1. (1) Resource Limits. If an individual’s total resources are equal to or below the prescribed resource limits at any time during the month the individual is eligible on the factor of resources for that month. The resource limit is the SSI limit specified in Rule 65A-1.716, F.A.C., with the following exceptions:

   1. (a) For Medicaid for the Aged or Disabled Demonstration Waiver (MEDS-AD), an individual whose income is equal to or below 88 percent of the federal poverty level must not have resources exceeding the current Medically Needy resource limit specified in Rule 65A-1.716, F.A.C.
   2. (b) For Qualified Medicare Beneficiary (QMB), an individual cannot have resources exceeding three times the SSI resource limit with increases based on the Consumer Price Index.
   3. (c) For Working Disabled (WD), an individual cannot have resources exceeding the Medically Needy resource limit.
   4. (d) For Specified Low Income Medicare Beneficiary (SLMB), an individual cannot have resources exceeding three times the SSI resource limit with increases based on the Consumer Price Index.
   5. (e) For Qualifying Individuals 1 (QI1), an individual cannnot have resources exceeding three times the SSI resource limit with increases based on the Consumer Price Index.
   6. (f) For Medically Needy, an individual or couple cannot have resources exceeding the applicable Medically Needy resource limit set forth in subsection 65A-1.716(3), F.A.C.
   7. (g) For the Home and Community Based Services (HCBS) Waiver Program, an individual cannot have countable resources that exceed $2,000. If the individual’s income falls within the MEDS-AD Demonstration Waiver limit, the individual can have resources up to $5,000.

2. (2) Exclusions. The Department follows SSI policy prescribed in 20 C.F.R. §416.1210 and 20 C.F.R. §416.1218 in determining resource exclusions, with the exceptions in paragraphs (a) through (g), below, in accordance with 42 U.S.C. §1396a(r)(2).

   1. (a) Resources of a comatose applicant (or recipient) are excluded when there is no known legal guardian or other individual who can access and expend the resource(s).
   2. (b) The value of a life estate interest in real property is excluded.
   3. (c) The cash surrender value of life insurance policies is excluded as resources if the combined face value of the policies is $2,500 or less.
   4. (d) The individual, and their spouse, may designate up to $2,500 each of their resources for burial funds for any month. The designated funds may be excluded regardless of whether the exclusion is needed to allow eligibility. The $2,500 is not reduced by the value of excluded life insurance policies or irrevocable burial contracts.
   5. (e) One automobile is excluded, regardless of value.
   6. (f) Property that is essential to the individual’s self-support shall be excluded from resources if it is producing income available to the individual which is consistent with its fair market value. This includes real and personal property used in a trade or business; non-business income-producing property; and property used to produce goods or services essential to an individual’s daily activities. Liquid resources other than those used as part of a trade or business are not property essential to self-support. For the purpose of this section, mortgages are considered non-liquid resources, if they were entered into on or before September 30, 2004.
   7. (g) An individual who is a beneficiary under a qualified state Long-Term Care Insurance Partnership Policy is given a resource disregard equal to the amount of the insurance benefit payments made to or on behalf of the individual for long term care services when determining if the individual’s countable resources are within the program limits to qualify for Medicaid Institutional Care Program (ICP), HCBS, the Program of All Inclusive Care for the Elderly (PACE), or hospice benefits.

3. (3) Transfer of Resources and Income. According to 42 U.S.C. §1396p(c), if an individual, the spouse, or their legal representative, disposes of resources or income for less than fair market value on or after the look back date, the Department must presume that the disposal of resources or income was to become Medicaid eligible and impose a period of ineligibility for ICP, Institutional Hospice or HCBS Waiver Programs. The Department will mail a Notice of Determination of Assets (or Income) Transfer, CF-ES 2264, 02/2007, incorporated by reference and available to HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11422" http://www.flrules.org/Gateway/reference.asp?No=Ref-11422, to individuals who report a transfer for less than fair market value, advising of the opportunity to rebut the presumption and of the opportunity to request and support a claim of undue hardship per subparagraph (c)5., below. The Spanish version, CF-ES 2264S, 02/2007, and the Creole version, CF-ES 2264H, 02/2007, of the Notice of Determination of Assets (or Income) Transfer form are incorporated by reference and available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11423" http://www.flrules.org/Gateway/reference.asp?No=Ref-11423 and HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11424" http://www.flrules.org/Gateway/reference.asp?No=Ref-11424, respectively. If the Department determines the individual is eligible for Medicaid on all other factors of eligibility except the transfer, the individual will be approved for general Medicaid (not ICP, Institutional Hospice or HCBS Waiver Programs) and advised of their penalty period using the Medicaid Transfer Disposition Notice, CF-ES 2358, 07/2013, incorporated by reference and available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11455" http://www.flrules.org/Gateway/reference.asp?No=Ref-11455. The Spanish version, CF-ES 2358S, 07/2013, and the Creole version, CF-ES 2358H, 07/2013, of the Medicaid Transfer Disposition Notice are incorporated by reference and available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11457" http://www.flrules.org/Gateway/reference.asp?No=Ref-11457 and HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11456" http://www.flrules.org/Gateway/reference.asp?No=Ref-11456, respectively. Transfers of resources or income made prior to January 1, 2010 are subject to a 36 month look back period, except in the case of a trust treated as a transfer in which case the look back period is 60 months. Transfers of resources or income made on or after January 1, 2010 are subject to a 60 month look back period.

   1. (a) The Department follows the policy for transfer of resources in accordance with 42 U.S.C. §§1396p and 1396r-5. Transfer policies apply to the transfer of income and resources.

   2. (b) When funds are transferred to a retirement fund, including annuities, within the transfer look back period the Department must determine if the individual will receive fair market compensation in their lifetime from the fund. If fair compensation will be received in their lifetime there has been no transfer without fair compensation. If not, the establishment of the fund must be regarded as a transfer without fair compensation. Fair compensation shall be calculated based on life expectancy tables published by the Office of the Actuary of the Social Security Administration. See Rule 65A-1.716, F.A.C.

      1. Individuals and their spouses must disclose their ownership interest in any annuity, including annuities that are not subject to the transfer of resources provision, and if purchased on or after November 1, 2007 (and within the look back period) must name the state as a remainder beneficiary (for applicants at the time of approval or for recipients at time of annual review) in the first position for no more than the total amount of medical assistance paid on behalf of the institutionalized individual or in the second position after the community spouse and/or minor or disabled child unless the spouse, child or their representative disposes of the remainder for less than fair market value.

      2. A purchase of an annuity (and other transactions that change the course of an annuity payment or treatment of income or principal) made on or after November 1, 2007 (and within the look back period) will be considered a transfer of resources for less than fair market value unless the annuity meets all of the following criteria for applicants at the time of approval and recipients at the time of annual review: (a) the State of Florida, Agency for Health Care Administration, is named as the primary beneficiary (or secondary as appropriate pursuant to subparagraph (b)1., above); (b) the annuity is irrevocable and non-assignable; (c) the annuity pays principal and interest in equal amounts during the term of the annuity, with no balloon or deferred payments; and (d) the annuity is actuarially sound based on standards published by the Office of the Chief Actuary of the Social Security Administration called the Period of Life Table as set forth in Rule 65A-1.716, F.A.C. (Life Expectancy Tables). If the annuity meets all of the above criteria, funds in the annuity are excluded as a resource and the periodic payments are counted as income in the eligibility determination and calculation of patient responsibility.

      a. Transactions, such as additions of principal to an existing annuity or electing to annuitize an existing annuity that occurs on or after November 1, 2007 make an annuity (including an annuity purchased before November 1, 2007) subject to the transfer of resources provisions unless the criteria of paragraphs (2)(a) through (2)(d), above are met.

      b. Annuities purchased on or after November 1, 2007 (and within the look back period), by or on behalf of the community spouse, must name the State of Florida, Agency for Health Care Administration, as primary (or secondary) beneficiary pursuant to subparagraph (b)1., above and must be actuarially sound based on the community spouse’s age and the life expectancy tables. Annuities purchased by or on behalf of the community spouse after approval of ICP, Institutional Hospice or HCBS Waiver Programs for the applicant spouse are not evaluated for transfer of resources provisions.

      3. Individual Retirement Accounts (IRAs) or annuities (as described in Section 408 of the Internal Revenue Code) established by an employee or employer are not considered under the transfer of resources provision and are not required to name the state as the primary remainder beneficiary in accordance with subparagraph (b)1., above.

   3. (c) No penalty or period of ineligibility shall be imposed against an individual for transfers described in 42 U.S.C. §1396p(c)(2).

      1. In order for the transfer or trust to be considered to be for the sole benefit of the spouse, the individual’s blind or disabled child, or a disabled individual under age 65, the instrument or document must provide that:

      a. No individual or entity except the spouse, the individual’s disabled child, or disabled individual under age 65 can benefit from the resources transferred in any way, either at the time of the transfer or at any time in the future; and

      b. The individual must be able to receive fair compensation or return of the benefit of the trust or transfer during their lifetime.

      2. If the instrument or document does not allow for fair compensation or return within the lifetime of the individual (using life expectancy tables noted in paragraph (b), above), it is not considered to be established for the sole benefit of the indicated individual and any potential exemption from penalty or consideration for eligibility purposes is void.

      3. A transfer penalty shall not be imposed if the transfer is a result of a court entering an order against an institutional spouse for the support of the community spouse.

      4. A transfer penalty shall not be imposed if the individual provides proof that they disposed of the resource or income solely for some purpose unrelated to establishing eligibility.

      5. A transfer penalty shall not be imposed if the Department determines that the denial of eligibility due to transferred resources or income would impose an undue hardship on the individual. Undue hardship exists when imposing a period of ineligibility would deprive an individual of medical care such that their life or health would be endangered. Undue hardship also exists when imposing a period of ineligibility would deprive the individual of food, clothing, shelter or other necessities of life. All efforts to access the resources or income must be exhausted before this exception applies. The facility in which the institutionalized individual is residing may request an undue hardship waiver on behalf of the individual with the consent of the individual or their designated representative.

   4. (d) Except for allowable transfers described in 42 U.S.C. §1396p(c)(2), in all other instances the Department must presume the transfer occurred to become Medicaid eligible unless the individual can prove otherwise.

      1. An individual who disposes of a resource for less than fair market value or reduces the value of a resource prior to incurring a medical or other health care related expense which was reasonably capable of being anticipated within the applicable transfer look back period shall be deemed to have made the transfer, in whole or part, in order to qualify for, or continue to qualify for, medical assistance.

      2. In cases where resources are held by an individual in common with others in a joint tenancy, tenancy in common, or similar arrangement, the individual is considered to have transferred resources or a portion thereof, as applicable, when action is taken by the individual or any other person authorized to access the resources that reduces or eliminates the individual’s ownership or control of such resource.

      3. Promissory notes, loans and mortgages purchased on or after November 1, 2007 (and within the look back period) will be considered transfers of resources for less than fair market value to become Medicaid eligible unless the promissory notes, loans or mortgages meet all of the following criteria:

      a. The repayment term is actuarially sound in accordance with the Life Expectancy Tables as referenced in subparagraph (b)2., above;

      b. Payments must be made in equal amounts during the term of the loan, with no deferral and no balloon payments being possible; and

      c. Debt forgiveness is not allowed. If these criteria are not met, for purposes of transfer of resources, the value of the promissory notes, loans or mortgages will be the outstanding balance due as of the date of application for ICP, Institutional Hospice or HCBS Waiver Programs.

      4. A life estate interest purchased in another individual’s home on or after November 1, 2007 (and within the look back period) is considered a transfer of resources for less than fair market value. If the individual has not lived in the home for at least one year after the date of the purchase, the full amount of the purchase price paid for the life estate will be considered an uncompensated transfer without considering the value of the life estate. If the individual who purchased the life estate has resided in the home for at least one continuous year after the date of the purchase, the value of the life estate will be considered compensation and will be calculated by multiplying the current market value of the property at the time of the purchase by the life estate factor that corresponds to the individual’s age at the time of the purchase. The life estate tables can be found on the Social Security Administration’s website at https://secure.ssa.gov/apps10/poms.nsf/lnx/0501140120. Brief absences from the life estate property such as stays in a rehabilitation facility or vacations may not disrupt the client’s residency in the home. The facts of each absence will be evaluated to determine if the home continued to be the individual’s principal place of residence such as whether the person’s mail was delivered and received there or whether they paid the property taxes.

      5. Compensation for a resource may be received in the form of cash, real or personal property or other valuable consideration provided. Compensation is the gross amount paid or to be paid for the resource based on the agreement at the time of transfer, or contract for sale, if earlier. Compensation received in the form of real or personal property is valued according to its fair market value (FMV). Fair market value is defined as the price for which a resource can reasonably be expected to sell on the open market. If compensation for the resource is in the form of jointly owned real or personal property, the value of the compensation received is the FMV of the fractional interest in the real or personal property transferred or received. Expenses attributed to the sale of a resource do not reduce the value of the compensation.

   5. (e) Each individual shall be given the opportunity to rebut the presumption that a resource or income was transferred for the purpose of qualifying for Medicaid. No period of ineligibility shall be imposed if the individual provides proof that they intended to dispose of the resource or income at fair market value or for other valuable consideration, or provides proof that the transfer occurred solely for a reason other than to become Medicaid eligible or if the individual’s total countable resources (including the transferred resources) are below the program limits.
   6. (f) The uncompensated value of a transferred resource is the difference between the fair market value of the transferred resource at the time of the transfer, less any outstanding loans, mortgages or other encumbrances on the resource, and the amount of compensation received at or after the time of the transfer.

   7. (g) For transfers prior to November 1, 2007 (and within the look back period), periods of ineligibility are calculated beginning with the month in which the transfer occurred and shall be equal to the actual computed period of ineligibility, rounded down to the nearest whole number. For transfers made on or after November 1, 2007 (and within the look back period), periods of ineligibility begin with the later of the following dates:

      1. (I) For transfers prior to November 1, 2007 (and within the look back period), where resources or income have been transferred in amounts or frequency or both that would make the calculated penalty periods overlap, the value of all transferred resources or income is added together and divided by the average cost of private nursing home care.
      2. (II) For transfers prior to November 1, 2007 (and within the look back period), where multiple transfers are made in such a way that the penalty periods for each would not overlap, each transfer is treated as a separate event with its own penalty period.

      3. (III) For transfers on or after November 1, 2007 (and within the look back period), the uncompensated value of all transfers will be added together to arrive at one total value with a penalty period assigned.

         b. If an institutionalized individual is ineligible for ICP, Institutional Hospice or an HCBS Waiver Program due to a transfer of resources or income by the community spouse, and the community spouse becomes potentially eligible for ICP, HCBS, or Institutional Hospice, any remaining penalty period must be apportioned between the spouses. The Department shall apportion penalty periods by dividing any new or remaining penalty periods by two and attribute the quotient to each spouse. Any excess months may be attributed to the spouse that caused the penalty or according to the wishes of the couple or their representative.

         c. Individuals who are ineligible due solely to the uncompensated value of a transferred resource or income are ineligible for ICP, Institutional Hospice or HCBS Waiver services payment, but are eligible for other Medicaid benefits.

      1. The day the individual is eligible (pursuant to Rules 65A-1.711 through 65A-1.713, F.A.C.) for Medicaid and would be receiving institutional level care services in a nursing home facility, an institution with a level of care equivalent to that of a nursing facility, or home or community-based services furnished under a waiver based on an approved application for such care but for the application of the penalty period; or

      2. The first day of the month in which the individual transfers the asset; or

      3. The first day following the end of an existing penalty period. The Department shall not round down, or otherwise disregard, any fractional period of ineligibility of the penalty period but will calculate the period down to the day. There is no limit on the period of ineligibility. Once the penalty period is imposed, it will continue although the individual may no longer meet all factors of eligibility and may no longer qualify for Medicaid long-term care benefits, unless all assets or income are returned to the individual or fair market value compensation is paid for the transferred assets or income. If all transferred assets or income are returned to the individual, the penalty period is eliminated. Eligibility must be evaluated with returned assets included as though the individual had never transferred the assets or income.

      a. Monthly periods of ineligibility due to transferred resources or income are determined by dividing the total cumulative uncompensated value of all transferred resources or income computed in accordance with paragraph 65A-1.712(3)(f), F.A.C., by the average monthly private pay nursing facility rate at the time of application as determined by the Department (refer to paragraph 65A-1.716(5)(d), F.A.C.).

4. (4) Spousal Impoverishment. The Department follows policy in accordance with 42 U.S.C. §1396r-5 for resource allocation and income attribution and protection when an institutionalized individual, including a hospice recipient residing in a nursing facility, has a community spouse. Spousal impoverishment policies are not applied to individuals applying for, or receiving services under, HCBS Waiver Programs, except for individuals in the Familial Dysautonomia and Model (Katie Beckett) waivers.

   1. (a) When an institutionalized applicant has a community spouse all countable resources owned solely or jointly by the husband and wife are considered in determining eligibility.
   2. (b) At the time of application only those countable resources which exceed the community spouse’s resource allowance are considered available to the institutionalized spouse.
   3. (c) The community spouse resource allowance is equal to the maximum resource allocation standard allowed under 42 U.S.C. §1396r-5 or any court-ordered support, whichever is larger.
   4. (d) After the institutionalized spouse is determined eligible, the Department allows deductions from the eligible spouse’s income for the community spouse and other family members according to 42 U.S.C. §1396r-5 and paragraph 65A-1.716(5)(c), F.A.C.
   5. (e) If either spouse can verify that the community spouse resource allowance provides income that does not raise the community spouse’s income to the state’s minimum monthly maintenance income allowance (MMMIA), the resource allowance may be revised through the fair hearing process to an amount adequate to provide such additional income as determined by the hearing officer. Effective November 1, 2007, the hearing officers must consider all of the community spouse’s income and all of the institutionalized spouse’s income that could be made available to a community spouse. The hearing officers will base the revised community spouse resource allowance on the amount necessary to purchase a single premium lifetime annuity that would generate a monthly payment that would bring the spouse’s income up to the MMMIA (adjusted to include any excess shelter costs). The community spouse does not have to actually purchase the annuity. The community spouse will have the opportunity to present convincing evidence to the hearing officer that a single premium lifetime annuity is not a viable method of protecting the necessary resources for the community spouse’s income to be raised to the state’s MMMIA. If the community spouse requests that the revised allowance not be based on the earnings of a single premium lifetime annuity, the community spouse must offer an alternative method for the hearing officer’s consideration that will provide for protecting the minimum amount of assets required to raise the community spouse’s income to the state’s MMMIA during their lifetime.
   6. (f) Either spouse may appeal the post-eligibility amount of the income allowance through the fair hearing process and the allowance may be adjusted by the hearing officer if the couple presents proof that exceptional circumstances resulting in significant inadequacy of the allowance to meet their needs exist. Exceptional circumstances that result in extreme financial duress include circumstances other than those taken into account in establishing maintenance standards for spouses. An example is when a community spouse incurs unavoidable expenses for medical, remedial and other support services which impact the community spouse’s ability to maintain themselves in the community and in amounts that they could not be expected to be paid from amounts already recognized for maintenance and/or amounts held in resources. Effective November 1, 2007, the hearing officers must consider all of the community spouse’s income and all of the institutionalized spouse’s income that could be made available to a community spouse. If the expense causing exceptional circumstances is a temporary expense, the increased income allowance must be adjusted to remove the expenses when no longer needed.

   7. (g) The institutionalized spouse shall not be determined ineligible based on a community spouse’s resources if all of the following conditions are found to exist:

      1. The institutionalized individual is not eligible for Medicaid Institutional Care Program because of the community spouse’s resources and the community spouse refuses to use the resources for the institutionalized spouse; and,

      2. The institutional spouse assigns to the state any rights to support from the community spouse by submitting the Assignment of Rights to Support, CF-ES 2504, 10/2005, incorporated by reference and available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11428" http://www.flrules.org/Gateway/reference.asp?No=Ref-11428, signed by the institutionalized spouse or their representative. The Spanish version, CF-ES 2504S, 10/2005, and the Creole version, CF-ES 2504H, 10/2005, of the Assignment of Rights to Support are incorporated by reference and available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11429" http://www.flrules.org/Gateway/reference.asp?No=Ref-11429 and HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11430" http://www.flrules.org/Gateway/reference.asp?No=Ref-11430, respectively; and,

      3. The institutionalized spouse would be eligible if only those resources to which they have access were counted; and,

      4. The institutionalized spouse has no other means to pay for the nursing home care.

5. (5) Other Resource Policies.

   1. (a) The Department follows the policy for home equity interest in accordance with 42 U.S.C. §1396p(f). Individuals shall not be eligible for ICP, Institutional Hospice or HCBS Waiver Programs on or after November 1, 2007, if the equity interest in the home exceeds the home equity limit.

      1. The individual’s equity interest is based on the current market value of the home (including all contiguous property), minus any encumbrances such as a mortgage or other associated loans.

      2. Unless evidence to the contrary is on file or is received, accept the individual or designated representative’s statement for the equity value of a home that is more than $25,000 below the home equity limit. For equity values within $25,000 of the home equity limit, the individual or designated representative must provide verification of current market value and indebtedness. Verification of the current market value must be obtained from a knowledgeable source commonly involved in the housing industry in the geographic locale, such as a real estate broker, mortgage broker, property appraiser, or builder. The verification must include the current market value, the name of the person providing the estimate, and the contact information of the business or agency for whom the person providing the estimate works.

      3. Paragraph (5)(a), above, does not apply if the individual’s spouse, individual’s child under age 21 or the individual’s blind or disabled child (in accordance with 20 C.F.R. §§416.981-416.986 and 20 C.F.R. §§416.905-416.906) of any age is residing in the institutionalized individual’s home.

      4. The home equity provision may be waived when denial of ICP, Institutional Hospice or HCBS Waiver Programs would result in demonstrated hardship to the institutionalized individual.

      5. The Department will mail a Notice of Excess Home Equity Interest, CF-ES 2354, 05/2012, incorporated by reference and available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11431" http://www.flrules.org/Gateway/reference.asp?No=Ref-11431, to individuals whose home equity interest exceeds the home equity limit, advising of the opportunity to have the home equity interest policy waived. The Spanish version, CF-ES 2354S, 05/2012, and the Creole version, CF-ES 2354H, 05/2012, of the Notice of Excess Home Equity Interest are incorporated by reference and available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11432" http://www.flrules.org/Gateway/reference.asp?No=Ref-11432 and HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-11433" http://www.flrules.org/Gateway/reference.asp?No=Ref-11433, respectively.

   2. (b) An individual’s entrance fee in a continuing care retirement community or life care community shall be considered a resource, as set forth in 42 U.S.C. §1396p(g).
   3. (c) The Department follows SSI policy prescribed in 20 C.F.R. §416.1208 in determining block accounts as countable resources. This applies regardless of whether the individual or their representative is required to petition the court to withdraw funds for the individual’s care. A blocked account is one in which state law protects an individual’s funds by specifically requiring that the funds be made available for the care and maintenance of the individual.

Rulemaking Authority 409.9102, 409.919 FS. Law Implemented 409.902, 409.903, 409.904, 409.906, 409.9102, 409.919 FS. History–New 10-8-97, Amended 1-27-99, 4-1-03, 9-28-04, 8-10-06 (1)(a), (f), 8-10-06 (1)(f), 8-10-06 (3)(g)1., 11-1-07, 12-24-09, 9-10-12, 10-6-13, 1-12-20.