Medicare / Medicaid Rules

If an individual or spouse has transferred or disposed of assets for less than fair market value on or after the specified look-back date as determined by the date of transfer, the individual shall not be eligible for payment of services for any institutionalized individual. The look-back date shall mean the earliest date on which a penalty for transferring assets for less than fair market value can be assessed, as specified in this subsection. A penalty shall be assessed for all transfers by the individual or the individual’s spouse that take place on or after the look-back date. A penalty shall not be assessed for any transfers that take place before the look-back date. The look-back date shall be the date that is 60 months before the date the individual received or was otherwise eligible to receive institutional care and has applied for medical assistance.

If the individual or spouse has transferred assets for less than fair market value, the individual shall not be eligible for the services for a penalty period equal to the number of days calculated by taking the total cumulative uncompensated value of the assets transferred by the individual or spouse on or after the look-back date, divided by the average daily private-pay cost of nursing facilities in the state in effect on the date the penalty begins. The average daily private-pay cost shall be determined at least annually based on the rates reported by the nursing facilities and compiled by the Department for Aging and Disability Services.