Long Term Care (LTC): Transfer of Assets/Penalty Period Overview

Transfer of Assets

Policy 317:35-9-67 (6) Home and Community based Waiver (HCBW)
Policy 317:35-17-10 (4) ADvantage
Policy 317:35-19-20 (6) Nursing Facility
Policy 317:50-1-6 (5) Medically Fragile Waiver

This information applies to transfers made on or after 02/08/06

The transfer of assets policy applies to any assets that are transferred including those transferred into a trust in which the client has no access to.

If an asset has been transferred a penalty must be assessed. There is no limit to the length of the penalty period. The penalty period will begin with the latter of:

  • The first day of the month in which an “institutionalized individual” transfers assets for less than fair market value. This applies to an open case with LTC services where the transfer is not discovered or did not occur until after certification. If transfer occurred prior to certification and was not discovered until after certification, the penalty period begins the date of certification of the LTC authorization;

-or-

  • The date on which the individual is “otherwise eligible” for and receiving nursing facility services that, were it not for the imposition of the penalty period, would be covered by SoonerCare. “Otherwise eligible” includes establishing and funding a MIPT, if needed.
  • For ADvantage, the penalty period will start the day services would have been approved if not for the transfer. Once individual is determined financially and medically eligible. Financial eligible also includes that the MIPT is established and funded if needed.

The penalty period:

  • Cannot begin until the expiration of any existing period of ineligibility due to a transfer
  • Will not be interrupted or temporarily suspended once it is imposed.

When there have been multiple transfers, all transferred assets are added together to determine the penalty.

The penalty period begins when the client would be eligible both financially and medically if it were not for the transfer. Client is to be certified for Medicaid, but authorization for the LTC is denied because of the penalty period.

A penalty would not be applied if the title to the individual’s home is transferred to:

  • The spouse
  • The individual’s child who is under age 21
  • The individual’s child who is blind or totally disabled as determined by the Social Security Administration or by the Veteran’s Administration if found 100% disabled
  • A sibling who has equity interest in the home and resided in the home for at least one year prior to the institutionalization of the individual
  • The individual’s son or daughter who resided in the home and provided care for at least two years immediately prior to the individual’s institutionalization

The penalty period consists of a period of ineligibility (number of days) for long-term care benefits determined by dividing the total uncompensated value of the asset by the average daily cost to a private patient in a nursing facility in Oklahoma. This amount is located on the Appendix C-1, Schedule VIII.B. In this calculation, the penalty must include any partial month disqualification. In determining the number of days of ineligibility, if you have a fraction of a day you must always round up. You cannot round down, or otherwise disregard, any fractional period of ineligibility determined with respect to transfer of assets. There is no limit to the length of the penalty period for these transfers.

Use the Transfer of Assets Penalty Period Calculator to calculate the penalty period.

The penalty period can be ended by either the assets being restored, or commensurate return being made, to the individual. Once the restoration or commensurate return is made, eligibility is re-determined considering the value of the restored asset or the amount of the commensurate return. The restoration or commensurate return will not entitle the applicant to benefits for the period of time the asset remained transferred.

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