Inaccessible Resources

Inaccessible Resources

Inaccessible resources (see Post 35) are treated as excludable resources for Medicaid eligibility purposes (N.J.A.C. 10:71-4.4(b)6).

The theory is that a countable resource is only such that can be converted to monies to pay nursing home costs.

Post 35 discusses in detail that a co-owner of real estate renders the real estate inaccessible if the co-owner (not the applicant) refuses to liquidate.

Similarly, the same regulation treats property in probate as an inaccessible resource. The effect of inheritance by the community spouse (Post 27) and the effect of inheritance by a Medicaid recipient (Post 28) discuss this topic in detail. Basically, the theory is that if an estate has not been administered and, therefore, not distributed, the inheritance only becomes a resource upon distribution. If distribution is delayed, the Internal Revenue Service for estate income tax purposes treats the estate as “closed.” I have not seen Medicaid take this position although it would make sense that an estate cannot be held “in probate” for an inordinate amount of time.

The relevant regulation (N.J.A.C. 10:71-4.4(b)6) treats as inaccessible “the value of resources which are not accessible to the individual through no fault of his/her own.” Therefore, the above are merely examples and the possibilities for inaccessible resources are infinite.

For example, small pieces of real estate, which have no value due to location and zoning are treated as inaccessible in my experience. Similarly, assets that are to be received in the future, such as royalties, would have a similar status.

Monies owed to a community spouse, but not paid because the employer of the spouse is having financial problems, in today’s environment would be a poignant example of an inaccessible resource for purposes of the community spouse resource allowance.

On the other hand, resources available only if a penalty is incurred, are treated as available resources. An example of such a resource would be an annuity subject to penalty if distributed.

Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.


© July 2009, Post 48

Community Spouse Not Limited to Community Spouse Resource Allowance After Date of Eligibility of Applicant

Community Spouse Not Limited to Community Spouse Resource Allowance
After Date of Eligibility of Applicant

Previously, it has been discussed (see Post 11) that after the applicant’s receives Medicaid, the community spouse is not limited by the Community Spouse Resource Allowance. Relevant administrative regulations are included for reference.

For example: (see Post 11, one of the reasons for transferring the house to the community spouse is that a sale by the community spouse of the primary residence after the applicant receives eligibility, would result in proceeds not subject to the Medicaid computations. Proceeds of a sale before the date of eligibility would be treated as part of the “pot” and, therefore, preclude current Medicaid eligibility.

Another common situation is an inheritance by the community spouse. N.J.A.C. 10:71-4.4(b)6. indicates that property in probate is an inaccessible resource. Therefore, if the community spouse is a beneficiary of the estate, his or her share of assets of the estate does not enter into the “pot” until distributed. If distribution occurs after the applicant receives Medicaid, the resources received are free without encumbrance. However, if distribution is made prior to eligibility, the resources become part of the “pot.”


Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.


© March 2009, Post #13