Adult Medicaid Manual MA-2230: FINANCIAL RESOURCES
V. RESULTING TRUSTS/LEGALLY BINDING AGREEMENTS
1. It is presumed that a resource owned by an individual is also available to him, unless there are circumstances which make the resource unavailable.
2. The terms of a divorce decree, will, deed, order, resulting trust or legally binding agreement may cause a resource technically owned by an individual to be unavailable to him.
3. A resulting trust exists when a person has a resource in his own name but is holding it for the benefit of another person and he:
a. Retains no legal interest in the resource, and
b. Will not benefit from the disposal of the resource.
4. If the a/r or a person financially responsible for the a/r alleging that a resource is held in trust for someone else continues to retain a legal interest in the resource and/or will receive the proceeds from the disposal of the resource, it is not considered to be held in trust for someone else and is a countable resource.
5. If the a/r or a person financially responsible for the a/r claims a resource is not available because of a resulting trust/legally binding agreement, he must cooperate by presenting necessary documentary evidence to show that the resource is not available.
6. A legally binding agreement may be either a written or a verbal contract. The evidence must be sufficient to:
a. Convince others of the validity of the agreement,
b. Show that the agreement existed at the time of the purchase/deposit of the resource, and
c. Show that the legal title holder holds the resource/property in trust for the party applying the purchase price or making the deposit.
(V.)
1. When a resource is apparently owned by an individual who has applied for Medicaid, determine whether it may not be actually available to him because of a legally binding agreement or resulting trust.
(1) Review the contract and determine if it affects the availability of the resource.
(2) Determine the intent and terms of the agreement between parties, including the type of resource, the date of the contract, reason for its existence, and specific terms of the agreement.
(3) Contact the county or agency attorney if there are questions regarding the terms or validity of the written contract.
Ask the a/r to submit 2 different types of the following evidence:
(1) Written statement(s)/affidavit(s) from the parties involved in the verbal agreement:
(a) Giving the type of resource,
(b) The intent and terms of the agreement, and
(c) Describing the involvement of the parties to the agreement.
(2) Canceled checks or receipts for payments on a mortgage, loan, etc., showing who is making payments on the resource,
(3) Letter(s) or statement(s) from finance companies, banks, credit unions, loan officers, automobile salespersons, insurance companies or agents, or others identifying the type of resource and supporting claims that the resource is held for another individual who is making payments on the resource, or
(V.B.1.b.)
(4) Written statements from at least 2 knowledgeable persons:
(a) Identifying the type of resource, and
(b) Giving the circumstances surrounding ownership, and
(c) Availability of the resource and the basis for their knowledge.
(1) Contact the county attorney to request assistance in determining availability if the resource in question involves real property.
(2) Only a court can set aside a deed to real property.
d. Liquid Assets/Bank Accounts
Obtain the following documentation for a bank account the a/r alleges is in his name only for check cashing purposes or because the other individual needs the a/r or financially responsible person's name on the account in the event of absence, illness, or for other reasons:
A written statement from each individual whose name is on the account, attesting to actual ownership of the funds and why the a/r's or financially responsible person's name is on the account.
A statement regarding the ownership of funds from the a/r or financially responsible person and one other knowledgeable source, such as:
(a) The parties involved in the agreement,
(b) Finance companies, banks, credit unions, loan officers, automobile salespersons, insurance companies or agents,
or
(c) An individual who knows the circumstances surrounding ownership and availability of the resource.
(V.B.1.)
Obtain the documentation in (1) below and one of documents listed in items (2), (3), and (4), below for a motor vehicle in the name of the a/r or financially responsible person who alleges that he is not the owner:
(1) Written statement(s) or affidavit(s) from the a/r and the other party(ies) involved in a verbal contract:
(a) Giving the intent and terms of the agreement and the involvement of the parties to the agreement, and
(b) Stating that the true owner, who is not the a/r or financially responsible person, makes monthly payments on the vehicle and pays the insurance premiums or taxes on the vehicle.
(2) Cancelled checks or receipts for payments on a loan, etc., showing who is making payments on the vehicle.
(3) Letter(s) or statement(s) from finance companies, banks, credit unions, loan officers, automobile salesmen, insurance companies or agents, or others supporting claims of the cost or of responsibility for the vehicle.
(4) Written statements from at least 2 knowledgeable sources as to the circumstances surrounding ownership and availability of the vehicle. Include the basis for their knowledge.
2. Do not count the resource for the a/r who shows by the evidence that it is held in trust for another individual.
3. If the other individual applies for Medicaid, it must be counted as a resource for that individual.