Section 441.75.24. Treatment of trusts established after August 10, 1993.

For purposes of determining an individual’s eligibility for, or the amount of, medical assistance benefits, trusts established after August 10, 1993, (except for trusts specified in 75.24(3)) shall be treated in accordance with 75.24(2).

         75.24(1) Establishment of trust.

            a.               For the purposes of this rule, an individual shall be considered to have established a trust if assets of the individual were used to form all or part of the principal of the trust and if any of the following individuals established the trust other than by will: the individual, the individual’s spouse, a person (including a court or administrative body, with legal authority to act in place of or on behalf of the individual or the individual’s spouse), or a person (including a court or administrative body) acting at the direction or upon the request of the individual or the individual’s spouse.

            b.               The term “assets,” with respect to an individual, includes all income and resources of the individual and of the individual’s spouse, including any income or resources which the individual or the individual’s spouse is entitled to but does not receive because of action by the individual or the individual’s spouse, by a person (including a court or administrative body, with legal authority to act in place of or on behalf of the individual’s spouse), or by any person (including a court or administrative body) acting at the direction or upon the request of the individual or the individual’s spouse.

            c.               In the case of a trust, the principal of which includes assets of an individual and assets of any other person or persons, the provisions of this rule shall apply to the portion of the trust attributable to the individual.

            d.               This rule shall apply without regard to:

             (1)             The purposes for which a trust is established.

             (2)             Whether the trustees have or exercise any discretion under the trust.

             (3)             Any restrictions on when or whether distribution may be made for the trust.

             (4)             Any restriction on the use of distributions from the trust.

            e.               The term “trust” includes any legal instrument or device that is similar to a trust, including a conservatorship.

         75.24(2) Treatment of revocable and irrevocable trusts.

            a.               In the case of a revocable trust:

             (1)             The principal of the trust shall be considered an available resource.

             (2)             Payments from the trust to or for the benefit of the individual shall be considered income of the individual.

             (3)             Any other payments from the trust shall be considered assets disposed of by the individual, subject to the penalties described at rule 441—75.23(249A) and 441—Chapter 89.

            b.               In the case of an irrevocable trust:

             (1)             If there are any circumstances under which payment from the trust could be made to or for the benefit of the individual, the portion of the principal from which, or the income on the principal from which, payment to the individual could be made shall be considered an available resource to the individual and payments from that principal or income to or for the benefit of the individual shall be considered income to the individual. Payments for any other purpose shall be considered a transfer of assets by the individual subject to the penalties described at rule 441—75.23(249A) and 441—Chapter 89.

             (2)             Any portion of the trust from which, or any income on the principal from which, no payment could under any circumstances be made to the individual shall be considered, as of the date of establishment of the trust (or, if later, the date on which payment to the individual was foreclosed) to be assets disposed of by the individual subject to the penalties specified at 75.23(3) and 441—Chapter 89. The value of the trust shall be determined for this purpose by including the amount of any payments made from this portion of the trust after this date.

         75.24(3) Exceptions. This rule shall not apply to any of the following trusts:

            a.               A trust containing the assets of an individual under the age of 65 who is disabled (as defined in Section 1614(a)(3) of the Social Security Act) and which is established for the benefit of the individual by a parent, grandparent, legal guardian of the individual, or a court if the state will receive all amounts remaining in the trust upon the death of the individual up to an amount equal to the total medical assistance paid on behalf of the individual.

            b.               A trust established for the benefit of an individual if the trust is composed only of pension, social security, and other income to the individual (and accumulated income of the trust), and the state will receive all amounts remaining in the trust upon the death of the individual up to the amount equal to the total medical assistance paid on behalf of the individual. For disposition of trust amounts pursuant to Iowa Code sections 633C.1 to 633C.5, the average statewide charges and Medicaid rates for the period from July 1, 2016, to June 30, 2017, shall be as follows:

             (1)             The average statewide charge to a private-pay resident of a nursing facility is $5,267 per month.

             (2)             The maximum statewide Medicaid rate for a resident of an intermediate care facility for persons with an intellectual disability is $28,915 per month.

             (3)             The average statewide charge to a resident of a mental health institute is $29,708 per month.

             (4)             The average statewide charge to a private-pay resident of a psychiatric medical institution for children is $7,999 per month.

             (5)             The average statewide charge to a home- and community-based waiver applicant or member shall be consistent with the level of care determination and correspond with the average charges and rates set forth in this paragraph.

            c.               A trust containing the assets of an individual who is disabled (as defined in 1614(a)(3) of the Social Security Act) that meets the following conditions:

             (1)             The trust is established and managed by a nonprofit association.

             (2)             A separate account is maintained for each beneficiary of the trust, but, for purposes of investment and management of funds, the trust pools these accounts.

             (3)             Accounts in the trust are established solely for the benefit of individuals who are disabled (as defined in 1614(a)(3) of the Social Security Act) by the parent, grandparent, or legal guardian of the individuals, by the individuals or by a court.

             (4)             To the extent that amounts remaining in the beneficiary’s account upon death of the beneficiary are not retained by the trust, the trust pays to the state from the remaining amounts in the account an amount equal to the total amount of medical assistance paid on behalf of the beneficiary.

This rule is intended to implement Iowa Code section 249A.4.

[ARC 7834B, IAB 6/3/09, effective 7/8/09; ARC 8898B, IAB 6/30/10, effective 7/1/10; ARC 9582B, IAB 6/29/11, effective 7/1/11; ARC 0192C, IAB 7/11/12, effective 7/1/12; ARC 0822C, IAB 7/10/13, effective 7/1/13; ARC 0821C, IAB 7/10/13, effective 7/1/13; ARC 1484C, IAB 6/11/14, effective 7/1/14; ARC 1483C, IAB 6/11/14, effective 7/1/14; ARC 2027C, IAB 6/10/15, effective 7/1/15; ARC 2605C, IAB 7/6/16, effective 7/1/16]