Edit: Disability_Asset_Protection_and_Resource_Disregard_Act

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= Disability Asset Protection and Resource Disregard Act = == Summary == This legislation would amend § 32.1-325 of the Code of Virginia to require the exclusion of certain non-liquid assets from eligibility determinations for medical assistance (Medicaid) and related disability-based benefit programs. The bill would direct the Board of Medical Assistance Services to disregard specified categories of non-cash assets up to a defined value threshold when calculating countable resources. The purpose of the bill is to prevent individuals with disabilities from losing eligibility for essential benefits due to ownership of modest, non-liquid personal property, including tools, equipment, or other items necessary for independent living or self-employment. ---- == Background == === Current Law === Virginia law governing Medicaid eligibility is codified in § 32.1-325 of the Code of Virginia. This section authorizes the Board of Medical Assistance Services to: * Establish eligibility criteria for medical assistance; and * Define which assets are considered "countable resources" for purposes of eligibility. The statute explicitly permits certain exclusions ("disregards") from countable resources, including: * Burial funds up to a specified amount; and * A primary residence, subject to conditions. These provisions demonstrate that Virginia already employs a resource-based eligibility system in which some assets are excluded while others are counted. === Identified Issue === Under current policy implementation, individuals receiving disability-related benefits may be disqualified if their total assets exceed program limits. In some cases, non-liquid personal property—such as artistic equipment, tools, or other work-related assets—may be counted toward these limits. This can result in: * Loss of benefits due to ownership of essential or productive assets; * Disincentives to work, create, or build financial stability; * Inability to maintain an emergency cushion without risking eligibility. === Structural Gap in Law === While § 32.1-325 allows the Board to disregard certain resources, it does not require exclusion of: * Non-liquid personal property; * Work-related equipment; * Assets used for self-sufficiency or income generation (beyond narrow categories already recognized). As a result, current exclusions are limited and may not reflect modern economic realities. ---- == Legislative Findings (Suggested) == The General Assembly may find that: * Asset-based eligibility limits for disability-related benefits can unintentionally penalize financial responsibility and self-sufficiency; * Non-liquid assets, including tools, equipment, and personal property, do not provide immediate financial liquidity and should be treated differently from cash or cash equivalents; * Individuals with disabilities should not be required to liquidate essential personal property in order to qualify for or maintain access to medical assistance; * Expanding resource disregards would promote economic participation, stability, and independence. ---- == Proposed Statutory Approach == === Primary Amendment Target === § 32.1-325, Code of Virginia === Core Mechanism === The bill would add a new required category of excluded resources ("disregard") for non-liquid assets. === Conceptual Draft Language === ''Note: Placeholder language for future refinement.'' A new subsection could provide: * That in determining eligibility, the Board shall disregard: * Non-liquid personal property assets; * Including tools, equipment, and other property used for employment, self-employment, education, or daily living; * Up to a specified aggregate value (e.g., $X per individual or household). === Alternative Approach === Instead of setting a fixed threshold in statute, the bill could: * Direct the Board to establish thresholds by regulation; and * Require periodic review and adjustment. ---- == Policy Design Considerations == === Asset Categories === Future research should define which assets qualify, such as: * Work-related tools and equipment; * Artistic or creative materials; * Assistive technology; * Durable household goods beyond basic exemptions. === Threshold Structure === Options include: * Flat dollar cap (e.g., $10,000); * Tiered structure based on household size; * Higher caps for employment-related assets. === Liquidity Distinction === A key design principle is distinguishing: * Liquid assets (cash, bank accounts) — countable; versus * Non-liquid assets (equipment, personal property) — partially or fully excluded. === Interaction with Federal Law === Medicaid eligibility is partially governed by federal law. Further research is needed to: * Confirm federal compliance constraints; * Identify waiver opportunities (e.g., § 1115 waivers); * Determine how far Virginia may expand disregards without federal approval. ---- == Implementation Considerations == * The Department of Medical Assistance Services would be responsible for: * Defining eligible asset categories; * Establishing valuation methods; * Updating eligibility determination procedures. * Administrative guidance may be required to: * Prevent abuse or overvaluation; * Ensure consistent application across cases. ---- == Comparison to Existing Law == This proposal extends an existing legal framework rather than creating a new one. Current exclusions include: * Burial funds (limited amount); * Primary residence (subject to conditions). This bill would add: * Non-liquid personal property exclusions up to a defined value. ---- == Potential Impacts == === Positive Effects === * Increased financial stability for individuals with disabilities; * Reduced disincentives for work and asset accumulation; * Greater alignment with modern economic realities. === Risks / Considerations === * Potential increase in program eligibility and associated costs; * Administrative complexity in asset valuation; * Need for safeguards against asset shielding. ---- == Areas for Further Research == * Current DMAS regulations defining "countable resources"; * Federal Medicaid asset rules and waiver flexibility; * Comparative policies in other states; * Fiscal impact estimates; * Stakeholder input (disability advocates, administrators, policy experts). ---- == Notes == * This proposal builds directly on § 32.1-325 of the Code of Virginia. * The statutory concept of "resource disregards" provides the legal foundation for the policy change. * Detailed implementation will likely occur through administrative regulation. [[Category:2027 Session Legislation Ideas]]

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