Probate & Trust Law Section Conference Manual ... - Minnesota CLE

v. Vehicle
One vehicle used to transport the Medical Assistance or SSI recipient is exempt for purposes of
determining financial eligibility. Excess assets can be reduced purchasing or making repairs to a
vehicle the recipient will use.
vi.
House
The homestead of a Medical Assistance or SSI recipient is exempt so long as he or she lives in
the house. Assets can be reduced purchasing, maintaining or improving a house in which the
recipient will live.
vii.
Household and Personal Items
Furniture, appliances, electronics, recreational equipment, household supplies and personal
items are exempt for purposes of Medical Assistance and SSI eligibility. Assets can be reduced
purchasing such items for use by the recipient.
viii.
Debt Reduction
The obligation to repay credit card or personal debt, car loans and mortgages makes reduction
of debt a penalty‐free method to reduce excess assets. Sometimes the best use of excess
assets is the elimination of the stress and anxiety caused by outstanding debt. With a mortgage
against the homestead, reducing the excess assets will have the added benefit of increasing the
equity value of an exempt asset.
ix.
Gifts
Excess assets can be reduced by giving them away. This option requires the exercise of extreme
caution because the Medical Assistance program has a penalty or "period of ineligibility" that
can arise if asset transfers are completed. Minn.Stat. § 256B.0595.
• At the time of a Medical Assistance application, all gifts or transfers completed during
the 60 months immediately before the month of application must be reported. Failure
to report transfers within this time period can constitute fraud. If application is made
beyond this "look‐back" period, the transfer does not need to be reported on the
application and no period of ineligibility is assessed.
• All reported transfers, except those where an exception applies, create a period of time
when Medical Assistance is not allowed to pay for long term care costs. This “period of
ineligibility” is calculated by dividing the amount of the transfer by the average monthly
cost for nursing home care in Minnesota. As of July 1, 2012, the monthly average is
$5,372.00.
6 Supplemental & Special Needs Trust Basics | Jeffrey W. Schmidt