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Effective: September 1, 2008 |
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19.55ar2 - Long-term Care (LTC) Home Equity Limit (Archive) |
Archived: December 1, 2010 |
Certain applicants and enrollees requesting or receiving MA payment of long-term care (LTC) services are limited to a home equity interest of $500,000 or less. The $500,000 home equity limit is verified and reviewed when people request or renew MA payment of LTC services.
Steps to Applying the Home Equity Limit.
The fair market value (FMV) or estimated market value (EMV) of an applicant's or enrollee's home must be verified at the time the home equity limit is applied. If the FMV or EMV is greater than $500,000 encumbrances must also be verified to determine the home equity interest.
See Agricultural Homestead to evaluate a home located on agricultural land.
Note: Real estate appraisals will generally refer to a home’s fair market value (FMV), while tax statements generally refer to estimated market value (EMV). Either FMV or EMV may be used for purposes of the home equity limit policy.
Check the county assessor’s website to determine the EMV of a client's home. Request verification from the client if the EMV cannot be obtained from the county assessor's website.
Steps to Applying the Home Equity Limit
Complete the following steps for people requesting or renewing MA payment of LTC services:
1. Determine if the Home Equity Limit is a condition of eligibility. Review policy provided in Applying the Home Equity Limit.
Continue to Step 2 if a review is required.
2. Compare the client's interest in the reported FMV or EMV of the home to the home equity limit of $500,000. If the client's interest in the FMV or EMV is:
l Equal to or less than the limit, and the FMV or EMV has not been verified, request verification if it is unavailable through the county assessor’s office.
l Equal to or less than the limit, and the FMV or EMV is verified, the client is eligible if all other eligibility criteria are met. See Notice Requirements for information on whether worker comments or a manual notice are needed.
l Greater than the limit, request verification of the home's FMV or EMV and all encumbrances against the home if not already received. Continue to Step 3 when verifications are provided.
3. Determine the client's equity value based on the client’s ownership interest in the home.
Note: If the client’s home equity interest is located on agricultural land and the client's equity interest in the home is greater than the home equity limit, determine the client's agricultural homestead equity value. See Agricultural Homestead for more information.
4. Compare the client's home equity interest to the home equity limit of $500,000. If the client's equity interest is:
l Equal to or less than the limit, the client is eligible for MA payment of LTC services if all other eligibility criteria are met. See Notice Requirements for information on whether worker comments or a manual notice.
l Greater than the limit, the client is ineligible for MA payment of LTC services.
n Deny eligibility for MA payment of LTC services for applicants requesting payment of these services.
n For enrollees, close MA payment of LTC services, with 10-day notice.
n Update MMIS to prohibit MA payment of LTC services. See the MMIS User Manual (RLVA) for instructions.
Note: An end date must be entered even though actual months of ineligibility are not calculated. Enter an end date of 12/31/63. Update that date when the client meets the home equity limit or no longer has a home equity limit requirement.
n Do not deny or close MA for non-LTC services if all other eligibility criteria are met.
n See Notice Requirements for information on whether worker comments or a manual notice are needed.
Clients may request a hardship waiver when MA payment of LTC services is denied or closed due to the home equity limit.
These steps are also available on the Home Equity Limit Flowchart.
Certain situations require the worker to mail a notice or add worker comments to the MAXIS notice.
l Add a worker comment when a client’s MA payment of LTC services is:
n Denied, at the time of an application, due to the home equity limit. Add the following worker comment:
"Medical Assistance (MA) will not pay for your long-term care services because your home has an equity value of more than $500,000. (Minnesota Statutes, Section 256B.056, subd. 2)
Call your county worker right away if you feel your life will be in danger as a result of losing MA payment for your long-term care services."
n Closed at the annual renewal due to the home equity limit. Add the following worker comment:
"Starting (add date) Medical Assistance (MA) will no longer pay for your long-term care services because your home has an equity value of more than $500,000. (Minnesota Statutes, Section 256B.056, subd. 2)
Call your county worker right away if you feel your life will be in danger as a result of losing MA payment for your long-term care services."
l Send the Notice of Action for Payment of Long-Term Care Services (DHS-4915), including the ”Important Information” section when an action is taken on an applicant's or enrollee’s request for MA payment of LTC services, including when a renewal is processed.