I-5700, Return of Transferred Asset

Revision 09-4; Effective December 1, 2009

If the transferred asset is subsequently returned to the individual, the transfer is nullified and the penalty period is erased retroactive to the initial month of penalty. The asset is treated as though never transferred, and is excluded or counted, as appropriate, in determining the client's eligibility for those months in which the asset was in someone else's possession.

In spousal cases, if the individual and or spouse transferred an asset before the individual entered the nursing facility and the asset is returned after institutionalization, the spousal protected resource amount must also be recalculated.

Examples:

  • If an excluded asset such as a homestead was transferred and subsequently returned, the transfer is nullified and the penalty period is erased retroactive to the initial month of penalty. Because the asset is excluded, it has no effect on countable assets when determining eligibility for those months in which the resource was in someone else's possession. If the client is in Mason Manor, submit Form H3618-A, Resident Transaction Notice for Designated Vendor Numbers (PDF), to report him discharged from Vendor No. 5997 and admitted to the nursing facility, with vendor payments reinstated, retroactive to the date the penalty period began.
  • If a countable asset such as a certificate of deposit was transferred and subsequently returned, its value is added to the value of other countable assets when determining current eligibility, as well as eligibility for those months in which the asset was in someone else's possession. If the client is in Mason Manor and would have been resource ineligible for those months in which the asset was in someone else's possession, do not retroactively discharge the client from Mason Manor.

For a penalty period to be nullified or erased retroactively, all of the asset in question or its equity value must be returned to the client. When only part of an asset or its equivalent value is returned, the penalty period is not nullified or erased retroactive but is recalculated based on the remaining amount of uncompensated transfer and the penalty period will be for a shorter length of time.

  • If the partial returned asset is excluded, it has no effect on countable assets when determining eligibility for those months in which the asset was in someone else's possession. If the client is in Mason Manor and the penalty recalculation results in an end to the penalty, enter the day after the last day of the penalty period. Submit Form H3618-A to report the client discharged from Vendor No. 5997 and admitted to the nursing facility, with vendor payments reinstated.
  • If the partial returned asset is countable, such as a certificate of deposit, the returned value is added to the value of other countable assets when determining current eligibility, as well as eligibility for those months in which the asset was in someone else's possession. If the client is in Mason Manor and would have been resource ineligible for those months in which the asset was in someone else's possession, do not retroactively discharge the client from Mason Manor.

Payment on the principal of a note is the return of a transferred asset and reduces the penalty accordingly.