An applicant and a recipient must meet the appropriate resource limitation to qualify for MA LTC. A resource is real or personal property that an individual has or can make available for partial or total support. Resources include equitable interests and partial interests.
There are different types of resources:
Real property and personal property
Liquid resources and non-liquid resources
Liquid resources are cash on hand, financial instruments that can be converted to cash, savings and checking accounts, stocks, bonds, mutual fund shares, money certificates, promissory notes and held mortgages.
Non-liquid resources are real and personal property that cannot be easily converted to cash, such as non-resident property that must be sold.
Excluded and countable resources
Apply spousal impoverishment provisions for:
A married couple with one spouse who is admitted to an LTC facility and is applying for MA LTC.
A married couple with one spouse who is admitted to an LTC facility for a continuous period of at least 30 calendar days
A married couple with one spouse who is found functionally eligible for a Home and Community-Based Services Waiver Program
See Section 440.9, Spousal Impoverishment.
Follow these steps to determine resource eligibility for a person applying for payment of LTC services:
1. Total the individual’s resources. If there is a community spouse, combine the countable resources of the couple and subtract the spousal share.
NOTE: Deduct the amount of any outstanding checks from the balance of a checking account.
NOTE: Determine the spousal share based on resources available on the date of admission to the LTC facility if the institutionalized spouse is applying for MA LTC, the first 30-day continuous admission to a LTC facility or on the date of assessment for HCBS. See 440.91 Resource Assessment.
2. Compare the individual’s total resources to the NMP resource limit if his or her gross monthly income is less than or equal to 300 % of the Federal Benefit Rate (FBR). If the individual’s gross monthly income is more than 300 % of the FBR, compare the person’s total resources to the MNO limit. The individual is eligible for MA LTC if the total resources are equal to or less than the appropriate resource limit for the category of MA LTC services.
NOTE: The $6,000 resource disregard is only for NMP applicants and recipients whose LTC eligibility is determined using the special gross monthly income limit of 300% of the FBR. The $6,000 resource disregard does not apply to MNO categories or to decide eligibility for Medicare Buy-In.
Example 1: Bonnie is applying for MA LTC and has a spouse living in the community. Bonnie's gross monthly income is $1,200. Resources were assessed previously and the combined resources were $130,000. The spousal share is $65,000. They currently have $72,500 in resources. After deducting the spousal share, Bonnie has $7,500 in resources. After subtracting the $6,000 resource disregard, Bonnie now has $1,500 in resources. She is now eligible for MA LTC based on resources.
Example 2: Tina is applying for MA LTC. Tina has a spouse living in the community. Resources were assessed previously and the combined resources were $130,000. The spousal share is $65,000. They currently have $66,500. After deducting the spousal share, Tina has $1,500 in resources. Tina meets the income eligibility requirements for TAN. She is eligible for MA LTC based on resources.
55 Pa. Code § 178.11 55 Pa. Code § 178.12
3. If the individual owns all or part of the resources that are protected for a spouse in the community (CS), the CAO must get the individual’s written agreement to transfer those resources to the CS within 90 days. See Section 440.93, Transfer of Resources to the Community Spouse.
If the individual or the individual’s representative does not agree to transfer ownership to the CS, count the resources owned by the individual to determine eligibility.
If the individual has total countable resources that are over the limit, tell him or her that an eligibility decision will be postponed if he or she plans to spend the excess resources, prior to the CAO deciding if the individual qualifies for MA LTC.
The CAO will exclude the amount of excess resources over the limit for MA if:
The excess resources are used within 30 calendar days of submitting an application for MA LTC to pay for medical expenses, and/or
The excess resources are used within 30 calendar days to buy or add to an existing irrevocable burial reserve.
The amount of the irrevocable burial reserve cannot be greater than 25% of the local established irrevocable burial limit.
If the individual spends excess resources on medical expenses and/or on an irrevocable burial reserve within 30 calendar days of the date of a timely submitted application for MA LTC, the CAO can authorize eligibility for the requested date for retroactive and/or ongoing MA LTC. Determine eligibility for MA LTC as if the excess resources never existed.
If excess resources are spent on personal needs (such as clothing, cell phone, television) other than medical expenses and/or an irrevocable burial reserve, the CAO cannot authorize eligibility for requested retroactive and/or ongoing MA LTC until the day after resources are at or below the appropriate resource limit.
NOTE: The CAO must review excess resources not spent on medical expenses and/or an irrevocable burial reserve to determine that the individual received fair consideration.
1. Determine the amount of resources that exceed MA LTC limit.
2. Notify the individual of the amount of resources that exceed the MA LTC limit.
3. Explain that the effect on eligibility for MA LTC depends on how the excess resources are spent.
4. Allow the individual 30 calendar days to spend down excess resources on medical expenses and/or an irrevocable burial reserve. The 30-calendar day count starts with the day the person submitted the MA LTC application to the CAO.
NOTE: The CAO may extend the 30-day time frame to convert excess resources to an irrevocable burial reserve if the person gives proof that steps were taken to spend the excess on medical expenses and/or to buy or increase an irrevocable burial reserve.
5. Authorize MA LTC effective the requested date for retroactive and/or ongoing MA LTC if the person gave proof that the excess resources amount was spent on medical expenses and/or an irrevocable burial reserve within the 30 calendar days.
6. Authorize MA LTC the day after the individual’s resources are within MA LTC resource limits if:
The individual gave proof that excess resources were spent for anything other than medical expenses and/or an irrevocable burial reserve.
The individual received fair consideration for the spending of the excess resources.
The individual
spends the excess resources within 30 calendar days of the date the
MA LTC application was submitted.
7. Deny MA LTC if excess resources are not spent within 30 days of the date the application was submitted to the CAO. Also deny MA LTC if the CAO does not receive proof that steps have been taken to spend excess resources on medical expenses and/or an irrevocable burial reserve.
8. Treat the individual who disposes of the excess resources within 30 calendar days of the date the application was submitted to the CAO without receiving fair market value as follows:
See Section 440.8, Disposition of Assets and Fair Consideration
Authorize MA NMP or MNO (whichever is appropriate if otherwise eligible) effective the day after the resources were within the appropriate resource limit.
Deny eligibility for MA LTC.
See Section
440.85, Period of Ineligibility for Payment of LTC Services.
NOTE: If the individual gives proof that excess resources were spent after he or she received the denial notice, but within 60 calendar days of the submitted application for MA LTC to the CAO, treat as follows:
If resources were spent on anything other than medical expenses and/or an irrevocable burial reserve, and the person received fair consideration for the disposal of the resources, authorize MA LTC effective the day the after resources are within the MA LTC resource limit.
If the CAO receives proof that the excess resources were spent on medical expenses and/or an irrevocable burial reserve, authorize MA LTC back to the original request for retroactive and ongoing MA LTC.
A new application for MA LTC is not required.
Example 1: Susan has life insurance policies and bank accounts that exceed the resource limit. She buys a new television set on February 15, reducing resources to the limit. Eligibility begins on February 16 the day after the resources are within the limit.
Example 2: Janet is a 70-year-old widow. She entered the LTC facility on August 1 and applied for MA LTC benefits effective August 1. Her monthly income is $1,000. Her resources consist of three bank accounts with a total value of $13,000 and one life insurance policy with a face value of $500. Because she qualifies for NMP, she has excess resources of $5,000 (using the $6,000 disregard for an NMP category). Janet's daughter and POA buy an irrevocable burial reserve on September 8 for $5,000. Mary is now resource eligible as of August 1.
Example 3: Brian is a 65-year-old widower who entered the LTC facility on April 1 and applied for MA LTC benefits effective April 20. His income/resources are:
Gross monthly income of $1,500
Bank Account with a balance of $2,800
Insurance policy with a FV of $5,000 and Cash Surrender Value (CSV) of $3,500. Exclude the first $1,000 of the CSV. Treat $2,500 as an available resource.
IRA with an available balance of $8,000
Total countable resources are $13,300 ($2,800 + $2,500 + $8,000). Total countable resources less $6,000 disregard ($13,300 - $6,000) = $7,300. Resource limit is $2,000
Brian has excess resources of $5,300. Brian gave the CAO proof that he has requested a payout on his IRA and used the proceeds to create an irrevocable burial reserve. Because the excess resources were not readily available and Brian did everything necessary to get the funds, the CAO will authorize MA LTC effective April 20. Brian has ninety (90) days to do the conversion.
On May 15, Brian gave proof that he received a $8,000 payout on his IRA. Brian established an irrevocable burial reserve for $7,500 and deposited $500 into his bank account. His total countable resources are now ($13,300 - $7,500) $5,800. Brian is resource eligible for MA LTC.
The CAO may make an eligibility decision within 30 days. The time frame is extended if the CAO notifies the individual in writing of what additional information is needed to complete the eligibility determination. If the individual reduces the resources after the CAO denies eligibility, the individual must apply again unless he or she appeals the denial or reduces the resources within 60 days of the date of the denial notice.
For applicants who die before authorization for MA LTC, count only resources available after payment of funeral expenses. If the remaining available resources are equal to, or less than, the MA LTC resource limit, authorize MA LTC effective the date of requested coverage. State law requires that payment of funeral expenses receives priority over medical expenses in the distribution of a decedent’s estate.
The individual is not eligible for MA LTC if the countable resources after payment of funeral expenses exceed the MA LTC resource limit. The CAO will not count resources used to pay medical expenses. If excess resources are used to pay medical expenses, the CAO determines eligibility for the retroactive period as if the resources never existed.
Example 1: Larry applied for MA LTC on May 4, requesting retroactive MA LTC to April 1. He had excess resources of $5,000 on April 1. Larry died on May 12, before determination of eligibility for MA LTC. The funeral expenses of $5,000 were paid on May 14 from Larry's estate. There were no resources available after funeral expenses of $5,000 depleted Larry's resources. The CAO can authorize MA LTC for the period April 1 through May 12.
Example 2: Linda applied for MA LTC on November 15, requesting MA LTC beginning October 1. Linda had excess resources of $8,000 and an outstanding medical expense of $3,000 for a hospital bill. Linda died on November 20, before determination of eligibility for MA LTC. The funeral bill of $5,000 was paid on December 1 and the hospital bill was paid on December 2 from Linda's estate. MA LTC can be authorized since the funeral bill ($5,000) and the hospital bill ($3,000) reduced her resources to the resource limit. The CAO can authorize MA LTC for the period October 1 through November 20.
55 Pa. Code § 181.12(b) 55 Pa. Code § 181.12(c) 20 Pa.C.S.A. § 3392 (Descendants, estates and fiduciaries code)
To determine resource eligibility for an LTC recipient, the CAO will count the resources of the recipient as of the date of requested MA LTC coverage.
NOTE: The CAO will not count recurring income, such as a Social Security benefit, as a resource in the month it is received. Any amount remaining from the recurring income in the following month counts as a resource.
If the recipient receives a new resource that can be treated as a lump sum, such as an inheritance, the CAO will determine whether the person wants the money treated as income or a resource. See Chapter 457, Lump Sum.
If a recipient receives new resources, the CAO will compare the resources to the eligibility limit. If the resources exceed the limit for MA LTC, the CAO will send an advance notice to the person about the case closing.
The IS may transfer excess resources to the CS to bring the CS back up to the protected share.
A transfer of excess resources from the IS to the CS does not affect eligibility for MA LTC and meets fair consideration requirements if:
The amount of resources the CS owns is less than the established protected share of resources that was previously determined when applying spousal impoverishment provisions, and
The amount of excess resources from the IS added to the resources owned by the CS does not exceed the protected share amount of the CS.
The IS is ineligible for MA LTC if:
There is a transfer of assets from the IS to the CS that meets fair consideration requirements, and
The sum of the IS resources plus the CS resources is greater than the sum of the MA LTC resource limit plus the established protected share of resources determined for the CS.
1. Determine the amount of resources that exceed the MA LTC resource limit.
2. Ineligibility for MA LTC exists on the day that the resources of the recipient exceed the MA LTC resource limit.
NOTE: There is no spend-down of excess resources to qualify for MA or MA LTC. Spend-down only applies to reducing income.
2. Ineligibility for MA continues until resources are equal to or less than the resource limit.
4. Send the person an advance notice to end MA LTC due to the amount of resources that exceed the MA LTC resource limit.
5. Tell the individual that eligibility for MA LTC will continue if the CAO receives proof that resources have been reduced within the MA LTC resource limit. The CAO must receive the proof before the expiration date on the advance notice.
NOTE: The individual must receive fair consideration for disposing of the excess resources. The individual can choose how he wants to spend the resources. The individual can pay for bills of the CS, buy (or add to an existing) irrevocable burial reserve that does not exceed the allowable limit, or buy clothing or items for personal use.
6. Continue eligibility for MA LTC if the excess resources are reduced before the expiration on the advance notice and the individual received fair consideration for the disposal of the resources.
NOTE: The CAO should not increase the individual’s payment toward the cost of care to reduce resources unless the individual chooses this.
3. Continue eligibility for MA LTC if the excess resources are disposed of before the expiration of the advance notice. Transfer of assets (income or resources) of less than $500 per month is not required to meet fair consideration requirements. There is no overpayment.
4. Treat the individual who disposes of the excess resources that exceed $500 before the expiration of the advance notice but did not receive fair consideration as follows:
Continue eligibility for MA , and
Send an advance
notice to end eligibility for payment of LTC
services.
5. End eligibility for MA LTC if resources continue to exceed the MA LTC resource limit when the advance notice ends.
The LTC facility must notify a resident when his funds are within $200 of the MA LTC resource limit. The CAO will monitor cases that are close to the limit. Patient funds accumulate quickly during periods of Medicare or other insurance coverage.
Example: Nina, with gross monthly income exceeding the special NMP gross monthly income limit, has a patient account at the LTC facility that exceeds $2,400 after receiving her personal needs allowance in March. The CAO sends a notice telling her that she is ineligible for MNO due to excess resources and that MA LTC will be discontinued. Nina's daughter calls within 10 days to report that she bought a sweater, shoes, and a bathrobe for her mother with money from the account and that the current balance is $2,295. The CAO continues eligibility without taking the proposed action. The CAO sets an alert to check the resource amount again in four months.
A current recipient of MA LTC that has more resources than the allowed resource limit, can request to "pre-pay" The Department of Human Services (DHS) to avoid closure of their MA LTC if the following has occurred:
DHS has paid for Long Term Care services and
The amount paid is greater than the extra resources.
Example: Alex has been receiving MA LTC for two years. The POA reported he received a $20,000 inheritance last week from an aunt. His total countable resources exceed the resource limit by $15,000. DHS has paid more than $15,000 in Long Term Care services for Alex since he has been receiving MA LTC. The POA elects to avoid case closure for excess resources by pre-paying the $15,000 to the Estate Recovery Program.
The recipient or their representative must make the request in writing and include the following information:
Recipient's full name.
Social Security number.
Date of birth.
Address.
Amount available to reimburse DHS.
Representative's name, address and phone number.
The letter with the above information should be given to the CAO. The CAO will then forward the request to:
Department of Human Services
Bureau of Program Integrity
Estate Recovery Program
PO Box 8486
Harrisburg, Pa 17105
Fax # (717) 772-6553
After the letter has been sent to the Estate Recovery Program, the CAO should narrate this has occurred. The recipient's MA LTC will remain authorized. The CAO will be notified by Estate Recovery when the payment is received. At that time, the CAO should complete a partial review of resources to verify that the recipient remains resource eligible.
When the CAO discovers unreported or underreported countable resources, the CAO will mail or fax a completed Overpayment Referral (OIG 189) to the OIG..
The OIG will evaluate the reason for the failure to report when deciding whether to prosecute or seek restitution. See Supplemental Handbook Chapter 910, Appendix A, Completing the Overpayment Referral (OIG 189) – Long Term Care Program Overpayments.
Mail or fax the completed OIG 189 for LTC overpayments to the appropriate OIG Regional Office:
Regional Manager
Office of Inspector General
Central Regional Office
101 South Second Street
Harrisburg, PA 17101
Fax: (717) 772-2225
Phone: (717) 705-4072
Regional Manager
Office of Inspector General
Western Regional Office
2121 Noblestown Road,
Suite 400
Pittsburgh, PA 15205
Fax: (412) 920-2541
Phone: (412) 920-2547
Regional Manager
Office of Inspector General
Northeast Regional Office
205 South Washington Street
Wilkes-Barre, PA 18711-3298
Fax: (570) 826-2381
Phone: (570) 826-2164
Regional Manager
Office of Inspector General
Southeast Regional Office 2
801 Market Street
Suite 6034
Philadelphia, PA 19017
Fax: (215) 560-2423
Phone: (215) 560-3456 (Regional Manager)
The OIG will determine if there was an overpayment. The individual receiving or holding the resource or the individual’s estate and/or survivors benefiting from receipt of the resource can be held liable for the overpayment. Establish the overpayment amount as an amount equal to whichever is less:
The market value of the unreported or underreported resource, or
The amount of MA LTC payments during the period of ineligibility.
NOTE: Timely reported resources that cause an overpayment due to Administrative Error (AE) are only recoverable by OIG if DHS gives proof that the person was notified that he or she was ineligible for the services received.
55 Pa. Code § 255.84(b)(1) 55 Pa. Code § 255.84(e)(4)
The CAO gives OIG the information necessary to prepare an Overpayment Referral. The CAO also gives any additional information OIG requests. OIG completes the Overpayment Referral and gives a copy to the CAO. OIG sends the CAO a completed Long Term Care Investigation Action Report (OIG 609) with the final result of the investigation.
See the Supplemental Handbook Chapter 910, Overpayment Recovery for regular processing of other overpayments.
NOTE: Before referring to the OIG, the CAO must actually verify the unreported or underreported countable resource. The fact that the resource appears on IEVS is not proof.
The OIG may request more information from the CAO by sending an OIG 613, Report on LTC Referral.
See the Supplemental Handbook Chapter 910, Overpayment Recovery for regular processing of other overpayments.
55 Pa. Code § 255.84(d) 62 P.S. § 1408(c)(6)(i)
Updated March 14, 2023 , Replacing March 11, 2022