Tenn. Comp. R. & Regs. 1240-03-03-.03 - RESOURCE LIMITATIONS FOR CATEGORICALLY NEEDY
(1)
Applicants for medical assistance as Categorically Needy in an AFDC related
coverage group are permitted to retain resources as described in rule
1240-01-50-.02 pertaining to the
Families First/AFDC cash assistance program. Excluded resources are those
excluded in the Families First/AFDC cash assistance program as reflected in
rule 1240-01-50-.05 and countable
resources are determined by using the Families First/AFDC policy reflected in
rule 1240-01-50-.06. Lump sum
payments are treated as income in the month of receipt and a resource if
retained thereafter.
(2) Applicants
for medical assistance as Categorically Needy in an SSI-related category are
permitted to retain resources in an amount not to exceed SSI limits except for
Qualified Medicare Beneficiaries (QMBs), Specified Low-Income Medicare
Beneficiaries (SLMBs), Qualifying Individuals 1 (QI1) (also referred to as
Specified Low-Income Beneficiaries (SLIBs)), and Qualified Disabled Working
Individuals who are permitted to retain resources in an amount not to exceed
two hundred percent (200%) of the SSI limits. Effective beginning with January
1, 2010, the resource limit for QMBs, SLMBs and QI1s increased to $6,600 for an
individual and $9,910 for a couple.
(a)
Resources excluded from consideration in determination of eligibility for
medical assistance are:
1. For SSI related
cases (aged, blind, and disabled individuals):
(i) A homestead may be exempt if used as a
home by the applicant/recipient, spouse, and/or dependent/relative. If absent
from the home with intent to return, an individual may retain a homestead for
an unlimited period of time. Based on current market values, individuals with
an equity interest in their home greater than five hundred thousand dollars
($500,000) are ineligible for Medical assistance for either institutional care
or Home and Community Based Services (HCBS) offered either through the CHOICES
Program or through a Section 1915(c) HCBS waiver program. This provision shall
not apply with respect to an individual if the spouse of an individual, or such
individual's child who is under age 21, or is blind or permanently and totally
disabled is lawfully residing in the individual's home. Beginning in the year
2011, the five hundred thousand dollar ($500,000) limit on home equity will
increase each year. The increase will be based on the percentage increase in
the Consumer Price Index (CPI) for all urban consumers, rounded to the nearest
one thousand dollars ($1,000).
(ii)
All life insurance, if the total face of all policies does not exceed fifteen
hundred dollars ($1500) per owner.
(iii) One motor vehicle of unlimited value is
excluded in its entirety, if it meets any one of the following conditions:
(I) It is necessary for employment;
or
(II) It is necessary to obtain
medical treatment of a specific or regular medical problem; or
(III) It has been modified for operation by
or transportation of a handicapped person; or
(IV) It is necessary because of climate,
terrain, distance, or similar factors to provide transportation to perform
essential daily activities.
I. If no motor
vehicle is excluded under the above provisions, one motor vehicle is excluded
to the extent equity value does not exceed forty-six hundred dollars ($4,600).
If the equity value exceeds forty-six hundred dollars ($4,600), the excess is
counted against the resource limit.
II. The equity value of any other motor
vehicle is counted unless also excludable under
1240-03-03-.03(2)(a)
1(iii) above or qualified as property under an approved plan for self-support
or necessary for self-support in a business or non-business income producing
activity. If no motor vehicle is excluded under the above provisions, one motor
vehicle is excluded to the extent equity value does not exceed forty-six
hundred dollars ($4,600). If the equity value exceeds forty- six hundred
dollars ($4,600), the excess is counted against the resource limit.
III. The equity value of any other motor
vehicle is counted unless qualified as property under an approved plan for
self-support or necessary for self-support, in a business or non-business
income producing activity, or fifteen hundred dollars ($1,500) of the equity
value is set aside for burial reserve.
(iv) Personal effects and household goods of
two thousand dollars ($2,000) or less equity value.
(v) Property essential to self-support can
include real and personal property (for example, land, buildings, equipment and
supplies, motor vehicles, and tools etc.) used in a trade or business;
nonbusiness income-producing property (such as, houses or apartments for rent,
land other than home property, etc.); and property used to produce goods or
services essential to an individual's daily activities. Liquid resources other
than those used as a part of a trade or business are not property essential to
self-support. If the individual's principal place of residence qualified under
the home exclusion (1240-03-03-.03(2)(a)
1(i) above), it is not considered in evaluating property essential to
self-support.
(I) Property used in a trade or
business or nonbusiness income-producing activity.
I. When property is used in a trade or
business or nonbusiness income-producing activity, only the individual's (or
spouse, if any) equity in the property is counted. Exclude as essential for
self-support up to six thousand dollars ($6,000) in equity and count only the
amount that exceeds six thousand dollars ($6,000), if the net income totals at
least six percent (6%) of the equity.
II. If the work activity produces less than a
six percent (6%) rate of return due to circumstances beyond the individual's
control such as due to illness or crop failure and the individual is expected
to resume the activity, the equity up to six thousand dollars ($6,000)
continues to be excluded. If the individual's total equity in the property is
producing six percent (6%) income but is over the six thousand dollars ($6,000)
equity limit, the amount of equity exceeding the six thousand dollars ($6,000)
is counted as a resource.
III. If
the individual owns more than one (1) piece of property and each produces
income, each is looked at to see if the six percent (6%) rule is met and then
the amounts of the individual's equity in all of those properties producing six
percent (6%) are totaled to see if the total equity is six thousand dollars
($6,000) or less. The equity in those properties that do not meet the six
percent (6%) rule is counted toward the allowable resource limit of two
thousand dollars ($2,000) for an individual. If the total equity in the
properties producing six percent (6%) income is over the six thousand dollars
($6,000) equity limit, the amount of equity exceeding six thousand dollars
($6,000) is counted as a resource toward the allowable resource limit.
Example: Charlotte operates a farm. She owns 3 acres of land on which her home is located. She also owns 10 acres of farm land not connected to her home. There are 2 tool sheds and 2 animal shelters located on the 10 acres. She has various pieces of farm equipment that are necessary for her farming activities. We exclude the house and the 3 acres under the home exclusion ( 20 C.F.R. § 416.1212). However, we look at the other 10 acres of land, the buildings and equipment separately to see if her total equity in them is no more than $6,000 and if the annual rate of return is 6 percent of her equity. In this case, the 10 acres and buildings are valued at $4,000 and the few items of farm equipment and other inventory are valued at $1,500. Charlotte sells produce which nets her more than 6 percent for this year. The 10 acres and other items are excluded as essential to her self-support and they continue to be excluded as long as she meets the 6-percent annual return requirement and the equity value of the 10 acres and other items remains less than $6,000.
Additional Example: At redetermination, Mr. Jones (the community spouse) states he now lives in an apartment and has rented the couple's formerly excluded homestead which has an equity value of $10,000. Although, the property produces a 6% rate of return, $4,000 of its equity cannot be excluded under this subpart (v).
(II) Property that represents government
authority to engage in an income-producing activity.
I. Property that represents the authority
granted by a governmental agency to engage in an income-producing activity is
excluded as property essential to self-support if it is used in a trade or
business or nonbusiness income-producing activity or not used due to
circumstances beyond the individual's control and there is a reasonable
expectation that the use will resume.
Example: John owns a commercial fishing permit granted by the State Commerce Commission, a boat and fishing tackle. The boat and tackle have an equity value of $6,500. Last year, John earned $2,000 from his fishing business. The value of the fishing permit is not determined because the permit is excluded under the exception. The boat and tackle are producing in excess of a 6 percent return on the excluded equity value, so they are excluded up to $6,000. The $500 excess value is counted toward the allowable resource limit of $2,000 for an individual.
(III) Property required by employer.
I. Personal property required by the
individual's employer for work is not counted regardless of value, while the
individual is employed. Examples of this type of personal property include
tools, safety equipment, uniforms and similar items.
(IV) Property used to produce goods or
services essential to daily activities.
I.
Nonbusiness property is considered to be essential for an individual's (and
spouse, if any) self-support if it is used to produce goods or services
necessary for his or her daily activities. This type of property includes real
property such as land which is used to produce vegetables or livestock only for
personal consumption in the individual's household (for example, corn,
tomatoes, chicken, cattle). Property used to produce goods or services or
property necessary to perform daily functions is excluded if the individual's
equity in the property does not exceed six thousand dollars ($6,000).
For example: Bill owns a small unimproved lot several blocks from his home. He uses the lot, which is valued at $4,800, to grow vegetables and fruit only for his own consumption. Since his equity in the property is less than $6,000, the property is excluded as necessary to self-support.
(vi) Burial
space for self, spouse and immediate family members.
(I) Burial space is defined to include
conventional grave sites, crypts, mausoleums, urns, or other repositories which
are customarily and traditionally used for the remains of deceased
persons.
(II) Immediate family
includes the applicant's or recipient's minor and adult children,
step-children, adopted children, brothers, sisters, parents, adoptive parents,
and spouses of these persons.
(vii) Funds used to purchase a promissory
note, loan or mortgage, if the repayment terms are actuarially sound, provide
for payments to be made in equal amounts during the term of the loan with no
deferrals or balloon payments, and the balance is not cancelled upon the death
of the lender.
(viii) Funds used to
purchase a promissory note, loan or mortgage, if the repayment terms are
actuarially sound, provide for payments to be made in equal amounts during the
term of the loan with no deferrals or balloon payments, and the balance is not
cancelled upon the death of the lender.
(ix) Funds, which are not commingled, are
subject to the limits specified below, which are designated as set aside for
expenses connected with the individual's burial, cremation or other funeral
arrangements.
(I) The maximum revocable amount
which may be set aside is fifteen hundred dollars ($1,500) for the
applicant/recipient and fifteen hundred dollars ($1,500) for his/her
spouse.
(II) The maximum revocable
amount is reduced by an amount equal to funds held in an irrevocable burial
trust, contract or agreement.
(III)
The maximum irrevocable burial fund, agreement or contract established by the
individual is six thousand dollars ($6,000) plus cost of transporting the
body.
(IV) Irrevocable burial
contract or agreements established by a funeral home/director for an individual
must be a reasonable amount and must have an itemized list of costs, goods and
services that reflect fair market value.
(x) Other resources determined to be
unavailable to the applicant/recipient due to circumstance beyond his/her
control.
(b)
In SSI related cases all other resources such as, but not limited to bank
accounts, money on hand, stocks, bonds, cash value of life insurance on which
the total face value exceed fifteen hundred dollars ($1,500), real property,
other than income-producing and homestead property (including cemetery plots)
not exempt in 1240-03-03-.03(2)(a)
1(i) and (v), non-excluded motor vehicles and revocable burial agreements,
unless exempt as in 1240-03-03-.03(2)(a)
1(iii) and (viii) shall be counted toward
the resource limit per family size.
(c) Resource eligibility will exist for the
entire month, if the applicant/recipient's total countable resources are at or
below the resource limit at any time during the month in question.
(3) Transfer of Assets.
(a) Countable assets under this paragraph (3)
include all real and personal property except a home and title transferred to
the individual's--
1. Spouse;
2. Minor child under age twenty-one (21) or
adult disabled or blind child;
3.
Sibling who has equity interest in the property and has resided in the home for
at least one (1) year prior to the individual's institutionalization;
4. Child [other than those in part 2 above]
who resided in the home at least two (2) years immediately preceding the
individual's institutionalization and who provided care that permitted the
individual to stay in the home rather than a medical or nursing facility;
or
5. To another for the sole
benefit of the community spouse or the individual's child who is blind or
permanently and totally disabled, or under age twenty-one (21).
(b) The period of ineligibility
for nursing home vendor payments through the CHOICES Program for assets
transferred within sixty (60) months of application for long term care nursing
services will be determined by dividing the uncompensated value of the
transferred asset by the average monthly nursing home private pay rate. In
determining the penalty for a transfer a State may not round down or disregard
any fractional period of ineligibility. There is no limit on the maximum months
of ineligibility. The penalty continues until expired unless hardship is
considered to exist and the institutionalized individual has no available
resources (other than the uncompensated value) in excess of the resource
limitations and the application of the penalty will result in loss of essential
nursing care, which is not available from any other source.
(c) If an asset has been found to be
transferred for less than fair market value within the sixty (60) month
look-back period, the penalty period begins the month the individual becomes
eligible for nursing home care through the CHOICES Program or the month of the
transfer, whichever is later. The penalty period runs consecutively even if the
individual leaves the nursing home for a period of time and later returns. If a
penalty period is imposed for new applicants, Medicaid requires a notice of
penalty. If a penalty period is imposed on an individual who is already
receiving Medicaid, a ten (10) day adverse action notice is required.
(d) Any multiple transfers made within the
look-back period will be treated as a single transfer and calculated as a
single period of ineligibility, which would begin on the date the individual is
eligible for medical assistance and would otherwise be receiving institutional
level care if not for the imposition of the penalty period, or the date of
transfer, whichever is later. For example, if an individual's spouse makes an
uncompensated transfer of assets of one thousand dollars ($1,000) in each of
the sixty (60) months of the look-back period, the State would add the
transfers together to arrive at a total amount of sixty thousand dollars
($60,000), divide that by the average private pay rate, and impose one
continuous period of ineligibility. The penalty period would start with the
earliest date specified under Tennessee's Medicaid plan.
(e) The transfers indicated below, if
occurring on or after February 8, 2006, may be considered a transfer of assets
for less than fair market value with respect to an individual applying for
Medicaid based on institutionalization:
1. If
the transfer of assets occurs within sixty (60) months of application for
institutional care.
2. If the
institutionalized individual, his/her spouse, or any person, court or
administrative body with authority to act on behalf of, or at the direction or
request of, the individual or his/her spouse, establishes a trust or similar
device, which includes the individual's assets and cannot be used by or for the
individual's benefit, if it occurred within sixty (60) months of application
for institutional care.
3. If an
asset is held jointly by the institutionalized individual with another person
and the individual or other owner reduces or eliminates the institutionalized
individual's ownership or control of the asset.
4. Penalty.
(i) The institutionalized individual may be
subject to penalty if the transfer was completed by himself/herself; the
individual's spouse; a person (including a court) or administrative body with
legal authority to act in place of, or on behalf of, or at the direction or
request of the institutionalized individual or his/her spouse.
(ii) The transfer of assets will be subject
to a penalty period of ineligibility for nursing home vendor payments
determined by dividing uncompensated value of the transferred asset by the
average monthly nursing home charge at the private pay rate unless satisfactory
proof is provided that the individual intended to dispose of assets for fair
market value; or assets were transferred exclusively for a purpose other than
to qualify for Medicaid; or transferred assets have been returned to the
individual; or it is determined that the penalty period would work an undue
hardship as defined in (3)(b) above.
(iii) Transfer of an asset for individuals
enrolled in HCBS either through the CHOICES Program or through Section 1915(c)
of the Social Security Act negates any eligibility under 42 C.F.R. §
435.217. The penalty for HCBS waiver recipients is the non-payment for waiver
services, the receipt of which is an eligibility requirement for the HCBS
category. The individual would remain ineligible until the look back period had
expired, or until such time as he/she entered a nursing facility. Upon entry
into a nursing facility, the penalty period would commence and continue for the
appropriate period of time.
(iv)
Assets include all income and resources, including the home, unless transferred
as indicated in (a) above, of the institutionalized individual and his/her
spouse (including income and/or resources the individual is entitled to, but
does not receive because of any action by the individual or his/her spouse, or
a person (including a court) or administrative body with legal authority to
represent the individual, his/her spouse, or who acts at the direction or
request of the individual and his/her spouse).
(f) Any contractual provision requiring the
resident to deposit entrance fees must take into account the required
allocation of resources or income to the community spouse before determining
the resident's cost of care. In addition the entrance fee paid to the
Continuing Care Retirement Community (CCRC) or life care community is treated
as a resource to an individual for purposes of determining Medicaid
eligibility. The following three (3) conditions must all be met in order for
the entrance fee to be considered an available resource:
1. Any portion of the entrance fee is
refunded or used to pay for care under the terms of the entrance contract
should other resources of the individual be insufficient; and
2. The entrance fee, or any portion thereof,
is refundable under the terms of the contract when the individual dies or
terminates the contract and leaves the CCRC or life care community, whether or
not any amount is actually refunded; and
3. The entrance fee does not confer an
ownership interest in the community.
(g) Funds used to purchase a loan, mortgage
or promissory note must be treated as a transfer of assets unless it has a
repayment term that is actuarially sound, provides for payments to be made in
equal amounts during the term of the loan with no deferral or balloon payment,
and prohibits cancellation of the balance upon the death of the lender. If an
individual purchases a home from a nursing home applicant and the purchase
agreement does not meet the criteria of this subparagraph (g). the value of the
home will be the outstanding balance due as of the date of the application for
Medicaid.
(h) A life estate
interest purchased by a nursing home applicant in another individual's home
shall be treated as a transfer of assets unless the nursing home applicant
resides in the home for a period of at least one (1) year after the date of the
purchase.
(4) Funds paid
into irrevocable burial agreements that are in compliance with T.C.A.
§
62-5-401 et seq. are not
counted as a resource. The agreement must be irrevocable as provided in
T.C.A. §
62-5-403(a)(2).
(5) Medicaid Qualifying Trust.
(a) Funds from a Medicaid qualifying trust,
as defined below, are deemed to be available to the applicant/recipient as
provided below when an application for Medicaid is filed on or after June 1,
1986 and a countable resource to that applicant/recipient.
(b) For purposes of this rule, a "Medicaid
qualifying trust" is a trust, or similar legal device, established prior to
August 11, 1993 (other than by will) by an individual (or an individual's
spouse) under which the individual may be the beneficiary of all or part of the
payments from the trust and the distribution of such payments is determined by
one or more trustees who are permitted to exercise any discretion with respect
to the distribution to the individual.
(c) The amounts from the trust deemed
available to an applicant/recipient is the maximum amount of payments that may
be permitted under the terms of the trust to be distributed to the
applicant/recipient, assuming full exercise of discretion by the trustee or
trustees for the distribution of the maximum amount to the applicant
recipient.
(d) The provisions of
this paragraph shall apply without regard to:
1. Whether or not the Medicaid qualifying
trust is irrevocable or is established for purposes other than to enable an
applicant/recipient to qualify for Medicaid; or
2. Whether or not the discretion described in
subparagraphs (b) and (c) is actually exercised.
(6) Undue hardship shall exist
when an application of a transfer of assets provision would deprive the
individual of medical care such that the individual's health or life would be
endangered or of loss of food, clothing, shelter, or other necessities of life.
(a) The individual, the individual's
responsible party, or the facility in which an institutionalized individual
resides may file an undue hardship claim on behalf of the applicant/recipient.
DHS will determine whether a hardship exists and notify the applicant/recipient
within thirty (30) days of filing.
(b) If undue hardship is determined not to
exist, the denial of undue hardship may be appealed within forty (40)
days.
(c) While an application is
pending for an undue hardship waiver and the applicant meets the criteria in
1240-03-03-.03(6)
above, the state will provide for nursing facility services in order to hold
the bed for the individual at the facility, but not in excess of ten (10)
days.
(7) Annuities.
(a) For any new application or
recertification for medical assistance for long-term care services, the
applicant must include a description and disclosure of any interest the
applicant or the community spouse may have in an annuity.
(b) The annuity must be treated as a transfer
of assets unless it is irrevocable and non-assignable, actuarially sound, and
provides payments in equal amounts during the term of the annuity, with no
deferral or balloon payments.
(c)
The purchase of an annuity will be treated as a transfer of assets for less
than fair market value unless:
1. The State of
Tennessee is named as the remainder beneficiary in the first position for at
least the total amount of medical assistance paid on behalf of the annuitant.
This provision applies to annuities purchased by an applicant or by a spouse,
or transactions made by the applicant or spouse.
2. If there is a community spouse and/or a
minor or disabled child, the State is named in the next position after those
individuals.
(i) If the State has been named
after a community spouse and/or a minor or disabled child, and any of those
individuals or their representatives dispose of any of the remainder of the
annuity for less than fair market value, the State may then be named in the
first position.
(ii) A child is
considered disabled if he or she meets the definition of disability found at
Section 1614(a)(3) of the Social Security Act ( 42 U.S.C. § 1382c(a)(3)
).
(d) In
addition to the provisions in (c)1 or 2 above, an annuity purchased by or on
behalf of the annuitant who has applied for medical assistance will not be
treated as a transfer of assets if the annuity meets any of the following
conditions in part 1 or part 2 or all of the conditions in part 3 below.
1. The annuity is -
(i) An individual retirement annuity
according to section 408(b) of the Internal Revenue Code of 1986 (IRC) ( 26
U.S.C. § 408(b)), or
(ii)
Deemed Individual Retirement Account (IRA) under a qualified employer plan
according to section 408(q) of the IRC ( 26 U.S.C. § 408(q)), or
2. The annuity is purchased with
proceeds from -
(i) A traditional IRA (IRC
§ 408(a) ( 26 U.S.C. § 408(a)), or
(ii) Certain accounts or trusts which are
treated as traditional IRAs (IRC § 408 (c)) ( 26 U.S.C. § 408(c)),
or
(iii) Simplified retirement
account (IRC § 408 (p)) ( 26 U.S.C. § 408(p)), or
(iv) A simplified employee pension (IRC
§ 408 (k)) ( 26 U.S.C. § 408(k)), or
(v) A Roth IRA (IRC § 408 (A) ( 26
U.S.C. § 408(A)), or
3. The annuity meets all of the following-
(i) The annuity is irrevocable and
non-assignable,
(ii) The annuity is
actuarially sound, and
(iii) The
annuity provides payments in equal amounts, with no deferred or balloon
payments.
4. If an
annuity is absent of such proof as outlined in this subparagraph (d), the
purchase of the annuity will be considered a transfer for less than fair market
value which is subject to a penalty. The burden is on the institutionalized
individual, or his or her representative, to produce the necessary
documentation.
(e) The
issuer of the annuity must notify the State when there is a change in the
disbursement of income or principal from the annuity.
(f) The application for assistance, including
the application for recertification, must include for long-term care services
the required disclosure under Section 1917(e)(1) and (2) of the Social Security
Act ( 42 U.S.C. § 1396p(e)(1) and (2)) as provided in subparagraph (a)
above. Failure to complete an application form that meets these requirements
will not affect the individual's eligibility for Medicaid; however, the
individual will not be eligible for coverage of long-term care services unless
the appropriate form is completed and signed.
(g) If the annuity is not subject to penalty
as transferred assets, it must still be evaluated as income or resources,
including spousal income or resources, and in the post-eligibility calculation,
as appropriate.
1. A revocable annuity can be
canceled and the funds used to purchase the annuity can be refunded to the
purchaser. If the owner or payee may be changed, the annuity is assignable and
can be sold on the secondary market.
(i) If an
annuity meets one or both of the criteria of revocable or assignable, it is a
countable resource. If the annuity is revocable, the resource value is the
amount that the purchaser would receive if the annuity is canceled. If the
annuity is assignable, the resource value is the amount the annuity can be sold
for on the secondary market.
(ii)
If an annuity purchased by or for an individual who has applied for medical
assistance with respect to nursing facility or other long-term care services is
a countable resource, it is not treated as a presumptive transfer of assets for
less than fair market value. However, assessing an annuity as a countable
resource does not preclude an evaluation of the purchase of the annuity as a
transfer of assets for less than fair market value if an assessment is
warranted based on the circumstances. For example, if an assignable annuity is
sold on the secondary market for less than its fair market value, a transfer of
assets for less than fair market value may have occurred.
(h) The provisions of this
paragraph (7) shall apply to all transactions occurring on or after February 8,
2006, including the purchase of an annuity and any other transaction that
changes the course of payments to be made or the treatment of income and
principal under an existing annuity, such as additions of principal, elective
withdrawals, request to change the distribution of the annuity, elections to
annuitize the contract and other similar actions.
(i) Routine changes which occur, based on the
terms of an annuity which existed prior to February 8, 2006, and which do not
require a decision, election, or action to take effect are not considered a
transaction. Routine changes would also include an address change or death or
divorce of a remainder beneficiary and other similar circumstances.
1. For example, if an annuity purchased in
June 2001 included terms which require distribution to begin five years from
the date of purchase, and payouts consequently begin, as scheduled, in June
2006, this will not be considered a transaction since no action was required to
initiate the change.
2. Changes
which are beyond the control of the individual, such as changes in law, a
change in the policies of the issuer, or a change in terms based on other
factors, such as the issuer's economic conditions, are not considered
transactions.
(8) Qualified Income Trust (QIT).
(a) Individuals who are receiving or will
receive nursing facility services or home and community based services (HCBS)
offered either through the CHOICES Program or through a Section 1915(c) HCBS
waiver program and whose income exceeds the Medicaid Income Cap (MIC) may
establish an income trust, referred to as a Qualified Income Trust (QIT) or
"Miller Trust". Funds placed in a QIT that meets the standards set forth in
paragraph (8) are not treated as available resources or income for purposes of
determining the individual's TennCare eligibility.
(b) A QIT is a trust consisting only of the
individual's pension income, Social Security Income, and other monthly income
that is created for the purpose of establishing income eligibility for TennCare
coverage when an individual is or soon will be confined to a nursing facility,
HCBS or ICF/MR waiver program offered either through the CHOICES Program or
through a Section 1915(c) HCBS waiver program.
(c) An individual is eligible to establish a
QIT if his or her income is above the level at which he or she would be
financially eligible for nursing facility, HCBS offered either through the
CHOICES Program or through a Section 1915(c) HCBS waiver program, or ICF/MR
care under Medicaid.
1. The amount of income
that an applicant/recipient places in a QIT cannot be limited nor can it be
counted when testing income against the Medicaid Income Cap (MIC). If the
applicant/recipient's income that is not placed in a QIT is over the MIC, the
individual is not financially eligible for nursing home Medicaid.
2. This Department of Human Services State
Rule 1240-03-03-.03(8)
shall apply to an income trust established on or after July 1, 2005 and with
the undue hardship provision in Section 1613(e) of the Social Security Act.
Hardship may be considered to exist when the institutionalized spouse and/or
his/her spouse would have resources in excess of the resource limit, is
otherwise eligible and for whom Medicaid ineligibility would result in loss of
essential nursing care, which is not available.
(d) A QIT must meet the following criteria:
1. The trust must be irrevocable and cannot
be modified or amended in whole or in part by the Grantor at any time. However,
the Trustee or a court of competent jurisdiction shall have the right and
jurisdiction to modify any provision of the trust to the extent necessary to
maintain the eligibility of the Grantor for medical assistance.
2. Other than disbursements under Part 3
below, each month the Trustee may only make disbursements from the trust for:
(i) A personal needs allowance up to the
amount recognized under Tennessee Medicaid policies. As of January 1, 2010,
this amount is Fifty Dollars ($50) per month;
(ii) Up to Twenty Dollars ($20) in necessary
expenses for management of the trust (i.e., bank charges);
(iii) A spousal income allocation in the
amount permitted under Tennessee Medicaid policies;
(iv) Expenses for health insurance premiums
for health insurance coverage of the Grantor other than Medicaid; and
(v) Expenses for qualifying medical or
remedial care received by the Grantor, to the extent such care is recognized
under Tennessee law as provided in Department of Human Services State Rule
1240-03-03-.04(2)(d)
but not covered as medical assistance under
the State's Medicaid program.
3. Each month the Trustee shall distribute
the entire amount of income remaining in the trust after any disbursements made
under Part 2 above to the State of Tennessee, Bureau of TennCare (or directly
to the nursing facility or HCBS provider or Managed Care Organization (MCO)
offered either through the CHOICES Program or through a Section 1915(c) HCBS
waiver program, as directed by the Bureau of TennCare), up to the total amount
of expenditures for medical assistance for the Grantor.
4. The sole beneficiaries of the trust are
the Grantor for whose benefit the trust is established and the State of
Tennessee (Bureau of TennCare). The trust terminates upon the death of the
Grantor, or if the trust is no longer required to establish Medicaid
eligibility in the State of Tennessee, if nursing facility or HCBS offered
either through the CHOICES Program or through a Section 1915(c) HCBS waiver
program is no longer medically necessary for the Grantor, or if the Grantor is
no longer receiving such services.
5. The trust must provide that upon the death
of the Grantor or termination of the trust, whichever occurs sooner, the State
of Tennessee (Bureau of TennCare) shall receive all amounts remaining in the
trust up to the total amount of medical assistance paid by the State on behalf
of the individual.
6. Amounts
remaining in the trust that are owed to the State must be paid to the Bureau of
TennCare within three (3) months after the death of the individual or
termination of the trust, whichever is sooner, along with an accounting of the
disbursements from the trust. The Bureau of TennCare may grant an extension if
a written request is submitted within two months of the termination of the
trust.
(9)
Assessment of Resources and Community Spouse Resource Allowance.
(a) Resources owned by either spouse, or by
both spouses together, are considered equally available to both spouses at the
beginning of a continuous period of institutionalization (i.e., 30 consecutive
days in nursing care) for persons institutionalized after September 30, 1989.
If an assessment of resources is requested by the institutionalized or
community spouse or by either spouse's authorized representative, an assessment
will be made within thirty (30) days of receipt of all relevant documentation
from the requesting party(ies). If either spouse is dissatisfied with the
Department's assessment of the community spouse's resource allowance at the
point an application for Medicaid has been filed, either spouse has a right to
a fair hearing with respect to the determination, which shall be held within
thirty (30) days of the date a request for hearing is made.
(b) The community spouse resource allowance
is equal to the greater of:
1. Effective April
1, 2009 one-half (1/2) of the total resources owned by both spouses not to be
less than twenty-one thousand nine hundred twelve dollars ($21,912) nor greater
than one hundred nine thousand five hundred sixty dollars ($109,560) and
adjusted annually per federal law;
2. The amount established after a fair
hearing by the Department of Human Services; or
3. The amount transferred under a court order
against the institutionalized spouse for the support of the community spouse,
using Tennessee's Medicaid eligibility standards, regardless of any other state
laws relating to community property or the division of marital
property.
(c) The
maximum amount of income of the institutionalized spouse must be allocated to
the community spouse before increasing the resource allocation.
(d) Spouses must be legally married pursuant
to the laws of the State of Tennessee; and
(e) The community spouse resource allowance
determined by the assessment will be deducted from the value of all available
resources owned by both spouses as of the first month for which assistance is
requested. After the initial month of eligibility, no resources of the
community spouse will be considered available to the institutionalized
spouse.
(f) Allocation of
Additional Resources to the Community Spouse.
1. Additional resources may be allocated to
the community spouse through the administrative appeals process, in accordance
with the criteria specified below, in order to make up any shortfall between
the allocation of income as specified in
1240-03-03-.04 and either the
standard maintenance amount (SMA) or the maximum monthly income allowance
(MMIA), as deemed appropriate.
2.
The amount of additional resources that are necessary to cover the shortfall in
the SMA or MMIA shall be determined in reference to the purchase of a single
premium annuity as follows:
(i) By calculating
the shortfall in the SMA or MMIA and determining the amount of additional
resources that must be invested in a single premium annuity in order to
generate the income necessary to cover the shortfall.
(ii) The amount of resources needed to cover
the shortfall shall be determined in reference to an annuity calculator as
adopted by the Department in its TennCare / Medicaid Policy Manual.
3. The additional allocation of
resources to the community spouse does not require the actual purchase of the
single premium annuity that is used for purposes of calculating the amount of
the additional resource allocation.
4. If a single premium annuity is actually
purchased pursuant to these rules, the annuity must comply with all other
relevant requirements of state and federal law.
5. The amount of additional resources that
are necessary to cover the shortfall in the SMA or MMIA shall not be determined
in reference to any investment which contemplates the return of the entire
principal at maturity.
Notes
Authority: T.C.A. §§
4-5-201 et seq., 4-5-202, 4-5-208,
4-5-209, 71-1-105(11) and (12), 71-5-101, 71-5-102, 71-5-103, 71-5-106,
71-5-111, 71-5-121, 71-5-147 and 71-5-1401 et seq; Acts 2008, Chapter 1190;
Acts 2009, Chapter 592, §1, 26 U.S.C. §§ 408 and 408A, 42 U.S.C.
§ 1382(a)(1)(B), 42 U.S.C. § 1382b, 42 U.S.C. § 1395x -
114(a)(3)(D), 42 U.S.C. §§ 1396 et seq., 42 U.S.C. § 1396a(q),
42 U.S.C. § 1396d(p) and (s), 42 U.S.C. § 1396d(p)(1)(c), 42 U.S.C.
§ 1396p, 42 U.S.C. § 1396p(c)(1)(A), (B), (C), (D), (E), (E)(iv),
(F), (G), (H), (I) and (J), 42 U.S.C. § 1396p(c)(2)(D), 42 U.S.C. §
1396p(d)(4)(B), 42 U.S.C. § 1396p(d)(5) and 42 U.S.C. §
1396p(e)(1),(2),(3) and (4), 42 U.S.C. § 1396p(f)(1), (2), (3) and (4), 42
U.S.C. § 1396p(g), 42 U.S.C. § 1396r-5, 42 U.S.C. § 1396r-5(b),
(c), (d), (f) and (g), and 42 U.S.C. § 1396r-5(d)(6) and (e); 20 C.F.R.
§§ 416.1205(c), 416.1212, 416.1220, 416.1222 and 416.1224; 42 C.F.R.
§ 435.601 and 435.602, 42 C.F.R. §§ 435.700, 435.721(b),
435.725, 435.735, 435.831, 435.832, 435.840, 435.845, and 435.914 (b) and (c);
45 C.F.R. § 233.20; PL 97-248, PL 98-369§ 2611, PL 99-509§ 9401
(a)(3), PL 100-93§9; PL
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