Section 210-RICR-40-00-3.7 - Factors Considered in the Treatment of Resources3.7.1Scope and PurposeA. There are several common features in process for evaluating resources when using the SSI methodology that apply across IHCC groups, whether using a full or simplified review. The purpose of this Section is to set forth these features and identify any exceptions where appropriate.3.7.2Process RulesA. The following process Rules apply generally in the evaluation of resources across IHCC groups.1. First of the Month Rule - Countable resources are determined as of the first (1st) of the month. This determination is based on the resources the person owns, their value, and whether or not they are excluded as of the first (1st) of the month.2. Resource Changes - What a person owns in countable resources can change during a month, but the change is always effective with the following month's resource determination. The kinds of changes that may occur include:a. Changes in value of existing resources. The value of an existing resource may increase or decrease.b. Disposition or acquisition of resources. A person may dispose of an existing resource, such as close a savings account and purchase an item, or may acquire a new resource, such as an inheritance which is subject to the income-counting Rules in the month of receipt.c. Change in exclusion status of existing resources. A person may replace an excluded resource with one (1) that is not excluded, such as sell an excluded vehicle for non-excluded cash, or vice versa (use non-excluded cash to purchase an excluded automobile). Similarly, a time-limited exclusion (such as the period for exclusion of retroactive Title II - RSDI - benefits) may expire.d. Change in resource form. The sale or transfer of a resource is treated as a change in the form of the resource rather than in countable income.3. Resource Reduction - If countable resources exceed the limit as of the first (1st) moment of a month, the applicant is not eligible for that month, unless the resources are reduced by expenditures on certain allowable expenses. In general, allowable expenses for resource reduction include:a. Health care services that are not covered under the Medicaid State Plan and the State's Section 1115 demonstration waiver granted under the authority of § 1115 of the Social Security Act, 42 U.S.C. § 1315, and are not reimbursable by a third (3rd) party such as Medicare, or some form of insurance. Such expenses must occur in a month of eligibility, including periods of retroactive eligibility when applicable. Certain LTSS home health care services are allowable expenses for Community Medicaid applicants when delivered by certified providers but only up to the amount Medicaid pays for the same or similar services on a fee-for-service basis. Additional Rules apply for Medicaid LTSS and are available at Part 50-00-6 of this Title.b. Tax payments based on assessments by the Federal Internal Revenue Service, the Rhode Island Department of Revenue or, other State or municipal taxing authority.c. Fees for court-appointed guardians or conservators including, but not limited to, court filing fees, the cost of a Probate Bond, court-approved guardianship/conservatorship fees, and court-approved legal fees.d. Legal fees associated with disposing or gaining access to resources.4. Evaluation Factors - The methods for evaluating resources vary depending on the standard of review, as indicated above, as well the type of resources. In general, each type of resource has its own unique deductions, exclusions, and methods for determining its countable value. Unless a resource is excluded, the ownership interest in a resource is evaluated in accordance with the following: a. Countable value. The countable value of a resource is the equity value. The equity value is the current fair market value minus any legal debt or encumbrances on the item. To be considered a debt against the resource, the debt must be legally recognized as binding on the resource's owner. The current fair market value is the amount an item can be sold for on the open market.b. Jointly Owned Resources. When two (2) or more parties share rights to sell, transfer, or dispose of part or all of personal or real property, the ownership share held by each person must be evaluated. This rule applies to resources such as joint checking or savings accounts and real estate held in common. In instances in which the document creating the joint interests, such as a deed to real estate or a bank account signature card, specifies the shares of the parties, the fair market value of the entire resource is divided between the joint owners according to the shares specified. The factors related to the availability and salability of jointly owned resources are taken into account in this review process. In instances in which a co-owner who must consent to the sale or redemption of a jointly owned resource is unavailable or refuses to take the actions necessary for the sale or redemption of the resource, then the resource is considered unavailable and is not included in the calculation of countable resources. Attribution of jointly owned resources is otherwise determined as indicated below:(1) Tenancy in common. Applies to all jointly owned resources involving two (2) or more persons which do not specify the ownership portion of each party - as in cases of joint tenancy or tenancy in its entirety. When the person seeking Medicaid and/or spouse has a tenancy in common with someone outside the household, the total value of non-liquid resources is divided among the total number of owners in direct proportion to the ownership interest held by each. By contrast, when a liquid resource such as an account in a financial institution is held in common, the entire equity value of funds in the account is considered available to its owner.(2) Joint tenancy. Occurs when each of two (2) or more persons has one (1) and the same undivided ownership interest and possession of the whole property for the duration of the tenancy. In effect, each owner owns all of the property. One (1) owner may sell, transfer or otherwise dispose of their share of the property without permission of the other owner(s) but cannot take these actions with respect to the entire property. Upon death of the joint tenant, title automatically vests in the surviving joint tenant. While alive any joint tenant may convey the interest held to a third (3rd) party. After such a conveyance, the new parties own the property as tenants in common.(3) Tenancy in its entirety. The value of any resource owned in its entirety by a person is considered available to its owner and is included as such for deeming in Community Medicaid and the allocation of resources for Medicaid LTSS.(4) Proportional joint ownership. The value of shared property in which each person only owns their fractional interest in the property is determined by dividing the total value of the property among all the owners in direct proportion to the ownership share held by each.c. Counting Order. If excluded funds are combined with countable resources, it is assumed the countable resources are spent first.d. Prudent-person standard. The prudent-person standard is used when determining whether a lower fair market value for a resource is reasonable. For example, for property sold at an auction, the current fair market value is considered to be the highest bid unless there is evidence that the transaction constitutes a resource transfer rather than a sale.5. Legal Factors Affecting Availability - A court restriction may make all or part of the resource unavailable. Other legal restrictions on resources may be included in: liens, domestic orders, divorce decrees, child support orders, probate matters, tax intercepts and garnishments, and/or bankruptcy proceedings. Other factors affecting the availability of a resource are specified below in § 3.7.2(A)(6) of this Part below and for LTSS eligibility purposes in Part 50-00-6 of this Title.6. Identifiability - Some resources must be identifiable to be excluded and, -as such must be distinguishable from other resources. A resource is identifiable if: a. The funds are kept physically apart from other funds, such as in a separate bank account.b. The funds are not kept physically apart from other funds but can be identified using a complete history of account transactions dating back to the initial date of deposit based on the records of the account holder.c. When a withdrawal is made from a commingled account, the non excluded funds are assumed to be withdrawn first, leaving as much of the excluded funds in the account as possible.d. The excluded funds remaining in the account can only be increased by deposits of subsequently received excluded funds and excluded interest. If interest on the excluded funds is excluded, the percent of an interest payment to be excluded is the same as the percent of funds in the account that is excluded at the time the interest is posted. The excluded interest is then added to the excluded funds in the account.3.7.3Mandatory Resource ExclusionsA. Resource exclusions may be mandated under the SSI methodology or by Federal laws other than the Social Security Act, 42 U.S.C. §§ 1396-1396w-7, as well as by the State and various other program requirements.1. Exclusions Required by Federal Law - Federal law establishes that certain resources are excluded when determining Medicaid eligibility using the SSI methodology across all IHCC coverage groups. A list of mandated Federal exclusions based on how they are treated if identifiable is located in § 3.8 of this Part.2. Required by State law or Regulation - Rhode Islanders are permitted a State tax deduction for funds committed to the State-administered 529 education account. Funds contributed to such an account are excluded, except for the amount of the Rhode Island tax deduction, as long as they are set aside for qualified educational expenses.3.7.4Special and Limited Time ExclusionsA. There are a number of special and time-limited exclusions that apply across the IHCC groups as well. Applicable general time-limited exclusions are as follows: 1. Retroactive Social Security and SSI/SSP - Retroactive payments of Federal SSI, SSP (the State only supplement to SSI), or RSDI benefits are excluded for nine (9) months beginning on the FOM after the month of receipt. These payments are also excluded as resources during the month of receipt.2. Funds for Replacing Excluded Resources - Cash and interest earned on that cash are excluded when received from any source, including casualty insurance, when it is for the purpose of repairing or replacing an excluded resource that is lost, stolen, or damaged. The exclusion is allowed for nine (9) months from the month of receipt of such funds and may be extended for an additional nine (9) months for good cause.3. Earned Income Tax Credit - State and Federal earned income tax credit refunds and advance payments are excluded as resources for one (1) year beginning the month after receipt.4. Health and Human Services Payments - Cash received for Health and Human Services is excluded for the calendar month following the month of receipt. The month following the month of receipt, the cash counts as a resource if it has been retained.5. Victim's Compensation Payments - State-administered victims' compensation payments are excluded for twelve (12) months after the month of receipt. 6. Relocation Payments - State and local government relocation payments are excluded for twelve (12) months after the month of receipt.7. Expenses from Last Illness and Burial - Payments, gifts, and inheritances occasioned by the death of another person are excluded provided that they are used for expenses resulting from the last illness and burial of the deceased and by the end of the calendar month following the month of receipt.8. Long-term Care Insurance Partnership - Amounts equal to the amount paid monthly in benefits from the time of application for long-term care insurance are disregarded as a resource when determining Medicaid eligibility under the Federal Deficit Reduction Act of 2005, Pub. Law 109-171. For purposes of LTSS eligibility, the same amount is excluded when determining the amount to be recovered from a beneficiary's estate.9. Dedicated home repair and modification funds - Up to an additional four thousand dollars ($4,000.00) may be set aside for a limited period - not to exceed one (1) year - in a separate dedicated account for the purposes of home repairs/modifications that enable a Medicaid LTSS beneficiary to continue to receive home-based care. Funds may only be used for such expenses when they are not covered by a third (3rd) party, including Medicare, Medicaid and any Federally or State-funded housing or assistance authority, and must be spent on repairs and modifications necessary to ensure a beneficiary is able to safely continue to obtain care in their own home. The set-aside must be approved by a Medicaid LTSS specialist based on documentation that the repairs/modifications are required for the person's health and safety and the cost estimates are deemed reasonable - estimates from a properly qualified contractor. Documentation that repairs are needed may be provided by a health practitioner or contractor. Any funds remaining in the account at the eligibility renewal after the account was established or used for purposes other than qualified home repairs or modifications are counted as a resource on the first (1st) day of the month following the renewal date.10. ABLE accounts - The federal Achieving a Better Life Experience Act (ABLE) of 2014, 26 U.S.C. § 529A, amended § 529 of the IRS code to permit States to create tax-advantaged savings accounts for persons who have proof of a documented disability or blindness, the onset of which occurred before age twenty-six (26). In accordance with R.I. Gen. Laws § 42-7.2-20.1 et seq., balances held in an ABLE account are excluded when determining financial eligibility for non-LTSS Medicaid under this Part and Medicaid LTSS pursuant to Part 50-00-6 of this Title. For persons eligible for Medicaid based on receipt of Supplemental Security Income (SSI), as described in Subchapter 05 Part 1 of this Chapter, balances of up to one hundred thousand dollars ($100,000.00) are excluded in the determination of financial eligibility. An SSI recipient with an ABLE account in excess of this balance loses SSI cash benefits until the balance is below this limit but is deemed eligible for the purposes of maintaining Medicaid eligibility. The resource exclusion for Medicaid eligibility continues to apply unless or until the contributions for the person benefiting from the ABLE account exceeds the annual limit of fifteen thousand dollars ($15,000.00) or the maximum life-time limit of three hundred ninety-five thousand dollars ($395,000.00). ABLE accounts are managed by the State and funds must be used only for the Qualified Disability Expenses established in Federal and State laws. Additional information on ABLE accounts is located at the Rhode Island Department of Behavioral Healthcare, Developmental Disabilities and Hospitals (BHDDH) website at: https://bhddh.ri.gov/developmental-disabilities-services/services-adults/able-saving-plan.3.7.5Determination of Resource EligibilityA. Once the appropriate exclusions have been applied and the value of each type of resource is determined, the value of all countable resources (including deemed resources) are added together to determine the total countable resources for the Medicaid eligibility group for the family size involved. If the resources of the Medicaid eligibility unit fall below or are equal to the applicable eligibility resource standard, the resource test is passed. If an excess resource amount remains after all exclusions have been applied, the applicant/beneficiary has not passed the resource test and must either reduce resources in accordance with the applicable provisions in § 3.7.2(A)(3) of this Part or give away excess resources subject to the transfer of resources Rule for Medicaid LTSS set forth in Part 50-00-6 of this Title.210 R.I. Code R. 210-RICR-40-00-3.7
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