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Minnesota Legislature

Office of the Revisor of Statutes

256B.0571 LONG-TERM CARE PARTNERSHIP PROGRAM.
    Subdivision 1. Definitions. For purposes of this section, the following terms have the
meanings given them.
    Subd. 2.[Repealed, 2006 c 282 art 17 s 37]
    Subd. 3. Long-term care insurance. "Long-term care insurance" means a policy described
in section 62S.01.
    Subd. 4. Medical assistance. "Medical assistance" means the program of medical assistance
established under section 256B.01.
    Subd. 5.[Repealed, 2006 c 282 art 17 s 37]
    Subd. 6. Partnership policy. "Partnership policy" means a long-term care insurance policy
that meets the requirements under subdivision 10 and was issued on or after the effective date of
the state plan amendment implementing the partnership program in Minnesota.
    Subd. 7. Partnership program. "Partnership program" means the Minnesota partnership for
long-term care program established under this section.
    Subd. 7a. Protected assets. "Protected assets" means assets or proceeds of assets that are
protected from recovery under subdivisions 13 and 15.
    Subd. 8. Program established. (a) The commissioner, in cooperation with the commissioner
of commerce, shall establish the Minnesota partnership for long-term care program to provide for
the financing of long-term care through a combination of private insurance and medical assistance.
(b) An individual who meets the requirements in this paragraph is eligible to participate in
the partnership program. The individual must:
(1) be a Minnesota resident at the time coverage first became effective under the partnership
policy;
(2) be a beneficiary of a partnership policy that (i) is issued on or after the effective date of
the state plan amendment implementing the partnership program in Minnesota, or (ii) qualifies as
a partnership policy under the provisions of subdivision 8a; and
(3) have exhausted all of the benefits under the partnership policy as described in this section.
Benefits received under a long-term care insurance policy before July 1, 2006, do not count
toward the exhaustion of benefits required in this subdivision.
    Subd. 8a. Exchange for long-term care partnership policy; addition of policy rider. (a)
If authorized by federal law or if federal approval is granted with respect to the partnership
program established in this section, a long-term care insurance policy that was issued before the
effective date of the state plan amendment implementing the partnership program in Minnesota
that was exchanged after the effective date of the state plan amendment for a long-term care
partnership policy that meets the requirements of Public Law 109-171, section 6021, qualifies
as a long-term care partnership policy under this section, unless the policy is paying benefits
on the date the policy is exchanged.
(b) If authorized by federal law or if federal approval is granted with respect to the
partnership program established in this section, a long-term care insurance policy that was issued
before the effective date of the state plan amendment implementing the partnership program in
Minnesota that has a rider added after the effective date of the state plan amendment that meets
the requirements of Public Law 109-171, section 6021, qualifies as a long-term care partnership
policy under this section, unless the policy is paying benefits on the date the rider is added.
    Subd. 9. Medical assistance eligibility. (a) Upon application for medical assistance program
payment of long-term care services by an individual who meets the requirements described in
subdivision 8, the commissioner shall determine the individual's eligibility for medical assistance
according to paragraphs (b) to (i).
(b) After determining assets subject to the asset limit under section 256B.056, subdivision 3
or 3c, or 256B.057, subdivision 9 or 10, the commissioner shall allow the individual to designate
assets to be protected from recovery under subdivisions 13 and 15 up to the dollar amount of the
benefits utilized under the partnership policy. Designated assets shall be disregarded for purposes
of determining eligibility for payment of long-term care services.
(c) The individual shall identify the designated assets and the full fair market value of those
assets and designate them as assets to be protected at the time of initial application for medical
assistance. The full fair market value of real property or interests in real property shall be based
on the most recent full assessed value for property tax purposes for the real property, unless the
individual provides a complete professional appraisal by a licensed appraiser to establish the full
fair market value. The extent of a life estate in real property shall be determined using the life
estate table in the health care program's manual. Ownership of any asset in joint tenancy shall
be treated as ownership as tenants in common for purposes of its designation as a disregarded
asset. The unprotected value of any protected asset is subject to estate recovery according
to subdivisions 13 and 15.
(d) The right to designate assets to be protected is personal to the individual and ends when
the individual dies, except as otherwise provided in subdivisions 13 and 15. It does not include
the increase in the value of the protected asset and the income, dividends, or profits from the
asset. It may be exercised by the individual or by anyone with the legal authority to do so on the
individual's behalf. It shall not be sold, assigned, transferred, or given away.
(e) If the dollar amount of the benefits utilized under a partnership policy is greater than the
full fair market value of all assets protected at the time of the application for medical assistance
long-term care services, the individual may designate additional assets that become available
during the individual's lifetime for protection under this section. The individual must make the
designation in writing to the county agency no later than the last date on which the individual
must report a change in circumstances to the county agency, as provided for under the medical
assistance program. Any excess used for this purpose shall not be available to the individual's
estate to protect assets in the estate from recovery under section 256B.15 or 524.3-1202, or
otherwise.
(f) This section applies only to estate recovery under United States Code, title 42, section
1396p, subsections (a) and (b), and does not apply to recovery authorized by other provisions of
federal law, including, but not limited to, recovery from trusts under United States Code, title
42, section 1396p, subsection (d)(4)(A) and (C), or to recovery from annuities, or similar legal
instruments, subject to section 6012, subsections (a) and (b), of the Deficit Reduction Act of
2005, Public Law 109-171.
(g) An individual's protected assets owned by the individual's spouse who applies for
payment of medical assistance long-term care services shall not be protected assets or disregarded
for purposes of eligibility of the individual's spouse solely because they were protected assets of
the individual.
(h) Assets designated under this subdivision shall not be subject to penalty under section
256B.0595.
(i) The commissioner shall otherwise determine the individual's eligibility for payment of
long-term care services according to medical assistance eligibility requirements.
    Subd. 10. Long-term care partnership policy inflation protection. A long-term care
partnership policy must provide the inflation protection described in this subdivision. If the
policy is sold to an individual who:
(1) has not attained age 61 as of the date of purchase, the policy must provide compound
annual inflation protection;
(2) has attained age 61, but has not attained age 76 as of such date, the policy must provide
some level of inflation protection; and
(3) has attained age 76 as of such date, the policy may, but is not required to, provide some
level of inflation protection.
    Subd. 11.[Repealed, 2006 c 282 art 17 s 37]
    Subd. 12. Compliance with federal law. An issuer of a partnership policy must comply
with Public Law 109-171, section 6021, including any federal regulations, as amended, adopted
under that law.
    Subd. 13. Limitations on estate recovery. (a) Protected assets of the individual shall not be
subject to recovery under section 256B.15 or 524.3-1201 for medical assistance or alternative care
paid on behalf of the individual. Protected assets of the individual in the estate of the individual's
surviving spouse shall not be liable to pay a claim for recovery of medical assistance paid for the
predeceased individual that is filed in the estate of the surviving spouse under section 256B.15.
Protected assets of the individual shall not be protected assets in the surviving spouse's estate
by reason of the preceding sentence and shall be subject to recovery under section 256B.15 or
524.3-1201 for medical assistance paid on behalf of the surviving spouse.
(b) The personal representative may protect the full fair market value of an individual's
unprotected assets in the individual's estate in an amount equal to the unused amount of asset
protection the individual had on the date of death. The personal representative shall apply the
asset protection so that the full fair market value of any unprotected asset in the estate is protected.
When or if the asset protection available to the personal representative is or becomes less than
the full fair market value of any remaining unprotected asset, it shall be applied to partially
protect one unprotected asset.
(c) The asset protection described in paragraph (a) terminates with respect to an asset
includable in the individual's estate under chapter 524 or section 256B.15:
(1) when the estate distributes the asset; or
(2) if the estate of the individual has not been probated within one year from the date of death.
(d) If an individual owns a protected asset on the date of death and the estate is opened for
probate more than one year after death, the state or a county agency may file and collect claims in
the estate under section 256B.15, and no statute of limitations in chapter 524 that would otherwise
limit or bar the claim shall apply.
(e) Except as otherwise provided, nothing in this section shall limit or prevent recovery
of medical assistance.
    Subd. 14. Implementation. (a) The commissioner, in cooperation with the commissioner of
commerce, may alter the requirements of this section so as to be in compliance with forthcoming
requirements of the federal Department of Health and Human Services and the National
Association of Insurance Commissioners necessary to implement the long-term care partnership
program requirements of Public Law 109-171, section 6021.
(b) The commissioner shall submit a state plan amendment to the federal government to
implement the long-term care partnership program in accordance with this section.
    Subd. 15. Limitation on liens. (a) An individual's interest in real property shall not be
subject to a medical assistance lien or a notice of potential claim while and to the extent it is
protected under subdivision 9.
(b) Medical assistance liens or liens arising under notices of potential claims against an
individual's interests in real property in the individual's estate that are designated as protected
under subdivision 13, paragraph (b), shall be released to the extent of the dollar value of the
protection applied to the interest.
(c) If an interest in real property is protected from a lien for recovery of medical assistance
paid on behalf of the individual under paragraph (a) or (b), no lien for recovery of medical
assistance paid on behalf of that individual shall be filed against the protected interest in real
property after it is distributed to the individual's heirs or devisees.
    Subd. 16. Burden of proof. Any individual or the personal representative of the individual's
estate who asserts that an asset is a disregarded or protected asset under this section in connection
with any determination of eligibility for benefits under the medical assistance program or any
appeal, case, controversy, or other proceedings, shall have the initial burden of:
(1) documenting and proving by clear and convincing evidence that the asset or source of
funds for the asset in question was designated as disregarded or protected;
(2) tracing the asset and the proceeds of the asset from that time forward; and
(3) documenting that the asset or proceeds of the asset remained disregarded or protected
at all relevant times.
History: 1Sp2005 c 4 art 7 s 5; 2006 c 255 s 74; 2006 c 282 art 17 s 28