§ 178.105. Presumption of disposition of assets to qualify for MA for transfers on or after July 30, 1994.
(a) If a presumption of disposition of assets to qualify for MA is made by the Department, the individual will be notified in writing by the CAO of the finding and of the right to rebut this presumption within 15 days from the date the notice is mailed.
(b) If the individual does not respond to the notice within 15 days from the date it is mailed, the CAO will complete the application/reapplication for MA using the UV as an asset available to the individual over the applicable look-back period from the date of the transfer of the asset and the total assets will be determined on that basis.
(c) If the individual responds to the written notice within 15 days from the date it was mailed that he wishes to rebut the presumption, the CAO shall explain to the individual that it is his responsibility to present within 10 calendar days the required verification and convincing evidence that the assets were transferred solely for some purpose other than to qualify for MA. Convincing evidence includes documentary and nondocumentary evidence which provides proof of the circumstances surrounding the transfer, including the following:
(1) The purpose for transferring the asset.
(2) The attempts to dispose of the asset at its FMV.
(3) The reasons for accepting less than FMV of the asset.
(4) The means of, or plans for, self-support after the transfer.
(5) The individual’s relationship to the person to whom the asset was transferred.
(d) If the evidence is received within the 10 calendar day period established in subsection (c), a decision on the success of the rebuttal of the individual will be made. If the establishment of MA eligibility is determined to be part of the reason for the transfer, even if another purpose has also been established, the asset was not transferred solely for some purpose other than to qualify for MA and the rebuttal is not successful. The presumption is rebutted only if the individual proves that the transfer was solely for some purpose other than to qualify for MA such as:
(1) If after the transfer of the asset, the individual either becomes disabled or has an unexpected loss of assets and this results in the need to apply for MA the presumption is rebutted. The unanticipated disability or unexpected loss of assets shall be verified.
(2) If the assets of the individual would still have been below the income and resource limits for the appropriate MA Program during each of the months in the period of ineligibility which would otherwise apply under § 178.104(d) (relating to disposition of assets and fair consideration provisions for transfers on or after July 30, 1994), had the asset been retained, the presumption is rebutted. The individual shall provide verification of the asset value during the period in question.
(3) If the transfer was the result of a court order or written settlement of a legal action, the presumption is rebutted. A copy of the court order or written settlement is required.
(e) The determination of whether the presumption is rebutted is made by the executive director of the CAO or a delegate. The individual is given written notice of the determination and of the right to appeal.
(f) If the presumption is rebutted, the transfer has no effect on the MA eligibility determination.
(g) If the presumption is not rebutted, it is presumed that the asset transferred was for the purpose of qualifying for MA and the following apply:
(1) The UV is considered an asset for 36 or 60 months, as applicable, from the date on which the individual is both an institutionalized individual and has applied for MA.
(2) The UV is added to other assets that are considered. If the total exceeds the MA income or resource limits in Appendix A or Chapter 181 Appendix B, for the appropriate MA Program, the individual is not eligible for MA.
(3) If the transferred asset is returned to the individual, the UV is not considered an asset as of the date the transferred asset was returned. If the transferred asset is cash or liquid assets, the UV is reduced by the value of the asset that was returned.
(4) A returned asset is evaluated as an asset.
(5) Additional compensation received in the form of cash after the transfer of the asset further reduces the UV by the amount of cash received as of the date the cash was received.
Authority The provisions of this § 178.105 issued under sections 201(2) and 403(b) of the Public Welfare Code (62 P. S. § § 201(2) and 403(b)).
Source The provisions of this § 178.105 adopted December 23, 1994, effective December 24, 1994, and apply retroactively to July 30, 1994, 24 Pa.B. 6423.
Notes of Decision Disposition of Assets
Medical Assistance applicant petitioned for review of decision of administrative law judge (ALJ) who refused to consider her attempt to rebut presumption that she transferred resources for the purpose of qualifying for Medical Assistance. The ALJ found that she received an overpayment of Medical Assistance benefits when she transferred resources to daughters of late husband without fair consideration during lookback period; while Department of Public Welfare presumes transfers are made to qualify for assistance, based on Department’s regulations, ALJ is required to give applicant an opportunity to rebut that presumption. Gilroy v. Department of Public Welfare, 946 A.2d 194, 196-197 (Pa. Cmwlth. 2008)
Where a couple converts otherwise countable assets into an irrevocable, actuarially sound commercial annuity for the sole benefit of the community spouse, the annuity is not a countable resource in calculating the CSRA. The transfer may not be used to impose a period of ineligibility. Mertz v. Houston, 155 F. Supp. 2d 415 (E.D. Pa. 2001).
Cross References This section cited in 55 Pa. Code § 178.104 (relating to disposition of assets and fair consideration provisions for transfers on or after July 30, 1994); and 55 Pa. Code § 178.106 (relating to reestablishment of MA eligibility after transfers made on or after July 30, 1994).
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