WAG 01-08-02: Denial Due to Excess Home Equity

PM 01-08-02

Hardship Waiver Examples - Home Equity

Example 1:

Mr. A, who has no spouse, suffers a stroke and enters a nursing home in 03/11. Because his stay in the facility is expected to be temporary and he declares his intention to return home, his home is considered homestead property. The house is valued at $625,000. Mr. A is determined ineligible for institutional services.

Mr. A files a request for a hardship waiver. He presents evidence that he has lived in the home for over thirty years, and its value has increased over time with the value of all property in the neighborhood. He also verifies that he has no liquid resources sufficient to pay for his nursing home care, so the denial of assistance would deprive him of needed medical care to the point that his life or health would be endangered. HFS Revised textOIG determines that:

  • a hardship exists;
  • since Mr. A is expected to return to the home in a short time there is no reasonable way he can access the equity value in the meantime; and
  • he did not purchase the home with the intention of making himself eligible for medical assistance.

The hardship waiver is granted.

Example 2:

Mr. B, who has no spouse, has savings, stocks, bonds, and other resources totaling $1,250,000. In 05/11 he cashes these in, and buys and moves into a house costing $1,200,000. In 07/11 he meets the certification requirements for long term care and enters a facility. Because he declares that he intends to return home, the house is considered homestead property. Mr. B is determined ineligible for institutional services due to the equity value of the home.

He files a request for a hardship waiver. On review of the circumstances, it is determined that evidence does not refute the conclusion that Mr. B purchased the house for the purpose of qualifying himself for medical assistance. Also, he still has $50,000 in resources, which will pay for his care for several months, and has not explored other methods of accessing the equity value of the house.

No hardship exists. The hardship waiver is denied.