Whose Resource is it?

In our previous review of how the HHSC treats income for Medicaid eligibility we discussed how they follow the “name on the check” rule. The name on the check rule places a great deal of importance on who a check is made payable to in order to determine its characterization for Medicaid eligibility purposes. When it comes to resources or assets, the rules are very different than the rules used for income and can be a great deal more complicated.

For the purpose of determining a nursing home Medicaid applicant’s resources (assets), the procedure is very different. The HHSC defines “resources” as cash, other liquid assets, or any real or personal property or other nonliquid assets that a person, a person’s spouse or parent could convert to cash to be used for his or her support and maintenance. A person’s resource is property that: 1) is owned, solely or in part, by the person; and 2) is accessible to the person. If the person has the right, authority or power to liquidate the property or his share of it, the property is a resource. Federal guidelines do not provide any leeway for hardship cases in determining the availability of resources. Unless a court has judged a person to be incompetent and a guardian or other agent is appointed to act for the person, the person has access to resources he owns.

You should notice how broad a net the HHSC casts when determining a person’s resources for Medicaid eligibility. Essentially any account or piece of property that the nursing home Medicaid applicant has the right or authority to convert to cash is a resource and its value is considered as part of the eligibility process. You should also notice there is no exception for separate property. Separate property is part of the eligibility process as well as community property.

Another fact that sometimes surprises people is that an account is considered a resource even if there are penalties or other negative effects from liquidating the account. The most common example of this would be if a nursing home resident has funds in an IRA, or a CD or annuity that has surrender penalties. Those assets are counted as resources and are not exempt based solely on the fact that accessing the funds will trigger an income tax event or other fees.

Know Your Resources

The first step in protecting as many resources as possible is knowing what the HHSC is going to characterize as a resource. If you are not sure what resources are at risk in your case and you would like to protect those resources, then get started today by calling me, Attorney Richard Shea of The Shea Law Firm at (832) 592-7913.