WAC 182-516-0140 Third-party trusts.

Effective March 2, 2018

1. This section governs third-party trust as defined under WAC 182-516-0001.
2. A trust containing the assets of a beneficiary's spouse may be a self-settled trust based on the date it was established. For specific rules regarding this, see WAC 182-516-0130.
3. A testamentary trust is a third-party trust created by a will where the trust is in the will and the estate is the grantor.
4. There is no requirement for a state to be named as a remainder beneficiary in third-party trusts.
5. If the beneficiary has the power to acquire the assets from the third-party trust, the trust is an available resource.
6. If the beneficiary has no power to access or control trust assets or distributions, as described under WAC 182-516-0105(4), a third-party trust is not an available resource.

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.

WAC 182-516-0130 Irrevocable self-settled trusts established on or after August 11, 1993.

Effective March 3, 2018

1. This section governs irrevocable self-settled trusts established on or after August 11, 1993, that do not meet the rules under either WAC 182-516-0120 or 182-516-0125.
2. A trust established on or after August 1, 2003, is a self-settled trust if:
   1. The assets of the trust are at least partially from the bene­ficiary or the beneficiary's spouse, or would have been owned by the beneficiary or the beneficiary's spouse unless diverted by the beneficiary, the beneficiary's spouse, the court, or someone acting on be­half of the beneficiary or the beneficiary's spouse;
   2. The trust is not established by will; and
   3. The trust was established by:
      1. The beneficiary or that beneficiary's spouse;
      2. A person, including a court or administrative body, with le­ gal authority to act in place or on behalf of the beneficiary or that beneficiary's spouse; or
      3. A person, including a court or administrative body, acting at the direction or upon the request of the beneficiary or that beneficiary's spouse.
3. A trust established from August 11, 1993, to July 31, 2003, is a self-settled trust if:
   1. The assets of the trust are at least partially from the bene­ficiary, or would have been owned by the beneficiary unless diverted by the beneficiary, the court, or someone acting on behalf of the beneficiary;
   2. The trust is not established by will; and
   3. The trust was established by:
      1. The beneficiary;
      2. A person, including a court or administrative body, with le­gal authority to act in place or on behalf of the beneficiary; or
      3. A person, including a court or administrative body, acting at the direction or upon the request of the beneficiary.
4. This section applies only to the assets contributed to a trust:
   1. Under subsection (2) of this section, by either the benefi­ciary or that beneficiary's spouse; or
   2. Under subsection (3) of this section, by the beneficiary.
5. The medicaid agency or the agency's designee applies the rules of this section without regard to:
   1. The purpose for establishing a trust;
   2. Whether the trustees have or may exercise any discretion un­der the terms of the trust;
   3. Restrictions on when or whether distributions may be made from the trust; and
   4. Restrictions on the use of distributions from the trust.
6. Treatment of payments or benefits from trusts established un­ der this section.
   1. Subject to subsection (7) of this section, if there are any circumstances under which payment or benefit from the trust could be made to or for the benefit of the beneficiary, the portion of the principal from which, or the income on the principal from which, payment to the beneficiary could be made is an available resource to the beneficiary, and the payment or benefit from that portion:
      1. Is unearned income when payment or benefit is to or for the benefit of the beneficiary; and
      2. Is an uncompensated asset transfer, if payment or benefit is for any other purpose.
   2. If there are no circumstances under which any payment or any benefit from the trust could be made to or for the benefit of the ben­eficiary, the part of the trust or income of that trust, from which payment or benefit cannot be made, is an uncompensated asset transfer.
7. For the purposes of subsection (6)(a) of this section, "available resource" means a resource after the resource exclusions under chapter 182-512 WAC are applied; however, for an institutional­ized individual, the resource exclusion for the home under WAC 182-512-0350 does not apply.
8. If unearned income under subsection (6)(a)(i) of this section was from an available resource under subsection (6)(a) of this section, then the value of the available resource will be reduced by the amount of unearned income under subsection (6)(a)(i) of this section.

WAC 182-516-0125 Irrevocable pooled self-settled trusts for a disabled client established on or after August 11, 1993.

Effective March 2, 2018

1. This section governs how the agency or the agency's designee treats pooled self-settled trusts, for a disabled client established under 42 U.S.C.1396p(d)(4)(c) on or after August 11, 1993, for medicaid eligibility purposes.
2. A pooled self-settled trust established on or after August 11, 1993, is not an available resource if:
   1. The beneficiary is disabled under WAC 182-512-0050 (1)(c) when the trust is established;
   2. The trust is irrevocable;
   3. An account in the trust was established for the sole benefit of that beneficiary;
   4. An account in the trust was established by that beneficiary, the beneficiary's parent, grandparent, legal guardian, or by a court;
   5. The trust was established by and is managed by a nonprofit association;
   6. A separate account is maintained for each beneficiary of the trust, but, for the purposes of the investment and management of funds, the trust pools these accounts; and
   7. The trust says that:
      1. Upon the death of the beneficiary, or, for trust accounts es­tablished on or after August 1, 2003, when the trust account terminates or the beneficiary's disability ends, the funds will remain in the trust to benefit other disabled beneficiaries; or
      2. The states that have spent medicaid funds for the beneficia­ry will receive all amounts remaining in the trust account for that beneficiary up to the amount of medicaid funds spent for the beneficiary.
         1. For trust accounts established from August 11, 1993, to July 31, 2003, the trust must pay the states when the beneficiary dies.
         2. For trust accounts established on or after August 1, 2003, the trust must pay the states when the beneficiary dies, the trust terminates, or the beneficiary's disability ends.
3. The medicaid agency or the agency's designee does not apply a penalty period to a beneficiary for asset transfers into a trust, described under subsection (2) of this section, when the beneficiary is under age sixty-five as of the date of the transfer.
4. Assets in trusts under subsection (2) of this section continue to be unavailable resources, even after the beneficiary turns age sixty-five.
5. Asset transfers to the trust from the beneficiary, after the beneficiary turns age sixty-five, may be subject to a transfer penalty under WAC 182-513-1363.
6. If a trust does not meet the requirements under subsection (2) of this section, see WAC 182-516-0130.

WAC 182-516-0120 Irrevocable self-settled trusts for a disabled client under age sixty-five established on or after August 11, 1993.

Effective March 2, 2018

1. This section governs how the agency or the agency's designee treats self-settled trusts, for a disabled client under age sixty-five established under 42 U.S.C. 1396p(d)(4)(a) on or after August 11, 1993, for medicaid eligibility purposes.
2. A self-settled trust established on or after August 11, 1993, is not an available resource if:
   1. The beneficiary is under age sixty-five and disabled under WAC 182-512-0050 (1)(c) when the trust is established;
   2. The trust is irrevocable;
   3. The trust was established for the sole benefit of that bene­ficiary;
   4. The trust was established by the beneficiary's parent, the beneficiary's grandparent, the beneficiary's legal guardian, by a court, or on or after December 13, 2016, the beneficiary; and
   5. The trust says that the states that have spent medicaid funds for the beneficiary will receive all amounts remaining in the trust up to the amount of medicaid funds spent for the beneficiary.
      1. For trusts established from August 11, 1993, to July 31, 2003, the trust must pay the states when the beneficiary dies.
      2. For trusts established on or after August 1, 2003, the trust must pay the states when the beneficiary dies, the trust terminates, or the beneficiary's disability ends.
3. The medicaid agency or the agency's designee does not apply a penalty period to a beneficiary for asset transfers into a trust, described under subsection (2) of this section, when the beneficiary is under age sixty-five as of the date of the transfer.
4. Assets in trusts under subsection (2) of this section contin­ue to be unavailable resources, even after the beneficiary turns age sixty-five.
5. Asset transfers to the trust from the beneficiary, after the beneficiary turns age sixty-five, may be subject to a transfer penalty under WAC 182-513-1363.
6. If a trust does not meet the requirements under subsection (2) of this section, see WAC 182-516-0130.

WAC 182-516-0115 Revocable self-settled trusts established on or after August 11, 1993.

Effective March 2, 2018

1. This section applies to revocable trusts that are self-settled and established on or after August 11, 1993.
2. This section does not apply to assets in a revocable trust established before August 11, 1993.
3. A revocable trust is a self-settled trust if:
   1. The assets of the trust are at least partially from the bene­ficiary or the beneficiary's spouse;
   2. The trust is not established by will; and
   3. The trust was established by:
      1. The beneficiary or that beneficiary's spouse;
      2. A person, including a court or administrative body, with legal authority to act in place or on behalf of the beneficiary or that beneficiary's spouse; or
      3. A person, including a court or administrative body, acting at the direction or upon the request of the beneficiary or that beneficiary's spouse.
4. The medicaid agency or the agency's designee treats assets in a revocable self-settled trust under this section as follows:
   1. Assets are subject to the resource exclusions under chapter 182-512 WAC; however, for an institutionalized individual, the resource exclusion for the home under WAC 182-512-0350 does not apply; and
   2. Assets not excluded under chapter 182-512 WAC are available resources.
5. Payments from assets in the trust under this section to or for the benefit of the beneficiary are unearned income of the beneficiary.
6. If unearned income under subsection (5) of this section was from an available resource under subsection (4) of this section, then the value of the available resource will be reduced by the amount of unearned income under subsection (5) of this section.
7. Any payments from the revocable trust, other than payments under subsections (5) and (6) of this section, are uncompensated asset transfers.

WAC 182-516-0110 Self-settled trusts overview.

Effective March 2, 2018

1. A trust containing the assets of a beneficiary's spouse may be a self-settled trust based on the date it was established. For specific rules regard­ ing this, see WAC 182-516-0130.
2. To determine whether the assets of the self-settled trust should be counted as income, a resource, or an asset transfer, the medicaid agency or the agency's designee applies the following rules based on when the trust was established:
   1. For revocable self-settled trusts, see WAC 182-516-0115.
   2. For irrevocable self-settled trusts for a disabled client under age sixty-five established on or after August 11, 1993, see WAC 182-516-0120.
   3. For irrevocable pooled self-settled trusts for a disabled client established on or after August 11, 1993, see WAC 182-516-0125.
   4. For all other irrevocable self-settled trusts:
      1. Established on or after August 11, 1993, see WAC 182-516-0130.
      2. Established before August 11, 1993, see WAC 182-516-0135.

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.

WAC 182-513-1105 Personal needs allowance (PNA) and room and board standards in a medical institution and alternate living facility (ALF).

Effective April 6, 2024

1. This section describes the personal needs allowance (PNA), which is an amount set aside from a client's income that is intended for personal needs, and the room and board standard.
2. The PNA in a state veteran's nursing facility:
   1. Is indicated on the chart described in subsection (8) of this section as "All other PNA Med Inst.", for a veteran without a spouse or dependent children receiving a needs-based veteran's pension in excess of $90;
   2. Is indicated on the chart described in subsection (8) of this section as "All other PNA Med Inst.", for a veteran's surviving spouse with no dependent children receiving a needs-based veteran's pension in excess of $90; or
   3. Is $160 for a client who does not receive a needs-based vet­eran's pension.
3. The PNA in a medical institution for clients receiving aged, blind, or disabled (ABD) cash assistance or temporary assistance for needy families (TANF) cash assistance is the client's personal and in­cidental (CPI) cash payment, as described in WAC 388-478-0006, based on residing in a medical institu­tion, which is $41.62.
4. The PNA in an alternate living facility (ALF) for clients re­ceiving ABD cash assistance or TANF cash assistance is the CPI, as described in WAC 388-478-006, based on residing in an ALF that is not an adult family home, which is $38.84.
5. The PNA for clients not described in subsections (2), (3), and (4) of this section who reside in a medical institu­tion or in an ALF, is indicated on the chart described in subsection (8) of this section as "All other PNA Med Inst." and "HCS & DDA Waivers, CFC & MPC PNA in ALF."
6. Effective January 1, 2024, and each year thereafter, the amount of the PNA in subsection (5) of this section will be adjusted by the percentage of the cost-of-living adjustment (COLA) for old-age, survivors, and disability social security benefits as published by the federal Social Security Administration per RCW 74.09.340.
7. The room and board standard in an ALF used by home and com­munity services (HCS) and the developmental disabilities administra­tion (DDA) is based on the federal benefit rate (FBR) minus the cur­rent PNA as described under subsection (5)(b) of this section.
8. The current PNA and room and board standards used in long- term services and supports are published under the institutional standards on the Washington apple health (medicaid) income and re­source standards chart located at www.hca.wa.gov/free-or-low-cost-health-care/i-help-others-apply-and-access-apple-health/program-standard-income-and-resources.

WAC 182-527-2753 Hearings.

Effective March 14, 2016

For the purposes of this section, the term "agency" includes the agency's designee.

1. An administrative hearing to contest action under this chapter determines only:
   1. In the case of a lien filed during the client's lifetime under WAC 182-527-2734:
      1. Whether the client can reasonably be expected to return home from the medical institution;
      2. Whether the client, or the client's estate, holds legal title to the identified property; and
      3. Whether the client received services subject to recovery.
   2. In the case of a lien filed after the client's death:
      1. The cost the agency correctly paid for services subject to recovery;
      2. Whether the client, or the client's estate, holds legal title to the identified property; and
      3. Whether the agency's denial of an heir's request for a delay of recovery for undue hardship under WAC 182-527-2750 was correct.
2. A request for an administrative hearing must:
   1. Be in writing;
   2. State the basis for contesting the agency's proposed action;
   3. Be signed by the requestor and include the client's name, the requestor's address and telephone number; and
   4. Within twenty-eight days of the date on the agency's notice, be filed with the office of financial recovery either:
      1. In person at the Office of Financial Recovery, 712 Pear St. S.E., Olympia, WA 98504-0001; or
      2. By certified mail, return receipt requested, to Office of Financial Recovery, P.O. Box 9501, Olympia, WA 98507-9501.
3. Upon receiving a request for an administrative hearing, the office of administrative hearings notifies any known titleholder of the time and place of the administrative hearing.
4. An administrative hearing under this subsection is governed by chapters 34.05 RCW and 182-526 WAC and this section. If a provision in this section conflicts with a provision in chapter 182-526 WAC, the provision in this section governs.
5. Disputed assets must not be distributed while in litigation.
6. Absent an administrative or court order to the contrary, the agency may file a lien twenty-eight calendar days after the date the agency mailed notice of its intent to file a lien.