210 R.I. Code R. 210-RICR-50-00-6.5

Current through December 3, 2024

Section 210-RICR-50-00-6.5 - LTSS Determination of Countable Resources

A. The State has established a four thousand dollar ($4,000.00) resource limit for Medicaid LTSS eligibility for family size of one (1) - that is, a single individual - except for ACA expansion adults as indicated in §6.5.1 below. These resource limits are used to determine financial eligibility only and are not protected or reserved for any purpose related to Medicaid LTSS access or coverage. Therefore, the State treats countable resources within these limits to be available to the applicant or beneficiary as indicated in §40-00-3 of this Title.

B. The process for determining countable resources for LTSS purposes requires evaluating total assets at the time of application as well as a look-back period of five (5) years prior to the application date. The purpose of this five (5) year lookback period is to assess whether an applicant has transferred an asset (that is, resource or income) for less than or an unascertainable fair market value and to ensure that the resources available to the applicant/beneficiary do not exceed any limits that apply. As indicated below, resource limits do not apply to applicants seeking LTSS through the eligibility pathway for ACA expansion adults.

6.5.1Resources and ACA Expansion Adults

A. The Centers for Medicare and Medicaid Services (CMS), the Federal agency that oversees the Medicaid program, has issued guidance stating the ACA expansion adults seeking Medicaid LTSS are exempt from the provisions in Title XIX requiring States to establish resource limits for eligibility that are no more restrictive than those that apply for SSI recipients. As indicated in Part 8 of this Subchapter, Medicaid Long-Term Services and Supports (LTSS) Post-Eligibility Treatment of Income (PETI), the provisions in Title XIX related to the poste-ligibility treatment also do not apply.

B. CMS has determined that ACA expansion adults are subject to Federal requirements related to the transfer of assets (i.e., liquid resources and real property) to prevent the divestiture of resources to gain access to Medicaid LTSS and ensure that a share of the applicant's resources are protected for a spouse and dependents. Therefore, the only provisions set forth in this section that apply to ACA expansion LTSS applicants are in §§ 6.6 to 6.12 of this Part.

6.5.2Community Spouse Resource Allocation (CSRA) Process

A. The Community Spouse Resource Allocation (CSRA) is one of several mechanisms established by the U.S. Congress to ensure that the costs of LTSS care do not impoverish the spouse and/or dependents of the person who is receiving LTSS. Toward this end, a CSRA assessment considers the couple's total resources beginning when LTSS began and allocates certain amounts, within the limits established by Federal Regulation, to both the LTSS recipient and his or her spouse. Hereinafter, the non-LTSS spouse is the person in a couple who is not receiving or applying for LTSS. Once the CSRA is completed, the amount allocated to the spouse is considered protected and is unavailable to pay for the Medicaid LTSS beneficiary's cost of care.

B. On and after the point in which one begins to receive LTSS on a continuous basis and/or applies for Medicaid LTSS, a CSRA assessment of combined resources is conducted to determine the amount allocated to the non-LTSS or "community" spouse. For the purposes of this Part, the point of continuous LTSS (formerly referred to as the point of continuous institutionalization) is:

1. Health institution - The first (1^st) day of the month in which the LTSS applicant or beneficiary has begun to receive or is determined to have a need for services in a health institution that is expected to last for thirty (30) consecutive days or longer going forward.

2. Home or community-based services - The first (1^st) day of the month that State or its contractual agent, or an appropriately qualified health care provider determines, based on an assessment as defined in § 5.4 of this Subchapter, that a person who has submitted a completed application for Medicaid LTSS requires or is receiving at least monthly one (1) or more of the Medicaid LTSS covered services identified in Subchapter 10 Part 1 of this Chapter, Medicaid Long-Term Services and Supports: Home and Community-Based Services (HCBS).

C. The CSRA assessment is optional for LTSS recipients in health institutions before applying for Medicaid and mandatory for all couples at the time of application without regard to the type of Medicaid LTSS they are seeking - that is, in health institution, at home, or in a community-based setting (HCBS).

1. Optional, preliminary CSRA for LTSS in health institutions - At the beginning of a continuous period of LTSS in a health institution, either spouse, or a representative acting on behalf of either spouse, may request a preliminary CSRA assessment. The optional CSRA assessment serves only as a snapshot of the couple's joint resources at the point in time in which it is completed. A CSRA is performed again, at the time of application, in most instances.

a. Purpose. The optional assessment calculates the total value of the couple's combined countable resources, owned either jointly or separately, as of the date on which continuous LTSS in the health institution began. The purpose of this assessment is to provide the couple with the information necessary for their financial planning in anticipation of Medicaid eligibility.

b. Requirements. An application for Medicaid is not required in conjunction with the optional assessment. Accordingly, information for this CSRA is not verified. The State bases the assessment on information provided through attestations and any documents that may be submitted in conjunction with the request for the CSRA. A letter is sent to the person requesting the CSRA assessment by the State indicating the outcome.

c. Limits. Due to federal requirements, the optional CSRA is not available for persons receiving long-term care in a HCBS setting until they have applied for Medicaid LTSS. The CSRA for a Medicaid applicant seeking HCBS is never retrospective, as an applicant must be receiving at least one (1) Medicaid-covered LTSS service to qualify for eligibility.

2. Mandatory CSRA - In conjunction with the application for Medicaid, all countable resources owned by either spouse, jointly or separately, are pooled together as of either the date continuous LTSS began if in a health institution, or the date Medicaid LTSS eligibility will begin if not receiving LTSS or seeking HCBS coverage. Before the eligibility determination is made for the LTSS spouse, resources are allocated to the non-LTSS spouse up to the maximum allowed under Community Spouse Resource Standard set forth in §40-00-3.1 .7(A)(7)(d) of this Title. This standard is set by the Federal government and changes annually on July 1 every year.

D. To determine the allocation of the resources for the LTSS spouse, the CSRA calculation includes the following steps:

1. Total countable resources - The countable resources of the couple are totaled. A resource is only included in the CSRA calculation if it is countable for eligibility purposes using the SSI method, as indicated in §40-00-3.5 et seq. of this Title or as specified in §6.5.3 of this Part below.

2. Determination of Community Resource Allowance - The allocation of community resources for each spouse is determined by dividing the total countable resources for the couple by two (2). If necessary, the amounts are adjusted to ensure the non-LTSS spouse is allocated no less than the minimum but no more than the maximum allowed under the Community Spouse Resource Standard in §40-00-3.1 .7(A)(7)(d) of this Title unless directed by a court order or fair hearing decision. Any amount exceeding the minimum or the maximum that may be allocated to the non-LTSS spouse as an allowance is considered available to the Medicaid LTSS applicant in the eligibility determination, regardless of which spouse owns the excess amount.

3. Medicaid LTSS resource eligibility - The amount of any excess resources after this calculation is compared to four thousand dollars ($4,000.00), the Medicaid LTSS resource eligibility limit for one (1) person. If the amount is equal to or below this limit, the LTSS spouse applying for Medicaid LTSS is resource-eligible; if the remaining resources exceed the eligibility standard, Medicaid LTSS eligibility is denied. Resource reduction is an option when resources exceed the limit, in accordance with §6.5.2(D)(6) of this Part.

4. Notice - The State provides timely and adequate notice of the results of the CSRA assessment that includes the right to appeal the manner and/or the amount of the assessment.

5. Allocation adjustment - If income of the non-LTSS spouse is below the minimum monthly maintenance of needs allowance, as determined in Part 8 of Subchapter 00 of this Chapter, Medicaid Long-Term Services and Supports (LTSS) Post-Eligibility Treatment of Income (PETI), during the post-eligibility treatment of income process, additional joint resources may be allocated from the LTSS applicant/beneficiary to his or her spouse to make up the difference.

6. Spousal transfers - An LTSS beneficiary has ninety (90) days from the date of the eligibility determination to transfer any resources necessary into the non-LTSS spouse's name. After the initial ninety (90) day period is over, the State counts all resources that remain in the LTSS applicant/beneficiary's name in determining Medicaid LTSS eligibility. The State may extend the ninety (90) day period if any of the following conditions exist:

a. Legal action. A court is involved in assigning the couple's property through support actions;

b. Appeal pending. An appeal of the CSRA has been filed and a decision has not been rendered; or

c. Change in competency. The condition of the LTSS beneficiary requires the appointment of a conservator or guardian to act on his or her behalf.

7. Annual increases - The maximum amount of resources available under the Community Spouse Resource Standard for a non-LTSS spouse is increased every year by the Federal government. No notice is required in conjunction with this adjustment unless the eligibility of the LTSS beneficiary is adversely affected.

E. In instances in which the total countable resources of a couple are increased as the result of the sale or divestiture of an excluded resource, the assets are allocated equally to each spouse unless otherwise noted in the sales or divestiture agreement.

F. Under Rhode Island law, the rights to spousal support are automatically assigned to the State upon application for and receipt of Medicaid. Accordingly, the CSRA process differs somewhat when spouses are estranged or the non-LTSS spouse refuses to make all or a portion of a couple's joint resources available, as follows:

1. Estrangement - "Estrangement" means a breakdown to the point that the spouses would not be living together if one (1) was not receiving LTSS, whether in a health institution or the home and community-based setting.

If the LTSS applicant is estranged from the non-LTSS spouse, eligibility is not denied due to excess resources or failure to cooperate if the applicant is able to demonstrate any of the following forms of hardship:

a. Information unavailable. The LTSS applicant cannot obtain required information about the non-LTSS spouse's resources after exploring all legal means.

b. Resources unavailable. The LTSS applicant is unable to access the estranged non-LTSS spouse's resources after exploring all legal means, even though the non-LTSS spouse's resources are sufficient in amount to cause a determination of ineligibility.

2. Spousal refusal - If the couple is not estranged and the non-LTSS spouse refuses to make resources available, eligibility is not denied on the basis of either the excess resources that are unavailable as a result of such refusal, or non-cooperation, as long as the LTSS applicant or beneficiary provides appropriate documentation of spousal refusal.

3. State recovery - Once eligibility has been determined, the State is authorized to pursue and recover from the non-LTSS spouse any of the couple's joint resources that were unavailable due to spousal refusal to the extent required to reimburse the State for the cost of Medicaid provided to the spouse receiving Medicaid LTSS.

6.5.3LTSS-Specific Factors Considered in the Treatment of Resources

A. The provisions governing the evaluation and treatment of countable resources and the types of resources and related exclusions that apply when using the SSI method are set forth in §§40-00-3.5 .3 through 3.5.5 of this Title unless otherwise noted in this Part.

B. LTSS-specific factors related to the treatment of resources include:

1. Home exclusion - The applicant's primary residence and associated land are excluded if it has an equity value at or below the equity limit established in §40-00-3.1 .7(A)(7)(e) of this Title. The provisions governing applicability of the home exclusion are set forth in §40-00-3.5 .5(A)(1)(a) of this Title. A person who owns a primary residence with equity value in excess of the limit may request a hardship exemption in accordance with the criteria established in § 6.12 of this Part. Home exclusion is applicable under the provisions of § 5.3(B)(2)(e) of this Part.

2. Intent to return - The home exclusion applies when the LTSS applicant or beneficiary, the non-LTSS spouse and/or a dependent resides in the home or, when receiving LTSS outside of the home in a health institution or community-based setting, the LTSS applicant or beneficiary has an intent to return to the home as a primary residence. The following specific provisions also apply with respect to the intent to return:

a. One (1) established residence. The intent to return only applies to the one (1) home that has been established as the principal place of residence at the time of application for Medicaid LTSS. The exclusion does not apply to a home in which residency was not established at the time Medicaid LTSS began, even if the person expresses an intent to return to that home.

b. Duration. The initial expression of the intent to return is not maintained indefinitely. At the time of application and with each subsequent eligibility renewal, the LTSS applicant/beneficiary or an authorized representative must provide a written expression of the intent to return for the home exclusion to apply.

c. Contrary acts. If the applicant or beneficiary acts in a manner that is inconsistent with the intent to return by attempting to transfer or sell ownership in the primary residence, the home exclusion may be withdrawn. The home is then treated as a countable resource. Timely and adequate notice by the State is provided prior to withdrawal of the exclusion.

d. Diminished capacity. If the State finds that the capacity of an applicant or beneficiary to express a clear expression of the intent to return is diminished, an authorized representative may submit a sworn affidavit of the intent to return on behalf of the applicant/beneficiary. Evidence of diminished capacity is required, such as a legal judgment of incompetence or a documentation of a medical or mental health condition.

e. Residence of spouse or dependents. The entire value of a home is excluded, regardless of its equity value and without the need of an expression of the intent to return, if any of the following relatives of the LTSS applicant/beneficiary residing in a health institution is living in the property:

(1) A spouse;

(2) A child who is younger than twenty-one (21) years old or who is blind or permanently and totally disabled;

(3) A sibling who has a legal interest in the home and who was living there for a period of at least one (1) year immediately before the applicant's or beneficiary's admission to the medical institution;

(4) A son or daughter who was living in the home and shows, to the State's satisfaction, that he or she served as the primary caregiver for the LTSS applicant/beneficiary for a period of at least two (2) years immediately before admission to the health institution; or

(5) A dependent relative has any kind of medical, financial, or other dependency on the LTSS applicant/beneficiary, including a child, stepchild, or grandchild; a parent, stepparent, or grandparent; an aunt, uncle, niece, or nephew; a brother, sister, stepbrother, or stepsister; a half-brother or half-sister; a cousin; or an in-law.

3. Life estate - A life estate conveys the property of one (1) party (the life estate holder) for life and to a second (2^nd) party (remainderman) when the life estate expires. The holder of the life estate agreement is entitled to all the income produced by the property unless the life estate specifies otherwise. The agreement that creates a life estate is a will, a deed or some other legal instrument. The following factors determine whether a life estate is treated as an excluded resource:

a. Value of the life estate. The physical property has one value and the life estate has another, separate value. The value of the life estate is based on the equity value of the property and the age of the life estate holder. The value is determined as follows:

(1) Equity value. Determined by subtracting any encumbrances from the FMV of the real property (home).

(2) Age of holder. Age of the estate holder rounded to the nearest year.

(3) Life estate and remainder tables. These tables provide the value of a life estate and of a remainderman at any given age. The equity value of the real property is multiplied by the appropriate age figure from the tables. The State uses the life estate and remainder tables published by the U.S. Social Security Administration for the SSI program located in the Program Operations Manual System (POMS) at Section SI 01140.120.

b. Excluded resource. The equity value of a life estate is an excluded resource if the provisions set forth in §6.5.3(B)(1) of this Part are met with respect to:

(1) Rhode Island residence -- The home is located in the State;

(2) Equity value limit - The equity value of the life estate is at or below the limit set in §40-00-3.1 .7(A)(7)(e) of this Title; and

(3) Principal place of residence - The home is established as the principal place of residence; and there is an intent to return to the home as specified in § 6.3(B)(2) of this Part.

(4) Use of property - The life estate holder may use the property as a home or sell his or her ownership interest or may rent the property. If the life estate was purchased on or after July 1, 2006, the applicant or beneficiary must have resided in the home for a period of at least one (1) year for the home exclusion to apply.

(5) Salability - If a life estate cannot be sold, then it is an unavailable resource and is excluded on that basis in accordance with the provisions in §6.5.4 of this Part.

c. Disqualifying transfer. The establishment of a life estate may be considered a disqualifying transfer which results in a penalty period as set forth in § 6.9 of this Part.

4. Qualified long-term care insurance partnership - Rhode Island has established a Qualified Long-Term Care Insurance Partnership (QLTCIP) program. The QLTCIP operates as follows:

a. Resource disregard. A Medicaid applicant's resources are disregarded in an amount equal to the benefits paid by their QLTCIP policy as of the time of their application for Medicaid, and

b. Estate recovery relief. The total amount paid by the QLTCIP policy at the time of death is disregarded in the determination of the amount to be recovered from a beneficiary's estate. This amount may be above the total amount disregarded at the time eligibility is determined if there are continuing QLTCIP policy payments after Medicaid eligibility is established, and the beneficiary gains assets that exceed total resources protected at the time of eligibility.

c. Basis for the disregard. Long-term care insurance benefits that count toward the disregard include:

(1) Benefits paid as direct reimbursement of LTSS expenses;

(2) Benefits for LTSS paid to or on behalf of the beneficiary on a per diem, or other periodic basis, while the beneficiary is receiving LTSS services.

d. Application of the disregard. It is not required that benefits available under a Partnership policy be fully exhausted before the disregard of resources can be applied. The use of a qualified partnership policy cannot be used to reduce the length of a penalty period resulting from a disqualifying transfer or a denial of Medicaid LTSS when an applicant's equity interest in home property exceeds the limits set forth in §40-00-3.1 .7(A)(7)(e) of this Title.

e. Policies issue in other states. The State recognizes the validity of Partnership policies issued in other States. However, the State is not bound to accept the terms of these policies if they require that resource disregards or other financial exceptions be applied in a manner that exceeds or is inconsistent with the provisions set forth herein.

5. Other forms of LTSS insurance - The State provides a resource disregard for the payments of other forms of long-term care insurance issued by licensed/certified long-term care providers that meet national standards for actuarial soundness. Benefits from these insurance plans must be paid as a direct reimbursement for LTSS expenses provided to the Medicaid beneficiary. Estate recovery relief for payments disregarded is not available at the time of death if the insurance is not issued under the QLTCIP.

6. Trusts - The provisions in § 6.11 of this Part govern the treatment of resources from trusts for applicants and beneficiaries of Medicaid LTSS.

7. Retirement funds - The treatment of retirement funds, including individual retirement accounts (IRAs), of the LTSS applicant for determining countable income and resources is as set forth in §40-00-3.5 .5(A)(2)(g) of this Title.

a. The Coronavirus Aid, Relief, and Economic Security Act (CARES) enabled any taxpayer with a Required Minimum Distribution (RMD) due in 2020 from a defined-contribution retirement plan, including a 401(k) or 403(b) plan, or an IRA, to skip those RMDs in 2020. This includes anyone who turned age seventy and one half (70 1/2) in 2019 and would have had to take the first RMD by April 1, 2020. This change does not apply to defined-benefit plans. In addition to the rollover opportunity, an IRA owner or beneficiary who had already received a distribution from an IRA of an amount that would have been an RMD in 2020 could repay the distribution to the IRA by August 31, 2020. This repayment is not subject to the one (1) rollover per twelve (12) month period limitation and the restriction on rollovers for inherited IRAs.

b. For the purposes of determining the allocation of joint resources in accordance with §6.5.2 of this Part above, a couple is treated as if they were living together when evaluating the availability and attribution of retirement funds irrespective of whether the LTSS applicant or beneficiary is residing in a health institution. The transfer of asset provisions set forth in §§ 6.6 to 6.12 of this Part apply if any funds withdrawn are divested for less than fair market value, or converted into another resource that is not actuarially sound or does not otherwise meet the criteria for an allowable transfer set forth therein.

6.5.4Availability of Resources

A. As a condition of eligibility for Medicaid LTSS under Federal law, an applicant or beneficiary must liquidate all available resources unless there is a specific exemption set.

B. When a person is legally entitled to a resource, the State considers it to be available on the application date or the date the resource is acquired, whichever is later. If a person so entitled cannot competently represent his or her interests, the resource is treated as available from the period beginning six (6) months after the date of application or the date the resource is acquired, whichever is later, in the following circumstances:

1. No legal representative - The applicant/beneficiary requires assistance to obtain the resource and has no guardian or conservator and an authorized representative (which may include a provider) is making a good-faith effort to secure the appointment of a competent guardian or conservator; or

2. Inaccessible trustee - The sole trustee of a Medicaid Qualifying Trust as defined in § 6.11 of this Part is incapacitated or unavailable and the applicant/beneficiary or an authorized representative is making a goodfaith effort to contact the missing trustee or to secure the appointment of a competent trustee to act as the sole trustee.

C. A resource is unavailable when the applicant or beneficiary has no legal access. The State does not count an unavailable resource when determining Medicaid eligibility, but only for the period in which there is no legal access. Unavailable resources include, but are not limited to:

1. Real Property - Real property may be considered unavailable when the ownership of it is the subject of legal proceedings such as probate or and divorce suits; and

2. Life insurance - The cash-surrender value of life-insurance policies is treated as unavailable when the policy has been assigned to the issuing company for adjustment.

3. Jointly owned financial instruments and holdings - The value of such financial instruments and holdings (stocks, bonds, CDs, etc.) is considered unavailable for both CSRA and the determination of financial eligibility when a sworn statement is provided indicating the applicant or beneficiary:

a. Bonds jointly held. Is the named co-owner and does not have possession of the paper bond or the electronic transaction authority required to redeem the bond and the other co-owner will not redeem the bond, cannot be located, or refuses to provide the bond or transaction authority;

b. Stocks and similar holdings and investment accounts. Is prohibited from selling the asset at its current value without the authorization of a co-owner and the co-owner cannot be located or refuses to provide such authorization.

6.5.5Resource Reduction

A. An applicant who is denied eligibility due to excess resources - that is, resources above the set limit allowed for financial eligibility - may become eligible for Medicaid LTSS through resource reduction. To become eligible using this process, an applicant must provide evidence that he or she paid an allowable health expenses that equals or exceeds the amount of excess resources.

B. When using the resource reduction process, the Medicaid eligibility date is the date the applicant pays health expenses (medical bills) that reduce his or her total resources to the allowable limit. The following conditions apply:

1. Time-period - The resource reduction must occur in no more than thirty-five (35) days from the date on the eligibility denial notice, unless the applicant proves that he or she did not receive the notice in a timely manner. After the resource reduction time-period expires, a person must reapply for Medicaid LTSS.

2. Transfer of assets - An applicant must comply with the transfer of asset provisions set forth in § 6.6 of this Part below. A disqualifying transfer of assets is not accepted for resource reduction purposes in any circumstances.

3. No State payment - The State does not pay or otherwise reimburse any portion of the health expenses used for resource reduction.

4. Limits - To be used for resource reduction, the health expense must have been incurred in or after the ninety (90) day period prior to the first (1^st) day of the month the application was filed. If the applicant were eligible - that is, were not denied due to excess resources - this is same three (3) month period in which Medicaid LTSS retroactive coverage would be available if all applicable requirements were met.

4. Single use - The total amount or any portion of a health expense that is used for resource reduction must not be used for any other purpose in the determination of financial eligibility, including to meet an LTSS medically needy spenddown, or the post-eligibility treatment of income.

5. Adjustments - If a beneficiary submits an allowable health expense bill with a date that precedes the date eligibility is established through the resource reduction process, the State readjusts the date of eligibility if all the requirements set forth herein are met.

210 R.I. Code R. 210-RICR-50-00-6.5

Adopted effective 1/20/2019
Amended effective 7/21/2021