The general guidelines of 5200 and 6100 are applicable to persons in HCBS arrangements. The following additional rules must also be considered.
When one spouse is determined to qualify for HCBS services (i.e., is assessed as in need of care, chooses HCBS, and services are available), the total value of the resources owned by the couple which exceed the community spouse resource allowance as determined in accordance with 8244.1 below shall be considered available to the spouse qualifying for HCBS in determining eligibility regardless of which spouse owns resources and regardless of whether the spouses intend to divide resources under the spousal impoverishment provisions.
NOTE: An initial resource test is not required for SSI recipients receiving SI Medical as this program is not a resource tested program. If the individual had a previous hospital or nursing facility stay of 30 days or more, the start date of the first 30-day stay is used for the initial resource test. For persons put on a waiting list for HCBS services who did not have a previous 30 day stay prior to being on the wait list, this provision shall generally be based on the date the person is assessed and meets waiver criteria. See 8200.2.
This provision is also applicable regardless of any previously established prenuptial or postnuptial agreement. The combined resources of the couple must be considered despite such agreement.
If the value exceeding the community spouse resource allowance is less than or equal to the allowable 1-person resource level described in 5130, the person is eligible. In the month following the first month of eligibility, only those resources owned by the spouse in HCBS shall be considered for determining continuing eligibility on his or her case. This may result in ineligibility for the following months unless the couple intend to transfer assets under the spousal impoverishment provisions.
If the value exceeding the community spouse resource allowance is more than the allowable 1-person resource level, the person shall not be eligible until such time that the excess falls below the 1-person resource standard. At that point, the person becomes eligible for the month the excess is reduced. For the following months, only the resources owned by the spouse in HCBS shall be considered on his or her case. This may result in ineligibility for those months as indicated above.
NOTE: A Community Spouse Resource Assessment (CSRA) completed in a state other than Kansas is not accepted as verification of a completed division of assets. Married individuals applying for Long Term Care (LTC) coverage must complete the CSRA process before Kansas Medicaid LTC coverage may be approved.
In the month following the first month of eligibility of the LTC spouse, only those assets in which the applicant or recipient has ownership interest in shall be considered for determining eligibility of each individual spouse. Those assets which intend to be transferred to the community spouse per the Notice of Intent to Transfer Resources are attributable to the community spouse when determining his or her eligibility. The pro rata share of jointly owned resources shall be considered.
This also applies if both spouses have been assessed in need of and chosen HCBS. In this case, the couple shall designate the community spouse and the LTC spouse. Consideration shall also be given to the income allocation allowances when making this decision.
See also item (3) below for allocation of income.
The allocation shall be calculated by using the ES-3104.7. The amount of the allocation when added to the nonexempt gross earned and unearned income of the children and any legally responsible person with whom they live cannot exceed the federal protected income level for the appropriate number of persons in independent living. Income exempts under the provisions of 6410 and subsections shall not be considered. Allocation will be permitted even though it may render the children ineligible for cash assistance or SSI.
If requested, eligibility of the children for medical will be determined based on their resources and considering the allocated amount as income. A separate application is required. Ineligibility of the child for medical does not prevent the individual receiving HCBS from allocating.
In addition, otherwise unspent exempt income which over time results in excess resources may also be voluntarily contributed by an HCBS recipient towards the client obligation in an on-going basis to maintain resource eligibility.
Under federal law, a married couple is allowed to protect a portion or all of their combined nonexempt resources and income when either spouse requires care in an HCBS arrangement for at least 30 consecutive days, including those situations in which the HCBS spouse dies prior to the 30th day of HCBS care. As a result, such protected resources and income would not be considered in determining the medical eligibility of the spouse in HCBS. The law also provides for income to be protected for dependent family members and for the consideration of only the HCBS spouse's own income in determining his or her eligibility beginning with the month the spouse chooses HCBS or begins receiving services, whichever is earlier.
The following policies are only applicable in those instances in which one spouse lives in the community and the other spouse will be receiving HCBS services or where both spouses are receiving HCBS. If both spouses are receiving HCBS, the couple must designate one spouse to be the LTC spouse and one to be the community spouse. Once this designation is made it cannot be changed unless there is also a change in living arrangement which requires either the husband or wife to be the LTC spouse. In these cases, the change is effective the month following the month the living arrangement changed. These provisions do not apply to single individuals or to married couples where both members remain in the community.
The spousal impoverishment provisions contained in this section shall be applicable to all legally married couples, including common-law and same sex marriages. The marriage relationship exists until legally terminated. Separated and legally separated couples continue to be married and therefore may divide assets and allocate income.
The following provisions are applicable to the consideration of the couple's resources. The methods outlined to determine the community spouse resource allowance apply regardless of any other division of marital property. No adjustments will be made in the amount of the community spouse resource allowance, including divisions made through prenuptial and postnuptial agreements or court orders, unless it is ordered through the fair hearing process. A fair hearing officer may grant an increase to the community spouse resource allowance as outlined in 1619.
If a court order meeting the significant financial duress criteria contained in 1619 has been entered against an HCBS spouse for the support of the community spouse, the community spouse resource allowance shall not be less than the amount of the court order, even if it exceeds the maximum community spouse resource allowance described in subsection (1) below.
The ES-3162, Resource Assessment and Allowance Determination form, shall be used for this purpose. Either spouse can request such an assessment be made without a formal application for assistance. If the assessment is done without an application for assistance, the couple shall be informed of the outcome of the assessment including the total nonexempt resources which were considered, and the community spouse's share of those resources based on the determination described above. A copy of the assessment form is also to be provided to the couple. The original is to be retained in the case file for use in determining eligibility at the time a formal application is filed. The couple does not have the right to a fair hearing concerning the assessment until the time a formal application is filed.
If an application is not taken at the time of assessment, a "pseudo" application shall be registered in KEES to track the resource determination. The normal registration process would be used including the client's name, date of birth, and SSN. In addition, the case should be assigned to the Medically Needy program. Upon completion of the assessment and notification to the couple, the application shall be denied. No formal denial notice would be sent. However, if the assessment shows there to be eligibility for the HCBS spouse based on the community spouse resource allowance, a formal application shall be taken and processed at that time.
Only nonexempt resources are to be considered. This would include such things as checking and savings accounts, land or buildings other than an exempted home, and life insurance with a face value of more than $1,500. Thus, any resources that are counted toward the allowable resource limits must be considered. See 5000. Exempted resources, such as the home and one automobile, would not be considered in determining the community spouse resource allowance. The couple will need to provide any necessary evidence to document the amount of resources owned.
The minimum and maximum resource allowance limits are subject to change annually based on increases in the federal customer price index (CPI). Any increase in standards will only affect those who apply or request an assessment on or after the effective date of the increase. The resource standards in place at the time the assessment is actually calculated shall be used.
The M-2, Notice of Intent to Transfer Resources form, shall be sent to the applicant for completion and return prior to determination of eligibility. The form is designed to notify the applicant of the resource transfer process and of his/her obligation to make the necessary transfer(s) upon notice of approval. By signing the form, the applicant agrees to make the transfers based on the agency determination. Either spouse may sign the form, but both spouses are encouraged to sign. If the applicant fails to return the completed form, the application may be denied for failure to provide information.
NOTE: The special treatment of resources contained in an available trust (5330 and 5430) does not apply to the assessment process. Trust resources shall be considered exempt or countable based on the non-trust treatment of assets. Therefore, a residence or primary vehicle contained in an available trust would be an exempt resource in determining the Community Spouse Resource Allowance. Those same trust assets would still be countable when determining the amount of resources available to the couple in the eligibility process.
If, based on the community spouse resource allowance, the HCBS spouse is otherwise eligible, the couple must then transfer sufficient resources to the community spouse to equal the allowance if the combined resources are mostly jointly owned between the spouses or primarily owned solely by the HCBS spouse. If such transfer does not occur, the resources will be considered for all months following the month of application based on ownership.
The agency shall notify the individual of the outcome of the resource assessment. By earlier signing and returning the M-2 form, the individual has already agreed to make the necessary transfer(s). The couple then has 90 days from the date of notification of approval to transfer the necessary resources to the community spouse. If there is no immediate eligibility, the couple can pursue the necessary transfers prior to reapplying.
If the spouse in HCBS is unable to help carry out the transfer or give his or her consent to the transfer because of disability, a period of up to one year is allowed for the community spouse to carry out the transfer. The spouse must seek court action (through conservatorship or other methodology) to gain authority to do so on behalf of the HCBS spouse during this period. Documentation of this would be required.
The 90 day/1 year time periods referred to above can be further extended for good cause. Potential good cause reasons would include legal impediments which may prohibit liquidation of some property or extenuating circumstances beyond the control of either or both spouses that delay transfer activity such as an unexpected illness or hospitalization or untimely cooperation by a necessary third party (joint property owner, life insurance company, etc.). In such instances, the couple or spouse must continue to try to overcome these obstacles and present evidence of their attempts. The transfer period can then be extended for as long as necessary to complete the division. In such instances in which the transfer was not completed due to a legal impediment on a piece of property, once the impediment is overcome and the property becomes available, such property would then be subject to transfer pursuant to the determined community spouse resource allowance.
In order to transfer resources, the couple may be required to take such action as setting up separate savings accounts, changing ownership on titles and deeds, or liquidating property and dividing the proceeds. It is important that the spouses transfer resources in such a way that the resulting ownership interest of each spouse in the resources is clearly designated and separately identifiable. Once the property has been divided into separate shares, either spouse may have their name placed on the resource of the other for convenience purposes if their access to the property is limited to acting as an agent for the other spouse.
Documentation of how the transfer was carried out and any subsequent changes must be included in the case file.
Case processing shall not be delayed because of the permitted transfer period as long as sufficient evidence is presented to determine that the transfer will result in eligibility. If the transfer will not result in eligibility because the client still has excess resources, eligibility must be denied, and the record of the assessment and community spouse resource allowance will need to be retained in the case file for future application purposes. Such denial action can be taken immediately. The couple may then either complete the necessary transfers or wait until the spouse's share is closer to the resource level for eligibility.
For clients who are presumed eligible during the transfer period, if the couple does not follow through with the transfer within that period and does not have good cause for further extending the period, the case shall be closed as soon as possible giving timely and adequate notice. Payments made on behalf of the client up to that time shall not be regarded as overstated eligibility. The case can be reopened if the couple later completes the transfer and provides all necessary information. However, the client would not be presumed eligible again and eligibility could be re-established beginning in the month the transfer is completed.
The following provisions are applicable to the consideration of the couple's income.
The budgeting methodologies described in 7100 shall be used to compute the income of both spouses. For self-employment, the adjusted gross income shall be computed in accordance with 7122.
Only the spouse's principal place of residence can be used to compute this allowance.
Subtract the food assistance standard utility allowance (SUA) from 30% of the monthly minimum community spouse income allowance. This amount is then subtracted from the allowable shelter expenses to determine the amount of the excess shelter expense. The excess shelter expense is added to the monthly minimum community spouse income allowance to determine the new enhanced allowance, not to exceed the monthly maximum community spouse income allowance.
The amount of the community spouse allowance will vary based on changes in either spouse's income or changes in shelter expenses (including a change in the food assistance standard utility allowance). In addition, as with the community spouse resource maximum levels, the monthly maximum income allowance will be adjusted annually based on the percentage increase in the federal customer price index (CPI).
The amount of the allowance shall be reviewed and, if necessary, adjusted at the time of the annual review and cost of living increases. The client and/or his or her spouse must still report any changes in their income or shelter expenses within 10 calendar days of the change and the amount of the allowance would then need to be adjusted at the time of the reported change.
NOTE: If a court order meeting the financial duress criteria contained in 1619 has been entered against an HCBS spouse for the support of the community spouse, the community spouse income allowance shall not be less than the monthly amount of the court order, even if it exceeds the monthly maximum income allowance. In addition, if a fair, hearings officer has ruled that additional income is needed by the community spouse in instances of financial duress as referenced in 1619, the allowance shall equal that amount.
NOTE: For children under age 18 who do not live with a community spouse or where there is no community spouse, the allocation policy of 8243(3) is applicable.
A family member is defined as a child, parent, or brother or sister of either spouse. Dependency may be of any kind (e.g., legal, financial, medical, etc.). The spouse's or dependent member's allegation shall be accepted without challenge unless there is a reason to question it.
The income of the family member to be considered for purposes of determining eligibility for the dependent family member allowance shall be based on the same guidelines as referenced for the community spouse income allowance. The income of a legally responsible person would not be considered in this determination, only the member's own income. As the amount of the allowance is based on a percentage of the minimum community spouse income allowance standard, it will be subject to change at the time of an increase in that minimum allowance amount. The dependent family member allowance is subject to termination if the member's income changes and exceeds the minimum community spouse income allowance standard.
The family member's income shall be reviewed at the time of the annual review. The client and/or family member is responsible for reporting any change in the member's income within 10 calendar days of the change if it exceeds the above-mentioned minimum income allowance standard.
In general, the spousal impoverishment provisions contained in the section concerning the budgeting of spousal resources and income apply to all married couples. However, the following exceptions to the spousal impoverishment resource and income provisions apply.
If the above conditions are met, eligibility shall be based on the HCBS spouse’s own resources. Any assets owned by the community spouse shall be disregarded in determining eligibility for the HCBS spouse. In addition, the M-3, Notice of Intent to Allocate Income form, will only be required where income is to be allocated to a dependent family member as no income may be allocated to the uncooperative community spouse.
If the above conditions are met, eligibility shall be based on the HCBS spouse’s own resources. In addition, since a CSRA will not be completed, the M-2, Notice of Intent to Transfer Resources form is not required. The M-3, Notice of Intent to Allocate Income form will only be required where income is to be allocated to a dependent family member as no income may be allocated to the missing community spouse.
A spouse requesting HCBS shall not be determined ineligible for medical assistance due to attribution of resources in excess of the community spouse resource allowance (CSRA) if the denial would result in an undue hardship. Undue hardship exists when application of the spousal impoverishment resource provisions put either spouse at serious risk of deprivation of necessary medical care, food, shelter, or other necessities of life.
Examples of undue hardship may include situations where the couple has a substantial outstanding debt which must be met through the resources attributed to the HCBS spouse or where liquidation of resources to pay for long term care services would cause a substantial loss of income which impairs the community spouse’s ability to meet his/her own basic needs.
A claim of undue hardship must be made and supported by sufficient documentation by the applicant/recipient. The claim and all supporting documentation shall be forwarded to KDHE-DHCF Eligibility Policy for review. Based on the information provided, KDHE-DHCF Eligibility Policy will either grant or deny the undue hardship request and report that decision back to eligibility staff.
If the undue hardship claim is denied by the agency, the individual retains the rights to request a fair hearing on the decision per 1610.