16 Del. Admin. Code § 20000-20360
Effective September 1, 1987 "conditional" Medicaid coverage for nursing home care can be approved for applicants who need Medicaid services while they are disposing of non-liquid resources, e.g., property. There are strict limits on the amount of time allowed for sale of resources and the applicant must sign a statement agreeing to the conditions before an application can be approved. Under conditional eligibility, excess resources are treated as a "conditional exclusion" and are not counted during the conditional benefit period.
However, there is no "conditional exclusion for spousal impoverishment cases. These resources count because they meet the spousal definition of countable resources. They should be counted in the spousal resource calculation.
8 DE Reg. 1312 (3/1/05)
A social worker can exclude the resource that causes someone to be ineligible for Medicaid and approve Medicaid coverage when:
There is a 9-month time limit on the period for which Conditional Medicaid benefits are payable; however, this period may be extended.
The Conditional Benefit Period ends when the individual:
If an individual becomes ineligible for one or more months despite exclusion of the resources to be sold (due to income, other resources, failure to file for other benefits, etc.) conditional Medicaid benefits are not payable for such month(s). However, the 9 month disposal/exclusion period continues to run.
Resources to be sold cannot be excluded until Form 412 "Agreement to Sell Property" has been signed and dated by the applicant or authorized representative. Medicaid eligibility cannot be effective prior to the date that Form 412 is signed and there can be no retroactive coverage.
Property listed with a realtor prior to or at time of application cannot be excluded until the agreement is signed and dated.
Contact the owner or his authorized representative (by phone, if possible) on the following schedule:
Record the individual's or responsible party's allegations regarding ads, listings, consignments and other efforts to sell the resources.
Obtain any supporting evidence the individual can provide (e.g.: copy of the listing agreement with the real estate agency in current use; dated advertisement(s) indicating the property is for sale; contracts with local media to advertise the property; a photograph of the "For Sale" sign on the property).
If the individual cannot provide evidence which is necessary to establish that good faith efforts to sell the resources are being made, verify the allegation with the appropriate third party, i.e., lawyer, banker, real estate broker. For example, the lawyer may verify that the guardianship is still pending and that the property cannot be offered for sale until the guardian is appointed.
It is not necessary to verify all allegations, only those necessary to establish that good faith efforts are being made. Verifying the duration of an ad, listing, or consignment at the outset will eliminate the need to verify its continuing existence at a subsequent follow-up contact.
Assume that an offer to buy property at a particular price is reasonable if it is at least two-thirds of the estimated current market value (CMV) unless the owner proves otherwise (e.g., provides convincing evidence of a different CMV).
Good faith efforts to sell property consist of taking all necessary and reasonable steps to sell it in the geographic area covered by local radio, television, newspaper and other media serving the area where the person lives or, if different, where the property is located.
If the allegations indicate circumstances beyond the individual's control obtain any evidence the individual has to support the allegations. To the extent necessary to establish that circumstances beyond the individual's control are preventing good faith efforts to sell the resources, verify any allegations the individual cannot support with evidence. Use the telephone whenever possible.
Although other circumstances will arise which require careful judgment, the following situations illustrate the principle of good cause.
The individual makes good faith efforts throughout the disposal period to sell an excess non-liquid resource, or is prevented from doing so by circumstances beyond his or her control, and receives no offer to buy them.
A legitimate or apparently legitimate offer to buy an excess non-liquid resource halts further efforts to sell it for a prolonged period of time, and the prospective buyer subsequently cannot or will not complete the purchase.
The individual accepts an offer to buy real estate, escrow begins, the acceptance of another offer is precluded, and closing (at which full or partial payment and transfer of title are exchanged) does not take place within the disposal/exclusion period.
The individual becomes homebound or hospitalized for a prolonged period, due to illness or injury, and cannot take the steps necessary to sell the resource or to arrange for someone to sell it on his or her behalf.
A co-owner of a resource dies, and administration of probation of the estate delays efforts to sell the resource (assuming that the property continues to be a resource).
Request documentation of the sale (i.e., settlement sheet, photocopy of the check) for the case record when resources are sold. The recipient is ineligible in the month proceeds are received. This information is important should the individual re-apply in the future claiming all resources have been depleted.
When an individual has received 9 months of conditional benefits but has not been able to sell real property despite reasonable efforts to do so, you may continue Medicaid coverage if the Medicaid recipient continues to make reasonable efforts to sell the resource and doesn't refuse a valid offer to buy the resource/property.
Inform the recipient or responsible party that:
Contact the owner or his representative (by phone, if possible) at 90 day intervals following the end of the conditional benefits period.
EXCEPTION - contact may be at 6 month intervals if:
The individual does not have a spouse and equity in the property to be sold is $2,000 or less; or
The individual has a spouse and equity in the property to be sold is $3,000 or less.
NOTE: This exception recognizes the possibility that an individual may have spent down other resources and become eligible without benefit of the real property exclusion.
Use these follow up contacts for the same purposes as described above.
Evaluate efforts to sell (and good cause, if appropriate) as above.
16 Del. Admin. Code § 20000-20360