Bench & Bar of Minnesota is the official publication of the Minnesota State Bar Association.

Gifting & Medical Assistance

Uncompensated transfers to family members will cause more problems for persons with medical assistance applications not approved prior to December 1, 2011. On that date the Department of Health & Human Services (DHS) implemented a new ?all or nothing? policy for reducing penalty periods caused by uncompensated transfers to family members.? MA takes into account transfers of assets or income for less than fair market value made to family members during the 60-month period prior to the month of application for benefits.? Transfers for less than fair market value disqualify the applicant for long-term care services in the community or in a nursing home.? For penalty periods imposed prior to December 1, 2011, it was and continues to be possible to shorten a penalty period by returning part of the value of the uncompensated transfers.? This allowed the family members to keep part of the uncompensated transfers and allowed them to return only enough to reduce the penalty period through passage of time and partial return of transfers.? Effective for penalty periods imposed on or after December 1, 2011, no credit for partial return of value will be allowed after the date on which the penalty period is imposed.? There are additional restrictions making it even more difficult to return all the transfers.? See for more details.? Arguably, this new policy violates federal law but CMS (the Centers for Medicare & Medicaid Services) has approved the policy change and there are no cases pending to challenge the new policy.

Julian Zweber

Attorney at Law, St. Paul

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