Legal Definitions - noncountable resource

A noncountable resource refers to an asset or item of value that, by law, is not included when calculating a person's total financial resources for the purpose of determining eligibility for certain government assistance programs, such as Medicaid or Supplemental Security Income (SSI). While many assets (like bank accounts, stocks, or additional real estate) are typically counted to assess financial need, specific legal provisions allow certain resources to be excluded because they are considered essential for daily living, necessary for future well-being, or not readily convertible to cash.

Here are some examples illustrating what might be considered a noncountable resource:

• A Term Life Insurance Policy

  A term life insurance policy provides coverage for a specific period and pays out only if the insured person dies within that term. Unlike a whole life or universal life policy, a term life policy typically does not accumulate cash value that the policyholder can borrow against or withdraw while alive. Because there is no cash value that can be accessed or converted into immediate funds, it is generally considered a noncountable resource when determining eligibility for financial assistance programs.

• Funds Held in a Special Needs Trust

  A Special Needs Trust (SNT), also known as a Supplemental Needs Trust, is a legal arrangement specifically designed to hold assets for the benefit of a person with a disability without jeopardizing their eligibility for means-tested government benefits. The funds in an SNT are used to pay for expenses that supplement, rather than replace, government assistance (like personal care, education, or recreation). Because the trust is structured to prevent the beneficiary from having direct control over the funds and to ensure they are used for specific, supplemental purposes, the assets within it are legally considered noncountable for benefit eligibility.

• Specialized Adaptive Equipment for a Disability

  For an individual with a disability, essential items like a custom-fitted power wheelchair, a specialized communication device, or a vehicle modified for accessibility are often considered noncountable resources. These items, while potentially valuable, are deemed necessary for the person's health, safety, independence, or ability to participate in daily life. The law recognizes that these are not discretionary assets to be liquidated but rather fundamental tools for living, and therefore, their value is excluded when assessing eligibility for assistance programs.