asset Allowance.
When to Finalize the Spousal Asset Allowance.
Evaluate Effective Date Assets
The first step in the asset assessment determination is to evaluate the assets reported on the Asset Assessment Form (DHS-3340), which were owned by either spouse on the effective date.
Look at the following when evaluating which assets to use:
l Do verify all assets included in the assessment owned on the effective date, regardless if counted or excluded. Assets must also be verified at initial application and the first yearly renewal.
l Do not consider the availability of an asset when making the asset assessment determination.
l The equity value of the following assets is counted in the asset assessment determination and must be evaluated:
n Annuities that meet one of the following:
m Not annuitized.
m In the free look period.
m Have a commuted cash value.
n The corpus of a trust set up for the sole benefit of the community spouse even if disbursements began before the date of the asset assessment.
n Irrevocable trusts created before July 1, 2005, or on or after July 1, 2005 when either spouse is not applying for payment of LTC services.
Count the value of the portion of the corpus and/or income that can be distributed to either spouse.
n Irrevocable trusts created on or after July 1, 2005 when the client or client’s spouse funded the trust and either is applying for payment of LTC services. See Trusts Established On or After 8/11/93 for more details on these trusts.
Count the corpus and undisbursed income. Count the percentage of the amount based on the funds/assets the client or the client’s spouse contributed when the trust was created.
n Burial funds, except as excluded below.
n Other non-excluded assets.
n Retirement funds which contain a provision that allows the person to gain access to the funds in certain circumstances such as medical emergencies.
Note: Include the maximum amount available as a countable asset.
l The following assets are not counted in the asset assessment determination:
n The homestead.
n Personal and household goods.
n One vehicle, regardless of its use.
m Exclude the vehicle with the least equity.
m Do not apply vehicle policy used for standard MA asset calculations for an asset assessment.
n Capital assets necessary to operate a trade or business.
n One of the two below:
m The cash surrender value (CSV) of non-term life insurance policies with a total face value (FV) of $1,500 or less per person.
m The first $1,500 of an Irrevocable Burial Agreement (IBA) for people who do not have life insurance with a FV of $1,500 or less.
n Retirement annuities funded by a pension fund or retirement plan unless the person can gain access to all or part of the funds.
Example:
Susan entered the LTCF two years ago on July 1. Her husband, Paul, resides in the community and is employed. He has a 401K plan through his employer. The plan allows him to withdraw $25,000 for medical emergencies. They completed an asset assessment.
Action:
Count the $25,000 toward the total countable assets for the asset assessment. Exclude the balance of the 401K plan.
n Irrevocable trusts created on or after July 1, 2005 when the client or client’s spouse funded the trust and they are not applying for payment of LTC services. See Trusts Established On or After 8/11/93 for more details on these trusts.
m Count only the value of the portion of the irrevocable trust principal and/or income that can be distributed to either spouse.
n Other excluded assets.
If you discover previously unreported assets at the time of application, revise the asset assessment to include those assets if they were owned on the effective date.
Determine the Community Spouse Asset Allowance
There are three steps in determining the community spouse asset allowance, which is also referred to as the spousal asset allowance:
1. Total the equity value of all non-excluded assets owned by either spouse on the effective date of the assessment. This is the couple’s total countable assets.
2. Divide the total countable assets in half.
3. Compare half of the total countable assets to the Minimum/Maximum Asset Allowance in effect at the time you complete the asset assessment determination.
If half of the total countable assets are:
n Less than the minimum asset allowance, the estimated community spouse asset allowance is the minimum.
n More than the minimum asset allowance but less than the maximum asset allowance, the estimated community spouse asset allowance is half of the total countable assets.
n More than the maximum asset allowance, the estimated community spouse asset allowance is the maximum asset allowance.
The result of this calculation is an estimate of the assets the community spouse may retain should the LTC spouse apply for MA. This allows the couple to have an idea of how they might prepare to split their assets at the time of MA application. See Spousal Assets Determination for more information on how and when a couple should split assets.
l Do not require people to divide assets between spouses until the final figures are needed at MA application.
l There may be no advantage to the couple for the LTC spouse to transfer assets to the community spouse before a determination of MA eligibility, because all assets owned singly or jointly by both spouses are considered at the time of MA application.
Example:
Ulysses has been in a LTCF since June 8, 2003. His wife, Helen, remains in the community. The couple completed an asset assessment in October 2003. The couple verified owning their home, two vehicles with equity values of $12,000 and $20,000, and a savings account with a balance of $18,000.
Action:
The effective date for the asset assessment is June 8, 2003. The worker completed an asset assessment determination based on assets owned on the effective date. The worker evaluated the assets determining that the house was excluded as a homestead and the $12,000 vehicle will be excluded.
1. The total countable assets at the time of the asset assessment were $38,000.
2. Half the total countable assets is $19,000.
3. The community spouse asset allowance for Helen is $25,601, because half of the total countable assets is less than the $25,601 minimum for 2003.
If Ulysses applied for MA in 2003, Helen would be able to retain $25,601 of their $38,000 total countable assets.
When to Finalize the Spousal Asset Allowance
Determine the spousal asset allowance at the time of the LTC spouse’s first applies for MA in Minnesota and is found eligible. The spousal asset allowance is based on:
l The value of half the countable assets on the effective date.
l The minimum/maximum asset allowance amounts in effect on the date of application.
l Verify all assets at the time of application.
l See Spousal Assets Determination for more information on how and when a couple should split assets.
Example:
Helen applies for MA on March 10, 2005 for her husband, Ulysses, who is a LTCF resident. An asset assessment was completed shortly after Ulysses entered the LTCF in June 2003. At the time of the asset assessment determination half the total counted assets were $18,000. The community spousal asset allowance was the minimum asset allowance. The couple continues to own their home, the two vehicles with an equity value of $10,000 and $18,000 and the savings account with a balance of $12,000 which they reported when the asset assessment was first completed.
Action:
When processing the MA application the worker completes determines the community spouse asset allowance using the minimum and maximum in effect on the date of application.
1. The total countable assets are currently valued at $30,000. This is the total of the vehicle with the highest equity and the savings account balance. The house and the vehicle with the lowest equity are excluded.
2. Half of the total countable assets on the effective date were $15,000.
3. On the effective date of the asset assessment determination the community spousal asset allowance was the minimum. The minimum in April 2005 is $26,898. Half the total countable assets on the effective date is less than the current minimum. The spousal asset allowance is the current minimum of $26,898.
Helen will be able to retain $26,898 of the $30,000 of countable assets.