MEDICAID PLANNING - NO SIMPLE ANSWER
(dollar values as of 1/2/2003)

INITIAL EFFECTIVE DATES. (Ohio is 1/1/90)
a. 9/30/89 married couples considered one financial unit beginning that date.
b. 9/30/89 beginning date for new "community spouse resource allowance," "minimum monthly maintenance needs allowance," and "excess shelter allowance."

OMNIBUS BUDGET RECONCILIATION ACT OF 1993 (OBRA-93)(8/10/93)
a. 8/10/93 transfer of asset disqualification period is 36 months, for transfers after 8/10/93.
b. 8/10/93 transfer of asset disqualification period is 60 months for transfers to a trust.
c. 8/10/93 eliminated 30-month cap on period of ineligibility. Count transfer date as the first of the month following the transfer. Thus, a transfer within the period of ineligibility could make
an applicant ineligible for more than 36 months if the application for Medicaid is made within
the 36 months. Multiple transfers must be added together to run consecutively, with the period
of ineligibility beginning to run on the date of the first transfer.
d. Transfer penalty eliminated by return of the transferred assets to the Medicaid applicant.
e. Estate Recovery (for deaths occurring after 10/1/93).  States are required to begin programs to recover nursing home and long-term-care Medicaid expenses from the estates of deceased recipients. Permitted against any real or personal property or other assets in which the
beneficiary had any legal title or interest at the time of death, specifically including the home.

DEFINITIONS.
a. Community spouse (CS) is the spouse remaining at home. Institutional spouse (IS) is the spouse in the nursing home.
b. Community spouse resource allowance (CSRA) is the lesser of $90,660 or 1/2 of the couple's assets (SSA 1924(f)(2)), plus the couple's home (SSA 1924(c)(5)). The guaranteed minimum to the community spouse is $18,132 (SSA 1924(f)(2)(A)), which Ohio could raise up to $90,660.
c. Minimum monthly maintenance needs allowance (MMMNA) the minimum amount of combined income allowed to the community spouse of $1,493 (eff 7/1/02)(which includes the community spouse's income (SSA 1924(d)). Ohio could increase the amount up to $2,232 (7/1/02).
d. Excess shelter allowance is the amount by which the couple's rent or mortgage payments, real estate taxes, insurance, condominium or cooperative maintenance charges, and utility costs exceed 30% of the MMMNA ($1,493 x 30% = $448)(SSA 1924(d)(4)) (eff 7/1/02).
e. Exempt assets are those assets which the Medicaid applicant may own but which are not counted in determining Medicaid eligibility.
f. SPLIMPA - Single Premium Lifetime Immediate Monthly Payment Annuity: Effective January 1, 1996 (OAC Rules 5101:6-2-50 and 5101:6-7-02, PAM 7515 et seq), upon request a state hearing will be granted to determine if CSRA should be increased if CS elects not to receive a monthly income allowance (MIA) from IS or the CS's gross income and the MIA from IS are not sufficient to raise the CS's income to the MMMNA. SPLIMPA is annuity to provide monthly payments for annuitant's lifetime only. Need 3 written estimates (averaged) of the cost of a SPLIMPA. Averaged estimate shall be substituted for the amount of resources. Do not need to purchase SPLIMPA.

Beginning 9/30/89 community spouse can keep the couple's home plus the community spouse resource allowance (CSRA). The CSRA is the lesser of $90,660 or 1/2 of the couple's assets with a guaranteed minimum of $18,132. An asset which may be exempt belonging to the community spouse will loose that status upon the death of the community spouse.

The transfer of asset restriction of 36 months (effective 8/10/93) only applies to the institutionalized spouse. The community spouse cannot generally transfer any asset without restriction.

EXEMPT ASSETS (Ohio Admin. Code 5101:1-39-26)
a. Household goods and personal effects of a reasonable value.
b. One car whose market value is $4500 or less (exclude lien); however, one car is TOTALLY
exempt for a married applicant who is institutionalized on or after 1/1/90 (one car also totally
exempt if specially equipped for a disabled individual or if used for employment).
c. Burial spaces for applicant and his immediate family.
d. Income producing property with equity less than $6000 and at least a 6% return on equity.
e. Life insurance with face value less than $1500 regardless of cash value.
f. Assets for which there is no real market.
g. Prepaid irrevocable burial contract.
h. Home, with certain requirements for community spouse.
i. Cash received for in-kind replacement of exempt asset that has been lost, damaged or stolen.

ASSETS FOR WHICH THERE IS NO REAL MARKET.
a. One-half interest in a single family home generally has no real market if the home is
occupied by the other one-half owner.
b. A life estate may not be considered marketable even though it has a fair market value.

HOME.
a. Home is considered to be the principal place of residence of the applicant for the first six
(6) months in the nursing home if the applicant asserts that they will return to the home.
period may be extended an additional six months.
b. If Medicaid applicant has been institutionalized for more than six (6) months then home will
still be exempt from sale if any of the following persons reside there:
    1) Applicant's spouse or dependent child (under age 21, or if over 21 then must be blind
    or disabled); or
    2) Applicant's child is 65 or older and financially dependent on applicant; or
    3) Applicant's brother or sister who has part ownership in home and resided in home
    for at least one year before applicant entered the medical institution; or
    4) Child who resided in home 2-year period before institutionalization and provided
    care to the disabled applicant which allowed the applicant to reside in the home rather
    than a medical institution.
c. When sale required, must be for at least 90% of the market value determined by the County
Auditor.

INCOME RULES.
a. Community spouse retains all income in his or her name.
b. Minimum monthly maintenance needs allowance (MMMNA) of $1,493 (eff 7/1/02) is allowed to community spouse. MMMNA may exceed $2,232 (eff 7/1/02) only after court order.
c. Excess shelter allowance (ESA) may be allowed if the couple's mortgage payments, rent, real estate taxes, insurance, condominium or cooperative maintenance charges, and utility costs exceed $448.00 ($1,493 times 30% = $448). (eff 7/1/02)

PLANNING OPTIONS
a. Home.
    1) Transfers limited per above discussion.
    2) Sale of home to child of a life estate measured on the life of the parent with a nonassignable or nontransferable mortgage by the mortgagee. Problems.
    3) Transfer of home to children, retaining a life estate with a power to change the remainderman by a power of appointment your Last Will and Testament. Problems.
    4) Transfer of home to children, and reserve special power of appointment and lease back.
    5) Use of a Transfer on Death Deed.
b. Commercial immediate payment annuities vs. family private annuities. Problems.
c. Exempt assets (other than home) can be transferred to anyone.
d. Demonstrate that denying applicant Medicaid eligibility would cause an undue hardship. Problems.
e. Revising Last Will and Testament.
f. Durable general power of attorney.
g. Change life insurance beneficiaries and IRA beneficiaries.
h. Change ownership of life insurance.
i. Monthly pay status for Individual Retirement Account.
j. SPLIMPA set aside. Request a state hearing.
k Cuyahoga CDJFS monthly average cost of private nursing home $3,903 (effective 8/01) for disqualifying transfers. (prior amount was $3,441 from 6/1/99)

WARNING This memorandum is not intended to provide advice, counsel or assistance for disposing of assets so as to result in any period of ineligibility. This memorandum is merely an attempt to provide information about a complex Federal benefit program administered by the State of Ohio.

NO TRANSFER OF ASSETS SHOULD BE ATTEMPTED WITHOUT CONSULTING AN ATTORNEY FOR ADVICE CONCERNING THE SPECIFIC APPLICATION OF YOUR PARTICULAR FACTUAL SITUATION AND ASSET ANALYSIS.

Other references:
"Financial Planning for Nursing Home Care: Medicaid Eligibility," Charles M. Delbaum and Roland
Hornbostel, revised, Nov. 1990, price $10.00, call Nursing Home Ombudsman at (216) 696-2719.
National Academy of Elder Law Attorneys, 1604 North Country Club Road, Tucson, AZ 85716, (520) 881-4005

* effective July 1

Initial medicaid rules effective in Ohio as of 1/1/90. Disqualification period is 30 months effective 1/1/90.

Disqualification period is 36 months, for transfers to trust is 60 months effective 8/10/93.

Average monthly cost of nursing home care (Cuyahoga CDJFS) for disqualifying transfers $3,903 (8/01).

CSRA - Community Spouse Resource Allowance is the lesser of designated amount or 1/2 of the couple's assets (SSA 1924(f)(2) plus the couple's home (SSA 1924(c)(5)). Minimum set by SSA 1924(f)(2)(A). Ohio is a minimum state. CS = Community Spouse IS = Institutional Spouse

MMNA - Monthly Maintenance Needs Allowance is the amount of combined income allowed to the community spouse (SSA 1924(d)). The minimum is sometimes referred to as MMMNA (Ohio is a minimum state). MIA = monthly income allowance

ESA - Excess Shelter Allowance is the amount by which the couple's rent or mortgage payments, real estate taxes, insurance, condominium or cooperative maintenance charges, and utility costs ($306 avg effective 2002) exceed 30% of the Minimum MMNA (SSA 1924(d)(4)).

SPLIMPA - Single Premium Lifetime Immediate Monthly Payment Annuity: Effective January 1, 1996 (OAC Rules 5101:6-2-50 and 5101:6-7-02, PAM 7515 et seq), upon request a state hearing will be granted to determine if CSRA should be increased if CS elects not to receive an MIA from IS or the CS's gross income and the MIA from IS are not sufficient to raise the CS's income to the MMMNA. SPLIMPA is annuity to provide monthly payments for annuitant's lifetime only. Need 3 written estimates (averaged) of the cost of a SPLIMPA. Averaged estimate shall be substituted for the amount of resources. Do not need to purchase SPLIMPA.