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N.D. Admin. Code 75-02-02.1-32 : Department of Human Services —02 - Economic Assistance —02-02.1 - Eligibility for Medicaid —02-02.1-32 - Valuation of assets

It is not always possible to determine the value of assets with absolute certainty, but it is necessary to determine a value in order to determine eligibility. The valuation must be based on reasonably reliable information. It is the responsibility of the applicant or recipient, or the persons acting on behalf of the applicant or recipient, to furnish reasonably reliable information. Because an applicant or recipient may not be knowledgeable of asset values, and particularly because that person may have a strong interest in the establishment of a particular value, whether or not that value is accurate, some verification of value must be obtained. If a valuation from a source offered by an applicant or recipient is greatly different from generally available or published sources, the applicant or recipient must provide a convincing explanation for the differences particularly if the applicant or recipient may be able to influence the person providing the valuation. If reasonably reliable information concerning the value of assets is not made available, eligibility may not be determined. Useful sources of verification include:

1. With respect to liquid assets: reliable account records.
2. With respect to personal property other than liquid assets:
a. Publicly traded stocks, bonds, and securities: stockbrokers.
b. Autos, trucks, mobile homes, boats, farm equipment, or any other property listed in published valuation guides accepted in the trade: the valuation guide.
c. With respect to harvested grains or produce: grain buyers, grain elevator operators, produce buyers; and, for crops grown on contract: the contract.
d. With respect to stock in corporations not publicly traded: appraisers, accountants.
e. With respect to other personal property: dealers and buyers of that property.
f. With respect to a life insurance policy: the life insurance company.
3. Real property.
a. With respect to mineral interests:
(1) If determining current value, the best offer received following a good-faith effort to sell the mineral interests. A good-faith effort to sell means offering the mineral interests to at least three companies purchasing mineral rights in the area, or by offering for bids through public advertisement.
(2) If determining a past value for mineral rights previously sold or transferred:
(a) If producing, the value is an amount equal to any lease income received after the transfer plus three times the annual royalty income based on actual royalty income from the sixty months following the transfer, or if sixty months have not yet passed, based on actual royalty income in the months that have already passed plus an estimate for the remainder of the sixty-month period.
(b) If not producing, but the mineral rights are leased, the value is an amount equal to two times the total lease amount; or
(c) If not leased, the value is an amount equal to the greater of two times the estimated lease amount or the potential sale value of the mineral rights, as determined by a geologist, mineral broker, or mineral appraiser.
(3) In determining current or past value, an applicant, recipient, or the department may provide persuasive evidence establishing a value different from the value established using the process described in this subdivision.
b. With respect to agricultural lands: appraisers, real estate agents dealing in the area, loan officers in local agricultural lending institutions, and other persons known to be knowledgeable of land sales in the area in which the lands are located, but not the "true and full" value from tax records.
c. With respect to real property other than mineral interests and agricultural lands: market value or "true and full" value from tax records, whichever represents a reasonable approximation of fair market value; real estate agents dealing in the area; and loan officers in local lending institutions.
4. Divided or partial interests. Divided or partial interests include assets held by the applicant or recipients; jointly or in common with persons who are not in the Medicaid unit; assets where the applicant or recipient or other persons within the Medicaid unit own only a partial share of what is usually regarded as the entire asset; and interests where the applicant or recipient owns only a life estate or remainder interest in the asset.
a. Liquid assets. The value of a partial or shared interest in a liquid asset is equal to the total value of that asset.
b. Personal property other than liquid assets and real property other than life estates and remainder interests. The value of a partial or shared interest is a proportionate share of the total value of the asset equal to the proportionate share of the asset owned by the applicant or recipient.
c. Life estates and remainder interests.
(1) The life estate and remainder interest tables must be used to determine the value of a life estate or remainder interest. In order to use the table, it is necessary to first know the age of the life tenant or, if there are more than one life tenants, the age of the youngest life tenant; and the fair market value of the property which is subject to the life estate or remainder interest. The value of a life estate is found by selecting the appropriate age in the table and multiplying the corresponding life estate decimal fraction times the fair market value of the property. The value of a remainder interest is found by selecting the appropriate age of the life tenant in the table and multiplying the corresponding remainder interest decimal fraction times the fair market value of the property.

Life Estate and Remainder Interest Table

Age

Life Estate

Remainder Interest

0

.97188

.02812

1

.98988

.01012

2

.99017

.00983

3

.99008

.00992

4

.98981

.01019

5

.98938

.01062

6

.98884

.01116

7

.98822

.01178

8

.98748

.01252

9

.98663

.01337

10

.98565

.01435

11

.98453

.01547

12

.98329

.01671

13

.98198

.01802

14

.98066

.01934

15

.97937

.02063

16

.97815

.02185

17

.97700

.02300

18

.97590

.02410

19

.97480

.02520

20

.97365

.02635

21

.97245

.02755

22

.97120

.02880

23

.96986

.03014

24

.96841

.03159

25

.96678

.03322

26

.96495

.03505

27

.96290

.03710

28

.96062

.03938

29

.95813

.04187

30

.95543

.04457

31

.95254

.04746

32

.94942

.05058

33

.94608

.05392

34

.94250

.05750

35

.93868

.06132

36

.93460

.06540

37

.93026

.06974

38

.92567

.07433

39

.92083

.07917

40

.91571

.08429

41

.91030

.08970

42

.90457

.09543

43

.89855

.10145

44

.89221

.10779

45

.88558

.11442

46

.87863

.12137

47

.87137

.12863

48

.86374

.13626

49

.85578

.14422

50

.84743

.15257

51

.83674

.16126

52

.82969

.17031

53

.82028

.17972

54

.81054

.18946

55

.80046

.19954

56

.79006

.20994

57

.77931

.22069

58

.76822

.23178

59

.75675

.24325

60

.74491

.25509

61

.73267

.26733

62

.72002

.27998

63

.70696

.29304

64

.69352

.30648

65

.67970

.32030

66

.66551

.33449

67

.65098

.34902

68

.63610

.36390

69

.62086

.37914

70

.60522

.39478

71

.58914

.41086

72

.57261

.42739

73

.55571

.44429

74

.53862

.46138

75

.52149

.47851

76

.50441

.49559

77

.48742

.51258

78

.47049

.52951

79

.45357

.54643

80

.43659

.56341

81

.41967

.58033

82

.40295

.59705

83

.38642

.61358

84

.36998

.63002

85

.35359

.64641

86

.33764

.66236

87

.32262

.67738

88

.30859

.69141

89

.29526

.70474

90

.28221

.71779

91

.26955

.73045

92

.25771

.74229

93

.24692

.75308

94

.23728

.76272

95

.22887

.77113

96

.22181

.77819

97

.21550

.78450

98

.21000

.79000

99

.20486

.79514

100

.19975

.80025

101

.19532

.80468

102

.19054

.80946

103

.18437

.81563

104

.17856

.82144

105

.16962

.83038

106

.15488

.84512

107

.13409

.86591

108

.10068

.89932

109

.04545

.95455

(2) The life estate and remainder interest tables are based on the anticipated lifetimes of individuals of a given age according to statistical tables of probability. If the life tenant suffers from a condition likely to cause death at an unusually early age, the value of the life estate decreases and the value of the remainder interest increases. An individual who requires long-term care, who suffers from a condition that is anticipated to require long-term care within twelve months, or who has been diagnosed with a disease or condition likely to reduce the individual's life expectancy is presumed to suffer from a condition likely to cause death at an unusually early age, and may not rely upon statistical tables of probability applicable to the general population to establish the value of a life estate or remainder interest. If an individual is presumed to suffer from a condition likely to cause death at an unusually early age, an applicant or recipient whose eligibility depends upon establishing the value of a life estate or remainder interest must provide a reliable medical statement that estimates the remaining duration of life in years. The estimated remaining duration of life may be used, in conjunction with a life expectancy table, to determine the comparable age for application of the life estate and remainder interest table.
5. Contractual rights to receive money payments:
a. Except during any disqualifying transfer penalty period as established by subdivision d, the value of contractual rights to receive money payments in which payments are current is an amount equal to the total of all outstanding payments of principal required to be made by the contract unless evidence is furnished that establishes a lower value.
b. Except during any disqualifying transfer penalty period as established by subdivision d, the value of contractual rights to receive money payments in which payments are not current is the current fair market value of the property subject to the contract.
c. Except during any disqualifying transfer penalty period as established by subdivision d, if upon execution the total of all principal payments required under the terms of the contract is less than the fair market value of the property sold, the difference is a disqualifying transfer governed by section 75-02-02.1-33.1 or 75-02-02.1-33.2, and the value of the contract is determined under subdivision a or b.
d. A contractual right to receive money payments that consists of a promissory note, loan, or mortgage is a disqualifying transfer governed by section 75-02-02.1-33.2 of an amount equal to the outstanding balance due as of the date the lender or purchaser, or the lender's or purchaser's spouse, first applies for Medicaid to secure nursing care services, as defined in section 75-02-02.1-33.2, if:
(1) Any payment on the contract is due after the end of the contract payee's life expectancy as established in accordance with actuarial publications of the office of the chief actuary of the social security administration;
(2) The contract provides for other than equal payments or for any balloon or deferred payment; or
(3) The contract provides for any payment otherwise due to be diminished after the contract payee's death.
e. The value of a secured contractual right to receive money payments that consists of a promissory note, loan, or mortgage not described in subdivision d shall be determined under subdivision a or b. For an unsecured note, loan, or mortgage, the value is the outstanding payments of principal and overdue interest unless evidence is furnished that establishes a lower value.
6. Contract values.
a. The value of a contract under which payments are made to an applicant or a recipient and in which payments are current is equal to the total of all outstanding payments of principal required to be made by the contract, unless evidence is furnished that establishes a lower value.
b. The value of a contract under which payments are made to an applicant or a recipient and in which payments are not current is an amount equal to the current fair market value of the property subject to the contract. If the contract is not secured by property, the value of the contract is the total of all outstanding payments of principal and past-due interest required to be made under the contract.
c. If the contractual right to receive money payments is not collectible and is not secured, the debt has no collectible value and is not a countable asset. An applicant or recipient can establish that a note has no collectable value if:
(1) The debtor is judgement proof which means a money judgement has been secured, an execution has been served upon the debtor which has been returned as wholly unsatisfied, and the debtor's affidavit and claim for exemptions exempt all of the debtor's property or as determined by the department; or
(2) The applicant or recipient verifies the debt is uncollectible due to a statute of limitations which may be shown, among other ways, by an attorney's letter identifying the applicable statute and the facts that make the debt uncollectible under that statute of limitations.

N.D. Admin Code 75-02-02.1-32

Amended by Administrative Rules Supplement 2014-352, April 2014, effective April 1, 2014. .
Amended by Administrative Rules Supplement 368, April 2018, effective 4/1/2018.

General Authority: NDCC 50-06-16, 50-24.1-04

Law Implemented: NDCC 50-24.1-02