Disqualifying Transfer 400-29-35-15

(Revised 6/1/11 ML #3269)

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(NDAC 75-02-10-08)

 

  1. A person is ineligible for benefits if the person or the spouse of the person disposes of assets or income for less than fair market value on or after the look-back date of thirty-six months (Example of assets or income: Home, cash, life estates, trust, property, etc.).
  2. The look-back date is the date that is thirty-six months before the date of application; or in the case of payments from a trust or portions of a trust, that are treated as income or assets disposed of by a person, sixty months before the date of application.
  3. A person is not ineligible for benefits under this program if:
  1. The asset transferred was a home, and title to the home was transferred to:
  1. The person's spouse; and
  2. The person's son or daughter who is under age twenty-one, blind, or disabled;
  1. The income or assets:
  1. Were transferred to the person's spouse or to another for the sole benefit of the person's spouse; or
  2. Were transferred from the person's spouse to another for the sole benefit of the person's spouse;
  1. The person makes a satisfactory showing that:
  1. The person intended to dispose of the income or assets at fair market value, and the person had an objectively reasonable belief that fair market value or its equivalent was received;
  2. The income or assets were transferred exclusively for a purpose other than to qualify for Medicaid or benefits under this program;
  3. For periods after the return, all income or assets transferred for less than fair market value have been returned to the person. If the transferred assets were returned to the client, from the point of return forward, the client is no longer ineligible; or
  4. If all income or assets of a particular transfer are returned at the time of the application, and no periods of eligibility have been established for that transfer after the date of the original transfer, process the application as if the original transfer never occurred.
  5. The individual shows that the total cumulative uncompensated value of all income and assets transferred for less than fair market value by the individual or the individual's spouse is less than the actual cost of services of a type provided under this program, provided after the transfer was made, for which payment has not been made and which is not subject to payment by a third party, provided that such a showing may only be made with respect to periods when the person is otherwise eligible for benefits under this program. (Example: Mr. Smith transferred his home to his children two years ago. The fair market value of the home was $20,000. Mr. Smith is ineligible for this program until Mr. Smith incurs $20,000 of expenses during periods in which he was otherwise eligible, for which payment has not been made, and which are not subject to payment by any third party (such as a long term care insurance policy.)
  1. There is a presumption that a transfer for less than fair market value was made for purposes of qualifying for benefits under this program when:
  1. The person's assets and the assets of the person's spouse that remain after the transfer produce income which, when added to other income available to the person and to the person's spouse totals an amount insufficient to meet all living expenses and medical costs reasonably anticipated to be incurred by the person and by the person's spouse in the month of transfer and in the thirty-five months, or fifty-nine months in the case of a transfer to a trust, following the month of transfer;
  2. The person or the person's spouse was an applicant for or recipient of Medicaid or benefits under this program before the date of transfer;
  3. A transfer was made, on behalf of the person or the person's spouse, by a guardian, conservator, or attorney in fact, to:
  1. The guardian, conservator, or attorney in fact; or
  2. Any spouse, child, grandchild, brother, sister, niece, nephew, parent, or grandparent, by birth, adoption, or marriage, of the guardian, conservator, or attorney in fact.
  1. An applicant or recipient who claims that income or assets were transferred exclusively for a purpose other than to qualify for Medicaid or benefits under this program before the transfer must show that a desire to receive Medicaid or benefits under this program played no part in the decision to make the transfer and must rebut any presumption under subsection 4. The fact that the person would be eligible for Medicaid or benefits under this program, and the transfer had not been made, is not evidence that the transfer was made exclusively for a purpose other than qualifying for this program.
  2. If the transferee of any income or asset is the child, grandchild, brother, sister, niece, nephew, parent, or grandparent of the person or the person's spouse, services or assistance furnished by the transferee to the person or the person's spouse may not be treated as consideration for the transferred income or asset unless the transfer is made pursuant to a valid written contract entered into prior to rendering the service. 
  3. A transfer is complete when the person, or the person's spouse, who made the transfer has no lawful means of undoing the transfer or requiring a restoration of ownership.
  4. For purpose of this section:
  1. Fair market value is received:
  1. In the case of an asset not subject to reasonable dispute concerning its value, such as cash, bank, deposits, stocks, and fungible commodities, when one hundred percent of apparent fair market value is received;
  2. In the case of an asset subject to reasonable dispute concerning its value, when seventy-five percent of estimated fair market value is received; and
  3. In the case of income, when one hundred percent of apparent fair market value is received.
  1. "Uncompensated value" means the difference between fair market value and the value of any consideration received.
  1. This section is applicable to all transfers whenever made.