1.1                          A bill for an act 
  1.2             relating to human services; authorizing an exception 
  1.3             to the prohibition on asset transfers for certain 
  1.4             charitable gifts; amending Minnesota Statutes 2003 
  1.5             Supplement, section 256B.0595, subdivisions 1, 1b. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2003 Supplement, section 
  1.8   256B.0595, subdivision 1, is amended to read: 
  1.9      Subdivision 1.  [PROHIBITED TRANSFERS.] (a) For transfers 
  1.10  of assets made on or before August 10, 1993, if a person or the 
  1.11  person's spouse has given away, sold, or disposed of, for less 
  1.12  than fair market value, any asset or interest therein, except 
  1.13  assets other than the homestead that are excluded under the 
  1.14  supplemental security program, within 30 months before or any 
  1.15  time after the date of institutionalization if the person has 
  1.16  been determined eligible for medical assistance, or within 30 
  1.17  months before or any time after the date of the first approved 
  1.18  application for medical assistance if the person has not yet 
  1.19  been determined eligible for medical assistance, the person is 
  1.20  ineligible for long-term care services for the period of time 
  1.21  determined under subdivision 2.  
  1.22     (b) Effective for transfers made after August 10, 1993, a 
  1.23  person, a person's spouse, or any person, court, or 
  1.24  administrative body with legal authority to act in place of, on 
  1.25  behalf of, at the direction of, or upon the request of the 
  2.1   person or person's spouse, may not give away, sell, or dispose 
  2.2   of, for less than fair market value, any asset or interest 
  2.3   therein, except assets other than the homestead that are 
  2.4   excluded under the supplemental security income program, for the 
  2.5   purpose of establishing or maintaining medical assistance 
  2.6   eligibility.  This applies to all transfers, including those 
  2.7   made by a community spouse after the month in which the 
  2.8   institutionalized spouse is determined eligible for medical 
  2.9   assistance.  For purposes of determining eligibility for 
  2.10  long-term care services, any transfer of such assets within 36 
  2.11  months before or any time after an institutionalized person 
  2.12  applies for medical assistance, or 36 months before or any time 
  2.13  after a medical assistance recipient becomes institutionalized, 
  2.14  for less than fair market value may be considered.  Any such 
  2.15  transfer is presumed to have been made for the purpose of 
  2.16  establishing or maintaining medical assistance eligibility and 
  2.17  the person is ineligible for long-term care services for the 
  2.18  period of time determined under subdivision 2, unless:  (1) the 
  2.19  person furnishes convincing evidence to establish that the 
  2.20  transaction was exclusively for another purpose~~, or unless~~; (2) 
  2.21  the transfer is permitted under subdivision 3 or 4~~.~~; or (3) the 
  2.22  transfer is a gift that is a charitable contribution described 
  2.23  in section 170(c) of the Internal Revenue Code of 1986, as 
  2.24  amended.  A charitable contribution under clause (3) shall be 
  2.25  presumed to have been made exclusively for purposes other than 
  2.26  establishing or maintaining medical assistance eligibility and 
  2.27  shall not make a person ineligible for long-term care services 
  2.28  unless the commissioner establishes by convincing evidence that 
  2.29  the purpose of the transfer was to establish or maintain medical 
  2.30  assistance eligibility.  Notwithstanding the provisions of this 
  2.31  paragraph, in the case of payments from a trust or portions of a 
  2.32  trust that are considered transfers of assets under federal law, 
  2.33  any transfers made within 60 months before or any time after an 
  2.34  institutionalized person applies for medical assistance and 
  2.35  within 60 months before or any time after a medical assistance 
  2.36  recipient becomes institutionalized, may be considered. 
  3.1      (c) This section applies to transfers, for less than fair 
  3.2   market value, of income or assets, including assets that are 
  3.3   considered income in the month received, such as inheritances, 
  3.4   court settlements, and retroactive benefit payments or income to 
  3.5   which the person or the person's spouse is entitled but does not 
  3.6   receive due to action by the person, the person's spouse, or any 
  3.7   person, court, or administrative body with legal authority to 
  3.8   act in place of, on behalf of, at the direction of, or upon the 
  3.9   request of the person or the person's spouse.  
  3.10     (d) This section applies to payments for care or personal 
  3.11  services provided by a relative, unless the compensation was 
  3.12  stipulated in a notarized, written agreement which was in 
  3.13  existence when the service was performed, the care or services 
  3.14  directly benefited the person, and the payments made represented 
  3.15  reasonable compensation for the care or services provided.  A 
  3.16  notarized written agreement is not required if payment for the 
  3.17  services was made within 60 days after the service was provided. 
  3.18     (e) This section applies to the portion of any asset or 
  3.19  interest that a person, a person's spouse, or any person, court, 
  3.20  or administrative body with legal authority to act in place of, 
  3.21  on behalf of, at the direction of, or upon the request of the 
  3.22  person or the person's spouse, transfers to any annuity that 
  3.23  exceeds the value of the benefit likely to be returned to the 
  3.24  person or spouse while alive, based on estimated life expectancy 
  3.25  using the life expectancy tables employed by the supplemental 
  3.26  security income program to determine the value of an agreement 
  3.27  for services for life.  The commissioner may adopt rules 
  3.28  reducing life expectancies based on the need for long-term 
  3.29  care.  This section applies to an annuity described in this 
  3.30  paragraph purchased on or after March 1, 2002, that: 
  3.31     (1) is not purchased from an insurance company or financial 
  3.32  institution that is subject to licensing or regulation by the 
  3.33  Minnesota Department of Commerce or a similar regulatory agency 
  3.34  of another state; 
  3.35     (2) does not pay out principal and interest in equal 
  3.36  monthly installments; or 
  4.1      (3) does not begin payment at the earliest possible date 
  4.2   after annuitization.  
  4.3      (f) For purposes of this section, long-term care services 
  4.4   include services in a nursing facility, services that are 
  4.5   eligible for payment according to section 256B.0625, subdivision 
  4.6   2, because they are provided in a swing bed, intermediate care 
  4.7   facility for persons with mental retardation, and home and 
  4.8   community-based services provided pursuant to sections 
  4.9   256B.0915, 256B.092, and 256B.49.  For purposes of this 
  4.10  subdivision and subdivisions 2, 3, and 4, "institutionalized 
  4.11  person" includes a person who is an inpatient in a nursing 
  4.12  facility or in a swing bed, or intermediate care facility for 
  4.13  persons with mental retardation or who is receiving home and 
  4.14  community-based services under sections 256B.0915, 256B.092, and 
  4.15  256B.49. 
  4.16     <b>[EFFECTIVE DATE.]</b> (a) This section is effective July 1, 
  4.17  2004, to the extent permitted by federal law.  If any provision 
  4.18  of this section is prohibited by federal law, the provision 
  4.19  shall become effective when federal law is changed to permit its 
  4.20  application or a waiver is received.  The commissioner of human 
  4.21  services shall notify the revisor of statutes when federal law 
  4.22  is enacted or a waiver or other federal approval is received and 
  4.23  shall publish a notice in the State Register.  The commissioner 
  4.24  must include the notice in the first State Register published 
  4.25  after the effective date of the federal changes. 
  4.26     (b) If, by July 1, 2004, any provision of this section is 
  4.27  not effective because of prohibitions in federal law, the 
  4.28  commissioner of human services shall apply to the federal 
  4.29  government by August 1, 2004, for a waiver of those prohibitions 
  4.30  or other federal authority, and that provision shall become 
  4.31  effective upon receipt of a federal waiver or other federal 
  4.32  approval, notification to the revisor of statutes, and 
  4.33  publication of a notice in the State Register to that effect. 
  4.34     Sec. 2.  Minnesota Statutes 2003 Supplement, section 
  4.35  256B.0595, subdivision 1b, is amended to read: 
  4.36     Subd. 1b.  [PROHIBITED TRANSFERS.] (a) Notwithstanding any 
  5.1   contrary provisions of this section, this subdivision applies to 
  5.2   transfers involving recipients of medical assistance that are 
  5.3   made on or after July 1, 2003, and to all transfers involving 
  5.4   persons who apply for medical assistance on or after July 1, 
  5.5   2003, if the transfer occurred within 72 months before the 
  5.6   person applies for medical assistance, except that this 
  5.7   subdivision does not apply to transfers made prior to July 1, 
  5.8   2003.  A person, a person's spouse, or any person, court, or 
  5.9   administrative body with legal authority to act in place of, on 
  5.10  behalf of, at the direction of, or upon the request of the 
  5.11  person or the person's spouse, may not give away, sell, dispose 
  5.12  of, or reduce ownership or control of any income, asset, or 
  5.13  interest therein for less than fair market value for the purpose 
  5.14  of establishing or maintaining medical assistance eligibility.  
  5.15  This applies to all transfers, including those made by a 
  5.16  community spouse after the month in which the institutionalized 
  5.17  spouse is determined eligible for medical assistance.  For 
  5.18  purposes of determining eligibility for medical assistance 
  5.19  services, any transfer of such income or assets for less than 
  5.20  fair market value within 72 months before or any time after a 
  5.21  person applies for medical assistance may be considered.  Any 
  5.22  such transfer is presumed to have been made for the purpose of 
  5.23  establishing or maintaining medical assistance eligibility, and 
  5.24  the person is ineligible for medical assistance services for the 
  5.25  period of time determined under subdivision 2b, unless:  (1) the 
  5.26  person furnishes convincing evidence to establish that the 
  5.27  transaction was exclusively for another purpose ~~or unless~~; (2) 
  5.28  the transfer is permitted under subdivision 3b or 4b~~.~~; or (3) 
  5.29  the transfer is a gift that is a charitable contribution 
  5.30  described in section 170(c) of the Internal Revenue Code of 
  5.31  1986, as amended.  A charitable contribution under clause (3) 
  5.32  shall be presumed to have been made exclusively for purposes 
  5.33  other than establishing or maintaining medical assistance 
  5.34  eligibility and shall not make a person ineligible for medical 
  5.35  assistance services unless the commissioner establishes by 
  5.36  convincing evidence that the purpose of the transfer was to 
  6.1   establish or maintain medical assistance eligibility. 
  6.2      (b) This section applies to transfers to trusts.  The 
  6.3   commissioner shall determine valid trust purposes under this 
  6.4   section.  Assets placed into a trust that is not for a valid 
  6.5   purpose shall always be considered available for the purposes of 
  6.6   medical assistance eligibility, regardless of when the trust is 
  6.7   established. 
  6.8      (c) This section applies to transfers of income or assets 
  6.9   for less than fair market value, including assets that are 
  6.10  considered income in the month received, such as inheritances, 
  6.11  court settlements, and retroactive benefit payments or income to 
  6.12  which the person or the person's spouse is entitled but does not 
  6.13  receive due to action by the person, the person's spouse, or any 
  6.14  person, court, or administrative body with legal authority to 
  6.15  act in place of, on behalf of, at the direction of, or upon the 
  6.16  request of the person or the person's spouse. 
  6.17     (d) This section applies to payments for care or personal 
  6.18  services provided by a relative, unless the compensation was 
  6.19  stipulated in a notarized written agreement that was in 
  6.20  existence when the service was performed, the care or services 
  6.21  directly benefited the person, and the payments made represented 
  6.22  reasonable compensation for the care or services provided.  A 
  6.23  notarized written agreement is not required if payment for the 
  6.24  services was made within 60 days after the service was provided. 
  6.25     (e) This section applies to the portion of any income, 
  6.26  asset, or interest therein that a person, a person's spouse, or 
  6.27  any person, court, or administrative body with legal authority 
  6.28  to act in place of, on behalf of, at the direction of, or upon 
  6.29  the request of the person or the person's spouse, transfers to 
  6.30  any annuity that exceeds the value of the benefit likely to be 
  6.31  returned to the person or the person's spouse while alive, based 
  6.32  on estimated life expectancy, using the life expectancy tables 
  6.33  employed by the supplemental security income program, or based 
  6.34  on a shorter life expectancy if the annuitant had a medical 
  6.35  condition that would shorten the annuitant's life expectancy and 
  6.36  that was diagnosed before funds were placed into the annuity.  
  7.1   The agency may request and receive a physician's statement to 
  7.2   determine if the annuitant had a diagnosed medical condition 
  7.3   that would shorten the annuitant's life expectancy.  If so, the 
  7.4   agency shall determine the expected value of the benefits based 
  7.5   upon the physician's statement instead of using a life 
  7.6   expectancy table.  This section applies to an annuity described 
  7.7   in this paragraph purchased on or after March 1, 2002, that: 
  7.8      (1) is not purchased from an insurance company or financial 
  7.9   institution that is subject to licensing or regulation by the 
  7.10  Minnesota Department of Commerce or a similar regulatory agency 
  7.11  of another state; 
  7.12     (2) does not pay out principal and interest in equal 
  7.13  monthly installments; or 
  7.14     (3) does not begin payment at the earliest possible date 
  7.15  after annuitization. 
  7.16     (f) Transfers under this section shall affect 
  7.17  determinations of eligibility for all medical assistance 
  7.18  services or long-term care services, whichever receives federal 
  7.19  approval. 
  7.20     <b>[EFFECTIVE DATE.]</b> (a) This section is effective July 1, 
  7.21  2004, to the extent permitted by federal law.  If any provision 
  7.22  of this section is prohibited by federal law, the provision 
  7.23  shall become effective when federal law is changed to permit its 
  7.24  application or a waiver is received.  The commissioner of human 
  7.25  services shall notify the revisor of statutes when federal law 
  7.26  is enacted or a waiver or other federal approval is received and 
  7.27  shall publish a notice in the State Register.  The commissioner 
  7.28  must include the notice in the first State Register published 
  7.29  after the effective date of the federal changes. 
  7.30     (b) If, by July 1, 2004, any provision of this section is 
  7.31  not effective because of prohibitions in federal law, the 
  7.32  commissioner of human services shall apply to the federal 
  7.33  government by August 1, 2004, for a waiver of those prohibitions 
  7.34  or other federal authority, and that provision shall become 
  7.35  effective upon receipt of a federal waiver or other federal 
  7.36  approval, notification to the revisor of statutes, and 
  8.1   publication of a notice in the State Register to that effect.