Department of Social Services

Medicaid Eligibility Determinations for Long-Term Care (Follow-Up Review)

To be eligible to receive Medicaid for long-term care, an individual cannot have an income above a certain amount or assets worth more than a certain amount. To meet these requirements, some individuals dispose of their assets by means of trusts, title changes and cash gifts. Such actions do not affect Medicaid eligibility as long as they take place more than three years before the individual applies for Medicaid. However, if assets are disposed of within three years of the application date, an individual may not be eligible for Medicaid. In our prior audit report 94-S-28, we examined the procedures used by the Department of Social Services to identify Medicaid applicants who had recently disposed of their assets. We found that, while these procedures had been used to prevent inappropriate Medicaid payments, if certain changes were made in the procedures, the amount of inappropriate Medicaid payments that were prevented could be increased. We recommended that the Department analyze the cost and benefits of making these changes. In our follow-up review, we found that this recommendation has not been implemented. 95-F-47