3.3 Divestment

MDV 198638 (06/29/2020)
Divestment penalty not started, petitioner failed to reapply

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.01 Penalty period, 5 Subprograms, 5.05 Home and Community-Based Waivers Long-Term Care, 5.05.1 Family Care, ALJ Debra Bursinger

DHA Case No. MDV 198638 (Wis. Div. of Hearings and Appeals June 29, 2020) (DHS) ↓ Download PDF A divestment penalty for a Medicaid applicant begins on the date the person applies and is “otherwise eligible” but for the divestment; it begins for a member the first of the month after the member receives timely notice. In this case, […] Read more

FCP 177944 (12/13/2016)
Closing costs deducted from divestment amount

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.03 Transfers for FMV, 3.3.25 Life estates, 3.3.25.3 Life estate—termination and payment of less than FMV, 5 Subprograms, 5.05 Home and Community-Based Waivers Long-Term Care, 5.05.1 Family Care, ALJ Michael D. O’Brien

DHA Case No. FCP 177944 (Wis. Div. of Hearings and Appeals December 13, 2016) (DHS) ↓ Download PDF It is a divestment when a life estate is terminated and the life estate holder is not paid her proportional share. In this case, the petitioner’s life estate was divested when she sold her home and her […] Read more

MDV 183502 (12/06/2017)
No divestment for paying realtor fee

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.03 Transfers for FMV, 3.3.25 Life estates, 3.3.25.1 Life estate—transfer of property for less than FMV, 5 Subprograms, 5.04 Institutional Long-Term Care, ALJ John P. Tedesco

DHA Case No. MDV 183502 (Wis. Div. of Hearings and Appeals December 6, 2017) (DHS) ↓ Download PDF Adivestment occurs upon the transfer of a non-exempt resource for less than fair market value. In this simple case, the petitioner sold the home in which she had a life estate and paid a prorated portion of […] Read more

MDV 199054 (08/25/2020)
No divestment: home sold for less than assessed value, petitioner paid closing costs

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.03 Transfers for FMV, 3.3.25 Life estates, 3.3.25.1 Life estate—transfer of property for less than FMV, ALJ Debra Bursinger

DHA Case No. MDV 199054 (Wis. Div. of Hearings and Appeals August 25, 2020) (DHS) ↓ Download PDF A divestment occurs upon the transfer of a non-exempt resource for less than fair market value. In this case, the petitioner sold the home in which she had a life estate for $3,200 less than the tax […] Read more

MDV 199112 (09/21/2020)
Transfer of incremental RE interest was a divestment, despite pre-lookback agreement

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.02 Look back period, 5 Subprograms, 5.04 Institutional Long-Term Care, ALJ Kelly Cochrane

DHA Case No. MDV 199112 (Wis. Div. of Hearings and Appeals September 21, 2020) (DHS) ↓ Download PDF Divestment occurs at the time of a transfer for less than fair market value. In this case, the petitioner executed an agreement with her daughter in 2012 whereby her daughter made monthly payments and received incremental interests […] Read more

MDV 199858 (12/04/2020)
No divestment for paying boyfriend for services, but house sold less than FMV

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.03 Transfers for FMV, 3.3.07 Payments to relatives, 3.3.07.2 For services, 5 Subprograms, 5.05 Home and Community-Based Waivers Long-Term Care, ALJ Debra Bursinger

DHA Case No. MDV 199858 (Wis. Div. of Hearings and Appeals December 4, 2020) (DHS) ↓ Download PDF Divestment is a transfer of non-exempt resources for less than fair market value. This case involved two potential divestments when the petitioner’s house was sold to her daughter and daughter’s boyfriend: (1) the boyfriend was paid $40,534.37 […] Read more

MDV 200210 (01/21/2021)
Appeal too late to correct agency

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.01 Penalty period, 4 Program Administration, 4.7 Notices & fair hearings, 5 Subprograms, 5.05 Home and Community-Based Waivers Long-Term Care, ALJ Debra Bursinger

DHA Case No. MDV 200210 (Wis. Div. of Hearings and Appeals January 21, 2021) (DHS) ↓ Download PDF An appeal must be filed within 45 days of an agency action for the ALJ to have jurisdiction to review it. In this case, the petitioner established an irrevocable trust, divested, and applied for Medicaid in May […] Read more

MGE 200475 (02/08/2021)
Miscalculated MCA delayed eligibility

Tags: 1 Applications and Renewals, 1.1 Applications, 1.1.5 Begin dates, 3 Financial Eligibility, 3.1 Income, 3.1.5 Unearned income, 3.2 Assets, 3.2.6 Liquid assets, 3.2.6.04 Annuities, 3.3 Divestment, 3.3.01 Penalty period, 3.3.17 Irrevocable annuities, 5 Subprograms, 5.04 Institutional Long-Term Care, ALJ Peter McCombs

DHA Case No. MGE 200475 (Wis. Div. of Hearings and Appeals February 8, 2021) (DHS) ↓ Download PDF Eligibility for MA begins the first of the month in which the applicant meets all program requirements. In this case, the petitioner planned for a divestment penalty with a Medicaid-compliant annuity, but the final annuity payment occurred […] Read more

MDV 201093 (03/08/2021)
Divestment, no documentation of inheritance spend-down

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.03 Transfers for FMV, 4 Program Administration, 4.1 Verification, 5 Subprograms, 5.05 Home and Community-Based Waivers Long-Term Care, ALJ Debra Bursinger

DHA Case No. MDV 201093 (Wis. Div. of Hearings and Appeals March 8, 2021) (DHS) ↓ Download PDF Using an inheritance to buy personal property for fair market value is not a divestment, but the purchases must be verified. In this case, the petitioner inherited $9,633 and claimed to have spent it on a desk, […] Read more

MDV 204093 (03/24/2022)
Divestment penalty start date: A cautionary tale

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.01 Penalty period, 5 Subprograms, 5.05 Home and Community-Based Waivers Long-Term Care, ALJ Kelly Cochrane

DHA Case No. MDV 204093 (Wis. Div. of Hearings and Appeals March 24, 2022) (DHS) ↓ Download PDF A divestment penalty does not start until the date a Community Waivers applicant requests a waiver program, meets the functional screen criteria, and meets all other Medicaid eligibility requirements. In this case, the petitioner—represented by a lawyer—divested […] Read more

MDV 206205 (12/02/2022)
Assets available despite “irrevocable assignment”; divestment allowed because petitioner had resources to pay for 5 years

Tags: 3 Financial Eligibility, 3.2 Assets, 3.2.1 Availability, 3.3 Divestment, 3.3.06 Transfers made for purpose other than to qualify for Medicaid, 3.3.06.1 Sufficient resources to cover 5 years of LTC, 5 Subprograms, 5.04 Institutional Long-Term Care, ALJ Peter McCombs

DHA Case No. MDV 206205 (Wis. Div. of Hearings and Appeals December 2, 2022) (DHS) ↓ Download PDF Issue 1: “Irrevocable assignment” The Medicaid Eligibility Handbook provides that an asset is available when the owner can dispose of it, has a legal right to its value, has the legal ability to make it available, and can make […] Read more

MDV 45/86382 (11/19/2007)
No divestment for transfer of home (caretaker child) and rented commercial property (business exemption)

Tags: 3 Financial Eligibility, 3.1 Income, 3.1.5 Unearned income, 3.1.5.23 Rental income, 3.2 Assets, 3.2.8 Business property, 3.3 Divestment, 3.3.04 Transfers of exempt income or assets, 3.3.12 Homestead property, 3.3.12.4 Transfer of homestead to caretaker child, 3.3.25 Life estates, 3.3.25.1 Life estate—transfer of property for less than FMV, 5 Subprograms, 5.04 Institutional Long-Term Care, ALJ Kelly Cochrane

DHA Case No. MDV-45/86382 (Wis. Div. of Hearings and Appeals November 19, 2007) (DHS) ↓ Download PDF Issue 1: Caretaker child The caretaker child exception allows an institutionalized person to transfer homestead property to a child who lived with the person and provided care for at least two years. In this case, the petitioner co-owned […] Read more

MDV 37/88496 (05/16/2008)
No divestment for promissory note not signed by applicant and allowing lifetime forgiveness

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.03 Transfers for FMV, 3.3.18 Promissory notes – loans – land contracts – mortgages, 5 Subprograms, 5.04 Institutional Long-Term Care, ALJ Kenneth D. Duren

DHA Case No. MDV-37/88496 (Wis. Div. of Hearings and Appeals May 16, 2008) (DHS) ↓ Download PDF Promissory notes are commonly used to reduce countable resources for Medicaid eligibility. The rules require the note to have a repayment term within the applicant’s life expectancy, require equal payments with no balloon payment, prohibit cancellation of the […] Read more

MGE 117071 (07/26/2011)
No divestment for failing to claim marital share in estate, due to MPA

Tags: 3 Financial Eligibility, 3.3 Divestment, 3.3.13 Transfer of assets to spouse; marital property agreements, 3.3.20 Refusal to claim, 3.3.22 Community spouse divestment, 3.3.22.1 Before 5 years, 3.4 Spousal impoverishment, 5 Subprograms, 5.04 Institutional Long-Term Care, ALJ Gary M. Wolkstein

DHA Case No. MGE 117071 (Wis. Div. of Hearings and Appeals Jul. 26, 2011) (DHS) ↓ Download PDF This case is one example of a marital property agreement avoiding the potential divestment when a community spouse (1) dies, (2) leaves property to someone other than the institutionalized spouse, and (3) the institutionalized spouse fails to […] Read more

MDV 144813 (01/18/2013)
No divestment for spending $195,000 on LIFBCs for family

Tags: 3 Financial Eligibility, 3.2 Assets, 3.2.4 Burial assets, 3.3 Divestment, 3.3.26 Life insurance funded burial contracts, ALJ Nancy J. Gagnon

DHA Case No. MDV 144813 (Wis. Div. of Hearings and Appeals Jan. 18, 2013) (DHS) ↓ Download PDF The petitioner in this case spent $195,000 on life-insurance-funded burial contracts (LIFBCs) to become eligible for Medicaid. She bought 13 of them, all for her children and their spouses, at a cost of $15,000 each. The agency […] Read more

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