Section 700. Transfer of assets

Part III. Related More Liberal Methods of Treating Resources-Transfer of Assets

A. Certain term life insurance policies purchased after April 7, 1993. When making eligibility determinations for institutional or community-based care to be paid for by the department, the department shall consider as an uncompensated transfer all resources that are used by an applicant to purchase any term life insurance policy that does not have a benefit payable at death that will equal or exceed twice the sum of all premiums paid for such policy if the policy was purchased within 30 months prior to the date of application for medical assistance unless the policy was purchased to fund a funeral in accordance with § 54.1-2820 of the Code of Virginia.

The purpose of the policy shall be determined by reviewing the policy. If the policy language specifies that the death benefits shall be used to purchase burial space items or funeral services then the purchase of such policy shall not be considered a transfer of assets; however, the Department of Medical Assistance Services shall initiate action to recover from the beneficiary the amount of any benefit paid under the provisions of the policy which exceed the actual expense of the funeral and burial of the insured.

B. Inter vivos trusts.

1. Assets of inter vivos trusts available. When determining eligibility for medical assistance, the assets of any inter vivos trust, both principal and interest, shall be considered available to the grantor who is an applicant for or recipient of medical assistance without regard to any provision of the trust which provides directly or indirectly for the suspension, termination, or diversion of the principal, income or other beneficial interest of the grantor if he should apply for medical assistance or if he should require medical, hospital or nursing care or long-term custodial, nursing or medical care. The amount of principal or interest to be considered available shall be that amount of income or principal of the trust to which the grantor is entitled if no application for assistance had been made except for trusts created prior to August 11, 1993.

2. Trusts created prior to August 11, 1993. Up to $25,000 of the corpus of an inter vivos trust created prior to August 11, 1993, shall not be a countable asset. If the grantor created more than one such trust, the corpora of the trusts shall be added together. If the sum of the corpora is less than $25,000, no assets from any of the trusts shall be considered available. If the sum of the corpora exceeds $25,000, then the total amount of the corpora less $25,000 is a countable asset. In determining the amount of each trust to exempt, the $25,000 exemption shall be prorated among the trusts.

In applying this section, if, prior to August 11, 1993, the grantor has made transfers for an uncompensated value as defined in § 20-88.02 of the Code of Virginia within 30 months of applying for Medicaid and no payments were ordered pursuant to subsection D of that section, then no $25,000 exemption shall be granted.

Historical Notes

Derived from VR460-04-2.6108 § 1, eff. July 1, 1993; amended, Volume 17, Issue 13, eff. April 11, 2001; Volume 25, Issue 14, eff. April 15, 2009.

Statutory Authority

§§ 32.1-324 and 32.1-325 of the Code of Virginia.