Sec. 17b-261a. Transfer or assignment of assets resulting in the imposition of a penalty period. Return or partial return of asset. Regulations.

(a) Any transfer or assignment of assets resulting in the imposition of a penalty period shall be presumed to be made with the intent, on the part of the transferor or the transferee, to enable the transferor to obtain or maintain eligibility for medical assistance. This presumption may be rebutted only by clear and convincing evidence that the transferor's eligibility or potential eligibility for medical assistance was not a basis for the transfer or assignment.

(b) Any transfer or assignment of assets resulting in the establishment or imposition of a penalty period shall create a debt, as defined in section 36a-645, that shall be due and owing by the transferor or transferee to the Department of Social Services in an amount equal to the amount of the medical assistance provided to or on behalf of the transferor on or after the date of the transfer of assets, but said amount shall not exceed the fair market value of the assets at the time of transfer. The Commissioner of Social Services, the Commissioner of Administrative Services and the Attorney General shall have the power or authority to seek administrative, legal or equitable relief as provided by other statutes or by common law.

(c) The Commissioner of Social Services may waive the imposition of a penalty period when the transferor (1) in accordance with the provisions of section 3025.25 of the department's Uniform Policy Manual, suffers from dementia at the time of application for medical assistance and cannot explain transfers that would otherwise result in the imposition of a penalty period; or (2) suffered from dementia at the time of the transfer; or (3) was exploited into making such a transfer due to dementia. Waiver of the imposition of a penalty period does not prohibit the establishment of a debt in accordance with subsection (b) of this section.

(d) (1) For purposes of this subsection, an “institutionalized individual” means an individual who has applied for or is receiving (A) services from a long-term care facility, (B) services from a medical institution that are equivalent to those services provided in a long-term care facility, or (C) home and community-based services under a Medicaid waiver.

(2) An institutionalized individual shall not be penalized for the transfer of an asset if the entire amount of the transferred asset is returned to the institutionalized individual. A transferee may return any portion of a transferred asset to the transferor. If any transferred asset is returned to the transferor, the Department of Social Services shall adjust the penalty period to the extent permitted by federal law, provided the ending date of the penalty period as originally determined by the department shall not change. The department shall consider the entire amount of the returned asset to be available to the transferor only from the date of return of the transferred asset, and shall not determine the transferor to be ineligible in the month the transferred asset is returned, provided the transferor reduced the returned asset in accordance with federal law.

(3) If there are multiple transfers of assets to the same or different transferees, a return of anything less than the total amount of the transferred assets from all of the separate transferees shall not constitute a return of the entire amount of the transferred assets and shall represent a partial return.

(4) The conveyance and subsequent return of an asset for the purpose of shifting costs to the Medicaid program shall be regarded as a trust-like device. Such asset shall be considered available for the purpose of determining Medicaid eligibility. The conveyance and subsequent return of an asset made exclusively for a purpose other than to qualify for the payment of long-term care services under the Medicaid program shall not be regarded as a trust-like device.

(e) The Commissioner of Social Services, pursuant to section 17b-10, shall implement the policies and procedures necessary to carry out the provisions of this section while in the process of adopting such policies and procedures in regulation form, provided notice of intent to adopt regulations is published in the Connecticut Law Journal not later than twenty days after implementation. Such policies and procedures shall be valid until the time final regulations are effective.

(June Sp. Sess. P.A. 01-2, S. 4, 69; June Sp. Sess. P.A. 01-9, S. 129, 131; June 30 Sp. Sess. P.A. 03-3, S. 62; P.A. 04-16, S. 7; P.A. 05-209, S. 4; 05-280, S. 40; P.A. 11-44, S. 104; P.A. 13-218, S. 1.)

History: June Sp. Sess. P.A. 01-2 effective July 1, 2001; June Sp. Sess. P.A. 01-9 revised effective date of June Sp. Sess. P.A. 01-2 but without affecting this section; June 30 Sp. Sess. P.A. 03-3 designated existing provisions as Subsec. (a), added Subsec. (b) providing that transfer of assets resulting in imposition of a penalty period is presumed to be made with intent of allowing transferor to remain eligible for medical assistance, added Subsec. (c) re transfers resulting in imposition of a penalty period creating a debt due and owing to the department, added Subsec. (d) permitting commissioner to grant financial relief to nursing facility that demonstrates severe financial hardship due to imposition of transfer of assets penalties, added Subsec. (e) permitting commissioner to waive transfer of assets penalty period when transferor suffers from dementia or was exploited into making transfer, added Subsec. (f) providing that department, when determining medical assistance eligibility, shall review transfers of assets involving real property occurring in the 60 months preceding the date the individual applied for medical assistance and that federal law governs transfers of assets not involving real property, added Subsec. (g) permitting commissioner to establish threshold limits re annual asset transfers not subject to penalty and added Subsec. (h) requiring commissioner to implement policies and procedures necessary to carry out purposes of section while in the process of adopting regulations, effective August 20, 2003; P.A. 04-16 made technical changes in Subsec. (h); P.A. 05-209 deleted former Subsec. (a) re authority of commissioner to seek waiver of federal law for establishing penalty period for transfers of assets for less than fair market value, deleted former Subsec. (d) re commissioner's authority to grant financial relief to nursing homes experiencing severe financial hardship due to imposition of revised transfer of asset penalty period, deleted former Subsec. (e) re commissioner's authority to waive penalty period when transferor suffers from dementia, deleted former Subsec. (f) re 60-month penalty period for transfers of assets involving real property, deleted former Subsec. (g) re commissioner's authority to set threshold limits for transfers not subject to imposition of penalty period, and redesignated existing Subsecs. (b), (c) and (h) as new Subsecs. (a), (b) and (c), respectively, effective July 6, 2005; P.A. 05-280 added new Subsec. (c) re commissioner's authority to waive penalty period when transferor suffers from dementia and redesignated existing Subsec. (c) as new Subsec. (d), effective July 13, 2005; P.A. 11-44 added new Subsec. (d) re return or partial return of an asset and redesignated existing Subsec. (d) as Subsec. (e), effective June 13, 2011; P.A. 13-218 amended Subsec. (d) to add new Subdiv. (1) defining “institutionalized individual”, to designate existing provision re institutionalized individual not to be penalized as Subdiv. (2) and amend same to delete provision re partial asset return not to result in reduced penalty period and add provisions re return of portion of transferred asset, to redesignate existing Subdiv. (1) as Subdiv. (3) and amend same to add “and shall represent a partial return”, to delete former Subdiv. (2) re availability of entire amount of returned asset, to redesignate existing Subdiv. (3) as Subdiv. (4) and amend same to add provision re conveyance and subsequent return of asset for a purpose other than to qualify under Medicaid not to be regarded as a trust-like device, and to delete former Subdiv. (4) re definition of “institutionalized individual”, effective July 1, 2013.