Expanding Foundations: Non-MAGI Resources Expanding Foundations: Non-MAGI

Types of Resources and Data Entry Goal: To understand resource eligibility rules and processes   Objectives: After this module participants will: Data enter different types of resources. Identify exempt resources. List references to aid in data entry.

Life insurance policies Estates Life insurance policies Home Estate Accounts An Estate is the net worth (assets-liabilities) of an individual at any time Upon death the estate (both assets and liabilities) of an individual remains Assets may be liquidated and used to payoff liabilities Annuities

Inheritance Estate Home Accounts Annuities If any assets remain they will make up the inheritance to be divided according to the will or existing law. The estate can be settled and Annuities

Medicaid is not in the business of protecting inheritances! Assets can be distributed Medicaid is not in the business of protecting inheritances *few exceptions i.e. homes depending on who lives there.

Estate Recovery Estate Recovery allows Medicaid to recoup expenses from an estate prior to any inheritance disbursements.

Estate Recovery Home Estate Accounts Annuities To Medicaid

Estate Recovery Allows for less harsh rules upfront Homes, vehicles etc.

Liquid Assets Bank Accounts Retirement Accounts Cash Items held as an investment Etc. Page 39

Liquid Asset-Data Entry EBD Resource Name*** Identifiable Acct# Identifiable Type FMV –requires at least $0.01 to generate a checklist

Liquid Asset-Data Entry EBD Joint Ownership requires +Add button Amount of balance…. -Disregard current Income Exemption is not used in rules engine Percent Owned will assign asset share

Encumbrances Enter loans, Mortgages etc. Deducts from countable value (cars, mortgages) Page 41

Vehicle Exempt one if used for transportation Regardless of value Use FMV Bluebooks are guideline CBMS auto exempts higher value. Only will exempt the additional vehicle for spouse if each vehicle is individually owned (one by each person) Page 42

Vehicle FMV: Blue Books are guides – Use Trade-in Value (Need cash today scenario!) Good condition and 12,000 miles/year are defaults without more info. Other appraisals can be used, use PPP and err on the side of favorability to the client

Vehicle 1. Select Vehicle Button 2. Select Add Resource Page 43 Informational, See intent to Sell Note Encumbrances and Disposition tabs same as outlined earlier Page 43

Intent to Sell Exemption for vehicles and property Must be listed Client must accept reasonable offers Request updates/verification every 3 months Reasonable offers are defined as 2/3 FMV Upon Sale initial resource limits apply

Real Property Primary Home Secondary properties Mineral rights Other income producing property Page 44

Primary Home Exempt up to $552,000 in equity Must be living in home or “Intend to Return” Exempt if Spouse or dependent relative live in home (no limit) FMV Also 3 month exemption for secondary home being used as replacement (time to move) Intent to return has no time limit (estate recovery is in play). Intent to Return out of state means they are not a Colorado resident. One primary home exemption only (applies to non-legally separated couples) FMV use appraisals,

Secondary Property Equity is countable Intent to sell can be applied Appraisals as guideline Equity, enter FMV and Encumbrance Intent to sell Using eAppraisals is ok, but pull a variety of sources due to their volatility. Applicant can dispute Page 44

Mineral Rights Land appraisal if land is owned Mineral rights only appraisal if not Often low due to extraction costs Income producing property exemption Mineral rights are ownership of the natural resources that can be extracted, may not include ownership of the land itself Page 45

Income Producing Property Exempt up to $6000 Non-business property Business property producing a 6% return on the excluded value Income is countable income Mineral rights, Vehicles, Land, Rental property

Real Property Data Entry Resource Name Type: as applicable House-Primary will exempt Income generating FMV use appraisal value (even for primary home). Enter Encumbrance to calculate equity. Enter address below Page 46

Real Property Data Entry Intent to Sell information. Intent to return Prior to entering…. Information needed applies to estate recovery

Burial Assets Burial plots, and irrevocable policies are exempt Additional $1500 set aside per person as revocable Saves Medicaid burial costs later HCPF must be remainder beneficiary *$1500 is generally revocable policy or trust, but policy allows for ‘other arrangements’ so long as the account is kept separate (interest generated will also be exempt) Page 47

Burial Asset II> Resource Summary>Liquid Asset Summary>Burial Asset Ownership same as liquid assets

Life insurance Per Person (Applicant and Spouse Page 48 If total face value of all policies are over $1500, all are countable. If total face value of all policies are $1500 or less, all are not countable. Page 48

Life Insurance Face value: Death benefit Cash Value: Investment component Cash Surrender Value: Amount received to ‘cash out’ the policy

Term Life Insurance Premium payments keep death benefit active (face value) No cash value No cash surrender value Note the face value adds to the $1500 rule, but since there is no cash value this will not be countable

Whole Life Insurance Also called Universal or Variable Premium goes to death benefit and an investment fund The investment fund is the cash value The cash surrender value is a separate amount Note: Policy holders can ‘borrow’ from the cash value of a policy. This acts as a loan with a repayment agreement. The repayment agreement is at death (from the face value) or upon surrender (from the cash surrender value). The Cash Surrender Value always adjusts to reflect these loans

Counts for Medicaid only AF vs. Medicaid Countable for Both Face Value over $50,000 and Purchased within 48 months Counts for Medicaid only Face Value greater than $1500 but less than $50,000 Or >$50,000 and purchased more than 48 months ago Exempt for both Total Face Value $1500 or less

Life Insurance Ownership details remains the same Policy # for tracking purposes Face and cash surrender value

Data Entry Practice Page 52-63

Types of Resources and Data Entry Goal: To understand resource eligibility rules and processes   Re-Visit Objectives: Can you? Data enter different types of resources. Identify exempt resources. List references to aid in data entry. Page 64