Long-term care includes many types of services needed by individuals who have a physical disability, a mental disability, or both. Long-term care services can be provided in a variety of settings, including an individual's home or an institution, such as a nursing home. To be eligible for Medicaid coverage for long-term care, individuals must be within certain eligibility categories--such as those that are aged or disabled--and meet functional and financial criteria. Within broad federal standards, states determine whether an individual meets the functional criteria for long-term care coverage by assessing an individual's ability to carry out activities of daily living (ADL), such as eating and getting around the house; and instrumental activities of daily living (IADL), such as preparing meals and shopping for groceries. The financial eligibility criteria are based on individuals' assets--income and resources together. States are responsible for determining whether applicants meet the financial and other eligibility criteria for Medicaid coverage for long-term care. To qualify for Medicaid coverage for long-term care, individuals must have assets that fall below established standards, which vary by state, but are within standards set by the federal government. The Medicaid program bases its characterization of assets--income and resources--on that used in the Supplemental Security Income program. Income is something received during a calendar month, paid either in cash or in- kind, that is used or could be used to meet food or shelter needs; resources are cash or real or personal property that are owned that can be converted to cash and be used for food or shelter. (See table 1 for examples of different types of income and resources.) In establishing policy for determining financial eligibility for Medicaid coverage for long- term care, states can decide, within federal standards, which assets are countable. For example, states may disregard certain types or amounts of income, and may elect not to count certain resources. In most states, to be financially eligible for Medicaid coverage for long-term care, individuals must have $2,000 or less in countable resources ($3,000 for a married couple). Federal law limits Medicaid payment for long-term care services for persons who divest themselves of--or "transfer"--their assets for less than FMV within a specified time period. As a result, when an individual applies for Medicaid coverage for long-term care, states conduct a review, or "look back," to determine whether the applicant (or his or her spouse, if married) transferred assets to another person or party. If the state determines an applicant transferred an asset for less than FMV during the look-back period, the individual may be ineligible for Medicaid coverage for long-term care for a period of time, called the penalty period. The DRA extended the look-back period for transfers made on or after February 8, 2006, to 60 months; prior to that, it was generally 36 months. The DRA also specified circumstances under which the purchase of certain assets--such as an annuity, promissory note or loan, or life estate--is considered a transfer for less than FMV, and when entrance fees for CCRCs are countable for purposes of determining Medicaid eligibility. Additionally, while an individual's primary residence is generally not a countable resource for determining Medicaid eligibility, the DRA specified when an individual with substantial equity interest in his or her home is to be excluded from eligibility for Medicaid payment for long-term care; the amount of allowable equity interest is established by each state within federal guidelines. See table 2 for a summary of these DRA provisions. Most, but not all, of these DRA provisions became applicable on the date the law was enacted, February 8, 2006. To assess applicants' financial eligibility for Medicaid coverage for long- term care, and to determine whether they transferred assets for less than FMV, states generally require applicants to submit applications and to provide documentation of certain assets reported on the applications. State Medicaid programs may also obtain information from third parties, such as financial institutions or other government agencies, such as the Social Security Administration. Such information helps states verify the accuracy of applicants' reported assets, as well as determine whether applicants have assets they failed to report or transferred for less than FMV during the look-back period. The processing of Medicaid applications--including the collection of documentation and information from applicants and third parties--is generally performed by local or county-based eligibility workers. In 2008, Congress passed legislation that required states to implement electronic asset verification systems (AVS) to verify the assets of aged, blind, or disabled applicants for Medicaid, including those seeking Medicaid coverage for long-term care, with financial institutions. An AVS would provide states with an electronic mechanism to contact multiple financial institutions, including those not reported by an applicant, to determine if an applicant has, or had, an account and the value of any existing accounts. The law provides for states' implementation of these systems to occur on a rolling basis; the first systems were to be implemented by the end of fiscal year 2009, with all states implementing systems by the end of fiscal year 2013. (See table 3.) States reported requiring applicants to provide documentation for most of the 13 types of assets contained in our survey; however, the types and number of months of documentation that the states considered to be acceptable proof for determining an applicant's financial eligibility for Medicaid coverage for long-term care varied. Specifically, 44 states required documentation for at least 12 of the 13 types of assets. All states reported requiring documentation of annuities, burial contracts and prepaid funeral arrangements, financial and investment resources, life estates, and trusts, while fewer states reported requiring documentation of other types of assets. States were least likely to require documentation of vehicles (38 states) and primary residence (37 states), resources that states may choose not to count for purposes of determining financial eligibility for Medicaid coverage for long-term care. (See fig. 1.) Officials from several states reported not requiring documentation for a particular type of asset because the state was able to obtain the necessary information from a third party. For example, while 50 states reported requiring applicants to submit documentation of earned income, one state did not have such a requirement because the amount of earned income was verified through an interface with the state's Department of Labor. It was less clear how states assessed other assets--such as vehicles or CCRC entrance fees--absent documentation. Our survey also showed that states varied in how they treated specific types of documentation; that is, whether the documentation was required, acceptable as proof by itself, acceptable as proof with other documentation, or not acceptable as proof of an applicant's assets. For example, while states generally found a written statement of earnings from an employer as acceptable documentation of earned income, there was more variation in how they treated other types of documentation. (See table 4.) States also varied in the number of months of documentation required from applicants, especially as it related to financial and investment resources. Although all 51 states reported requiring documentation of financial and investment resources, 27 required only current documentation, while the remaining 24 required both current and past documentation. Of the 24 states that required documentation of both current and past financial and investment resources, most required 60 months of documentation, while the remaining states required fewer months of documentation. (See fig. 2.) There was some variation, but to a lesser extent, in the amount of documentation of earned and unearned income that states required from applicants. Of the 50 states that required applicants to provide earned income documentation, 47 required only current documentation. Of the 3 remaining states, 2 required 3 months of documentation and 1 required 2 months of documentation. Of the 49 states that required unearned income documentation, 47 only required documentation of current unearned income. The other 2 states required 3 months of documentation. In addition to the documentation required to assess whether applicants' assets were within state financial eligibility levels, 38 states reported requiring additional documentation from at least some applicants to identify assets transferred for less than FMV. Of these 38 states, 16 indicated they required additional documentation only if an applicant reported making a transfer, 5 reported doing so only if an applicant's information was questionable, and 8 reported both of these reasons. Of the remaining 9 states, 7 required additional documentation from all applicants, and 2 did not specify the circumstances that would result in a request for additional documentation. Appendix II provides additional information on states' asset documentation requirements for individuals applying for Medicaid coverage for long-term care. All 51 states reported that they obtained some amount of asset information from third parties, although the extent of the screenings conducted varied by state. No state had implemented an electronic AVS, which would allow them to contact multiple financial institutions-- including those not reported by an applicant--to determine the existence and value of any accounts belonging to an applicant. States reported challenges to implementing an AVS including not having sufficient resources. To varying degrees, states reported obtaining information from third parties through a variety of mechanisms, including data matches, direct contact with financial institutions, and property and vehicle records searches. Some states also reported taking additional verification steps to determine if an applicant transferred assets for less than FMV during the look-back period. All 51 states reported that they conduct data matches with the Social Security Administration to verify at least some applicants' assets. However, states' use of data matches with other sources of asset information--primarily related to income--varied, ranging from 48 states reporting data matches with state unemployment records, to as few as 6 states reporting data matches with state tax records. On average, states conducted data matches with 6 of the 10 sources included in our survey; the number of sources states reported using ranged from 1 to 9.In addition to variations in the use of data match sources, states varied in terms of the proportion of applicants screened, and when during the eligibility process the state conducted the screen. For example, most states reported conducting a data match with the Social Security Administration generally before determining an applicant's eligibility. In contrast, of the 30 states that reported conducting a data match with the Internal Revenue Service for at least some applicants, 21 reported doing so generally after determining eligibility. (See table 5 for summary information and app. III for more detailed information about the data matches conducted by states.) Twenty-four states reported that they contact financial institutions to verify at least some applicants' financial and investment resources, while the remaining 27 did not. However, these 24 states varied in terms of the range of financial institutions they contacted and the proportion of applicants about whom they inquired. (See table 6.) Some states reported contacting multiple types of financial institutions, such as institutions applicants reported having accounts with, and some that applicants did not report. However, 13 of the 24 states reported contacting only financial institutions with whom the applicant reported having an account; of these 13 states, 3 states contacted financial institutions for all applicants, while the other 10 states did so for some applicants. These 13 states, and the 27 that reported not contacting any financial institutions, are unlikely to identify accounts that an applicant failed to report. Of the remaining 11 states that reported contacting financial institutions not reported by an applicant, 3 reported contacting only local institutions, whereas the other 8 contacted a combination of local, statewide, and national institutions. Regarding the proportion of applicants for which states contact financial institutions, half of the 24 states reported they only contact financial institutions if an applicant submits insufficient information or provides questionable information. Of the 24 states that reported they contact financial institutions to request information, the type of information--account balances or itemized statements--and the number of months they request varied. (See fig. 3.) Specifically, half of these states requested itemized statements that include information on each transaction, while the other half requested monthly account balances. Most of the states that requested account balances did so for 3 or fewer months. Of the 12 states that requested itemized statements, 5 requested 60 months of statements, 3 requested only the statement for the current month, and the other 4 states requested between 3 and 36 months of information. Most of the states (20 of 24) reported that they contact financial institutions for asset information before determining eligibility. Appendix IV provides additional information about states' contact with financial institutions to verify applicants' assets. Thirty-five states reported that they conduct some type of property records search to verify at least some applicants' real property. The extent of the searches varied in terms of the geographic area covered and the proportion of applicants for which property searches were conducted. (See table 7.) Of the 35 states that reported conducting property searches, 2 states conduct property searches only within an applicant's county of residence. Of the 33 states that reported conducting property searches beyond an applicant's county of residence, 8 do so only if they have reason to believe the applicant lived in another county or state. Additionally, 12 of the 35 states indicated they conduct property searches only when an applicant submits questionable or insufficient information, an applicant reports the property, or a combination of both factors. States reported being able to conduct property searches using several types of information, including an applicant's name (33 states), property address (32 states), property zip code (12 states), or an applicant's Social Security number (10 states). Most of the states (29 of the 35) reported that they generally conduct property searches before determining eligibility. Appendix V provides additional information about the property searches conducted by states. Thirty states reported that they conduct searches of Department of Motor Vehicles' (DMV) records to verify at least some applicants' vehicles. Specifically, 14 states reported conducting vehicle searches for all applicants and 1 state reported conducting searches for most of its applicants. The remaining 15 reported conducting such searches for less than half of their applicants; of these 15 states, 6 indicated that they only conduct searches of vehicle records if they receive information from an applicant that they deem questionable. States reported being able to search these records using several types of information, including an applicant's name (29 states), a vehicle identification number (20 states), and an applicant's driver's license or license plate number (18 states each). Most of the states (25 of the 30 states) reported that they generally conduct DMV searches before determining eligibility. Appendix VI provides additional information about the vehicle searches conducted by states. Twenty-two states reported taking additional steps to obtain information from third parties, such as conducting additional property searches, to identify assets transferred for less than FMV; 7 states reported doing this for all applicants; and 15 states reported doing this for some applicants. Of the 15 states that reported taking additional verification steps for just some applicants, most of them indicated they do so only if they question the information provided by applicants or have reason to believe a transfer may have occurred, such as if an applicant reported making a transfer. Appendix VII provides information on the proportion of applicants for which each state reported taking additional verification steps to identify assets transferred for less than FMV during the look-back period. Although 25 states were supposed to have implemented their electronic AVS to obtain information from financial institutions by the end of fiscal year 2011, no state had implemented one at the time of our survey. Eighteen states reported that they were in the process of implementing an AVS, while the remaining 33 states had yet to begin implementation. When asked about the challenges to implementing an AVS, 32 states reported that they did not have enough resources--such as money, staff, or time--required to implement such a system, and 18 states reported that it had been or would be challenging to get financial institutions to participate and provide information. One state reported that it had initially planned to have its AVS implemented by December 2011, but was unable to do so because financial institutions in the state were unwilling to participate in the AVS until state legislation is passed that releases the financial institutions from any liability, ensures they are fairly reimbursed for their services, and makes the process voluntary. The state Medicaid program is seeking such legislation during the state's 2012 legislative session and then plans to proceed with implementing its AVS. CMS acknowledged that states may have challenges that could affect their ability to implement an AVS as scheduled. CMS officials were aware of states' progress in implementing the AVS and told us that the agency was regularly communicating with states regarding AVS implementation. On the basis of states' responses to questions about the documentation required from applicants and the asset information obtained from third parties, it is unclear whether some states obtain sufficient information to implement certain DRA provisions, particularly the provisions related to the look-back period and home equity. The results of our survey raise questions about some states' implementation of the DRA, but are not conclusive, and we have additional work planned related to Medicaid long-term care financial eligibility. Look-back Period. We asked states about (1) the number of months of financial and investment resources documentation required to determine eligibility, (2) additional documentation required to identify assets transferred for less than fair market value, and (3) number of months of documentation obtained directly from financial institutions. When considering states' responses to those questions, we found that 31 states reported obtaining less than 60 months of information about at least some applicants' assets. Three of the 31 states reported requiring a single month of documentation from applicants and did not obtain any information from financial institutions. CMS officials noted that it is costly and time consuming to conduct a review for the 60 month look-back period. Thus, these officials stated, it was understandable for states to use discretion and only conduct reviews when there is reason to believe that a transfer could have been made during the look-back period. For example, a state might determine the need to conduct a more thorough review as a result of red flags found through other checks, such as when an applicant has very high income and no resources. However, the application forms in 6 of the 31 states did not ask about transfers made during the entire look-back period. Thus, it is unclear how these 6 states would know whether assets were transferred for less than FMV in the 60 months prior to application, and how all 31 states would be able to detect unreported transfers of assets made during the entire look-back period. In contrast, 20 states reported requiring 60 months of documentation from all applicants, 5 of which also requested 60 months of information from financial institutions for at least some applicants. Home Equity. Fourteen states reported not requiring documentation of a primary residence. Of these 14 states, 8 indicated that they conduct property record searches in the county of residence for at least some applicants to try to obtain information about property the applicant may own. Additionally, 1 state indicated that it could obtain information about an applicant's primary residence from a third party. The remaining 5 states reported they did not conduct property records searches; as such, it is unclear how these states would determine if an applicant owns a home that he or she failed to report, and the value of an applicant's equity interest in the home. Of the 37 states that reported requiring applicants to submit documentation of a primary residence, only 3 reported requiring documentation that could provide the state with information on the value of the home or an applicant's equity interest in the home. The remaining 34 states reported requiring documentation about applicants' primary residence, but the documentation received may not provide all of the information necessary to determine if applicants' equity interest in their homes exceeds the state's allowable amount. Life Estates. Among the 32 states that provided information on our survey about life estates, 2 states reported not assessing the length of time an applicant with a life estate resided in the property. The remaining 30 states reported requiring some type of proof in order to determine the amount of time an applicant resided in the property after the purchase of the life estate interest. On the basis of our analysis of state responses, 7 of the 30 states reported relying only on a statement from an applicant or another person who owns the residence to determine the length of time an applicant resided in the property; however, 2 of these 7 states said that they would require more documentation if they determined that the information they received was questionable. The remaining 23 states reported relying on documentation, such as a utility bill; a statement from an applicant; a statement from a third party; or some combination of these sources to determine the length of time an applicant lived in the property. CCRCs. On the basis of our survey results, most states--46 of 51--reported requiring applicants to provide documentation of CCRC or life care community entrance fees, such as a copy of the contract or agreement. Thus, these states should have sufficient information to determine if, under the DRA, an applicant's entrance fees should be countable resources for determining Medicaid eligibility. However, it is unclear how the remaining 5 states would be able to determine if an applicant has paid such fees, and whether they should be counted toward the applicant's Medicaid long-term care eligibility determination. Promissory Notes. Fifty states reported on our survey that they require applicants to provide documentation of promissory notes or loans; such documentation should allow the state to determine if a note meets the requirements specified in the DRA, such as providing for payments to be made in equal installments throughout the course of the loan, or if a note should be treated as a transfer of assets for less than FMV. Annuities. In responding to our survey, all states reported requiring documentation of annuities and thus should have sufficient information to determine whether an annuity should be considered a transfer of assets for less than FMV under the DRA. Additionally, our review of 49 states' long-term care application forms found that 45 required the disclosure of any interest the applicant or spouse has in an annuity and 27 contained statements regarding the state becoming a remainder beneficiary of such annuities. (See app. VIII.) As the demand for long-term care services increases and federal and state resources continue to be strained, it is important to ensure that only eligible individuals receive Medicaid coverage for long-term care. Since each state is responsible for day-to-day implementation of its Medicaid program, variation in policies and practices for determining financial eligibility is expected. However, some of the variation we found may raise questions regarding how states determine Medicaid eligibility for long- term care and enforce certain provisions of the DRA. States must balance the costs of eligibility determination efforts with the need to ensure that those efforts provide sufficient information to implement federal requirements. While third-party verification of applicants' financial information likely provides states with the best assurance of having a complete picture of an applicant's financial status, it can be a complex and costly process that requires a significant amount of information and review. Given the complexities involved, it may be reasonable for states to adhere to a risk-based approach and focus their eligibility determination efforts on applicants who appear to be more likely to have assets or to have transferred assets that would make them ineligible. The electronic AVS that is required by law may help states identify some unreported or transferred assets. However, it is too early to assess its overall effectiveness, which will ultimately depend on the breadth of the financial institutions participating and the depth of the information obtained. We provided a draft of this report to HHS for its review, and HHS provided written comments (see app. IX). HHS concurred with our findings and noted that the results of our comprehensive report will serve as a resource for all interested parties. Further, HHS indicated that the report will be helpful for targeting CMS's ongoing technical assistance and oversight efforts with states. As agreed with your offices, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date. At that time, we will send copies to the Administrator of CMS and other interested parties. In addition, the report will be available at no charge on the GAO website at http://www.gao.gov. If you or your staff have any questions about this report, please contact me at (202) 512-7114 or yocomc@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made key contributions to this report are listed in appendix X. State reported it did not count a primary residence when determining an applicant's eligibility--and therefore did not require documentation--if an applicant was living in the home or intended to return home. State reported it did not require documentation of primary residence unless it appeared as though the primary residence could exceed the allowable amount of equity interest. State reported it did not require documentation of primary residence because it was not countable when determining an applicant's eligibility. State reported it did not count a primary residence when determining an applicant's eligibility--and therefore did not require documentation--if an applicant's spouse, child under 20 years old, or disabled child was living in the home. State reported requiring documentation of vehicle loan value only if it affected eligibility determination. State reported requiring documentation of a life insurance policy if the applicant reported that it had a face value of $10,000 or more. State reported it did not require documentation of primary residence unless the applicant reported the value of the residence was within $200,000 of the allowable amount of equity interest. = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. = Not acceptable as proof. -- = Response not provided. = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. = Not acceptable as proof. -- = Response not provided. = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. = Not acceptable as proof. -- = Response not provided. = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. = Not acceptable as proof. -- = Response not provided. Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. -- = Response not provided. = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. = Not acceptable as proof. -- = Response not provided. = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. = Not acceptable as proof. -- = Response not provided. = Required. = Acceptable as proof by itself. = Acceptable as proof with other documentation. = Not acceptable as proof. -- = Response not provided. = All applicants. = Most (more than half) applicants. = Some applicants. = No applicants. -- = Response not provided. = All applicants. = Most (more than half) applicants. = Some applicants. = No applicants. -- = Response not provided. = Generally before eligibility determination. = Sometimes before and sometimes after eligibility determination. = Generally after eligibility determination. N/A = Not applicable, state did not conduct data match with respective source. -- = Response not provided. = Generally before eligibility determination. = Sometimes before and sometimes after eligibility determination. = Generally after eligibility determination. N/A = Not applicable, state did not conduct data match with respective source. -- = Response not provided. Appendix IV: States' Contact with Financial Institutions to Verify Applicants' Assets State Alaska Arizona Connecticut Illinois Indiana Kentucky Louisiana Maine Maryland Michigan Missouri New Jersey New York Rhode Island South Carolina Texas Vermont = All applicants. = Most (more than half) applicants. = Some applicants. = No applicants. -- = Response not provided. -- = Response not provided. = Generally before eligibility determination. = Sometimes before and sometimes after eligibility determination. = Generally after eligibility determination. Appendix V: States' Use of Property Records Searches to Verify Applicants' Assets State Alabama Alaska Arizona Colorado Connecticut Delaware Hawaii Illinois Iowa Kansas Kentucky Louisiana Maine Maryland Michigan Mississippi Missouri Montana Nevada New Hampshire New York North Carolina Ohio Oklahoma Oregon Pennsylvania Rhode Island = All applicants. = Most (more than half) applicants. = Some applicants. = No applicants. -- = Response not provided. -- -- = Response not provided. = Generally before eligibility determination. = Sometimes before and sometimes after eligibility determination. = Generally after eligibility determination. Pennsylvania Rhode Island South Carolina = All applicants. = Most (more than half) applicants. = Some applicants. = No applicants. -- = Response not provided. = Generally before eligibility determination. = Sometimes before and sometimes after eligibility determination. = Generally after eligibility determination. Rhode Island South Carolina South Dakota Tennessee Texas = All applicants. = Some applicants. = No applicants. -- = Response not provided. Appendix VIII: GAO Analysis of Annuity Language Contained in States' Application Forms * Application form contained language regarding Name the state as a remainder 27 State collected information from applicants through an interview rather than a paper application form. In addition to the contact named above, Michelle B. Rosenberg, Assistant Director; Emily Binek; Julianne Flowers; Kaycee M. Glavich; Shirin Hormozi; Emily Loriso; Christina Ritchie; and Phillip J. Stadler made key contributions to this report.

Summary:
Medicaid--a joint federal-state health care financing program for certain low income individuals--paid for nearly half of the nation's $263 billion long-term care expenditures in 2010. To be financially eligible for Medicaid coverage for long-term care, applicants cannot have assets--income and resources--above certain limits. Federal law discourages individuals from artificially impoverishing themselves in order to establish financial eligibility for Medicaid. Specifically, those who transfer assets for less than fair market value during a specified time period--or "look-back" period--before applying for Medicaid may be ineligible for coverage for longterm care for a period of time. The DRA extended the look-back period to 60 months and introduced new requirements for the treatment of certain types of assets, such as annuities, in determining eligibility. States are responsible for assessing applicants' eligibility for Medicaid, the criteria for which varies by state. GAO was asked to provide information on states' requirements and practices for assessing the financial eligibility of applicants for Medicaid long-term care coverage. GAO examined the extent to which states (1) require documentation of assets from applicants, (2) obtain information from third parties to verify applicants' assets, and (3) obtain information about applicants' assets that could be used to implement eligibility-related DRA provisions. From October 2011 to November 2011, GAO surveyed Medicaid officials from each of the 50 states and the District of Columbia. GAO also interviewed officials from CMS, the agency within HHS that oversees Medicaid. States reported requiring applicants to provide documentation for most of the 13 types of assets included in GAO's survey. States varied in the extent to which they obtained information from third parties to verify applicants' assets. For example, all states conducted data matches with the Social Security Administration but used other sources to a lesser extent. While states' implementation of an electronic asset verification system (AVS) was required on a rolling basis beginning in 2009, no state had fully implemented an AVS at the time of GAO's survey. Among the implementation challenges reported by states were lack of resources and getting financial institutions to participate. Officials from the Centers for Medicare & Medicaid Services (CMS) were aware of states' progress and challenges and told GAO that they regularly communicated with states on AVS implementation. On the basis of states' responses to questions about the extent of documentation required from applicants and information obtained from third parties, it is unclear whether some states obtain sufficient information to implement certain provisions of the Deficit Reduction Act of 2005 (DRA). For example, 31 states reported requiring less than 60 months of documentation from applicants and financial institutions. The results of GAO's survey raise questions about states' implementation of the DRA, but are not conclusive. CMS officials said that it is reasonable for states to only conduct reviews when there is reason to believe a transfer of assets occurred. GAO has additional work planned related to Medicaid long-term care financial eligibility. States must balance the costs of eligibility determination efforts with the need to ensure that those efforts provide sufficient information to implement federal requirements. Given the complexities involved, it may be reasonable for states to adhere to a risk-based approach and focus their eligibility determination efforts on applicants who appear to be more likely to have assets or to have transferred assets that would make them ineligible. It is too early to assess the effectiveness of the AVS; its utility will ultimately depend on the breadth of the financial institutions participating and the depth of the information obtained. The Department of Health and Human Services (HHS) concurred with GAO's findings and commented that GAO's comprehensive report will serve as a helpful resource for CMS and other interested parties.