New Mexico Administrative Code
Title 8 - SOCIAL SERVICES
Chapter 281 - MEDICAID ELIGIBILITY - INSTITUTIONAL CARE (CATEGORIES 081, 083 AND 084)
Part 510 - TRUST STANDARDS
Section 8.281.510.7 - DEFINITIONS

Universal Citation: 8 NM Admin Code 8.281.510.7

Current through Register Vol. 35, No. 18, September 24, 2024

A. "Assets" include all income and resources as described in 8.281.500 NMAC of an applicant/recipient and his/her spouse. Assets not in a trust are considered under the applicable rule to determine if they are countable or excludable for the purposes of medicaid eligibility.

B. "Beneficiary" is the individual(s) for whose benefit the assets are held by the trustee.

C. "Benefit" is something to the advantage of or profit to the recipient.

D. "Community spouse" is an individual as described in Subsection E of 8.281.500.7 NMAC, definitions.

E. "Corporate trustee" means a bank, trust company, or company whose primary business is trust services. A corporate trustee may not have any affiliation with the beneficiary either through relatives working for the corporate trustee or investments by the beneficiary with the company other than for administrative fees.

F. "Corpus" is the body of the trust or the original asset used to establish the trust (to include principal, interest, and subsequent additions), such as a sum of money or real property.

G. "Department" is the New Mexico human services department or successor agency.

H. "Grantor" is the owner of or has legal control over the assets placed into a trust. A grantor may also be referred to as a settlor or trustor.

I. "Institutionalized individual" is an individual as described in Subsection K of 8.281.500.7 NMAC.

J. "Irrevocable trust" is created when the grantor does not reserve any right to cancel or revoke any provision of the trust.

(1) Although termed irrevocable, a trust which provides that the trust can only be modified or terminated by a court is a revocable trust because the applicant/recipient (or his/her responsible party) or the trustee can petition the court to amend or terminate the trust.

(2) Although termed irrevocable, a trust that will terminate if a certain circumstance occurs during the lifetime of the applicant/recipient, such as the applicant/recipient leaving the nursing facility and returning home, is a revocable trust.

(3) Although termed irrevocable, a trust that can be revoked or terminated upon the agreement of any or all beneficiaries (including residual beneficiaries) is a revocable trust.

K. "Payment" means any disbursal from the corpus of the trust or from income generated by the trust which benefits the party receiving it. A payment may include actual cash, as well as non-cash or property disbursements, such as the right to use and occupy real property.

L. "Residual beneficiary" is a person or entity that receives the remaining trust principal upon the death of the original trust beneficiary.

M. "Revocable trust" is created when the grantor reserves any right to cancel any provision of the trust.

N. "Sole benefit of" means that no individual or entity, except the person for whom the trust was established, may benefit from the assets in any way whether at the time the trust is created or at any time in the future except after medicaid is reimbursed.

O. "Trust" includes any legal instrument, device or arrangement, that is reduced to writing, signed and executed, which may not be called a trust under state law, or which is similar to a trust. A trust is a legal device in which property (real or personal) or other assets are held by one or more individuals for the benefit of others. A trust is usually created by a transfer of assets from the owner (grantor) to the trustee. Assets are not part of a trust and are considered outside of the trust until the date they are actually transferred into the trust, as demonstrated by verifiable documentation, regardless of the effective date of the trust. The transfer may be made while the grantor is alive or it may be made by will. The transfer of assets into a trust divests the original owner of legal title or restricts access to those assets. Trusts may also include structured settlements meeting the requirements stated above.

P. "Trust records" include, but are not limited to verifiable documentation of all transactions paid by or paid into a trust. Minimal documentation of distributions includes date of transaction, amount of payment (or if not paid by cash or other legal tender, type of asset distributed), person or entity receiving distribution, purpose of distribution, if distribution was made to acquire a non-consumable good, the location of that non-consumable good, and person or entity authorizing the distribution. Minimal documentation of additions to the trust includes the date of the transaction and a description of or amount of the asset transferred into the trust. The department shall not pay any costs or fees for obtaining trust records from the applicant/recipient or the trustee.

Q. "Trustee" is a person or entity who holds and controls the assets in the trust. The trustee usually has legal title to the assets held in the trust and is considered the owner of the trust assets in most dealings with third parties.

Disclaimer: These regulations may not be the most recent version. New Mexico may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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