Uniform Medical Plan

Kaiser Permanente of Washington

Kaiser Permanente Northwest

Brian Jensen

Asset verification

Revised date
Purpose statement

To explain the asset verification system (AVS) and new program requirements for applicants and recipients of long-term care services. 

WAC 182-503-0055 Asset verification system

WAC 182-503-0055 Asset verification system

Effective September 12, 2020

  1. This rule implements the asset verification system (AVS) outlined in section 1940 of the Social Security Act.
  2. This rule applies to any client, or those financially responsible for them, who is subject to:
    1. The disclosure of resources, as defined in WAC 182-512-0200, to determine eligibility; or
    2. Provisions related to the transfer of assets, as described in WAC 182-513-1363.
  3. For the purposes of this section:
    1. "Financial institution" means the same as defined in section 1101 of the Right to Financial Privacy Act, and may include, but is not limited to:
      1. Banks; or
      2. Credit unions.
    2. "Financial record" means any record held by a financial institution pertaining to a customer's relationship with the financial institution; and
    3. "Financial responsibility" is described in WAC 182-506-0015.
  4. You and any other financially responsible people must provide authorization for us to obtain any financial record held by a financial institution.
    1. For you, the authorization may be provided by anyone described in WAC 182-503-0010 (1) and (2)(a), (b), or (c), except in the case of an authorized representative who must be designated by the client.
    2. For a financially responsible spouse, authorization may be provided by the spouse, their legal guardian, or their attorney-in-fact.
    3. The agency may grant an exception to rule as described in WAC 182-503-0090 if authorization is not provided by those listed in (a) and (b) of this subsection.
  5. The authorization, provided under subsection (4) of this section, will remain in effect until one of the following occurs:
    1. Your application for apple health is denied;
    2. Your eligibility for apple health is terminated; or
    3. You revoke your authorization in a written notification to us.
  6. We will:
    1. Use the authorization provided under subsection (4) of this section to electronically verify your financial records and those of any other financially responsible person to determine or renew your eligibility for apple health; or
    2. Inform you in writing at the time of application and renewal that we will obtain and use information available through AVS to determine your eligibility for apple health.

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

Clarifying information

Section 1940 of the Social Security Act 2008 (42 USC 1396w), requires all states to implement a system to verify resources/assets of aged, blind, or disabled applicants and recipients of Medicaid, including long-term services and supports (LTSS), through the use of an asset verification system.

The AVS searches client financial institution accounts via several methods:

  • Automatically searches for accounts at the largest financial institutions in the United States.
  • Automatically searches for accounts at specific financial institutions based on the client's residential address, via a geographic search algorithm.
  • Allows financial eligibility staff to directly search for accounts at financial institutions where we believe the applicant/recipient has an account.

AVS reports on the following account types:

  • Burial accounts
  • Certificate of deposit
  • Checking accounts
  • Christmas club accounts
  • IRA accounts
  • Keogh accounts
  • Money market accounts
  • Rent security
  • Savings accounts
  • Trusts

Financial eligibility staff review the information received from financial institutions and resolve discrepancies with the client prior to the eligibility determination.

AVS does not change how financial eligibility staff handles questionable situations; AVS is another tool to use to determine eligibility.

Clients, and those financially responsible for them, must provide authorization before an AVS search is submitted.

Once a client or financially responsible person gives authorization for use of AVS, it remains in place until the client or the financially responsible person cancels the authorization in writing, they are no longer eligible for coverage, or the application is withdrawn or denied.

Worker responsibilities

NOTE: Please refer to your agency's AVS procedures documentation.

AVS authorization

Staff must receive authorization in order to run an AVS search. Tickles will be generated approximately 90 days prior to the end of the renewal month for clients who do not have an AVS authorization in place. 

Staff should review the case record to determine whether authorization was granted on an application or review form previously received, or authorization was granted and documented in the ACES narrative. 

If authorization was granted, update the AVS authorization field to "AVS Authorized."

If authorization is not provided, request AVS authorization from the client. 

If there has been a break in medical coverage for more than 30 days, a new authorization is required. 

At renewal

AVS will provide banking information for the month the AVS search is submitted.

Approximately 60 days prior to the end of the renewal month, if an AVS authorization is in place for the client and financially responsible people (if applicable), an AVS request will be sent overnight via batch process. Fifteen days after submission AVS results will populate in the AVS portal.

At application

For Medicaid programs that do not  have a 60 month look back period, the AVS will provide 4 months of financial institution account balance data from the application date.

For Medicaid programs that have a 60 month look back period, the AVS will review accounts balances and transfers for the 60 month period from the application date.

An AVS request is sent after both the client and financially responsible person (if applicable) have a status of "AVS authorized." At that point, all financial institutions on the ACES resource page that have been added through the financial institution search, will be sent to the AVS vendor to directly search for records at that those financial institutions. An AVS2 tickle will be set for 16 days following submission.

AVS results

Financial staff must contact the applicant or recipient and give them the opportunity to provide the needed information to resolve a discrepancy and determine ongoing eligibility when AVS returns information that indicates: 

  • Inconsistent withdrawals during the look back period (for LTSS programs with a transfer look back period); or 
  • Bank accounts that are over the resource standard; or
  • Accounts not listed on the application, or disclosed during the interview (if an adverse action may be necessary); or 
  • Any other questionable information.

Financial eligibility staff cannot deny or terminate a case based solely on the information received from AVS or LexisNexis. Alternate verification must be requested.

If the client is ineligible due to transfers in the 60 month look back period, determine if there is eligibility for another medical program without a look-back period: 

  • S-series AH if client is resource eligible
  • HWD if the client is disabled and working
  • TSOA eligibility

At application or eligibility review, once AVS results are received, document the client's resources in ACES.

Once results are reviewed in the portal and documented in ACES, the AVS case must be closed in the portal using closed/withdrawn. 

Please report broken links or content problems.

WAC 182-503-0055 Asset verification system

WAC 182-503-0055 Asset verification system

Effective September 12, 2020

  1. This rule implements the asset verification system (AVS) outlined in section 1940 of the Social Security Act.
  2. This rule applies to any client, or those financially responsible for them, who is subject to:
    1. The disclosure of resources, as defined in WAC 182-512-0200, to determine eligibility; or
    2. Provisions related to the transfer of assets, as described in WAC 182-513-1363.
  3. For the purposes of this section:
    1. "Financial institution" means the same as defined in section 1101 of the Right to Financial Privacy Act, and may include, but is not limited to:
      1. Banks; or
      2. Credit unions.
    2. "Financial record" means any record held by a financial institution pertaining to a customer's relationship with the financial institution; and
    3. "Financial responsibility" is described in WAC 182-506-0015.
  4. You and any other financially responsible people must provide authorization for us to obtain any financial record held by a financial institution.
    1. For you, the authorization may be provided by anyone described in WAC 182-503-0010 (1) and (2)(a), (b), or (c), except in the case of an authorized representative who must be designated by the client.
    2. For a financially responsible spouse, authorization may be provided by the spouse, their legal guardian, or their attorney-in-fact.
    3. The agency may grant an exception to rule as described in WAC 182-503-0090 if authorization is not provided by those listed in (a) and (b) of this subsection.
  5. The authorization, provided under subsection (4) of this section, will remain in effect until one of the following occurs:
    1. Your application for apple health is denied;
    2. Your eligibility for apple health is terminated; or
    3. You revoke your authorization in a written notification to us.
  6. We will:
    1. Use the authorization provided under subsection (4) of this section to electronically verify your financial records and those of any other financially responsible person to determine or renew your eligibility for apple health; or
    2. Inform you in writing at the time of application and renewal that we will obtain and use information available through AVS to determine your eligibility for apple health.

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

Trusts

Revised date
Purpose statement

Describe and clarify rules on how trusts affect Apple Health (Medicaid) eligibility.

WAC 182-516-0001 Definitions

WAC 182-516-0001 Definitions

Effective February 2, 2018

"Acquire" means, in the context of trusts, to gain title to, or to gain ownership interest in an asset in a trust. Receiving payment or benefit from an asset in a trust is not acquiring the asset.

"Annuitant" means a person or entity that receives the stream of payments from an annuity.

"Annuity" means a policy, certificate or contract that is an agreement between two parties in which one party pays a lump sum to the other, and the other party agrees to guarantee payment of a set amount of money over a set amount of time.

"Beneficiary" means, in the context of a trust, a person or entity that is entitled to benefit from a trust.

"Grantor" means the person or entity who owned the asset immediately before establishing a trust with that asset.

"Immediate" means, in the context of annuities, an annuity that is fully funded at purchase with no accumulation or deferral to allow accumulation.

"Income" means, in the context of a trust, the undistributed proceeds that a trust principal generates over a period including, but not limited to, interest, dividends, rents and realized gains on the sale or exchange. Any income not disbursed in one period is principal the next period.

"Irrevocable":
     a. For a trust, "irrevocable" means the grantor or someone act­ ing on behalf of the grantor cannot reacquire any portion of the as­ sets in the trust for the benefit of the grantor or unilaterally change the terms of the trust; and the beneficiary or someone acting on behalf of the beneficiary cannot acquire any portion of the assets in the trust for the benefit of the beneficiary or unilaterally change the terms of the trust. A legal instrument that is called irrevocable, but permits acquisition or reacquisition of any portion of the assets if some action is taken by or on behalf of the grantor or the benefi­ciary, is revocable for the purposes of this chapter.

     b. A trust or annuity that is not irrevocable is revocable.

     c. A trust is still irrevocable if it meets the definition under (a) of this definition, but allows modifications to the trust to conform with changes in trust law, which occur after the establishment of the trust.

     d. For an annuity, "irrevocable" means the contract cannot be canceled and the terms of the contract cannot be changed.

"Principal" means the assets, other than income, that make up the trust, promissory note, or loan.

"Revocable" means the instrument is not irrevocable. See the def­inition of "irrevocable."

"Self-settled trust" means any trust established with assets that were originally owned by the beneficiary, or would have been owned by the beneficiary if they had not been diverted into the trust by the beneficiary, the court, or someone acting on the beneficiary's behalf. Depending on the date a trust is established, a trust may be self-set­tled if the assets were originally owned by the beneficiary's spouse, or would have been owned by the beneficiary's spouse if they had not been diverted into the trust by the beneficiary's spouse, the court, or someone acting on the beneficiary's spouse's behalf.

"Sole benefit" of a beneficiary means a trust benefits no one but that beneficiary, whether at the time the trust is established or at any time during the lifetime of the beneficiary.

"Third-party trust" means a trust established with assets origi­nally owned by someone other than the beneficiary. However, depending on the date a trust is established, a trust may be self-settled if the assets were originally owned by the beneficiary's spouse, or would have been owned by the beneficiary's spouse if they had not been diverted into the trust by the beneficiary's spouse, the court, or some­ one acting on the beneficiary's spouse's behalf. 

"To or for the benefit of" means that a payment or benefit of any sort from a trust is transferred to the beneficiary, another person, or entity such that the beneficiary derives some benefit from the transfer.

"Trust" means:

    a. Any arrangement in which a grantor transfers property to a trustee with the intention that it be held, managed, or administered by the trustee for the benefit of the grantor or another beneficiary; or

     b. Any legal instrument, device, or arrangement similar to a trust in which:

          i. A grantor transfers an asset to another; and

          ii. The grantor transfers the asset intending that it be held, managed, or administered for the benefit of the grantor or another beneficiary.

Trustee" means a person or entity that manages and administers a trust for the beneficiary.

"Uncompensated asset transfer" means the entirety of the fair market value of the asset transferred was uncompensated, regardless of any consideration received in return for the asset.

 

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

WAC 182-516-0100 Trust index

WAC 182-516-0100 Trust index

Effective March 2, 2018

The medicaid agency or the agency's designee applies the following rules to determine how trusts affect eligibility for medicaid:

  1. WAC 182-516-0105 General rules that apply to all trusts.
  2. WAC 182-516-0110 Self-settled trusts overview.
  3. WAC 182-516-0115 Revocable self-settled trusts established on or after August 11, 1993.
  4. WAC 182-516-0120 Irrevocable self-settled trusts for a disabled client under age sixty-five established on or after August 11, 1993.
  5. WAC 182-516-0125 Irrevocable pooled self-settled trusts for a disabled client established on or after August 11, 1993.
  6. WAC 182-516-0130 Irrevocable self-settled trusts established on or after August 11, 1993.
  7. WAC 182-516-0135 Self-settled trusts established before August 11, 1993.
  8. WAC 182-516-0140 Third-party trusts.
  9. WAC 182-516-0145 Trusts containing both assets of the beneficiary and third-party assets.

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

Clarifying Information

The new trust WACs are ordered in a somewhat logical way. First, there is a WAC that contains rules applicable to all trusts. Next, trust rules are broken down into whether the beneficiary is the grantor (self-settled trust) or not (third party trust).

There is a rule for self-settled revocable trusts, then rules for self-settled irrevocable trusts.

Irrevocable trusts are split into two categories – those that are excluded for Medicaid, and those that are not excluded for Medicaid.

After the self-settled trust rules, there are rules for third party trusts and trusts that contain both self-settled and third party assets.

WAC 182-516-0105 General rules that apply to all trusts

WAC 182-516-0105 General rules that apply to all trusts.

Effective March 2, 2018

  1. Regardless of treatment under this chapter, all trusts remain subject to Title 182 WAC, which include income and resource rules under chapter 182-512 WAC and asset transfer rules under WAC 182-513-1363, un­less specified otherwise.
  2. The medicaid agency or the agency's designee treats the trust or a distribution from the trust as a third-party resource under WAC 182-501-0200 if:
    1. The agency or the agency's designee determines the trust is not an available resource or determines the distributions from a trust are not income; and
    2. The terms of the trust or how the trust is being administered meet the third-party resource rules under WAC 182-501-0200.
  3. The agency or the agency's designee applies the rules under WAC 182-516-0100 to both the language of the trust and how the trust is being administered.
  4. Assets in a trust are available resources to the beneficiary if the beneficiary:
    1. Is a trustee; or
    2. Can direct the use of the trust principal or income, or di­rect the trustee's use of trust principal or income, for that benefi­ciary's support and maintenance under the terms of the trust.
  5. Cash distributions from a trust to the beneficiary are un­ earned income to the beneficiary in the month they are received or should have been received under the trust's terms.
  6. For asset transfer dates for trusts, the transfer date of an asset under WAC 182-513-1363 is the latest of:
    1. The date the trust was established;
    2. The date the asset being evaluated was transferred into the trust; or
    3. The date access to the asset was foreclosed by any action, inaction, or language in the trust, which prevents the beneficiary from accessing the asset.
  7. A client who is denied or terminated from medicaid due to the application of any rules under WAC 182-516-0100 may apply for a hard­ship waiver under WAC 182-513-1367.

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

Clarifying Information

Although there are WACs specific to trusts, this does not mean all nontrust WACs do not apply to trusts (for example: income, resource, third-party resources, transfers, etc.) Only when a trust specifically states a different rule does that trust rule control. For example, if a trust is determined to be an “available resource” under the trust rules, then the availability rules under chapter 182-512 WAC (the 20-day convert to cash rules) do not apply.

Both the language of the trust and the actual use of the trust matter.

Example: If a trust states the beneficiary cannot receive cash disbursements, but the trustee disburses cash to the beneficiary, we will assume the trustee can always disburse cash. Likewise, if a trustee has no discretion and must pay for a beneficiaries medical expenses, but the trustee states that they will not, we will assume they can.

If the beneficiary is also a trustee or co-trustee, or otherwise has control over the assets in the trust, we will assume the beneficiary can use the trust however they want, regardless of the trust language; therefore, it is an available resource.

The hardship waiver WAC 182-513-1367 was amended to include hardship waiver requests for adverse actions because of a trust.

WAC 182-516-0135 Self-settled trusts established before August 11, 1993.

WAC 182-516-0135 Self-settled trusts established before August 11, 1993.

Effective March 2, 2018

  1. A revocable or irrevocable self-settled trust established before August 11, 1993, under this section is one:
    1. Established other than by will by a beneficiary or that bene­ficiary's spouse;
    2. Under which that beneficiary may be the beneficiary of all or part of the payments from the trust; and
    3. Under which the distribution of those payments is determined by one or more trustees who are permitted to exercise any discretion with respect to the distribution to the beneficiary.
  2. For trusts established under subsection (1) of this section, the maximum value the trustee may distribute, under any circumstances, to the beneficiary is unearned income.
  3. If a trust does not meet subsection (1)(c) of this section:
    1. The trust is an available resource to the extent that trust assets can be used for the beneficiary; and
    2. Any asset that cannot be used for the beneficiary is an un­ compensated asset transfer.
  4. This section does not apply to any trust or initial trust de­cree established before April 7, 1986, for the sole benefit of an intellectually disabled client who resides in an intermediate care fa­cility for the intellectually disabled.

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

Clarifying Information

These trusts are referred to as "Medicaid qualifying trusts," in the sense that these trusts restrict access to Medicaid (not make someone able to qualify for Medicaid).

Clarifying Information

Because the assets in a third party trust did not belong to the beneficiary before being placed in the trust, these trust generally do not affect Medicaid eligibility. That is unless the beneficiary has some control over the trust, or the beneficiary is able to remove assets from the trust. Or, in rarer circumstances, the trust is meant to supplant Medicaid or prevent the need for Medicaid entirely.

A critical, yet sometimes misunderstood, distinction for testamentary trusts: the estate of a late spouse who establishes a trust for the surviving spouse always establishes a third party trust. But only with the late spouse’s share of the community property. A late spouse cannot bequeath more than they own of the community property. Additionally, only assets that went through probate are third party – you will need to review assets that did not go through probate (such as life insurance, annuities, or retirement accounts).

Worker Responsibilities

When a client reports an irrevocable non-pooled trust as indicated in WAC 182-516-0130, notify the HCA Casualty Unit at HCACasualtyUnit@hca.wa.gov.  Include a copy of the trust document should the client provide one.

Trust Table Summary

The following table is a summary of treatment of trusts for Medicaid. Trust rules are the authority and this table should only be used as a guide. Be sure to look at the specific rule in question in addition to this table.

The table assumes the beneficiary and trustee are not the same person and the beneficiary has no control over the trust.

Trust type Grantor Beneficiary Available resource Income Asset transfer
Third party Not beneficiary Client No Only disbursements to beneficiary No
Third party Client Not client No No Review 182-513-1363

Revocable trust on or after 8/11/93

Client, spouse or both

Client

 Yes - anything not excluded under chapter 182-512 WAC. Home exclusion does not apply if client is institutionalized

Yes - any payment or benefit from the trust

 No

Revocable trust before 8/11/93

Client, spouse, or both

Client, spouse, or both

Yes - largest amount allowed by the trust's terms

Yes - amount allowed by trust's terms

Yes - assets that are not available by trust's terms

d4A irrevocable trust

Client

Client

No

Only disbursements to beneficiary

Only transfers to the trust after beneficiary turns age 65

d4C

Client

Client

No

Only disbursements to beneficiary

 Only transfers to the trust after beneficiary turns age 65
Irrevocable trust on or after 8/1/03 Client, spouse, or both Client, spouse, or both Yes - any assets that can be used for the beneficiary Yes - any assets used to or for the benefit of the beneficiary Only assets that cannot be used for the beneficiary (rare) or assets that were actually not used for the beneficiary
Irrevocable trust on or after 8/11/93, but before 8/1/03 Client Client Yes - any assets that can be used for the beneficiary Yes - any assets used to or for the benefit of the beneficiary Only assets that cannot be used for the beneficiary (rare) or assets that were actually not used for the beneficiary
Irrevocable trust before 8/11/93 Client, spouse, or both Client, spouse, or both Yes - largest amount allowed by the trust's terms Yes - amount allowed by trust's terms Yes - assets that are not available by trust's terms
Any trust established before 4/7/86 for a client with intellectual disabilities who resides in an ICF/ID Client Client No Only disbursements to beneficiary No

Additional information about Trusts can be found on the Trusts continued page.

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Does the SEBB Program have any authority over retirement benefits?

No. The SEBB Program does not have authority over contributions made to pensions or any form of retirement accounts.

 

Can SEBB organizations offer additional FSA, HSA, or DCAP benefits?

No. HCA maintains the authority to offer cafeteria plans (as identified in IRS Section 125). This means SEBB organizations cannot offer health savings accounts (HSAs), a flexible spending arrangement (FSA), or a dependent care assistance program (DCAP).

A SEBB organization also cannot make additional employer contributions to an HSA for employees who enroll in an IRS qualified high-deductible health plan. The employer contribution is limited to the annual amount authorized by the SEBB Program and deposited into the HSA account by HCA on behalf of the SEBB organization.

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