TITLE 8 SOCIAL
SERVICES
CHAPTER 281 MEDICAID
ELIGIBILITY - INSTITUTIONAL CARE (CATEGORIES 081, 083, 084)
PART 500 INCOME
AND RESOURCE STANDARDS
8.281.500.1 ISSUING
AGENCY: New Mexico Health Care Authority.
8.281.500.2 SCOPE: The
rule applies to the general public.
[8.281.500.2 NMAC - Rp, 8.281.500.2 NMAC,
8/15/2015]
8.281.500.3 STATUTORY AUTHORITY: The New Mexico medicaid program and other health care programs are administered pursuant to regulations promulgated by the federal department of health and human services under Title XIX of the Social Security Act as amended or by state statute. See, Section 27-1-12 et seq. NMSA 1978. Section 9-8-1 et seq. NMSA 1978 establishes the health care authority (HCA) as a single, unified department to administer laws and exercise functions relating to health care facility licensure and health care purchasing and regulation.
[8.281.500.3 NMAC - Rp,
8.281.500.3 NMAC, 8/15/2015 ; A,
7/1/2024]
8.281.500.4 DURATION: Permanent.
[8.281.500.4 NMAC - Rp, 8.281.500.4 NMAC,
8/15/2015]
8.281.500.5 EFFECTIVE
DATE: August 15, 2015, unless a later date is cited
at the end of a section.
[8.281.500.5 NMAC - Rp, 8.281.500.5 NMAC,
8/15/2015]
8.281.500.6 OBJECTIVE: The
objective of this rule is to provide specific instructions when determining
eligibility for the medicaid program and other health care programs it
administers. Generally, applicable
eligibility rules are detailed in the medical assistance division (MAD) medical
assistance programs (MAP) eligibility rules manual, specifically Section 8.200.400
NMAC. Processes for establishing and
maintaining MAP eligibility are detailed in the income support division (ISD)
general provisions 8.100 NMAC.
[8.281.500.6 NMAC - Rp, 8.281.500.6 NMAC,
8/15/2015]
8.281.500.7 DEFINITIONS:
A. Definitions
beginning with “A”:
(1) Actuarially
sound: With respect to an annuity or
promissory note, the payments made to the beneficiary must not exceed their
life expectancy and returns to the beneficiary an amount at least equal to the
amount used to establish the contract.
(2) Annuity: A financial instrument, usually sold by a
life insurance company, that pays out a regular income at fixed intervals for a
certain period of time, often beginning at a certain age and continuing for the
life of the owner.
(3) Asset limit: An applicant or recipient may be eligible for
a MAP category of institutional care on the factor of resources if countable
resources do not exceed $2,000.
(4) Assets:
All income and resources of an applicant or recipient and their spouse,
if applicable.
(5) Authorized representative: The individual designated to represent and
act on the applicant’s or recipient’s behalf during the eligibility
process. The applicant or recipient or
their authorized representative must provide formal documentation authorizing
the named individual or individuals to access the identified case information
for a specified purpose and time frame.
An authorized representative may be an attorney representing a person or
household, a person acting under the authority of a valid power of attorney, a
guardian, or any other individual or individuals designated in writing by the
claimant.
B. Definitions
beginning with “B”: Bona fide: A bona fide agreement is made in good faith
and is legally valid.
C. Definitions
beginning with “C”:
(1) Community spouse: The
spouse of an institutionalized applicant or eligible recipient who is residing
in the community and is not in an institution.
(2) Community spouse resource allowance (CSRA): An amount of a married couple’s resources
that is set aside for the community spouse when the eligible recipient is
institutionalized. There is a MAD
minimum and a federal maximum amount of resources that can be set aside for the
community spouse.
D. Definitions beginning with “D”: [RESERVED]
E. Definitions
beginning with “E”: Encumbrance: A general term for any claim or lien on a
parcel of real property, including mortgages, deeds of trust and abstracts of
judgments.
F. Definitions
beginning with “F”: Fair market value: An estimate of the value of an asset, if sold
at the prevailing price at the time it was actually transferred. Value is based on criteria used in appraising
the value of assets for the purpose of determining a MAP category of
eligibility.
G. Definitions
beginning with “G”: [RESERVED]
H. Definitions beginning with “H”: Home equity: (Also
known as equity value.) The value of a
home minus the total amount owed on it in mortgages, liens and other
encumbrances.
I. Definitions
beginning with “I”:
(1) Income:
Anything that an applicant or recipient receives in cash or in kind that
[he or she] they can use to meet their needs for food and shelter. In-kind income is not cash, but is actual
food or shelter, or something that the applicant or recipient can use to get
one of these.
(2) Institutionalized spouse: An applicant or recipient who is in an acute
care hospital, nursing facility, intermediate care facility for individuals
with intellectual disabilities (ICF-IID), swing bed or certified in-state
inpatient rehabilitation center.
J. Definitions beginning with “J”:
[RESERVED]
K. Definitions beginning with “K”: [RESERVED]
L. Definitions
beginning with “L”:
(1) Life estate: An
interest in property that exists for the life of a person. For example, an individual gives a life
estate in a house to person A and the remainder to person B. Person A has a life estate and person B has a
remainder interest until person A dies.
(2) Liquid
resource: Cash or something that can
easily be converted to cash within 20 business days.
(3) Loan: A transaction in which one party advances
money to, or on behalf of another party, who promises to repay the lender in
full, with or without interest.
(4) Long-term Care Insurance Policy: A
type of insurance developed specifically to cover the costs of nursing homes, assisted living, home health care
and other long-term care services as specified in the individual’s policy.
(5) Lookback period: A
period of time in the past through which the ISD caseworker may examine all
financial transactions for asset transfers.
M. Definitions
beginning with “M”: Minimum monthly maintenance needs
allowance: A minimum level of income
that the federal government allows to be set aside for the support of the
community spouse when the other spouse is in an institution.
N. Definitions
beginning with “N”:
(1) Negotiable agreement: An
agreement (i.e., a loan) in which the ownership of the agreement and the whole
amount of money can be transferred from one person to another.
(2) Non-liquid
resource: An asset such as real
property, which cannot be easily converted to cash within 20 days.
O. Definitions beginning with “O”: [RESERVED]
P. Definitions beginning with “P”:
(1) Promissory
note: A promissory note is a
written, unconditional agreement in which one person promises to pay a
specified sum of money at a specified time to another person.
(2) Protected
Asset Limit: Protected assets up to
the amount of qualified long-term care insurance partnership (QLTCPI) benefit
payments made to or on the behalf of individual. This is the applicant’s or recipient’s
protected asset limit (PAL).
Q. Definitions
beginning with “Q”: Qualified state long-term care insurance
partnership (QSLTCIP) program: A
partnership program that joins MAD with private insurance companies that offer
long-term care insurance policies. The
MAP eligibility requirements are adjusted to provide financial incentives for
eligible recipients to purchase private QSLTCIP coverage.
R. Definitions beginning with “R”:
(1) Relative:
Relative is defined as a spouse, son or daughter; grandson or
granddaughter; step-son or step-daughter; in-laws; mother or father;
step-mother or step-father; half-sister or half-brother; grandmother or
grandfather; aunt or uncle; sister or brother; step-brother or step-sister; and
niece or nephew.
(2) Remainder/remainder
man: An interest in property that
occurs after a life estate. For example,
an individual gives a life estate in a house to person A and the remainder to
person B. Person A has a life estate and
Person B has a remainder interest until person A dies. Person B is also called the remainderman.
(3) Resources: Cash or other liquid assets and any real or
personal property that applicant or recipient (or spouse if any) owns and could
convert to be used for their support and maintenance.
(4) Restricted
coverage: An eligible recipient who
has restricted coverage may access medically necessary MAD benefits except for
long-term care services in a nursing facility.
(5) Reverse
mortgage: A loan against home equity
providing cash advances to a borrower and requiring no repayment until a future
date.
S. Definitions
beginning with “S”:
(1) Sole benefit of: A
transfer is considered for the sole benefit of a spouse, blind or disabled
child, or a disabled individual if the transfer is arranged in such a way that
no individual or entity except the spouse, blind, or disabled child, or
disabled individual can benefit from the assets transferred in any way, whether
at the time of the transfer or at any time in the future.
(2) Spouse: For purposes of this rule, a spouse is an
individual who is legally married under the laws of a state, a territory, or a
foreign jurisdiction in which the marriage was celebrated.
T. Definitions
beginning with “T”: Transfer: To change over the possession, control or
ownership of something.
U. Definitions beginning with “U”: [RESERVED]
V. Definitions beginning with “V”: [RESERVED]
W. Definitions beginning with “W”: [RESERVED]
X. Definitions beginning with “X”: [RESERVED]
Y. Definitions beginning with “Y”: [RESERVED]
Z. Definitions beginning with “Z”: [RESERVED]
[8.281.500.7 NMAC - Rp, 8.281.500.7 NMAC,
8/15/2015; A, 3/1/2018; A, 12/1/2022]
8.281.500.8 MISSION:
To transform
lives. Working with our partners, we
design and deliver innovative, high quality health and human services that improve
the security and promote independence for New Mexicans in their communities.
[8.281.500.10 NMAC -
N, 12/1/2022]
8.281.500.9 NEED DETERMINATION: Applicants
for and recipients of institutional care must apply for and take all necessary
steps to obtain any income or resources to which they may be entitled. When an applicant or recipient is given notification
by HSD to apply for and obtain specific income and resources they must take
steps to do so within 30 calendar days.
A. Failure to
apply for and take steps to determine eligibility for other benefits: Failure or refusal to apply for and take all
necessary steps to determine eligibility for other benefits after notice is
received results in an applicant or recipient becoming ineligible for a MAP
category of eligibility for institutional care.
B. Exceptions to general requirement: Applicants
or recipients who have elected a lower veterans administration (VA) payment do
not need to reapply for veterans administration improved pension (VAIP)
benefits. Crime victims are not required
to accept victims compensation payments from a state-administered fund as a
condition of MAP eligibility.
[8.281.500.9 NMAC - Rp, 8.281.500.9 NMAC,
8/15/2015; A, 12/1/2022]
8.281.500.10 RESOURCE
STANDARDS: A “resource” is defined as cash or liquid
assets and real or personal property which is owned and can be used either
directly, or by sale or conversion, for the applicant’s or recipient’s support
and maintenance. Resources may be liquid
or non-liquid and may be excluded from the eligibility determination process
under certain conditions. A liquid
resource is an asset which can readily be converted to cash. A non-liquid resource is an asset or property
which cannot readily be converted to cash.
A. Resource determination: The
resource determination for a MAP category of eligibility for institutional care
is made as of the first moment of the first day of the month. An applicant or recipient is ineligible for
any month in which their countable resources exceed the allowable resource
standard as of the first moment of the first day of the month. Changes in the amount of countable resources
during a month do not affect eligibility or ineligibility for that month.
B. Distinguishing between
resources and income: Resources must be distinguished from income
to avoid counting a single asset twice.
As a general rule, ownership of a resource precedes the current month
while income is received in the current month.
Income held by an applicant or recipient until the following month
becomes a resource.
[8.281.500.10 NMAC - Rp, 8.281.500.10
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.11 APPLICABLE
RESOURCE STANDARDS: The resource
criteria and eligibility standards of this section apply to all applicants for
and recipients of a MAP category of eligibility for institutional care. An applicant or recipient is eligible for a MAP
category of eligibility for institutional care on the factor of resources if
countable resources do not exceed $2,000.
Some of an applicant’s or recipient’s resources are counted in the
eligibility determination and some resources are excluded. Any resource which is not specifically
excluded in Section 8.281.500.13 NMAC is considered a countable resource for
the purpose of determining a MAP category of eligibility for institutional
care.
A. Liquid resources: A liquid resource is cash or something that
can easily be converted to cash within 20 business days. The
face or surrender value of liquid resources such as cash, savings or checking
accounts, and other financial instruments are considered in determining a MAP
category of eligibility. The countable
value of liquid resources is based on their current fair market value.
(1) An
applicant or recipient must provide verification of the value of all liquid
resources. The resource value of a bank
account is customarily verified by a statement from the bank showing the
account balance as of the first moment of the first day of the month in
question. If an applicant or recipient cannot
provide this verification, the ISD worker provides the applicant or recipient
with a detailed request of all documents needed to determine a MAP category of eligibility.
(2) If
the applicant or recipient can demonstrate that a check was written and
delivered to a payee but not cashed by the payee prior to the first moment of
the first day of the month, the amount of that check is subtracted from the applicant
or recipient checking account balance to arrive at the amount to be considered
a countable resource.
B. Non-liquid resources: A non-liquid resource is something such as
real property that cannot easily be converted to cash within 20 business
days. The value of non-liquid resources
is computed at current market value minus encumbrances or financial penalties
for early withdrawal.
[8.281.500.11 NMAC - Rp, 8.281.500.11
NMAC, 8/15/2015]
8.281.500.12 COUNTABLE RESOURCES:
Before a resource can be considered countable, the three criteria listed
below must be met.
A. Ownership
interest: An applicant or recipient
must have an ownership interest in a resource for it to be countable. The fact that an applicant or recipient has
access to a resource, or has a legal right to use it, does not make it
countable unless the applicant or recipient also has an ownership interest in
it.
B. Legal
right to convert resource to cash:
An applicant or recipient must have the legal ability to spend the funds
or to convert non-cash resources into cash.
(1) Physical
possession of resource: The fact
that an applicant or recipient does not have physical possession of a resource
does not mean it is not their resource.
If they have the legal ability to spend the funds or convert the
resource to cash, the resource is considered countable. Physical possession of savings bonds is a
legal requirement for cashing them.
(2) Unrestricted
use of resource: An applicant or
recipient is considered to have free access to the unrestricted use of a
resource even if they can take those actions only through an agent, such as a
representative payee, guardian, conservator, trustee, or another authorized
representative. If there is a legal bar
to the sale of a resource, the resource is not countable. However, if a co-owner of real property can
bring an action to partition and sell the property, their interest in the
property is a countable resource.
C. Legal ability
to use a resource: If a legal
restriction exists which prevents the use of a resource for the applicant’s or
recipient’s own support and maintenance, the resource is not countable.
D. Joint
ownership of resources: If an
applicant or recipient owns either liquid or non-liquid resources jointly with
others, they have 30 calendar days from the date requested by the ISD worker to
submit all documentation required to verify their claims regarding ownership
of, access to, and legal ability to use the resource for personal support and
maintenance. Failure to do so results in
the presumption that the resource is countable and belongs to the applicant or
recipient.
(1) Jointly
held property: If jointly held
property is identified during review of an active case, the ISD worker must:
(a) determine
whether the property is a countable resource;
(b) determine
whether the value of the jointly held property plus the value of other
countable resources exceeds the allowable resource maximum; and
(c) if
the value of countable resources exceeds the allowable maximum, advance notice
is furnished to the applicant or recipient of the intent to close their case
and their right to verify claims regarding ownership of, access to, and legal
ability to use the property for personal support and maintenance.
(i) If
the applicant or recipient fails to provide required information or respond
within the advance notice period, their case is closed.
(ii) If,
after expiration of the advance notice period but prior to the end of the month
in which the advance notice expires, the applicant or recipient provides the
required evidence to show the property is not a countable resource, or is
countable in an amount which, when added to the value of other countable
resources, does not exceed the maximum allowable limit, and eligibility
continues to exist on all other factors, the case is reinstated for the next
month.
(2) Joint
bank accounts: If liquid resources
are in a joint bank account of any type, the applicant’s or recipient’s
ownership interest, while the parties to the account are alive, is presumed to
be proportionate to the applicant’s or recipient’s contributions to the total
resources on deposit.
(a) The
applicant or recipient is presumed to own a proportionate share of the funds on
deposit unless they present clear and convincing evidence that the parties to
the account intended the applicant or recipient to have a different ownership
interest.
(b) To
establish the applicant’s or recipient’s ownership interest in a joint account,
the following are required:
(i) statement
by the applicant or recipient regarding contributions to the account; reasons
for establishing the account; who owns the funds in the account; and any
supporting documentation; plus
(ii) corroborating
statements from the other account holder(s);
(iii) if
either the applicant or recipient or the other account holder is not capable of
making a statement, the applicant or recipient or an authorized representative
must obtain a statement from a third party who has knowledge of the
circumstances surrounding the establishment of the joint account.
(c) Failure
to provide required documentation within 30 calendar days of the date requested
by the ISD worker results in a determination that the entire account amount
belongs to the applicant or recipient.
(d) If
the existence of a jointly held bank account is identified during the review of
an active case, the ISD worker requests evidence of ownership and
accessibility. If the evidence is not
furnished within 30 calendar days of the request, their case is closed.
(3) Life estate: A life estate interest in the applicant’s or
recipient’s own home will count as a resource if the applicant or recipient has not resided on the property continuously
for at least 12 months from the date of the life estate purchase. For a purchase of a life estate in the home
of another, see Subsection D of 8.281.500.14 NMAC.
(a) The “unisex life estate and remainder
interest tables” are used to determine the value of a life estate. See 8.200.520 NMAC. The value is computed by multiplying the
current fair market value by the percentage reduction on the unisex table under
the column for the applicant’s
or recipient’s age.
(b) If an applicant or recipient feels
the value calculated based on this method is overstated, they can obtain a
valuation of the life estate in the area for use as documentation of lesser
value.
E. The home as a countable resource: If
the applicant or recipient or their authorized representative states the
applicant or recipient does not intend to return to the home and it is not the
residence of applicant’s or recipient’s spouse or dependent relative, the home
is considered a countable resource. If
the applicant or recipient or their authorized representative puts the home up
for sale and it is not the primary residence of the applicant’s or recipient’s
spouse or a dependent relative, the home is considered a countable
resource. A dependent relative is a
minor child or adult disabled child of the applicant, recipient, or community
spouse.
F. Value of property: The applicant or recipient must supply HSD
with written documentation regarding the fair market value of the property from
a real estate agent, title company or mortgage insurance company familiar with
the area in which the property is located in addition to any encumbrances
against the property. The ISD worker
determines the equity value of the property by subtracting the amount of the
encumbrances from the fair market value of the property.
G. Hardship: Applicants or recipients who are on
restricted coverage due to excess equity in their homes may request an undue
hardship waiver based on the criteria specified in 8.281.500.24 NMAC.
H. Real property:
(1) If
an applicant or recipient is the sole owner of real property, other than the
applicant’s or recipient’s or their primary residence and has the right to
dispose of it, the entire equity value is included as a countable resource.
(2) If
an applicant or recipient owns property with one or more individuals and the
applicant or recipient has the right, authority or power to liquidate the
property or their pro-rata share of the property, it is considered a resource. If a property right cannot be liquidated, the
property will not be considered a resource to applicant or recipient. The applicant or recipient must provide a
copy of the legal document which indicates [his or her] their interest in the
property.
I. Vehicles: One automobile is totally excluded regardless
of value if it is used for transportation for the applicant or recipient or a
member of applicant’s or recipient’s household.
Any other automobiles are considered to be non-liquid resources. Recreational vehicles and boats are
considered household goods and personal effects rather than vehicles.
J. Household
goods and personal effects:
Household goods and personal effects are considered countable resources
if the items were acquired or are held for their value or are held as an
investment. Such items can include but
are not limited to gems and jewelry that is not worn or held for family
significance, or collectibles.
K. Promissory notes: If an applicant or recipient holds or owns a
promissory note and the note is negotiable, it is a countable resource. The value is the outstanding principal
balance due at the time of the applicant’s or recipient’s MAP application,
unless the applicant or recipient proves that it has a lower value.
(1) A
promissory note held by the applicant or recipient must be a bona fide
loan. This means that it must be legally
valid and made in good faith. The ISD
worker must evaluate the note and determine whether or not it is a bona fide
loan. In order to determine if the note
is a bona fide loan, the ISD worker should obtain documentation of the
applicant’s or recipient’s receipt of payments on the note at the time of
application and at re-certification. If
the applicant or recipient sells or transfers the promissory note, then [he or
she] they may be subject to a penalty for a transfer of assets for less than
fair market value.
(2) If
the promissory note is non-negotiable, and the applicant or recipient receives
payments on the note that could be used for food or shelter, then the amount of
the payment retained in the month following receipt is a resource to the
applicant or recipient.
(3) If
an applicant or recipient purchases a promissory note, loan or mortgage, the
repayment terms must be actuarially sound, provide for equal payment amounts
with no deferral or balloon payments, and it must contain a provision that
prohibits cancellation of the balance upon the death of the lender. A promissory note not meeting these
requirements shall be treated as a transfer of assets for less than fair market
value. If a promissory note does not
meet these requirements, the value of the note, loan or mortgage is the
outstanding balance due on the date of the applicant’s or recipient’s MAP
application.
L. Pension funds: A pension fund, if accessible to the
applicant or recipient, is a countable resource. Any fees for withdrawal of the funds are
subtracted from the balance and the remainder is a countable resource.
M. Individual retirement accounts (IRA): An IRA is a tax-deductible savings account
that sets aside money for retirement.
Funds in an IRA are counted as an asset in their entirety less the
amount of penalty for early withdrawal.
N. Keogh plan: A Keogh plan is a retirement plan established
by a self-employed applicant or recipient alone or for the self-employed
applicant or recipient and their employees.
If the Keogh plan was established for the self-employed applicant or
recipient alone, the funds in the plan are counted as an asset in their
entirety less the amount of penalty for early withdrawal. If the Keogh plan was established for
employees other than the spouse of the applicant or recipient, the funds do not
count as an asset.
O. Loans: In
some circumstances a loan may be a countable resource.
(1) Negotiable
loan. If an applicant or recipient owns
a loan agreement or is a lender and the agreement is a negotiable, bona fide
loan:
(a) the
outstanding principal balance is a resource of the applicant or recipient;
(b) the
cash provided to the borrower is no longer the applicant or recipient lender’s
resource because they cannot access it for their own use; the loan agreement
replaces the cash as the applicant or recipient lender’s resource;
(c) payments
that the applicant or recipient lender receives from the borrower against the
loan principal are conversions of a resource, not income; if retained, the
payments are counted as the applicant or recipient lender’s resource starting
in the month following the month of receipt; and
(d) interest
income received by the applicant or recipient lender is unearned income.
(2) Non-negotiable
loan. If the applicant or recipient owns
a loan agreement or is a lender and the loan agreement is not a bona fide loan
or is not negotiable:
(a) the
agreement is not a resource of the applicant or recipient lender;
(b) payments
against the principal are income to the applicant or recipient lender, not
conversion of a resource;
(c) the
cash specified in the agreement may be a resource if the applicant or recipient
lender can access it for their own use; and
(d) interest
income received by the applicant or recipient lender is unearned income.
(3) Bona
fide loan. If the applicant or recipient
is the borrower and the agreement is a bona fide loan:
(a) the
loan agreement itself is not a resource for the applicant or recipient; and
(b) the
cash provided by the applicant or recipient lender is not income, but is the
borrower’s resource if retained in the month following the month of receipt.
(4) Not
a bona fide loan. If the applicant or
recipient is the borrower and the agreement is not a bona fide loan:
(a) the
loan agreement itself is not a resource of the applicant or recipient; and
(b) the
cash provided by the applicant or recipient lender is income in the month
received and is a resource if retained in the month following the month it was
received.
(5) Informal
loan. If the agreement is an agreement
between applicants or recipients who are not in the business of lending money
or providing credit, it is an informal loan.
An informal loan is bona fide if it meets all of the following criteria:
(a) the
agreement is enforceable under state law;
(b) the
agreement is in effect at the time that the cash is provided to the borrower;
money given to an applicant or recipient with no obligation to repay cannot
become a loan at a later date;
(c) the
obligation to repay the loan must be acknowledged by both the applicant or
recipient lender and the borrower; when money or property is given and accepted
based on any understanding other than it is to be repaid by the receiver, there
is no loan;
(d) the
agreement must include a plan or schedule for repayment, and the borrower’s
express intent to repay by pledging real or personal property or anticipated
future income (such as social security insurance (SSI) benefits);
(e) the
repayment plan or schedule must be feasible; in determining the plan’s
feasibility, consider the amount of the loan, the applicant’s or recipient’s
resources and income and the applicant’s or recipient’s living expenses;
(f) if
the applicant or recipient is the borrower, the loan proceeds are a resource if
they are retained in the month following the month of receipt; the resource
value is the amount of the proceeds that the applicant or recipient still holds
in the month following the month of receipt;
(g) if
the applicant or recipient is the lender, the agreement is a countable resource
starting in the month after the month that the applicant or recipient lender
provides the proceeds to the borrower; and
(h) the
agreement’s resource value is the outstanding principal balance unless the
applicant or recipient lender provides evidence that the loan has a lower
value.
P. Other financial instruments: Other financial instruments will be evaluated
by HSD to determine if they are a countable resource.
Q. Continuing care retirement community,
assisted living, life care community or like living arrangement: The portion of initial fees paid upon signing
a contract for housing and care that has a potential to be refunded to the
applicant or recipient is countable.
R. Other
countable resources: Other liquid or
non-liquid resources must be considered in the calculation of total countable
resources. The following non-liquid
resources may be included in the calculation of countable resources if they
cannot be excluded pursuant to 8.281.500.13 NMAC:
(1) burial
funds;
(2) burial
spaces;
(3) life
insurance and other insurance products such as annuities;
(4) income-producing
property; and
(5) other
financial investment products.
[8.281.500.12 NMAC - Rp, 8.281.500.12
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.13 RESOURCE EXCLUSIONS: Some
types of resources can be excluded from the calculation of countable resources
if they meet the specific criteria listed below.
A. Burial fund exclusion: Up to
$1,500 can be excluded from the countable liquid resources of an applicant or
recipient if designated as their burial fund.
An additional amount of up to $1,500 can be excluded from countable
liquid resources if designated as burial funds for the spouse of the applicant
or recipient. The burial fund exclusion
is separate from the burial space exclusion.
(1) Retroactive
designation of burial funds: An
applicant or recipient can retroactively designate funds for burial back to the
first day of the month in which the applicant or recipient intended the funds
to be set aside for burial. The
applicant or recipient must sign a statement indicating the month the funds
were set aside for burial.
(2) Limit
on exclusion: An applicant or
recipient can designate as much of their liquid resources as they wish for
burial purposes. However, only one
burial fund allowance of up to $1,500 each for the applicant or recipient and
their spouse can be excluded from countable resources. A burial fund exclusion does not continue
from one period of eligibility to another (i.e., across a period of
ineligibility). For each new period of
eligibility, any exclusion of burial funds must be developed as for an initial
application.
(3) Removal
of designation: An applicant or
recipient cannot "un-designate" burial funds, unless one of the
following occurs:
(a) eligibility
terminates;
(b) part,
or all, of the funds can no longer be excluded because the applicant or
recipient purchased excluded life insurance or an irrevocable burial contract
which partially or totally offsets the available burial fund exclusion; or
(c) the
applicant or recipient uses the funds or any portion of the funds for another
purpose; this action makes the funds countable; any designated burial funds
used for another purpose will be counted as income in the month withdrawn and
as a resource thereafter.
(4) Reduction
of burial fund exclusion: The $1,500
burial fund exclusion is reduced by the following:
(a) the
face value of excluded life insurance policies;
(b) assets
held in irrevocable burial trusts; irrevocable means the value paid cannot be
returned to the applicant or recipient;
(c) assets
that are not burial space items held in irrevocable burial contracts;
(d) assets
held in other irrevocable burial arrangements; and
(e) assets
held in an irrevocable trust available to meet burial expenses.
(5) Interest
from burial fund: Interest derived
from a burial fund is not considered a countable resource or income if all the
following conditions exist:
(a) the
original amount is excluded;
(b) the
excluded burial fund is not commingled with non-excluded burial funds;
(c) the
interest earned remains with the excluded burial funds.
(6) Commingling
of burial funds: Burial funds cannot
be commingled with non-burial funds. If
only part of the funds in an account are designated for burial, the burial fund
exclusion cannot be applied until the funds designated for burial expenses are
separated from the non-burial funds.
Countable and excluded burial funds can be commingled.
(7) Life
insurance policy designated as burial fund:
An applicant or recipient can designate a life insurance policy as a
burial fund at the time of application.
The ISD caseworker must first analyze Subsection H of 8.281.500.13 NMAC
[of this rule].
(8) Burial
contracts: If an applicant or
recipient has a prepaid burial contract, the ISD caseworker determines whether
it is revocable or irrevocable and whether it is paid for. Until all payments are made on a burial
contract, the amounts paid are considered burial funds and no burial space
exclusions apply.
(a) An
applicant or recipient may have a burial contract which is funded by a life
insurance policy. The life insurance may
be either revocably or irrevocably assigned to a funeral director or mortuary.
(b) A
revocable contract exists if the value can be returned to the applicant or
recipient. An irrevocable contract
exists when the value cannot be returned.
If the contract or insurance policy assignment is revocable, the
following apply.
(i) If
the burial contract is funded by a life insurance policy, the policy is the
resource which must be evaluated. The
burial contract itself has no value. It
exists only to explain the applicant’s or recipient’s burial arrangements.
(ii) No
exclusions can be made for burial space items because the applicant or
recipient does not have a right to them if the contract is not paid for or the
policy is not paid up.
(c) If
the assignment is irrevocable, the life insurance or burial contract is not a
countable resource, because the applicant or recipient does not own it.
(i) The
burial space exclusions can apply if the applicant or recipient has the right
to the burial space items.
(ii) The
value of the irrevocable burial arrangement is applied against the $1,500 burial fund exclusion only if the
applicant or recipient has other liquid resources to designate for burial.
B. Burial space
exclusion: A burial space or an
agreement which represents the purchase of a burial space held for the burial
of an applicant or recipient, their spouse, or any other member of their
immediate family is an excluded resource regardless of value. Interest and accruals on the value of a
burial space are excluded from consideration as countable income or resources.
(1) When
calculating the value of resources to be deemed to an applicant or recipient
from their parent(s) or spouse, the value of spaces held by the parent(s) or
spouse which are to be used for the burial of the applicant or recipient, or
any member of the applicant’s or recipient’s immediate family, including the
deemer parent or spouse, must be excluded.
(2) The
burial space exclusion is separate from, and in addition to, the burial fund
exclusion.
(3) Burial
space definitions: "Burial
space" is defined as a burial plot, gravesite, crypt, mausoleum, casket,
urn, niche, or other repository customarily used for the deceased's bodily
remains.
(a) A
burial space also includes necessary and reasonable improvements or additions,
such as vaults, headstones, markers, plaques, burial containers (e.g.,
caskets), arrangements for the opening and closing of a gravesite, and
contracts for care and maintenance of the gravesite, sometimes referred to as
endowment or perpetual care.
(b) Items
that serve the same purpose are excluded once per applicant or recipient, such
as excluding a cemetery lot and a casket, but not a casket and an urn.
(4) Burial space contract: An agreement which represents the purchase of
a burial space is defined as a contract with a burial provider for a burial
space held for the eligible applicant or recipient or a member of their
immediate family.
(a) Until
all payments are made on the contract, the amounts paid are considered burial
funds and no burial space exclusions apply.
(b) An
applicant’s or recipient’s immediate family includes:
(i) spouse;
(ii) natural
or adoptive parents;
(iii) minor
or adult children, including adoptive and stepchildren;
(iv) siblings,
including adoptive and stepsiblings; and
(v) spouse
of any of the above relatives.
(c) If
a relative's relationship to an applicant or recipient is by marriage only, the
relationship ceases to exist upon the dissolution of the marriage.
(5) Burial
space “held” for an applicant or
recipient: A burial space is considered held for an
applicant or recipient if:
(a) someone
has title to or possesses a burial space intended for the use of the applicant
or recipient or a member of their immediate family; or
(b) someone
has a contract with a funeral service company for a specified burial space for
the applicant or recipient or a member of their immediate family, such as an
agreement which represents the applicant’s or recipient’s current right to the
use of the items at the amount shown.
(6) Until
the purchase price is paid in full, a burial space is not considered “held for”
an applicant or recipient under an installment sales contract or similar device
if:
(a) the
applicant or recipient does not currently own the space;
(b) the
applicant or recipient does not currently have the right to use the space; and
(c) the
seller is not currently obligated to provide the space.
C. Life estate exclusion: The
value of a life estate interest in the applicant’s or recipient’s own home or
in the home of another is excluded if the applicant or recipient has
continuously resided in the home for a period of 12 months or more from the
date of the life estate purchase. The
value of the remainderman's interest when a life estate is retained in one's
own home is considered a transfer of resources to be evaluated in accordance
with 8.281.500.14 NMAC.
D. Settlement
exclusions: Agent orange settlement
payments made to applicant or recipient veterans or their survivors are
excluded from consideration as resources.
(1) Payments
made under the Radiation Exposure Compensation Act are excluded from
consideration as resources.
(2) Payments
received from a state-administered fund established to aid victims of crime are
excluded for nine months beginning the month after the month of receipt.
(3) Payments
under the foundation called ‘remembrance, responsibility and the future’,
excluded from consideration as resources.
E. Exclusions for
real property and home: A home is
any shelter used by an applicant or recipient, or their spouse, as the
principal place of residence. The home
is not considered a countable resource while in use by the applicant,
recipient, or their spouse as a principal place of residence. If an applicant’s or recipient’s home equity
value exceeds the amount allowed under 8.200.510 NMAC, then the entire valued
amount of their home is a countable resource.
An applicant or recipient with home equity of more than the amount
specified shall be placed on restricted coverage for as long as they own the
home. The home includes any buildings
and contiguous land used in the operation of the home. If the amount is equal to or less than
allowed under 8.200.510 NMAC, then their home is excluded during the periods
when they reside in an acute care or long-term care medical facility when the
applicant or recipient, or their authorized representative, states that the
applicant or recipient intends to return to their home.
F. Exclusion
of home: If the applicant or
recipient or their authorized representative states the applicant or recipient
does not intend to return to the home, but the home is the residence of the
applicant’s or recipient’s spouse or dependent minor child or adult disabled
child, the home is an excluded resource.
G. Income-producing property
exclusion: To be excluded from consideration as a
countable resource, income-producing property that does not qualify as a bona
fide business (e.g., rental property or mineral rights) must have an equity
value of no more than $6,000 and an annual rate of return of at least six
percent of the equity value. See
Subsection F of 8.281.500.13 NMAC if the equity value exceeds $6,000 but the
rate of return is at least six percent annually. The $6,000 and six percent limitation does
not apply to property used in a trade or bona fide business, or to property
used by an applicant or recipient as an employee which is essential to the
applicant’s or recipient’s self-support (e.g., tools used in employment as a
mechanic, property owned or being purchased in conjunction with operating a
business). Existence of a bona fide
business can be established by documentation such as business tax returns.
(1) Determination
of rate of return: To calculate the
annual rate of return for income producing property when the $6,000 and six
percent limits apply, the previous year's income tax statement, or at least
three months earnings is used to project the rate of return for the year.
(a) If
the income is sporadic or has decreased from that needed to maintain a six
percent rate of return for the coming year, the property is reevaluated at
appropriate intervals.
(b) If
the annual rate of return is at least six percent of the equity value but the
equity value exceeds $6,000, only the excess equity is a countable resource.
(c) If
the annual rate of return is less than six percent but the usual rate of return
is more, the property is excluded as a countable resource if all the following
conditions are met:
(i) unforeseeable
circumstances, such as a fire, cause a temporary reduction in the rate of
return;
(ii) the
previous year's rate of return, as documented by the income tax statement or
several months receipts, is at least six percent; and
(iii) the
property is expected to produce a rate of return of at least six percent within
18 months of the end of the year in which the adverse circumstances occurred;
the ISD caseworker records in the case narrative the plan of action which is
expected to increase the rate of return.
(d) The
ISD caseworker notifies the applicant or recipient in writing that the property
is excluded based on its expected increase in return and that it will be
reevaluated at the end of the 18 month grace period. When this period ends, the property must be
producing an annual rate of at least six percent to continue to be excluded as
a countable resource.
(2) Types
of income-producing property:
Income-producing property includes:
(a) a
business, such as a farm or store, including necessary capital and operating
assets such as land and buildings, inventory or livestock; the property must be
in current use or have been used with a reasonable expectation of resumed use
within a year of its most recent use; the ISD caseworker must account for the
cash actually required to operate the business; liquid business assets of any
amount are excluded;
(b) non-business
property includes rental property, leased property, land leased for its mineral
rights, and property producing items for home consumption; property which
produces items solely for home use is assumed to be producing an annual rate of
return of at least six percent;
(c) employment-related
property, such as tools or equipment; the applicant or recipient must provide a
statement from their employer to establish that tools or equipment are required
for continued employment when the applicant or recipient leaves the institution;
if the applicant or recipient is self-employed, only those tools normally
required to perform the job adequately are excluded; the applicant or recipient
must obtain a statement from someone in the same line of self-employment to
establish what is excludable.
H. Vehicle exclusion: The
term “vehicle” includes any mode of transportation such as a passenger car,
truck or special vehicle. Included in
this definition are vehicles which are unregistered, inoperable, or in need of
repair. Vehicles used solely for
purposes other than transportation, such as disassembly to resell parts, racing
or as an antique, are not included in this definition. Recreational vehicles and boats are
classified as personal effects and are evaluated under the household goods and
personal effects exclusion. One vehicle
is totally excluded if regardless of value if it is used for transportation for
the applicant or recipient or a member of their household. Any other automobiles are considered to be
non-liquid resources. Equity in the
other automobiles is counted as a resource.
I. Life insurance
exclusion: The value of life insurance policies is not
considered a countable resource if the total cumulative face value of all
policies owned by the applicant or recipient does not exceed $1,500. A policy is considered to be “owned” by the
applicant or recipient if the applicant or recipient is the only one who can
surrender the policy for cash.
(1) Consideration
of burial insurance and term insurance:
Burial insurance and term insurance are not considered when computing
the cumulative face value because this insurance is redeemable only upon death.
(2) Calculation
when value exceeds limit: If the
total cumulative face value of all countable life insurance policies owned by
the applicant or recipient exceeds $1,500, the ISD caseworker:
(a) verifies
the total cash surrender value of all policies and considers the total amount a
countable resource;
(b) informs
the applicant or recipient that the insurance policies can be converted to term
insurance or ordinary life insurance of lower face value at their option, if
the cash surrender value, alone or in combination with other countable
resources, exceeds the resource standard.
J. Qualified
State Long-term Care Insurance Partnership (QSLTCIP) program: A resource exclusion equal to the amount of
the qualified long-term care insurance benefit payments is made to or on the
behalf of the applicant or recipient as determined during their eligibility
process.
(1) In
order to be considered a QSLTCIP policy it must meet the requirements set forth
in 1917(a) of the Social Security Act.
(2) The
applicant or recipient:
(a) must
have been a beneficiary of a QSLTCIP that was purchased on or after August 15,
2015; or
(b) must
have a QSLTCIP policy established in another state with a CMS approved state
plan for state long-term care insurance partnerships and the beneficiary must
have been a resident of such a state on the date the policy was purchased; or
(c) must
be a current New Mexico resident and after August 14, 2015 have purchased a
long-term care policy that was converted to a QSLTCIP through an endorsement,
exchange, or rider.
(3) Long-term
care insurance does not qualify as a QSLTCIP.
(4) Resources
excluded in the amount of benefits paid out are also excluded in the estate
recovery process.
(5) Resources
can be designated for protection when a MAP category of eligibility for either
institutional care services or home and community based services is
established, while receiving MAD benefits provided through institutional care
or home and community based waiver programs, or during the estate recovery
process after a recipient dies.
(6) An
applicant or recipient may protect assets up to the amount of QSLTCIP benefit
payments made to or on the behalf of an applicant or recipient; this is the
eligible applicant or recipient’s protected asset limit (PAL). If the value of protected assets exceeds the
PAL, the excess value is counted against the asset limit and is not protected
in estate recovery.
(7) The
following conditions may apply to assets protected under a QSLTCIP:
(a) an
applicant or recipient may keep protected resources;
(b) the
value of protected assets is updated each year at the MAP eligibility review;
the updated value is the counted towards the PAL;
(c) an
applicant or recipient may transfer a protected asset to another person without
a transfer penalty; a transferred asset is counted against the PAL based on the
value of the asset on the day it was transferred;
(d) an
applicant or recipient may use a protected asset to obtain another protected
asset, which then becomes the protected asset;
(e) an
applicant or recipient can spend or deplete a protected asset; the asset
continues to be protected and is counted against the PAL even though the
applicant or recipient no longer has it;
(f) once
an asset is officially designated for protection, it cannot be undesignated in
favor of designating another asset;
(g) changes
in the status of protected assets must be reported at the recipient’s annual
re-determination for MAP eligibility; some examples of changes are
transferring, spending, depleting, or replacing an asset; and
(h) new
countable assets that are reported in-between MAP eligibility renewals must be
evaluated when reported to determine if they can be protected under the QSLTCIP
program’s PAL;
(i) the
following assets cannot be protected under the QSLTCIP program and must be made
available after the death of the recipient to reimburse HSD up to the amount of
the paid MAD benefits on the deceased recipient behalf;
(i) special
and or supplemental needs, pooled charitable trusts, irrevocable trusts with a
reversionary state interest, or income diversion trusts; and
(ii) annuity
interest where HSD has been named a reminder beneficiary.
(8) Unused
asset protection may result because all available asset protection was not used
at the time of designation or when an applicant or recipient PAL has increased
because the applicant or recipient continues to receive benefits from a QSLTCIP
while receiving MAD benefits.
(9) Unused
asset protection will automatically apply to protect assets already officially
indicated for protection when the value of the asset has increased and there is
unused asset protection.
(10) Unused
asset protection may also be used to more fully cover an asset that is only
partially protected, protect additional assets that have become available
during a recipient’s lifetime, or to protect assets in a recipient’s estate
after they die.
K. Produce
for home consumption exclusion: The value of produce for home
consumption is totally excluded.
L. Exclusion of
settlement payments from the federal department of housing and urban
development: Payments from the
department of housing and urban development (HUD) as defined in Underwood v. Harris are excluded as
income and resources. These one-time
payments were made in the spring of 1980 to certain eligible tenants of
subsidized housing (Section 236 of the National Housing Act).
(1) Segregation
of payment: To be excluded as a
resource, payments retained by an applicant or recipient must be kept separate;
these payments must not be combined with any other countable resources.
(2) Income
from segregated funds:
Interest or dividend income received from segregated payment funds is
not excluded from income, or, if retained, is not an excluded resource; this
interest or dividend income must be kept separate from excludable payment
funds.
M. Lump sum payments
exclusion: SSI and social security lump sum payments for
retroactive periods are excluded as countable resources for nine months after
the month in which they are received.
See Subsection B of 8.281.500.15 NMAC for instructions regarding SSI and
social security lump sums which are placed into the ownership of a MAD
qualifying trust. Social security lump
sum payments are considered infrequent income.
See Subsection C of 8.281.500.19 NMAC.
N. Home replacement
exclusion: The proceeds from a reverse mortgage from the
sale of an excluded home is excluded.
Additionally, the value of a promissory note or similar installment
sales contract which constitutes proceeds from the sale of an excluded home is
excluded from countable resources if all of the following conditions are met:
(1) the
note results from the sale of the applicant’s or recipient’s home as described
in Subsection E of 8.281.500.13 NMAC;
(2) within
three months of receipt (execution) of the note, the applicant or recipient
purchases a replacement home which meets the definition of a home in Subsection
E of 8.281.500.13 NMAC;
(3) all
note-generated proceeds are reinvested in the replacement home within three
months of receipt;
(4) additional
exclusions: in addition to excluding
the value of the note itself, the down payment received from the sale of the
former home, as well as that portion of any installment amount constituting
payment on the principal are also excluded from countable resources;
(5) failure
to purchase another excluded home timely:
if the applicant or recipient does not purchase another home which can
be excluded under the provisions of Subsection E of 8.281.500.13 NMAC and the
following paragraphs within three months, the value of the promissory note or
similar sales contract received from the sale of an excluded home becomes a
countable resource as of the first moment of the first day of the month
following the month the note is executed; if the applicant or recipient
purchases a replacement home after the expiration of the three month period,
the value of the promissory note or similar installment sales contract becomes
an excluded resource effective the month following the month of purchase of the
replacement home provided that all other proceeds are fully and timely
reinvested;
(6) failure
to reinvest proceeds timely: if the
proceeds from the sale of an excluded home under a promissory note or similar
installment sales contract are not reinvested fully within three months of
receipt in a replacement home, the following resources become countable as of
the first moment of the first day of the month following receipt of the
payment:
(a) the
fair market value of the note;
(b) the
portion of the proceeds, retained by the applicant or recipient which was not
timely reinvested;
(c) the
fair market value of the note remains a countable resource until the first
moment of the first day of the month following the receipt of proceeds that are
fully and timely reinvested in the replacement home; failure to reinvest
proceeds for a period of time does not permanently preclude exclusion of the
promissory note or installment sales contract; however, previously received
proceeds that were not timely reinvested remain countable resources to the
extent they are retained;
(7) interest
payments: if interest is received as
part of an installment payment resulting from the sale of an excluded home
under a promissory note or similar installment sales contract, the interest
payments are considered countable unearned income in accordance with Subsection
A of 8.281.500.19 NMAC;
(8) when
the home replacement exclusion does not apply: if the home replacement exclusion does not
apply, the market value of a promissory note or sales contract as well as the
portion of the payment received on the principal are considered countable
resources.
O. Household
goods and personal effects exclusion: Household goods and
personal effects are excluded if they meet one of the following four criteria:
(1) items
of personal property, found in or near the home, which are used on a regular
basis; items may include but are not limited to furniture, appliances,
recreational vehicles (i.e. boats and RVs), electronic equipment (i.e.
computers and television sets), and carpeting;
(2) items
needed by the householder for maintenance, use and occupancy of the premises as
a home; items may include but are not limited to cooking and eating utensils,
dishes, appliances, tools, and furniture;
(3) items
of personal property ordinarily worn or carried by the applicant or recipient;
items may include but are not limited to clothing, shoes, bags, luggage,
personal jewelry including wedding and engagement rings, and personal care
items;
(4) items
otherwise having an intimate relation to the applicant or recipient; items may
include but are not limited to prosthetic devices, educational or recreational
items such as books or musical instruments, items of cultural or religious
significance to an applicant or recipient; or items required because of an
applicant or recipient impairment.
[8.281.500.13 NMAC - Rp, 8.281.500.13
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.14 ASSET TRANSFERS: The
ISD caseworker must determine whether an applicant or recipient or their spouse
transferred assets within a specified period of time (lookback period) before
applying for a MAP category of eligibility for institutional care or at any
time after approval of the applicant’s or recipient’s application. Then the ISD caseworker must determine if the
applicant or recipient or their spouse received fair market value for the
asset. If the applicant or recipient or
their spouse did not receive fair market value for the asset, then the
applicant or recipient may be subject to a penalty. In the case of an asset held by the applicant
or recipient in common with another individual or individuals in a joint
tenancy, tenancy in common, or similar arrangement including life estate or
remainderman relation, the asset (or the affected portion of such asset) is
considered to be transferred by the applicant or recipient when any action is
taken, either by the applicant or recipient or by any other individual, acting
on behalf of the applicant or recipient (including but not limited to a spouse,
representative payee, trustee, guardian, conservator, or another authorized
representative), that reduces or eliminates the applicant’s or recipient’s
ownership or control of such asset. Any
asset transferred to a community spouse in excess of the community spouse
resource allowance (CSRA) is considered to be totally available to the
institutionalized spouse and must be spent down before eligibility can be
established.
A. Lookback period: Any transfer of assets made prior to February
8, 2006, is subject to a 36-month lookback period prior to the date of the
applicant’s or recipient’s application or at any time subsequent to the
approval of an application for a MAP category of eligible for institutional
care. Transfers made on or after
February 8, 2006, are subject to a 60-month lookback period.
(1) The
lookback period is 60 months if the transfer occurred as the result of payments
from a trust or portions of a trust that are treated as assets disposed of by
the applicant or recipient.
(2) The
lookback period starts on the date the applicant or recipient applies for a MAP
category of institutional care and is in an institution.
B. Transfer of assets for
less than fair market value: If a transfer of assets
occurred within the applicable lookback period, or at any time after approval
of the applicant’s or recipient’s application, the ISD caseworker must
determine whether the applicant or recipient or their spouse received fair
market value for the transferred asset(s).
(1) Documentation
requirement: The applicant or
recipient or their spouse must provide documentation of the transfer, the fair
market value of the asset(s) transferred, the circumstances surrounding the
transfer and the amount, if any, received as compensation for the transferred
asset.
(2) If
the applicant or recipient fails to provide this information without good cause
within 30 calendar days from the date requested by the ISD caseworker, the ISD
caseworker denies the application or closes the applicant’s or recipient’s
case, as appropriate.
(a) Good
cause is considered to exist if the applicant or recipient or their authorized
representative can show that they were effectively precluded from timely
reporting because of legal, financial, or other reasons, or because of the
existence of a health related problem including death of a family member within
the specific degree of relationship during the period of time in which the
applicant or recipient, or authorized representative has to report the required
information. The health or other problem
must have been of such severity and duration as to have effectively precluded
the applicant or recipient or their authorized representative from reporting in
a timely manner. See 8.291.410 NMAC for
a detailed description of degree of relationships.
(b) To
document the good cause claim, the applicant or recipient or authorized
representative must provide proof of the existence of the health or other
problem and must explain the circumstances which precluded provision of the
required information.
(c) The
ISD caseworker makes the determination of good cause subject to review and
approval by the county director or designee.
(3) Restricted
coverage: If a transfer of assets
occurred within the applicable lookback period, or at any time subsequent to
approval for a MAP category of institutional care eligibility, for which the
applicant or recipient or their spouse did not receive fair market value, the
ISD caseworker determines if a penalty period must be calculated. The penalty for transfers of assets for less
than fair market value in a MAP category of eligibility for institutional care
is restricted coverage. "Restricted
coverage" means that the applicant or recipient is eligible for all MAD
services except services furnished in a nursing facility or services considered
to be long-term care services.
(a) Determine
the current average monthly cost of nursing facilities for private
patients. See 8.281.500.13 NMAC.
(b) Divide
the total uncompensated value (amount) of the resources transferred for less
than fair market value by the current average monthly cost of nursing
facilities for private patients.
(c) The
result is the number of months and partial months for which the applicant or
recipient will be on restricted coverage.
(4) Calculating
restricted coverage when the transferred asset is income: If income has been transferred as a lump sum,
the period of restricted coverage is calculated based on the lump sum
value. For transfers of the right to an
income stream, the period of restricted coverage is calculated using the
actuarial value of all payments transferred.
See 8.200.520 NMAC.
C. Transfer rules based on
date of transfer: Two sets of rules govern the calculation of
penalty periods if a transfer of assets for less than fair market value has
occurred. The date of transfer and
approval date for the MAP category of institutional care medicaid applicant or
recipient institutional care governs which set of rules is used to calculate
the penalty period.
(1) For
transfers made on or after August 11, 1993:
Periods of restricted coverage are calculated as follows (Omnibus Budget
Reconciliation Act of 1993):
(a) the
period of restricted coverage begins the month the resources were transferred;
the total uncompensated value of the transferred assets divided by the average
cost to a private patient for nursing facility services in the state at the
time of the applicant’s or recipient’s application is the methodology used to
calculate a period of restricted coverage;
(b) transfers
for less than fair market value made by an institutionalized SSI applicant or
recipient, or a community spouse of institutionalized applicant or recipient
may subject the institutionalized applicant or recipient to a period of
restricted coverage;
(c) penalty
periods are now consecutive rather than concurrent; if multiple transfers occur
in different months, the periods of restricted coverage begin with the month of
the initial transfer and run consecutively; for example, if an applicant or
recipient transfers an asset for less than fair market value in February
causing four months of restricted coverage (i.e., February through May) and
transfers another asset in April causing three months of restricted coverage,
the second period of restricted coverage begins in June and lasts through
August; and
(d) if
an institutionalized applicant or recipient with a community spouse is placed
on restricted coverage as the result of a transfer of assets for less than fair
market value and the community spouse subsequently becomes eligible for a MAP
category of eligibility for institutional care, any remaining months in the
restricted coverage period must be divided equally between the spouses.
(2) For transfers made on or after February 8,
2006: Pursuant to the Deficit
Reduction Act of 2005, otherwise eligible institutionalized recipients who
transfer assets for less than fair market value after this date are penalized
as follows:
(a) the
period of restricted coverage begins the first day of the month in which the
resources were transferred, or the date on which the individual applicant or
recipient meets a MAP category of eligibility, and would otherwise be receiving
institutional level of care but for the application of the penalty period,
whichever is later, and does not occur during any other period of ineligibility
as a result of an asset transfer; see Subsection B of 8.281.500.14 NMAC for the
methodology used to calculate a period of restricted coverage;
(b) once
eligibility has been determined and a penalty period has begun to run, it
continues until expiration, whether or not there is a break in the
institutionalized recipient's eligibility;
(c) the
beginning date of restricted coverage is the first day of the month in which
the resources were transferred provided the applicant or recipient is
institutionalized and retains their MAP category of eligibility for
institutional care; for current recipients who fail to report a transfer, the
recipients will continue to receive benefits until the adverse action notice
date, but HSD may seek to recover any MAD benefits paid for long-term care
services during what should have been a period of restricted coverage; federal
law does not provide a basis to impose a transfer penalty based on date of
discovery;
(d) for
a non-institutionalized applicant or recipient, the date restricted coverage
begins is the month in which the applicant or recipient becomes
institutionalized;
(e) transfers
for less than fair market value made by an institutionalized SSI applicant or
recipient, or a community spouse of the institutionalized applicant or
recipient may subject the institutionalized applicant or recipient to a period
of restricted coverage; and
(f) multiple
transfers occurring in different months are added together and calculated as a
single period of ineligibility, that begins on the earliest date that would
otherwise apply if the transfer had been made in a single lump sum.
D. Non-excludable transfers: Certain financial instruments must be
evaluated before they can be considered a transfer of assets.
(1) Annuities: Annuities belonging to the
applicant or recipient or to the spouse of the applicant or recipient must be
declared. Annuities must be actuarially
sound with no deferral and no balloon payments.
Annuities purchased or issued after February 8, 2006, must meet the
following additional requirements for exclusion as a transfer of assets:
(a) HSD
is named as the remainder beneficiary in the first position for at least the
total amount of MAD benefits paid on behalf of the institutionalized applicant
or recipient; HSD may be named the remainder beneficiary in the second position
if there is a community spouse, or a minor, or a disabled child and is named in
the first position if the community spouse or an authorized representative of
the child disposes of any such remainder for less than fair market value;
(b) when
HSD is a beneficiary of an annuity, issuers of annuities are required to notify
MAD of any changes in the disbursement of income or principal from the annuity
as well as any changes to HSD’s position as remainder beneficiary; and
(c) it
is non-assignable and irrevocable.
(2) Life estates: If an applicant or recipient purchases a life
estate in another individual's home, the applicant or recipient must live in
that home for a period of at least 12 months after the date of purchase or the
transaction will be treated as a transfer of assets for less than fair market
value.
(3) Promissory notes: If an applicant or recipient uses funds to
purchase a promissory note, the repayment terms must be actuarially sound,
provide for equal payment amounts with no deferral or balloon payments, and it
must contain a provision that prohibits cancellation of the balance upon the
death of the applicant or recipient lender.
A promissory note not meeting these requirements shall be treated as a
transfer of assets for less than fair market value.
E. Excludable
transfers: If certain conditions are
met, an applicant or recipient is not placed on restricted coverage for
transferring assets for less than fair market value.
(1) Transferred
asset was home: The asset
transferred was a home and title to the home was transferred to:
(a) the
spouse of the applicant or recipient;
(b) the
son or daughter of the applicant or recipient who is under 21 years of age or
who meets the social security administration's definition of disability or
blindness; if the child is receiving benefits based on disability or blindness
from a program other than social security or SSI, or is not receiving benefits
based on disability or blindness from any program, the ISD caseworker must
request a determination of disability or blindness from disability
determination services;
(c) sibling
of the applicant or recipient who has an equity interest in the home and who
was residing in the home for a period of at least one year immediately before
the applicant or recipient was institutionalized; or
(d) son
or daughter of the applicant or recipient who was residing in the home for a
period of at least two years immediately before the applicant or recipient was
institutionalized; for this exclusion to apply, the ISD caseworker must
determine that the son or daughter provided care to the applicant or recipient
which permitted the applicant or recipient to reside at home rather than in a
medical facility or nursing home.
(2) Other
asset transfers: Sufficient
information must be given to the ISD caseworker to establish that either:
(a) the
applicant or recipient intended to dispose of the asset at fair market value;
or
(b) at
the time of the transfer the applicant or recipient had no expectation of
applying for a MAP category of eligibility and the resources were transferred
exclusively for a purpose other than to qualify for a MAP category of
eligibility as demonstrated by a preponderance of evidence; unless these
conditions are met, the transfer is presumed to have been for the purpose of
qualifying for a MAP category of eligibility; or
(c) HSD
determines that the denial of eligibility would work an undue hardship.
(3) Asset
transferred to or for the sole benefit of the community spouse: No transfer penalty is assessed when assets
are transferred from one spouse to another (e.g., assets are transferred from
an institutionalized spouse to a community spouse). Any asset transferred to a community spouse
or to another individual for the sole benefit of the community spouse in excess
of the CSRA is considered to be totally available to the institutionalized
spouse and must be spent down before eligibility can be established. No transfer penalty is assessed when assets
are transferred to another for the sole benefit of the community spouse if all
of the conditions listed in Subparagraphs (a) through (c) below are met.
(a) a
transfer is considered to be for the sole benefit of the community spouse if it
is arranged in such a way that no individual or entity except the community
spouse can benefit from the assets transferred in any way, whether at the time
of the transfer or at any time in the future;
(b) a
transfer, or transfer instrument, that provides for funds or property to pass
to a beneficiary who is not the community spouse is not considered to be
established for the sole benefit of the community spouse; for a transfer to be
considered to be for the sole benefit of the community spouse, the instrument
or document must provide for the spending of the funds involved for the benefit
of the community spouse on a basis that is actuarially sound based on the life
expectancy of the community spouse or when the instrument or document does not
so provide, any potential exemption from penalty or consideration for
eligibility purposes is void;
(c) to
determine whether an asset was transferred for the sole benefit of the
community spouse, ensure that the transfer was accomplished via a written
instrument of transfer (e.g., a trust document) which legally binds the parties
to a specified course of action and which clearly sets out the conditions under
which the transfer was made, as well as who can benefit from the transfer; a
transfer without such a document cannot be said to have been made for the sole
benefit of the community spouse since there is no way to establish, without a
document, that only the community spouse will benefit from the transfer.
(4) Asset
transfers to or for the sole benefit of a blind or disabled child of the
institutionalized individual: No
transfer penalty is assessed when assets are transferred to a blind or disabled
child of the institutionalized applicant or recipient, or to a trust
established solely for the benefit of a blind or disabled child of the
institutionalized applicant or recipient.
For this exemption to apply, the child must meet the social security
administration's definition of blindness or disability. The transfer must either meet the criteria
set forth in 8.281.500.11 NMAC or meets all of the conditions listed in this
section, Subparagraphs (a) through (c) below to be excluded in the eligibility
determination process.
(a) A
transfer to such a blind or disabled child is considered to be for the sole
benefit of that child if the transfer is arranged in such a way that no
individual or entity, except the blind or disabled child, can benefit from the
assets transferred in any way, whether at the time of the transfer or at any
time in the future.
(b) A
transfer, or transfer instrument, that provides for funds or property to pass
to a beneficiary who is not the blind or disabled child of the
institutionalized applicant or recipient is not considered to be established
for the sole benefit of the blind or disabled child. For a transfer or trust to be considered to
be for the sole benefit of a blind or disabled child, the instrument or
document must provide for the spending of the funds involved for the benefit of
the blind or disabled child on a basis that is actuarially sound based on the
life expectancy of the child. When the
instrument or document does not so provide, any potential exemption from
penalty or consideration for eligibility purposes is void.
(c) To
determine whether an asset was transferred for the sole benefit of the blind or
disabled child of the institutionalized applicant or recipient, ensure that the
transfer was accomplished via a written instrument of transfer (e.g., a trust
document) which legally binds the parties to a specified course of action and
which clearly sets out the conditions under which the transfer was made, as
well as who can benefit from the transfer.
A transfer without such a document cannot be said to have been made for
the sole benefit of the blind or disabled child since there is no way to
establish, without a document, that only the blind or disabled child will
benefit from the transfer.
(5) Asset
transfers to a trust for the sole benefit of a disabled individual under age
65: No transfer penalty is assessed
when assets are transferred to a trust established for the sole benefit of an
individual under age 65 who meets the social security administration's
definition of disability. The transfer
must either meet the criteria set forth in 8.281.500.11 NMAC or meet all of the
conditions listed in Subparagraphs (a) through (c) below to be excluded in the
eligibility determination process.
(a) A
transfer is considered to be for the sole benefit of a disabled individual
under age 65 as described above if the transfer is arranged in such a way that
no individual or entity except the disabled individual can benefit from the
assets transferred in any way, whether at the time of the transfer or at any
time in the future.
(b) A
transfer, transfer instrument, or trust that provides for funds or property to
pass to a beneficiary who is not a disabled individual under age 65 as
described above, is not considered to be established for the sole benefit of
the disabled individual. For a transfer
or trust to be considered to be for the sole benefit of the disabled
individual, the instrument or document must provide for the spending of the
funds involved for the benefit of the disabled individual on a basis that is
actuarially sound based on the life expectancy of the disabled individual. When the instrument or document does not so
provide, any potential exemption from penalty or consideration for eligibility
purposes is void.
(c) To
determine whether an asset was transferred for the sole benefit of the disabled
individual, ensure that the transfer was accomplished via a written instrument
of transfer (e.g., a trust document) which legally binds the parties to a
specified course of action and which clearly sets out the conditions under
which the transfer was made, as well as who can benefit from the transfer. A transfer without such a document cannot be
said to have been made for the sole benefit of the disabled individual since
there is no way to establish, without a document, that only the disabled
individual will benefit from the transfer.
(6) Assets transfers and qualified state
long-term care insurance partnerships (QSLTCIP) protected asset limits (PAL):
(a) No
transfer penalty is assessed if at initial determination the applicant or
recipient has indicated protection of the transferred asset and there is enough
of the PAL to cover the value of the resource at the time of the transfer.
(b) No
transfer of assets penalty is assessed if the applicant or recipient has
previously indicated an asset for protection and there was enough of the
applicant’s or recipient’s PAL to cover the value of the resource at the time
of the transfer.
(c) No
transfer penalty is assessed for the portion of a resource which has been
partially protected. The unprotected
portion of the resource is subject to all assets transfer provisions outlined
in 8.281.500.14 NMAC.
F. Re-establishing eligibility: If an asset is transferred for less than fair
market value and the applicant or recipient is placed on restricted coverage,
they have options to re-establish their past MAP category of eligibility.
(1) Reimbursement
by transferee: The individual to
whom the asset was transferred can reimburse the applicant or recipient for the
asset at fair market value or liquidate or sell the asset and spend an amount
equal to the uncompensated fair market value on the applicant’s or recipient’s
care or other exempt assets as listed in 8.281.500.13 NMAC.
(2) Return
asset to applicant: The asset can be
transferred back to the applicant or recipient, liquated or sold. The applicant or recipient must determine the
use of the asset; such use may include spending down the resource limit on the
applicant’s or recipient’s care, classifying the resource as exempt as listed
in 8.281.500.13 NMAC, or having the asset become a countable resource.
(3) If
the transferred asset is restored to an applicant or recipient, they may become
totally ineligible for a MAP category of institutional care eligibility due to
excess resources. The ISD caseworker
must verify that the applicant’s or recipient’s countable assets do not exceed
the standard for a MAP category of institutional care eligibility. If the transferred asset is restored to an
applicant or recipient, they may no longer be eligible for a MAP category of
institutional care due to the excess resources.
The ISD caseworker must verify that the applicant’s or recipient’s
countable assets meet the requirements to have a MAP category of institutional
care eligibility.
[8.281.500.14 NMAC - Rp, 8.281.500.14
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.15 RESOURCE STANDARDS FOR MARRIED COUPLES:
A. Community property
resource determination methodology: Community property resource
determination methodology is used in the eligibility determination for a
married applicant or recipient who began institutionalization for a continuous
period prior to September 30, 1989.
(1) To
determine the countable value of resources, the ISD worker must:
(a) add
the total value of all resources owned by both spouses;
(b) exclude
the separate property of the non- applicant or recipient spouse; and
(c) attribute
one-half of the total value of the community property to the applicant or
recipient spouse plus the value of [his or her] their separate property;
(d) the
resulting figure must be less than $2,000.
(2) Application
of community property rules: Under
community property rules, all property held by either spouse is presumed to be
community property unless successfully rebutted by the applicant or recipient,
or representative. To rebut community
property status, the applicant or recipient, or representative must document
that the property was:
(a) acquired
before marriage or after a divorce or legal separation;
(b) designated
as separate property by a judgment or decree of any court;
(c) acquired
by either spouse as a gift or inheritance; or
(d) designated
as separate property by a written agreement between the spouses, including a
deed or other written agreement concerning property held by either or both
spouses in which the property is designated as separate property.
(i) If
one of the parties to this written agreement is incompetent, legal counsel must
execute the agreement on behalf of the incompetent spouse.
(ii) Property
designated as separate by written agreement is evaluated according to current
rules regarding transfer of resources.
(iii) Income
cannot be designated as separate by an agreement between spouses; income is
considered separate only if it is derived from a resource that has been
determined separate.
B. Spousal impoverishment:
Spousal impoverishment provisions apply if one spouse of a married
couple is institutionalized for a continuous period of at least 30 consecutive
days beginning on or after September 30, 1989.
See spousal impoverishment provisions of the Medicare Catastrophic
Coverage Act of 1988 (MCCA). No
comparable treatment of resources and income is required for non-institutionalized
applicants or recipients who do not have a spouse remaining in the
community. These provisions cease to
apply as of the month following the month an applicant or recipient is no
longer institutionalized or no longer has a community spouse. If a community spouse or other dependents
apply for a MAP category of eligibility they are subject to the rules governing
treatment of income and resources for the individual applicant or recipient.
(1) Resource
assessment: A resource assessment
must be completed to evaluate a couple's resources as of the first moment of
the first day of the month one member of the married couple is
institutionalized for a continuous period of at least 30 consecutive days
beginning on or after September 30, 1989.
This process is used to determine the amount of resources which may be
protected for the community spouse. See
Subparagraph (f) below for resources which must be included in the resource
assessment. The resource assessment and
computation of spousal shares occurs only once, at the beginning of the first
continuous period of institutionalization beginning on or after September 30,
1989. A new resource assessment may be
completed if it is later determined that the original resource assessment was
inaccurate. Upon the death of the
community spouse, the ISD worker may review the applicant’s or recipient’s
resources.
(a) A
MAP application does not need to be submitted at the time the assessment is
requested. A reasonable fee may be
charged for completing assessments which are not made in conjunction with the
applications. Applications for
assessments are available at the ISD offices which determine eligibility for a
MAP category of institutional care.
Either member of the couple or their authorized representative may
request an assessment application.
(b) The
ISD worker must complete a resource assessment using the following criteria:
(i) one
member of a married couple became institutionalized on or after September 30,
1989 in an acute care hospital or nursing facility for a continuous period of
at least 30 consecutive days;
(ii) the
institutionalized applicant or recipient has a spouse who remains in the
community in a non-institutionalized setting; and
(iii) the
institutionalized spouse remains, or is likely to remain, institutionalized for
a period of at least 30 consecutive days based on a written statement from
their physician and supporting medical documentation; the institutionalized
applicant or recipient is considered “likely to remain” even if they do not
actually remain in an institution for 30 consecutive days if they met this
condition at the beginning of the period of institutionalization.
(c) The
ISD worker explains exactly what verification is required to complete the
assessment. If the ISD worker requires
further information, the individual requesting the assessment is notified in
writing and given a reasonable time period of at least 10 working days to
provide the additional information.
(d) The
institutionalized individual or their spouse or an authorized representative is
responsible for providing all verification necessary to complete the
assessment.
(e) The
ISD worker completes the resource assessment within 45 calendar days of the
date of receipt of the completed and signed assessment application unless
verification is still pending by the 45th day.
In that case, the assessment is not completed until all necessary
information is provided by the institutionalized individual or their spouse or
authorized representative.
(f) Assessments
include the total value of the couple's countable resources held jointly or
separately as of the first moment of the first day of the month one spouse
became institutionalized for a continuous period of at least 30 consecutive
days beginning on or after September 30, 1989.
The assessment form identifies the spousal shares and the CSRA. The couple is entitled to all resource
exclusions allowed in 8.281.500.13 NMAC except that value limits for the exempt
vehicle and household goods of the community spouse do not apply. Assets excluded under the QSLTCIP program are
counted in the spousal resource assessment. The disregarded assets are included in
determining the amount of the CSRA. The disregarded asset is not counted in
determining the applicant’s or recipient’s eligibility.
(g) When
the assessment is complete, the ISD worker copies all documentation used to
make the determination of countable resources and retains the documents in the
case record. The ISD worker also
provides complete copies of the assessment forms to the following parties:
(i) institutionalized
applicant or recipient;
(ii) community
spouse; and
(iii) authorized
representative(s) if any.
(h) When
the amount of the couple's total countable resources has been determined, the
resulting amount is divided by two to determine the spousal shares. The community spouse is entitled to their
spousal share or the MAD minimum resource allowance, whichever is greater, up
to the applicable federal maximum standard or an amount determined at a HSD
administrative hearing or an amount transferred pursuant to a district court
order. The CSRA is the amount by which
the greatest of the spousal shares or state minimum resource allowance exceeds
the amount of resources otherwise available to the community spouse without
regard to such an allowance. The CSRA
remains in effect until one of the spouses dies. The remainder of the couple's total countable
resources in excess of the CSRA is considered available to the
institutionalized spouse. If either the
institutionalized spouse or the community spouse is dissatisfied with the
computation of the spousal share of the resources, the attribution of resources
or the determination of the community spouse resource allowance, they can
request a HSD administrative hearing pursuant to 8.352.2 NMAC. Refer to 8.352.2 NMAC for a detailed
description of the HSD administrative hearing process.
(2) CSRA
standards: The state minimum
resource allowance and the federal maximum standards vary based on when the
applicant or recipient became institutionalized for a continuous period of at
least 30 consecutive days. See
8.281.500.10 NMAC for the applicable standards.
(3) CSRA
revision: The CSRA can be revised if
either of the following occurs:
(a) a
different amount is determined by a HSD administrative hearing final decision
or district court decision; or
(b) inaccurate
information was provided to the ISD worker at the time the spousal share was
calculated.
(4) Resource
availability after computation of CSRA:
Resources of a couple remaining after the computation of the CSRA are
considered available to the institutionalized spouse. These remaining resources are compared to the
resource limit.
(a) From
the time of the initial determination of eligibility until the first regularly
scheduled redetermination, the CSRA is not considered available to the
institutionalized spouse.
(b) The
CSRA may be applied retroactively for the three months prior to the month of
application and is not considered available to the institutionalized spouse
until the first periodic review following initial approval.
(5) Resource
transfer after computation of the CSRA:
When eligibility has been approved for an institutionalized spouse,
resources equal to the amount of the CSRA may be transferred to the community
spouse. This transfer is intended to
assist the community spouse in meeting their needs in the community. Couples should transfer resources in the
amount of the CSRA to the community spouse as soon as possible after approval
for a MAP category of institutional care eligibility. The institutionalized spouse or authorized
representative can complete this transfer at any time between the date of the
assessment and the first periodic review 12 months after approval.
(6) Resource
transfers which exceed the CSRA:
Resources transferred to a community spouse at less than fair market
value are not subject to transfer penalties.
Resources transferred to the community spouse in excess of the computed
CSRA are considered available to the institutionalized spouse and must be spent
down to below the resource standard before eligibility can be established. Resources transferred to the community spouse
may exceed the CSRA if an increased amount is ordered by any court having
jurisdiction or by the MAD director as part of a HSD administrative hearing
final decision.
(7) Transfer
deadlines: If the resource transfer
is not completed by the institutionalized spouse by the end of the initial
period of eligibility, the resources are considered completely available to the
institutionalized spouse beginning with the first periodic review after the
initial determination of eligibility.
(8) Newly
acquired assets: After a continuous
period of institutionalization begins, newly acquired resources or increases in
the value of resources owned by the institutionalized spouse are
countable. Recalculations of eligibility
for the institutionalized spouse based on countable resources are effective at
the beginning of the month following the month in which new resources were
received or an increase occurred in the value of resources already owned.
(a) The
institutionalized spouse may transfer newly acquired resources to the community
spouse without a penalty up to the difference between the CSRA and the state
minimum resource standard in effect as of the date of institutionalization.
(b) After
a continuous period begins, new resources acquired by the community spouse or
increases in the value of resources which are part of the CSRA are not
considered available to the institutionalized spouse.
[8.281.500.15 NMAC - Rp, 8.281.500.16
NMAC, 8/15/2015; A, 3/1/2018; A, 12/1/2022]
8.281.500.16 DEEMING RESOURCES:
Deeming of resources applies only during periods when an eligible
applicant/recipient under 18 years of age lives at home and during the month
the eligible applicant or recipient enters an institution. After the initial month of entry into the
institution, only those resources directly attributable to or available to the
applicant or recipient are counted and compared to the $2,000 resource limit.
A. Deeming of
resources for children who are blind or have a disability: If
an applicant or recipient under 18 years of age who is blind or disabled enters
an institution, the resources of the parent(s) are deemed to the applicant or
recipient if the parent(s) live in the same household. If an ineligible parent receives temporary
assistance to needy families (TANF), resources are not deemed to the applicant
or recipient.
B. To determine the
amount of resources deemed to the applicant or recipient, the following
computation is made:
(1) determine
parent(s) resources;
(2) allow
parent(s) all the resource exclusions that an eligible applicant or recipient
would receive;
(3) the
remaining resources in excess of $2,000 for one
parent or $3,000 for two parents are deemed to the applicant or recipient
child; if there is more than one applicant or recipient child, the deemed
resources are divided equally; and
(4) the
deemed resources are added to whatever countable resources the applicant or
recipient child has in their own right; the applicant or recipient child is
eligible for a MAP category of institutional care eligibility on the factor of
resources if countable resources do not exceed $2,000.
[8.281.500.16 NMAC - Rp, 8.281.500.17
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.17 INCOME: An applicant’s or recipient’s gross countable
monthly income must be less than the maximum allowable monthly income
standard. If an applicant’s or
recipient’s monthly gross countable income is below $50, the application can
still be processed; however, the applicant or the recipient must be referred to
the social security administration to apply for SSI. Income may be in the form of cash, checks,
and money orders, or in-kind, including personal property or food. If income is not received in the form of
cash, the cash value of the item is determined and counted as income. The ISD worker verifies all income and
obtains appropriate documentation.
Income is counted in the month received.
Income is considered available throughout the month regardless of the
date received.
A. Types of
income: Countable income is the sum of
unearned income or earned income, less disregards or exclusions, plus deemed
income.
B. Earned income: Earned
income consists of the total gross income received by an applicant or recipient
for services performed as an employee or as a result of self-employment.
(1) Royalties
earned in connection with the publication of an applicant’s or recipient’s work
and any honorarium or fee received for services rendered are considered earned
income.
(2) The
self-employed applicant or recipient must provide an estimate of their current
income based on the tax return filed for the previous year or current records
maintained in the regular course of business.
The estimate of net earnings for the entire previous taxable year is
prorated equally among all months of the current year, even if the business is
seasonal.
(a) Consideration
is given to the applicant’s or recipient’s explanation as to why they believe
the estimated net earnings for the current year vary substantially from the
information shown on their tax return for past years.
(b) A
satisfactory explanation is that the business suffered heavy loss or damage
from fire, flood, burglary, serious illness or disability of the owner, or
other such catastrophic events.
Documentation must include copies of newspaper accounts or medical
reports and must be filed in the case record to substantiate the need for a
reduced estimate of current self-employment income.
C. Unearned
income: Unearned income consists of all other
income (minus exclusions and disregards) that is not earned in the course of
employment or self-employment.
D. Deemed income: Deemed
income is income considered available to a minor applicant or recipient from
their parents.
E. Community
property income methodology: If an applicant or recipient is
married, community property income methodology shall be used in the eligibility
determination, regardless of the living arrangements, if the one spouse has
less income than the other spouse or if using the community property
methodology would benefit both spouses.
Under this methodology, one-half of the community property income is
attributed to each spouse. Income is
considered separate if it is earned in and is paid from a non-community
property state. Proof of separate income
is the burden of the applicant or recipient, spouse, or authorized
representative.
[8.281.500.17 NMAC - Rp, 8.281.500.18
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.18 INCOME STANDARDS: The
applicable income standard used in the determination of a MAP category of
institutional care eligibility for an applicant or recipient who has not been
institutionalized for a period of 30 consecutive days is the SSI federal
benefit rate (FBR) for a non-institutionalized individual. Participation in the medicaid home and
community based waiver program is considered institutionalization and counts
toward the calculation of the 30-day period.
All income, whether in cash or in-kind, shall be considered in the
eligibility determination, unless such income is specifically excluded or
disregarded.
A. Institutionalization
period of 30 consecutive days: After
the applicant or recipient has been institutionalized for 30 consecutive days,
the application can be approved as of the first day of the 30-day period. Once an applicant or recipient has been
institutionalized for 30 consecutive days, the higher income maximum as
specified in 8.200.520 NMAC is used.
B. Institutionalization
period less than 30 consecutive days:
If the applicant or recipient leaves the facility before 30 consecutive
days, the lower income standard (SSI FBR) is used to establish eligibility.
C. Transfer or
death: If an applicant or recipient
transfers to another institution or dies prior to completing 30 consecutive
days of institutionalization, the higher income maximum is used. See 8.200.520 NMAC.
(1) Income
exclusions: Income exclusions are
applied before income disregards.
Exclusions are applied in determining eligibility whether the income
belongs to the applicant or recipient or to an individual from whom income is
deemed.
(2) Infrequent
or irregular income: Exclude the
first $30 per calendar quarter of earned income; and the first $60 per calendar
quarter of unearned income. The
following definitions apply:
(a) “Irregular
income” is income received on an unscheduled or unpredictable basis.
(b) “Infrequent
income” is income received only once during a calendar quarter from a single
source and includes:
(i) proceeds
of life insurance policies;
(ii) prizes
and awards;
(iii) gifts;
(iv) support
and alimony;
(v) inheritances;
(vi) interest
and royalties; and
(vii) one-time
lump sum payments, such as social security.
(c) “Frequency”
is evaluated for the calendar quarter (i.e. January - March, April - June, July
- September, October - December) but the dollar amount is considered in the
month received.
(3) Foster
care: Foster care payments are
totally excluded if:
(a) the
foster child is not eligible for SSI; and
(b) the
child was placed in the applicant’s or recipient’s home by a public or private
nonprofit child placement or child care agency.
(4) Domestic
volunteer services exclusions:
Payments to volunteers under domestic volunteer services (ACTION)
programs are excluded from consideration as income in the eligibility
determination process. These programs include
the following:
(a) volunteers
in service to America (VISTA);
(b) university
year for action (UYA);
(c) special
demonstration and volunteer programs;
(d) retired
senior volunteer program (RSVP);
(e) foster
grandparent program; and
(f) senior
companion program.
(5) Census
bureau employment: Wages paid by the
census bureau for temporary employment related to the census bureau are
excluded from consideration as income in the eligibility determination process.
[8.281.500.18 NMAC - Rp, 8.281.500.19
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.19 UNEARNED INCOME:
Unearned income includes all income not earned in the course of
employment or self-employment. If
payment is made in the name of either or both spouses and another party, only
the applicant’s or recipient’s proportionate share is considered available to
them. If income is derived from property
for which ownership is not established, such as unprobated property, one-half
of the income is considered available to each member of a married couple.
A. Standards
for unearned income: Unearned income is computed on a
monthly basis. If there are no expenses
incurred with the receipt of unearned income, such as annuities, pensions,
retirement payments or disability benefits, the gross amount is considered
countable unearned income.
(1) Social
security overpayments: If the social
security administration withholds an amount because of an overpayment, the
gross social security payment amount is used to determine eligibility. See Subsection B of 8.281.500.22 NMAC for
instructions regarding calculation of the medical care credit.
(2) Rental
income: If an applicant or recipient
has rental property, the ISD worker allows the cost of real estate taxes,
maintenance and repairs, advertising, mortgage insurance and interest payments
on the mortgage as deductions from the amount received as rent.
(3) Interest
on promissory note or sales contract:
The portion of the payment representing interest received from a
promissory note or sales contract is considered unearned income. The market value of promissory notes or sales
contracts and the portion of the payment representing payment of the principal
are considered resources. See also
Subsection L of 8.281.500.13 NMAC.
(4) Income from annuities, pensions and other
periodic payments: Payments from
annuities, pensions, social security benefits, disability, veterans benefits,
worker compensation, railroad retirement annuities and unemployment insurance
benefits and other periodic payments are counted as unearned income.
B. Unearned
income exclusions:
(1) Interest from an excluded burial fund: Interest from an excluded burial fund is not
considered unearned income if the interest is applied toward the fund
balance. If the interest is paid to the
applicant or recipient, it is considered unearned income.
(2) Tax
refunds and earned income tax credit:
Tax refunds from any public agency for property taxes or taxes on food
purchases are totally excluded. Any
portion of a federal income tax return which constitutes an earned income tax
credit is excluded.
(3) Grants,
scholarships and fellowships: All
grants, scholarships and fellowships used to pay tuition and fees at an
educational institution, including vocational and technical schools, are
totally excluded. Any portion of a
grant, scholarship or fellowship used to pay any other expenses, such as food,
clothing or shelter, is not excluded.
(4) Veteran’s
pensions: Allowances for aid and
attendance (A&A) and unusual medical expenses (UME) are excluded from
unearned income for determination of eligibility. If an applicant or recipient receives an
augmented VA pension as a veteran or veteran's widow or widower, the pension
amount may include an increment for a dependent. If so, the VA must be contacted to provide
documentation of the portion of the pension which represents the dependent's
increment. When verified, this amount of
the VA pension is considered the dependent's income.
(5) Payments
by a third party: Third party
payments are excluded as income if made directly to the applicant’s or
recipient’s creditor.
(a) Third
party payments may include mortgage payments by credit life or credit
disability insurance and installment payments by a family member on a burial
plot or prepaid burial contract.
(b) Interest
from a burial contract that is automatically applied to the outstanding balance
is excluded from unearned income. If the
payment or interest is sent to the applicant or recipient, it is counted as
unearned income regardless of the sender's (third party's) intentions. This applies even if the sender specifies the
purpose of the payment on the check.
This provision does not apply if the signature of the creditor and the
applicant or recipient must both be present in order to negotiate the check
(two-party check).
(6) Indian
tribe per capita payments: Funds
held in trust by the secretary of the interior for an Indian tribe and
distributed on a per capita basis and any interest and investment income from
these funds, are excluded as income and resources in the eligibility
determination process and the computation of the medical care credit.
(7) Plans
for achieving self-support: Income
derived from, or necessary to, an approved plan for achieving self-support for
a blind or disabled applicant or recipient under 65 years of age is excluded.
(a) For
an applicant or recipient who is blind or disabled and over 65 years of age,
this exclusion applies only if they received MAD services for the month
preceding their 65th birthday.
(b) The
self-support plan must be in writing and contain the following:
(i) designated
occupational objective;
(ii) specification
of any savings (resource) or earnings needed to complete the plan, such as
amounts needed for purchase of equipment or for financial independence;
(iii) identification
and segregation of any income saved to meet the occupational goal;
(iv) designation
of a time period for completing the plan and achieving the occupational goal.
(c) Plans
for achieving self-support are developed by vocational rehabilitation
counselors. If a self-support plan is
not in place, the ISD worker makes a referral to the division of vocational
rehabilitation (DVR).
(d) The
ISD worker forwards the written plan and documentation to the MAD eligibility
unit. The plan must be approved by that
unit.
(e) An
approved plan is valid for the following specified time periods:
(i) initial
period of no more than 18 months;
(ii) extension
period of no more than 18 months;
(iii) final
period of no more than 12 months; and
(iv) total
period of no more than 48 months.
(8) Agent
orange settlement payments: Agent
orange settlement payments made to applicant or recipient veterans or their
survivors are excluded from consideration as income in determining eligibility.
(9) Radiation
Exposure Compensation Act payments:
Payments made under the Radiation Exposure Compensation Act are excluded
from consideration as income in determining eligibility.
(10) Victims
compensation payments: Payments made
by a state-administered fund established to aid victims of crime are excluded
from consideration as income in determining eligibility. These payments are included as countable
income when calculating the medical care credit.
(11) Lump
sums for retroactive periods: SSI
lump sum payments for retroactive periods are excluded from consideration as
countable income in the month received.
(12) Life
insurance and other burial benefits:
Life insurance and other burial benefits are unearned income to the
beneficiary (not the owner). The ISD
worker must subtract the amount spent on the insured recipient’s last illness
or burial up to $1,500. Any excess is
counted as unearned income.
(13) One hundred percent state funded assistance payment: Any one hundred percent-state-funded
assistance payment based on need, such as general assistance (GA) is
excluded. Any interim payments made by a
state or municipality from all state or local funds while an SSI application is
pending are excluded.
(14) National
vaccine injury compensation program (NVICP) payment: The NVICP funds are excluded as income or a
resource until they are actually disbursed by the issuing agent. However, they are counted as income in the
month in which they are received and counted as a resource in the following
months, provided that the funds in question are not specifically earmarked for
medical expenses. If the payment is
designated for both living expenses and medical care, a determination must be
made to identify how much of the payment is for living expenses, and how much
is for medical care. The only portion
actually counted then is that amount which is for living expenses. Therefore, a determination must be made as to
how the payment is apportioned before making an eligibility determination.
(15) Remembrance,
responsibility and the future payments:
Payments by the remembrance, responsibility and the future foundation to
individual survivors forced into slave labor by the Nazis are excluded as
income in determining eligibility.
[8.281.500.19 NMAC - Rp, 8.281.500.20
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.20 DEEMED INCOME:
A. Availability:
Deemed income is income considered available to a minor applicant or
recipient from their parents. Deeming of
resources and income applies only during periods when an applicant or recipient
under 18 years of age is living with their parents and during the month of
entry into an institution.
B. Situations
in which deeming occurs: Deeming of
income occurs:
(1) from
ineligible parent to eligible child; or
(2) if
there is both a MAP eligible parent and a MAP eligible child in the home.
C. Computing
deemed income: The ISD worker
computes the total monthly amount of parental unearned and earned income and
then computes the deemed income available to the applicant or recipient
child. If the deemed income plus the
child’s separate income exceeds the applicable maximum, the child will not have
a MAP category of institutional care eligibility for that month.
(1) Parents and children receiving aid: If one of the applicant or recipient child's
parents is receiving any benefit or assistance paid by a governmental agency on
the basis of economic need, that benefit plus all the income of that parent is
excluded from the deeming process. This
exclusion applies only to the income of the parent who receives the
benefit. Even if the income of one
parent is excluded, that parent is still considered a member of the household
for purposes of determining the parental allocation. Provisions for deeming income do not apply to
benefits under temporary assistance to needy families (TANF). No income is deemed to a parent or child(ren)
if that parent or child(ren) is (are) receiving TANF assistance.
(2) Applicant
or recipient parent and their
child(ren): If a household is
composed of an applicant or recipient parent and an applicant or recipient
child(ren), the parent's income is determined according to the methodology
appropriate to the MAP category of eligibility which they receive.
(a) If
there is enough income to make the applicant or recipient parent ineligible,
the remainder of the income is carried over to be deemed to the child(ren).
(b) If
there is more than one potentially eligible child, the deemed income is divided
equally among them. If total countable
income is less than the applicable maximum, the applicant or recipient has a
MAP category of institutional care eligibility on the factor of income.
(c) If
an applicant or recipient is determined to meet the MAP category of
institutional care eligibility, the ISD worker must recompute available income
for the following month based on separate income to establish the correct
medical care credit. See 8.281.500.23
NMAC, post-eligibility/medical care
credit.
[8.281.500.20 NMAC - Rp, 8.281.500.21
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.21 DISREGARDS:
Income disregards are determined on an individual basis. Disregards may be applied to any appropriate
month of assistance, regardless of which income maximum is used.
A. $20
disregard: The first $20 of unearned
or earned income received in a month is disregarded. This disregard is applied first to unearned
income and, if any amount remains, to earned income. If there is no unearned income, the entire
$20 disregard is applied to earned income.
This disregard is not applied to any payment made to the applicant or
recipient through government assistance programs or private charitable
organizations, where payments are based on need. These payments include financial assistance,
TANF, assistance from catholic charities, salvation army, bureau of Indian
affairs, and VA pension (not compensation) payments.
B. Additional
earned income disregard: After
applying the $20 disregard as specified in Subsection A of 8.281.500.21 NMAC if
appropriate, the first $65 of monthly earned income plus one-half of the
remainder is also disregarded.
C. Work-related
expenses of the blind: Work-related
expenses of an employed applicant or recipient or couple who are legally blind
are disregarded. The dollar amount of
expenses which may be disregarded must be reasonable. Expenses are disregarded when paid and must
be verified.
(1) This
disregard does not apply to an applicant or recipient who is blind and is 65
years or age or older, unless they were receiving SSI payments due to blindness
in the month before turning 65 or received payments under a state aid to the
blind program.
(2) Types
of work-related expenses which may be disregarded include:
(a) federal,
state, and local income taxes;
(b) social
security contributions;
(c) union
dues;
(d) transportation
costs, including actual cost of bus/taxi cab fare, or $0.15 per mile for
private automobile;
(e) lunches;
(f) child
care costs, if not otherwise provided;
(g) uniforms,
tools and other necessary equipment; and
(h) special
expenses necessary to enable an applicant or recipient who is blind to engage
in employment, such as a seeing-eye dog or Braille instructions.
D. Student
earned income disregard: Up to
$1,200 per quarter or a maximum of $1,620 per calendar year of the earned
income of certain students may be disregarded.
To qualify for this disregard, the applicant or recipient must meet all
of the following requirements:
(1) under
22 years of age;
(2) unmarried;
(3) not
head of a household; and
(4) in
regular attendance at a college or university, for at least 12 semester hours
or vocational or technical training course for at least 20 hours per a calendar
week.
(a) This
disregard applies only to a student's own earned income and includes all
payments made as compensation for services, such as wages from employment or
self-employment, or payments from programs such as neighborhood youth corps or
work-study.
(b) This
disregard is available in addition to any exclusions applied to grants,
scholarships or fellowships and in addition to any other allowable disregards.
E. Child
support payments: One-third of the
amount of child support payments made to a child applying for a MAP category of
institutional care eligibility is disregarded.
The remainder is considered unearned income, subject to the appropriate
disregards outlined below.
[8.281.500.21 NMAC - Rp, 8.281.500.22
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.22 POST ELIGIBILITY/MEDICAL CARE CREDIT: Once
financial eligibility for a MAP category of institutional care has been
established, the ISD worker must determine the following.
A. Medical
care credit: The medical care
credit is the amount of the applicant’s or recipient’s income used to reduce
the MAD payment to the institution where they reside. An applicant or recipient must make this
payment directly to the institution.
Applicants or recipients eligible for a MAP category of institutional
care due to institutionalization in an acute care hospital or an in-state
in-patient rehabilitation center are not charged a medical care credit. The amount of the medical care credit is always
determined prospectively. The ISD worker
computes a medical care credit starting with the first full month of
institutional care. No medical care
credit is required for the month the recipient enters the institution if they
are admitted after the first moment of the first day of the month.
(1) No
medical care credit for the month of discharge or death: An applicant or recipient is not required to
pay a medical care credit for the month of discharge from the institution. The medical care credit must be paid if the
applicant or recipient is transferred to another institution or makes a short
visit outside the institution. No
medical care credit is charged for the month in which a recipient who received
MAD institutional care services dies.
This will prevent a deficit for the institution when a benefit, such as
social security, must be returned due to the death of a beneficiary.
(2) Application
delay: If there is a delay between
application and approval, an applicant or recipient incurs a liability for a
medical care credit. The ISD worker
notifies the applicant or recipient of this liability during the application
process and informs them of the amount of the medical care credit they should
pay. The applicant or recipient is
encouraged to pay the medical care credit to the institution before approval of
the application.
(3) Medical
care credit during retroactive months:
No medical care credits are applied for any period of retroactive
eligibility under this provision.
B. Computing
the medical care credit: The current
personal needs amount (PNA) of an applicant or recipient monthly income is
protected for their personal use in a nursing facility. Each year thereafter, the amount of an
applicant’s or recipient’s monthly income shall be adjusted according to the
consumer price index as indicated in 8.200.510 NMAC. The excess over the amount protected, subject
to other deductions, is applied toward payment for care in the nursing facility
as a medical care credit.
(1) See
Paragraph (6) of Subsection B of 8.281.500.22 NMAC for personal needs allowance
for veterans or surviving spouses.
(2) An
applicant’s or recipient’s total income, including amounts disregarded in
determining eligibility, is used to compute the medical care credit with the
following exceptions:
(a) Indian
tribe per capita payments (see Subsection B of 8.281.500.19 NMAC);
(b) German
reparation payments; and
(c) social
security administration overpayments.
(i) When
the social security administration withholds an amount due to an overpayment,
the social security gross payment amount is used to determine eligibility per
Subsection A of 8.281.500.19 NMAC. To
determine the amount used in calculating the medical care credit, the ISD
worker ascertains whether a social security (Title II) overpayment is being
recouped or whether an SSI overpayment is being recouped from a social security
benefit check (a cross-program recoupment).
Cross-program recoupments are at the recipient's option so the gross
benefit amount is used to calculate the medical care credit.
(ii) Recoupment
of a social security overpayment from a social security benefit check is
mandatory. In such cases, the net social
security benefit amount is used to calculate the medical care credit.
(d) payments
from the Radiation Exposure Compensation Act.
(e) ‘remembrance,
responsibility and the future’ payments.
(3) Dependent
children at home: If an
institutionalized applicant or recipient with no spouse has dependent children
at home who are ineligible for TANF or assistance from any other program, or
are eligible for an amount less than the TANF need standard, an allowance for
each child of up to the current TANF standard of need may be deducted from the
institutionalized applicant’s or recipient’s income which is in excess of the
applicant’s or recipient’s personal allowance.
(4) Expenses not subject to third party payment 42 CFR 435.725(4): Amounts for incurred expenses
for medical or remedial care that are not subject to payment by a third party,
including:
(a) medicare and other health insurance
premiums, deductibles, or coinsurance charges; and
(b) necessary medical or remedial care
recognized under state law but not covered under the state medicaid plan,
subject to reasonable limits on amounts of these expenses. HSD has the following reasonable limits on
amounts for necessary medical or remedial care not covered under medicaid:
(i) For expenses not covered under the state
plan or expenses covered under the state plan, but not paid for by medicaid,
the amount of the deduction is the billed amount not to exceed the provider’s
usual and customary charges except for unpaid nursing facility expenses.
(ii) To be deducted, an expense must be for
medically necessary medical or remedial care rendered to the applicant or
beneficiary and prescribed by a health care practitioner acting within their
scope of practice who meet the qualifications of an eligible medicaid provider
as listed in the New Mexico Administrative Code (NMAC) 8.310.3.9 NMAC, even if
such practitioner is not a medicaid provider.
(iii) A deduction for incurred medically
necessary non-covered medical or remedial care expenses will be allowed when
the bill is incurred during a period which is no more than three months prior
to the month of the current application.
For each month of unpaid nursing facility services incurred during this
period, deductions are allowed at an amount not to exceed the average monthly
private rate of nursing facility services, as used to calculate asset transfer
penalties and which is updated annually in 8.200.510.13 NMAC (or a prorated
amount of this figure, for unpaid nursing facility services that are for less
than a full month.
(iv) The deduction for medical and remedial
care expenses that were incurred as the result of a transfer penalty period is
limited to zero.
(v) Expenses for cosmetic/elective
procedures (e.g., face lifts or liposuction etc.) are not allowed as deductions
except when prescribed by a health care practitioner.
(vi) Expenses from medical or remedial
procedures that were denied coverage by an insurer, including medicaid, on the
basis of a lack of medical necessity are not allowed.
(5) Court-ordered
support: A deduction for the full
amount of court-ordered child or spousal support is also allowed for the
applicant or recipient.
(6) Personal
needs allowance for recipients in an ICF-IID: If an applicant or recipient who is
institutionalized in an intermediate care facility for individuals with
intellectual disabilities (ICF-IID) has a monthly income from employment in a
sheltered workshop or other work activity program, up to the first $100 of this
earned income is protected for the applicant’s or recipient’s personal
needs. This amount is in addition to the
applicant’s or recipient’s personal needs allowance protected from income from
any source. If the applicant’s or
recipient’s income is from any other source, the personal needs allowance is
set at the amount as set forth in 8.281.500.12 NMAC.
(7) Veterans
administration (VA) benefits: The
ISD worker must contact the VA on each veteran’s case to verify how much of the
benefit is for pension, aid and attendance (A&A) or unusual medical
expenses (UME).
(a) For
MAP eligible veterans with no spouse or dependent children, and for surviving
spouses of veterans without dependent children who do not reside in a state
veteran’s home (Fort Bayard or Truth or Consequences):
(i) exclude
the A&A and UME in the medical care credit computation;
(ii) allow
the personal needs allowance as set forth in 8.281.500.12 NMAC;
(iii) the
benefit for applicant or recipient will be reduced to $90
per month effective the latest of the following;
(iv) the
last day of the calendar month in which medicaid coverage begins;
(v) the
last date of the month following 60 calendar days after issuance of a reduction
notice;
(vi) the
earliest date on which payment may be reduced without creating an overpayment;
(vii) when
the benefit is reduced to $90, recomputed the medical care credit to allow $90
for personal needs.
(b) For
MAP eligible veterans with no spouse or dependent children, and for surviving
spouses of veterans without dependent children who do reside in a state
veteran’s home (Fort Bayard or Truth or Consequences):
(i) include
the A&A and UME in the medical care credit computation;
(ii) allow
$90 for their personal needs;
(iii) the
benefit for the applicant or recipient is not reduced to $90.
(c) Benefits
for the following applicants or recipients are not reduced to $90 a month,
regardless of whether or not they reside in a state veteran’s home:
(i) veterans
who have a spouse or dependent child(ren);
(ii) surviving
spouses of veterans who have dependent child(ren).
(d) The
ISD worker allows these applicants or recipients the allowance as set forth in
8.281.500.12 NMAC, for personal needs.
C. Computing medical care
credits for married institutionalized applicants or recipients: To
calculate the medical care credit for a married institutionalized applicant or
recipient, the “name-on-the-check” rule applies. The ISD worker uses only the income belonging
to the institutionalized applicant or recipient to compute their medical care
credit. Total gross income before any
deductions is used in this process.
(1) Treatment
of VA aid and attendance (A&A) and unusual medical expenses (UME): Allowances for A&A and UME are considered
when computing the medical credit in accordance with Subsection B of
8.281.500.22 NMAC.
(2) Court-ordered
support: A deduction for the full
amount of court-ordered child or spousal support is also allowed for the
applicant or recipient.
D. Computing
medical care credits for an institutionalized couple: To compute medical care credits for each of
an eligible institutionalized couple, the ISD worker totals the couple's gross
income and divides by two. The personal
needs allowance as set forth in Subsection B of 8.281.500.22 NMAC is subtracted
from each amount for each applicant’s or recipient’s personal needs and added
to any allowable amount(s) paid by that applicant or recipient for noncovered
medical expenses.
E. Medical
care credit deductions: The ISD
worker applies the deductions listed below in the following order when
determining the medical care credit:
(1) institutionalized
spouse's personal needs allowance as set forth in 8.281.500.12 NMAC;
(2) community
spouse monthly income allowance (CSMIA); the CSMIA deduction is permitted only
to the extent that the income is available and is actually contributed to and
accepted by the community spouse or other dependent family members:
(a) the
CSMIA is calculated by starting with the minimum monthly maintenance needs
allowance (MMMNA) and subtracting the community spouse's total gross income;
(b) both
spouses shall be given notice of the amount of the CSMIA;
(c) if
either spouse is dissatisfied with the amount of the CSMIA, [he or she] they
can request a HSD administrative hearing pursuant to 8.352.2 NMAC, to establish
that the community spouse needs income above the minimum monthly maintenance
needs allowance; the spouse must demonstrate that the community spouse needs
the additional income above the level otherwise provided by the minimum monthly
maintenance needs allowance due to exceptional circumstances resulting in
significant financial duress; if the spouse establishes that the community
spouse needs additional income due to exceptional circumstances resulting in
significant financial duress, there shall be substituted for the CSMIA such
amount as is necessary to alleviate the financial duress and for so long as the
exceptional circumstances exist; if as a result of a HSD administrative hearing
final decision or district court hearing, additional income is granted to the
community spouse for a specified period of time, when that time expires, the
original CSMIA, as calculated by the ISD worker is reinstated; the exceptional
circumstances can include medical, remedial or other support expenses that
jeopardize the ability of the community spouse to remain self-sufficient in the
community;
(d) if
as a result of a district court hearing or a HSD administrative hearing final
decision, a request for a revision of the CSMIA is granted, the revised amount
shall be substituted for the CSMIA calculated by the ISD worker; and
(e) when
the institutionalized applicant’s or recipient’s income is insufficient to
provide the minimum authorized deduction for the community spouse, either
spouse can request a HSD administrative hearing pursuant to 8.352.2.NMAC if
either spouse establishes that the CSRA (in relation to the amount of income
generated by such an allowance) is inadequate to raise the community spouse's
income to the MMMNA, there shall be substituted, for the CSRA, an amount
adequate to provide the MMMNA.
(3) an
excess shelter allowance for allowable expenses of the community spouse which
exceed thirty percent of the MMMNA standard up to a specified maximum; the
following expenses are allowed for the primary residence of the community
spouse:
(a) rent
or mortgage payment, including interest or principal;
(b) home
taxes and insurance;
(c) maintenance
charges for a condominium or cooperative; and
(d) amount
equal to the standard utility allowance used by the food stamp program if the
community spouse incurs a heating or cooling expense; utility expenses included
in the rent or the basic maintenance fee for a condominium or cooperative, are
not allowed.
(4) The
total CSMIA and excess shelter allowance combined may not exceed the standard
amount per month, unless the MAD director or a district court orders the
institutionalized spouse to pay an increased amount.
(5) An
allowance for each eligible family member equal to one-third of the balance
obtained after deducting the family member's gross income from the MMMNA. Family members include the couple's minor
child(ren) under the age of 18 years, disabled adult child(ren) of the couple
who meet the social security administration's definition of disability and
dependent sibling(s) or parent(s) of the couple. These family members must reside with the
community spouse. The dependency
requirements are met if either member of the couple could claim the family
member as a dependent for tax purposes.
(6) The
deductions for the community spouse and dependent family members apply only so
long as there is a community spouse.
Deductions for the community spouse and other family members shall cease
in the first full calendar month after the community spouse dies, becomes
divorced, or is institutionalized.
(7) Health
insurance premiums and non-covered medical expense deduction.
F. Reporting
requirements: An applicant or
recipient, spouse, or authorized representative is required to report to the
ISD worker any change in circumstances which may affect eligibility or the
medical care credit amount within 10 working days after the date the change
occurs. Changes which cause adjustments
in an applicant’s or recipient’s medical care credit amount are effective the
month after the change occurs. Family
members receiving allowances must also report all changes of gross income and
residence within 10 working days after the date the change occurs. Changes must be reported when the
institutionalized spouse stops making all or part of a maintenance allowance
available to the community spouse or other family member(s), or when the
recipient of a maintenance allowance begins to refuse all or part of the
income.
G. Changes
in income and recipient medical care credit: Payments received by an applicant or
recipient, such as social security, VA, retirement or other benefits, are
applied to billing for services for the same month in which the payment is
received. If the income increases, the
institution must continue to collect the amount indicated on the medical care
credit report in the eligible recipient's file and immediately advise the ISD
worker of the change. The ISD worker
processes the change, notifies the institution and the eligible recipient of
the new medical care credit amount and indicates the month in which the higher
amount is to be collected. The
difference between the medical care credit amounts is deposited in the eligible
recipient's personal fund account until the change is effective.
[8.281.500.22 NMAC - Rp, 8.281.500.23
NMAC, 8/15/2015; A, 12/1/2022]
8.281.500.23 UNDUE HARDSHIP: An applicant or recipient subject to a
penalty for transfer of assets for less than fair market value may apply for a
waiver of the regulation regarding transfer of assets as constituting an undue
hardship. The facility where an
institutionalized applicant or recipient resides may file an application for
waiver of the requirement on behalf of the applicant or recipient with the
applicant’s or recipient’s or authorized representative’s consent.
A. The transfer must
have been made to someone other than a family member. “Family member” includes son, daughter,
grandson, granddaughter, step-son, step-daughter, in-laws, mother, father,
step-mother, step-father, half-brother, half-sister, niece, nephew,
grandmother, grandfather, aunt, uncle, sister, brother, step-sister,
step-brother.
B. The applicant or
recipient must demonstrate that the application of the transfer of assets
regulation would deprive the applicant or recipient of:
(1) medical
care such that the applicant’s or recipient’s health or life would be
endangered; or
(2) food,
clothing, shelter or other necessities of life.
C. The applicant or
recipient or the facility where the applicant or recipient resides must submit
any documentation to support the claim that application of the transfer of
assets requirement would constitute an undue hardship within 30 calendar days
of the date of the notice regarding the penalty to the ISD county office.
D. Undue hardship
does not exist when the application of a transfer penalty causes an applicant
or recipient or [his or her] their family members inconvenience or restricts
their lifestyle.
E. The county
director of the ISD office will make a decision regarding an application for
waiver of the transfer of assets requirements within 30 calendar days of
receipt of the application.
(1) Notice
of the decision shall be mailed to the applicant or recipient or [his or her]
their authorized representative.
(2) MAD
may make payments to the nursing facility for an applicant or recipient who is
a resident of the facility while an application for waiver of the requirement
is pending to hold the bed for the applicant or recipient. HSD may make payments for no more than 30
calendar days.
F. If the
applicant’s or recipient’s application for waiver of the transfer of assets
requirement is granted, MAD shall pay for long-term care services prospective
from the date of the application. MAD
shall pay for long-term care services as long as the circumstances constituting
the basis for waiver of the application of the requirement exist. If the applicant’s or recipient’s application
for waiver of the transfer of assets requirement is denied, the applicant or
recipient can request a HSD administrative hearing pursuant to 8.352.2 NMAC
within 90 calendar days of the date of the notice of denial.
G. The applicant or
recipient or their authorized representative must notify the ISD worker of any
change in circumstances which affects the application of the undue hardship
waiver exception within 10 working days of the change in circumstances. MAD will review the change of circumstances
and determine the next appropriate action, which may include withdrawal of the
waiver.
[8.281.500.23 NMAC - Rp, 8.281.500.24
NMAC, 8/15/2015; A, 12/1/2022]
HISTORY OF 8.281.500 NMAC: The
material in this part was derived from that previously filed with the
Commission of Public Records - State Records Center and Archives:
ISD Rule 380.0000,
Medical Assistance for Persons Requiring Institutional Care, 12/29/1983.
ISD Rule 380.0000,
Medical Assistance for Persons Requiring Institutional Care, 8/11/1987.
MAD Rule 380.0000,
Medical Assistance for Persons Requiring Institutional Care, 2/5/1988.
MAD Rule 380.0000,
Medical Assistance for Persons Requiring Institutional Care, 2/25/1988.
MAD Rule 380.0000,
Medical Assistance for Persons Requiring Institutional Care, 6/1/1988.
MAD Rule 380.0000,
Medical Assistance for Persons Requiring Institutional Care, 1/31/1989.
MAD Rule 380.0000,
Medical Assistance for Persons Requiring Institutional Care, 6/21/1989.
MAD Rule 880.0000,
Medical Assistance for Persons Requiring Institutional Care, 3/21/1990.
MAD Rule 880,
Medical Assistance for Persons Requiring Institutional Care, 5/3/1991.
MAD Rule 880,
Medical Assistance for Persons Requiring Institutional Care, 6/12/1992.
MAD Rule 880,
Medical Assistance for Persons Requiring Institutional Care, 11/16/1994.
MAD Rule 889,
Spousal Impoverishment, 8/17/1992.
MAD Rule 889,
Spousal Impoverishment, 2/17/1994.
MAD Rule 882,
Resources - Medical Assistance for Persons Requiring Institutional Care, 3/9/1993.
MAD Rule 882,
Medical Assistance for Persons Requiring Institutional Care, 11/16/1994.
MAD Rule 882,
Resources, 12/29/1994.
MAD Rule 883, Income
- Medical Assistance for Persons Requiring Institutional Care, 3/18/1993.
MAD Rule 883, Income
- Medical Assistance for Persons Requiring Institutional Care, 11/16/1994.
MAD Rule 883,
Income, 12/29/1994.
MAD Rule 888,
Medicare Catastrophic Coverage Act of 1988 Regarding Transfers of Assets, 3/10/1994.
MAD Rule 888,
Transfers of Assets, 12/27/1994.
MAD Rule 885,
Medical Care Credit, 11/16/1994.
History of Repealed Material: 8.281.500
NMAC, Income and Resource Standards, filed 2/15/2001 - Repealed effective 8/15/2015.