10:71-4.4 Excludable resources
(a) A resource which is classified as excludable shall not be considered either in the
deeming of resources or in the determination of eligibility for participation in the Medicaid
Only Program.
(b) The following resources shall be classified as excludable:
1. A house occupied by the individual as his/her place of principal residence, and the land
appertaining thereto, shall be excluded:
i. Short temporary absences from home such as trips, visits, and hospitalizations do not
affect this exclusion so long as the individual intends, and may reasonably be expected, to
return home. An absence of more than six months is assumed to indicate that the home no
longer serves as a principal residence. However, if the home is used by a spouse or there
is evidence that the absence from the house is temporary, the home may continue to be
excluded. With that exception, the CWA shall extend the period only with approval from the
Division of Medical Assistance and Health Services.
2. In the determination of resources of an individual (and spouse, if any), an automobile
shall be excluded or counted as follows:
i. One automobile is totally excluded regardless of value if, for the individual or a member
of the individual's household:
(1) It is necessary for employment; or
(2) It is necessary as a means of transportation for the medical treatment of a specific or
regular medical problem; or
(3) It is modified for operation by, or transportation of, a handicapped person.
ii. If no automobile is excluded under (b)2i above, one automobile is excluded as a
resource to the extent that its current market value (CMV) does not exceed $4,500. The
CMV in excess of $4,500 is counted against the resource limit. Where more than one
automobile is involved, the car of highest value may be excluded for use if it is to the
advantage of the applicant/beneficiary.
(1) The CMB of an automobile is the value of the vehicle as indicated by the "Average
Wholesale Value" in the most recent April or October edition of the Red Book; Official Used
Car Valuations.
iii. Other automobiles: Any other automobiles are treated as non-liquid resources and
counted to the extent of their equity value.
3. Personal effects and household goods, to the extent that the total equity value of such
resources does not exceed $2,000:
i. The amount by which the equity value of such resources exceeds $2,000 shall be
countable toward the appropriate resource maximum.
ii. In determining the value of household goods and personal effects of an individual (and
spouse), there shall be excluded a wedding ring and an engagement ring.
iii. Prosthetic devices, dialysis machines, hospital beds, wheel chairs, and similar
equipment shall not be considered in the evaluation of personal effects, unless such items
are used extensively and primarily by other members of the household, as well as by the
person whose physical condition requires them.
4. The cash surrender value of all life insurance policies owned and in the control of the
individual, if the total face value of such policies does not exceed $1,500 (see also (b)9
below):
i. If the total face value of such policies exceeds $1,500, the total cash surrender value of
all policies shall be included as a resource, countable toward the appropriate resource
maximum.
5. Nonhome property that is used in a business or nonbusiness self-support activity is
excluded from resources when the equity does not exceed $6,000 and the activity produces
a net annual return of at least six percent of the excludable equity value. If a net return of
six percent on $6,000 equity is shown, but the equity value of the property exceeds $6,000,
the excess equity (property value less $6,000) is a countable resource and applied to the
resource standards in N.J.A.C. 10:71-4.5. If such property is not excludable because the
net annual return is less than 6 percent of the equity value (with exceptions below), the total
equity value is an includable resource.
i. A rate of return of less than six percent is considered acceptable when all the following
conditions are met:
(1) The property is used in a business income-producing operation; and
(2) Unusual or untoward circumstances cause a temporary reduction in the net rate of
return; and
(3) The usual net rate of return is six percent of equity value; and
(4) The individual expects the property to again produce a return of six percent of equity
value within 18 months of the end of the taxable year in which the unusual incident which
caused the reduction in the rate of return occurred.
ii. Tools and equipment required for employment are assumed to be of a reasonable
value and producing a reasonable rate of return and are, therefore, excluded from
resources.
6. The value of resources which are not accessible to an individual through no fault of his
or her own.
i. Such resources include, but are not limited to, irrevocable trust funds, property in
probate, and real property which cannot be sold because of the refusal of a co-owner to
liquidate.
ii. Inaccessible resources shall be reevaluated (regarding their accessibility) at every
redetermination.
7. In the case of a blind or otherwise disabled person, resources which have been
accumulated in connection with a plan to achieve self-support.
i. To qualify for this exclusion, an individual's plan to achieve self-support shall have been
approved by the Division of Vocational Rehabilitation Services or the Commission for the
Blind and Visually Impaired, and must be current as of the date of the exemption.
8. The replacement value of excludable resources shall be considered as follows:
i. For insurance proceeds, the amount received from an insurance company for the
purpose of replacing or repairing an originally excludable resource, if repair or replacement
of such resource occurs within nine months.
(1) The initial nine month period shall be extended for a reasonable period up to an
additional nine months when it is determined that the individual had good cause for not
replacing or repairing the resource. An individual will be found to have good cause when
circumstances beyond his or her control prevented the repair or replacement or the
contracting for the repair or replacement.
ii. The proceeds from the sale of a home which is excluded from the individual's
resources will also be excluded from resources to the extent that they are intended to be
used and are, in fact, used to purchase another home, which is similarly excluded, within
three months of the date of the proceeds. If the proceeds are not used in the above manner
they shall be counted toward the resource maximum.
9. Burial spaces intended for the use of the individual, his or her spouse, or any other
member of his or her immediate family and funds which are set aside for the burial
expenses of the individual or spouse, subject to the limits specified below.
i. The following definitions apply in regard to burial spaces or funds:
(1) Burial spaces are conventional grave sites, crypts, mausoleums, urns, or other
repositories which are customarily and traditionally used for the remains of deceased
persons.
(2) Funds set aside for burial include revocable burial contracts, burial trusts, and any
separately identifiable assets which are clearly designated as set aside for the expenses
connected with an individual's burial, cremation or other funeral arrangements.
(3) Funds in an irrevocable trust or other irrevocable arrangement which are available
for burial are funds held in an irrevocable burial contract and irrevocable burial trust, or an
amount in an irrevocable trust which is specifically identified for burial expenses.
(4) Immediate family includes an individual's minor and adult children, stepchildren and
adopted children, brothers, sisters, parents, adopted parents and spouses of those persons.
Dependency and living-in-the-same household are not factors. Immediate family does not
include the members of an ineligible spouse's family unless they meet this definition.
ii. The exclusion from resources of funds set aside for burial applies only when counting any portion of the funds toward the resource limit would cause ineligibility due to excess
resources.
(1) If the individual or couple would otherwise be ineligible and could be eligible with the
application of this exclusion and the individual or couple alleges that funds are set aside for
the burial of the eligible individual or his or her spouse, an affidavit indicating such must be
obtained.
(A) The amount of funds that may be excluded shall be determined and may not
exceed the maximum limit of $1,500 each for the individual and his or her spouse. The
maximum limit for each individual is reduced by an amount equal to the amount of funds
held in an irrevocable burial trust, an irrevocable burial contract, or other irrevocable
arrangement which is available to meet that individual's burial expenses. Each individual's
maximum limit is further reduced by the face value of any insurance policy on that
individual's life owned by him or her or his or her spouse if the cash surrender value of the
policy was excluded in determining the resources of the individual.
(B) In order for burial funds to be excluded, the funds must be separately identifiable
(that is, not commingled with other funds or assets which are not set aside for burial).
Additionally, the funds must be already designated as set aside for burial. If the funds are
not so designated, the funds may be excluded if the individual attests in writing, that he or
she intends to use the funds for his or her burial and agrees to submit within 30 days,
documentary evidence that the funds have been designated as set aside for burial.
(C) Any increase in the value of excluded burial funds due to interest on such funds
which were left to accumulate or appreciation of such funds after establishment of Medicaid
eligibility shall be excluded.
10. No portion of a cash reward provided to any individual by the Division for providing
information about fraud and/or abuse in any program administered in whole or in part by the
Division shall be included in the computation of income for financial eligibility purposes;
11. In order for the cash reward to continue to be excluded, the funds shall be separately
identifiable (that is, not commingled with the other funds or assets), but held in a separate
account. Any increase in the value of the excluded case reward shall also be excluded.
10:71-4.5 Resource eligibility standards
(a) For eligibility in the Medicaid Only Program, total countable resources are subject to the
following limits. (See N.J.A.C. 10:71-4.1(b) regarding definition of resources, N.J.A.C.
10:71-4.2 regarding countable resources, and N.J.A.C. 10:71-4.8 regarding resources of a
couple when one member is applying for Medicaid for institutional services.)
1. Resource eligibility is determined as of the first moment of the first day of the month.
Changes in the amount of countable resources subsequent to the first moment of the first
day of the month shall not affect eligibility.
2. In the case of checking accounts, the balance as of the first moment of the first day of
the month shall be reduced by the amount of any checks which have been drawn on the
account but which have not yet cleared the financial institution.
(b) Resource maximum for a couple: Participation in the program shall be denied or
terminated if the total value of a couple's countable resources exceeds $3,000.
1. Definition of a couple: A couple shall be defined as a man and a woman who are legally married, or who have been determined to be a couple by the Social Security Administration
for receipt of RSDI benefits, or who are living together in the same household and
presenting themselves to the community in which they live as husband and wife.
(c) Resource maximum for an individual: participation in the program shall be denied or
terminated if the total value of an individual's resources exceeds $2,000.
(d) Resource maximum (institutionalized individuals): The resource maximum for an
individual in (c) above applies equally to individuals institutionalized in a Title XIX approved
facility. Countable resources held in the institution (for example, trust funds, personal needs
accounts) together with those held outside the institution, are to be applied toward the
resource maximum. If the resource maximum is exceeded, Medicaid eligibility will cease.
(See also N.J.A.C. 10:71-4.8 regarding resource eligibility for institutionalized individuals.)
(e) The grandfather clause: An individual who satisfied the following criteria may have
his/her resource eligibility determined in accordance with procedures formerly used in New
Jersey's OAA, AB, and DA programs if it is more advantageous to the individual (see
Financial Assistance Manual, Chapter 300, for regulations in effect prior to January 1,
1974):
1. The individual was participating in the Medicaid program during December 1973 under
one of New Jersey's Federal programs for the aged, blind, or disabled;
2. The individual has, since December 1973, continuously resided in New Jersey;
3. The individual has, since December 31, 1973, continuously been an eligible individual,
an eligible spouse, or an essential person participating in the Medicaid program.
i. Essential person status (refers to spouse only): A spouse who received Medicaid
coverage in December 1973 because of his/her status as a person "essential" to the
existence of an eligible person is also considered eligible for receipt of Medicaid Only
benefits under the provision of the grandfather clause. Such spouse must continue to
reside with the eligible individual alone in order to retain his/her essential person status.
ii. Once an individual's essential person status is terminated, he/she must again apply for
benefits and be determined eligible or ineligible on the basis of criteria used for other newly
applying aged, blind, or disabled individuals.
(f) No portion of a cash reward provided to any individual by the Division for providing
information about fraud and/or abuse in any program administered in whole or in part by the
Division shall be included in the computation of income for financial eligibility purposes;
(g) In order for the cash reward to continue to be excluded, the funds shall be separately
identifiable (that is, not commingled with the other funds or assets), but held in a separate
account. Any increase in the value of the excluded case reward shall also be excluded.