New Mexico Administrative Code › Title 8 - SOCIAL SERVICES › Chapter 215 - MEDICAID ELIGIBILITY - SUPPLEMENT SECURITY INCOME (SSI) METHODOLOGY › Part 500 - INCOME AND RESOURCE STANDARDS › Section 8.215.500.14 - RESOURCE EXCLUSIONS

Current through Register Vol. 35, No. 13, July 16, 2024
Some types of resources can be excluded from the calculation
				  of countable resources if they meet the specific criteria listed below.
A.
Burial fund exclusion:
Up to
				one thousand five hundred dollars ($1,500) can be excluded from the countable
				liquid resources of an applicant/recipient if designated as burial funds. An
				additional amount of up to one thousand five hundred dollars ($1,500) can be
				excluded from countable liquid resources if designated as burial funds for the
				spouse of the applicant/recipient. The burial fund exclusion is separate from
				the burial space exclusion.
(1)
Retroactive designation of burial funds:
An applicant/recipient
				can retroactively designate funds for burial back to the first day of the month
				in which the applicant/recipient intended the funds to be set aside for burial.
				The applicant/recipient must sign a statement indicating the month the funds
				were set aside for burial.
(2)
Limit on exclusion:
An applicant/recipient can designate as much
				of his/her liquid resources as he/she wishes for burial purposes. However, only
				one burial fund allowance of up to one thousand five hundred dollars ($1,500)
				each for the applicant/recipient and his/her spouse can be excluded from
				countable resources. A burial fund does not continue from one period of
				eligibility to another (i.e., across a period of ineligibility). For each new
				period of eligibility, any exclusion of burial funds must be developed as for
				an initial application.
(3)
Removal of designation:
An applicant/recipient cannot
				"undesignate" burial funds unless one of the following occurs:
(a) eligibility terminates;
(b) part, or all, of the funds can no longer
				be excluded because the applicant/recipient purchased excluded life insurance
				or an irrevocable burial contract which partially or totally offsets the
				available burial fund exclusion; or
(c) the applicant/recipient uses the funds
				for another purpose.
(4)
Reduction of burial fund exclusion:
The one thousand five hundred
				dollars ($1,500) burial fund exclusion is reduced by the following:
(a) the face value of excluded life insurance
				policies;
(b) assets held in
				irrevocable burial trusts; irrevocable means the value paid cannot be returned
				to the applicant/recipient;
(c)
				assets that are not burial space items held in irrevocable burial
				contracts;
(d) assets held in other
				irrevocable burial arrangements.
(5)
Interest from burial fund:
Interest derived from a burial fund is not considered a countable resource or
				income if all of the following conditions exist:
(a) the original amount is
				excluded;
(b) the excluded burial
				fund is not commingled with non-excluded burial funds; and
(c) the interest earned remains with the
				excluded burial funds.
(6)
Commingling of burial funds:
Burial funds cannot be commingled with non-burial funds. If only part of the
				funds in an account is designated for burial, the burial fund exclusion cannot
				be applied until the funds designated for burial expenses are separated from
				the non-burial funds. Countable and excluded burial funds can be
				commingled.
(7)
Life
				insurance policy designated as burial fund:
An applicant/recipient can
				designate a life insurance policy as a burial fund at the time of application.
				The ISD worker must first analyze the rule according to Subsection H of Section
				8.215.500.14.NMAC,
life insurance exclusion
, and following
				subsections.
(8)
Burial
				contracts:
If an applicant/recipient has a prepaid burial contract, the
				ISD worker determines whether it is revocable or irrevocable and whether it is
				paid for. Until all payments are made on a burial contract, the amounts paid
				are considered burial funds and no burial space exclusions apply. An
				applicant/recipient may have a burial contract which is funded by a life
				insurance policy. The life insurance may be either revocably or irrevocably
				assigned to a funeral director or mortuary. A revocable contract exists if the
				value can be returned to the applicant/recipient. An irrevocable contract
				exists when the value cannot be returned.
(a)
				If the contract or insurance policy assignment is revocable, the following
				apply.
(i) If the burial contract is funded by
				a life insurance policy, the policy is the resource which must be evaluated.
				The burial contract itself has no value. It exists only to explain the
				applicant/recipient's burial arrangements.
(ii) No exclusions can be made for burial
				space items because the applicant/recipient does not have a right to them if
				the contract is not paid for or the policy is not paid up.
(b) If the assignment is irrevocable, the
				life insurance or burial contract is not a countable resource because the
				applicant/recipient does not own it.
(i) The
				burial space exclusions can apply if the applicant/recipient has the right to
				the burial space items.
(ii) The
				value of the irrevocable burial arrangement is applied against the one thousand
				five hundred dollars ($1,500) burial fund exclusion only if the
				applicant/recipient has other liquid resources to designate for
				burial.