Arkansas Administrative Code › Agency 016 - DEPARTMENT OF HUMAN SERVICES › Division 20 - Division of County Operations › Rule 016.20.08-001 - Medical Services Policy Manual - Long Term Care Insurance Partnership Program

Current through Register Vol. 49, No. 6, June, 2024
21700
Estate Recovery
The Omnibus Budget
			 Reconciliation Act of 1993 and Arkansas Act 415 of 1993 mandate recovery of
			 medical payments correctly made from 8/13/93 and later from the estates of:
* Individuals of any age who were considered to be permanently
				institutionalized, who received medical services in a nursing or ICF/MR
				facility, and who were required to pay all but a minimal amount of income for
				their care, and for
* Individuals age 55 and older who received medical services in
				a nursing or ICF/MR facility or in a home and community based waiver program,
				whether or not they were considered to be permanently institutionalized.
Estate recovery will not be made from the estate of deceased
				individuals when:
* there is a surviving spouse, dependent children under age 21,
				or blind or disabled children (as determined by SSA disability
				guidelines),
* recovery will create an undue hardship for other surviving
				family members, or
* recovery is not cost effective.
*
Estate recovery will not be made from assets
				which were protected as a result of the individual having a Qualified Long Term
				Care Insurance Partnership Policy. The maximum amount protected at estate
				recovery will be the amount protected when eligibility was established. If any
				of the protected assets have been spent or given away, only the amount
				remaining will be protected at estate recovery.
21705
Definitions
Estate
- The term "estate" under Arkansas law,
				with respect to a deceased individual, means all real and personal property
				owned by the individual at his death.
Permanently Institutionalized
- An individual is
				considered to be "permanently institutionalized" if a medical determination is
				made which indicates there is no reasonable expectation that the individual is
				likely to return home.
The date on which an individual was determined to be
				permanently institutionalized is irrelevant. If services were provided prior to
				the time a decision was made regarding permanent institutionalization, recovery
				will include assistance provided prior to the decision.
Intent to Return Home
- When an individual who
				enters an institution states his intent to return home, the home may be
				excluded from countable resources in determining eligibility, even when a
				medical decision has been made that the individual is "permanently
				institutionalized".
Undue Hardship
- Undue hardship may exist when the
				estate's asset is the sole asset of the survivors, the asset is their sole
				source of income, the income is not sufficient to meet their living expenses
				and also repay the debt to DHS, or there are other compelling circumstances
				(e.g., the estate assets cannot be readily converted to cash).
20000
Long Term Care
			 Insurance Partnership Program
The Deficit Reduction Act of 2005,
				Pub.
				L. 109-171,
				Section
				6021 allows for the expansion of a Qualified
				State Long Term Care (LTC) Partnership Program. This permits States to
				disregard as a resource when determining Medicaid eligibility an amount up to
				the total amount of benefits paid out of a LTC Insurance Partnership policy.
				The benefits will be disregarded in determining an individual's Medicaid
				eligibility for Facility Care as well as Home and Community Based Services. The
				Arkansas General Assembly passed Act 99 on February 13, 2007 to establish the
				Arkansas Long Term Care Partnership Program.
The Qualified State LTC Partnership Program encourages
				individuals to accept personal responsibility for their future long term care
				needs by purchasing insurance and reduces the incentive to transfer or hide
				assets that can be protected legally. It will help individuals better plan for
				long term care needs they may have in the future.
NOTE:
Purchasing or owning a LTC Partnership
				policy does not guarantee Medicaid eligibility. Other eligibility factors must
				be met also.
20010
Asset Disregard
An asset disregard in an amount up to the amount of benefits
				paid out by a Qualified Long Term Care Insurance Partnership policy will be
				allowed when determining eligibility for Medicaid. This is a "dollar for
				dollar" calculation for asset protection. The benefits will be disregarded in
				determining an individual's Medicaid eligibility for Facility Care as well as
				Home and Community Based Services.
Example:
An individual purchased a qualified
				policy with a benefit of $100,000. Application is made for Medicaid and the
				policy has paid out $90,000 in benefits. The policyholder's assets can be
				protected up to $90,000.
Only certified "partnership qualified" LTC insurance policies
				provide this asset protection. The asset disregard cannot be allowed for a
				non-qualified LTC insurance policy.
20020
Policy
			 Identifiers
The Arkansas Department of Insurance has established specific
				criteria that the qualified long term care insurance policy must meet. The
				criteria are:
1. The policy must cover
			 a person who is a resident of the Qualified Partnership State when coverage
			 first became effective.
2. The
			 policy must meet the definition of a "qualified long term care insurance
			 policy" established by the Internal Revenue Code of 1986.
3. The policy must not have been issued
			 earlier than July 1, 2008.
4. The
			 policy must include inflation protection which is established at the time of
			 purchase. The inflation protection can be up to 5% but not less than 3%.
The assets to be protected will be designated during the
				initial application process and the value of the designated assets must be
				verified by the eligibility worker.