104 CMR 30.01 - Patient Funds in Facilities

(1) Scope. 104 CMR 30.01 shall apply to Department facilities and inpatient units contracted for by the Department. It shall apply to the maintenance and expenditure of patient funds which are located within the facility or which are deposited with the facility director or his or her designee. For purpose of 104 CMR 30.00, any reference to facility shall include a Department contracted inpatient unit.
(2) Definitions. In addition to the terms defined in 104 CMR 25.02: Definitions, the following terms shall have the meanings throughout 104 CMR 30.01, unless the content clearly provides otherwise.

Dependent Funds. Those funds belonging to a patient that are located at a facility or received by a facility if:

(a) the patient is unable to manage these funds himself or herself as determined by an evaluation in accordance with 104 CMR 30.01(4);
(b) the patient is unable to manage these funds as determined by a court of competent jurisdiction;
(c) the patient is unable to manage these funds as determined by the Social Security Administration or Veterans Administration in accordance with their requirements;
(d) the funds were received from a legally authorized representative of the patient for the patient; or
(e) the funds belong to a patient who is a minor.

Financial Manager. The individual appointed by the person in charge of a facility to manage patient funds held by the facility.

Funds. Cash, checks, negotiable instruments, or other income or liquid assets.

Independent Funds. All of a patient's funds which are located at the facility and which are not dependent funds.

Liquid Assets. Cash and all property capable of ready conversion into cash, such as stocks and bonds, whether held jointly or solely. Liquid assets do not include life insurance or its cash value, nor assets subject to an irrevocable trust with the patient or client as named beneficiary, unless those assets are available to the patient or client or fee payer on demand.

(3) Upon Admission and Prior to Evaluation. All of a patient's funds shall be deemed to be independent funds, unless such funds have been determined to be dependent as defined in 104 CMR 30.01(2).
(4) Evaluation of Ability to Manage Funds.
(a) Unless a legally authorized representative has been appointed with authority to manage all of the patient's funds, or the patient is a minor, the clinical staff of the facility shall evaluate the patient as soon as possible after admission (but no later than 30 days after admission); at least once during the second three months after admission; and at least every 12 months thereafter; and upon the patient's request, to determine his or her ability to manage and spend his or her funds. No patient shall be found unable to manage and spend his or her funds unless it is determined by a clinical evaluation that the patient is unable to manage and spend money to satisfy his or her needs and desires because:
1. he or she lacks a basic understanding of the value of money; or
2. his or her fiscal judgment is significantly impaired due to behavioral health or medical condition or due to a lack of appreciation of his or her needs and desires, as shown by actual past example or by strong medical evidence.

The evaluation shall be conducted pursuant to any guidelines established by the Department. The evaluation shall be a part of the periodic review of the patient pursuant to M.G.L. c. 123, § 4 and 104 CMR 27.11: Periodic Review.

(b) The evaluation shall take into consideration the amount of the patient's present and future funds and shall determine:
1. whether the patient is able to manage and spend all of his or her funds;
2. if the patient is not able to manage and spend all of his or her funds, how much of such funds he or she is able to manage and spend and how much of such funds he or she is not able to manage and spend; and
3. in regard to funds the patient is not able to manage and spend himself or herself, how such funds can best be used to benefit the patient, consistent with 104 CMR 30.01(8).
(c) The results of the evaluation shall become part of the patient's record and a copy shall be provided to the patient and his or her legally authorized representative, if any.
(d) At least seven days prior to the evaluation, the patient shall receive both written and oral notice of the evaluation which includes a description of the evaluation process. At the evaluation, the patient shall have the right to present any information on his or her behalf, and to be assisted by a person of his or her choice. The patient shall be informed that the facility's Human Rights Officer is available to assist him or her. In addition, the patient shall be informed of the right to seek legal assistance. The facility director or his or her designee, may waive the requirement of seven days written and oral notice to the patient of such evaluations only pursuant to the provisions of 104 CMR 30.01(4)(e).
(e) Emergency Evaluation. Facilities shall have procedures for situations where a patient's use of his or her funds present a significant risk to the patient, others, or may result in damage to or loss of the funds themselves. These procedures may include an emergency evaluation of the patient's ability to manage his or her funds by the facility's clinical staff, without prior notice as described in 104 CMR 30.01(4)(d) if the circumstances so require. The reasons for any such emergency evaluations shall be explained to the patient at the time of the evaluation and shall be documented in the patient's record. In addition, within 14 days of an emergency evaluation, the patient must be given another evaluation of his or her ability to manage funds with the notices and other protections described in 104 CMR 30.01(4)(d). Funds which are determined at an emergency evaluation to be dependent funds may be spent by the facility director only with the approval of the patient or his or her legally authorized representative, if any.
(5) Evaluation of Need for a Legally Authorized Representative.
(a) If a patient is determined to be unable to manage his or her funds, pursuant to 104 CMR 30.01(4), a further determination shall be done as to whether or not the appointment of a legally authorized representative to manage the patient's funds is indicated and if so, the type of legally authorized representative that is needed. The determination and the reason(s) for it shall be documented in the patient's record.
(b) If a determination is made that a legally authorized representative is needed, or if in accordance with M.G.L. c. 123, § 25, a patient has been under the care of the Department for at least six months and it has been determined pursuant to 104 CMR 30.01(4) that the patient is not able to manage and spend any of his or her funds independently and the patient does not have a legally authorized representative, the Department shall notify the patient and the patient's nearest living relative to recommend that the necessary steps be taken to appoint an appropriate legally authorized representative.
(6) Training Patients to Manage Their Own Funds. A patient's treatment team shall develop a plan to teach or assist the patient to manage all, or a portion, of his or her own funds according to his or her capabilities and the level of supports available to him or her.
(7) Use of Independent Funds by the Patient. The patient shall have an unrestricted right to manage and spend, at his or her sole discretion, all of his or her independent funds. Independent funds, at the patient's discretion, may be deposited with the facility director or his or her designee.
(8) Management and Expenditure of Dependent Funds.
(a) Facility Director. In accordance with M.G.L. c. 123, § 26(a) and federal regulations, the facility director shall be responsible for the management and expenditure of all dependent funds.
(b) Designated Staff. To carry out his or her responsibility as to the proper management and expenditure of dependent funds, the facility director shall designate staff within the facility who shall be directly responsible to the facility director and who shall determine on a day-to-day basis how to best manage and spend a patient's dependent funds, consistent with 104 CMR 30.01(8). These designated staff shall have sufficient contact with the patient to have firsthand knowledge of the patient and to be responsive to the patient's day-to-day needs and desires. Designated staff shall consult with a patient prior to making a purchase for him or her. The facility director may establish a committee to make recommendations regarding the expenditure of dependent funds.
(c) Appropriate Expenditures. Dependent funds shall be used only for purposes which directly benefit the patient. Generally, dependent funds should be used to facilitate the patient's earliest possible rehabilitation and discharge to the community, for personal needs to improve the patient's condition while in the facility, and to help the patient live as normal and comfortable a life as practicable. The patient's desires, as well as needs, will be considered. Where the patient has unmet current needs, continued saving of dependent funds is not in the patient's interest unless such saving is for a foreseeable and appropriate future purpose such as to pay for living expenses upon discharge. A patient's current needs include paying the facility's charge for services provided to the patient, as determined in accordance with 104 CMR 30.04 and other applicable law. Dependent funds shall not be expended for any item or service which the facility is obligated to supply the patient and which would already have been included with the usual and customary charge for service or which the patient is otherwise entitled to receive without charge.
(d) Group Purchases. Dependent funds of a patient may be used together with funds of other patients to allow for a group purchase. However, a group purchase may be made only if all patients in the group shall benefit from such purchase, and contribute a fair amount to the purchase. Patients and their legally authorized representatives, if any, should be consulted prior to any such group purchase.
(9) Maintenance of Bank Accounts; Records and Accountings.
(a) Pursuant to M.G.L. c. 123, § 26(a), the facility director or his or her designee may maintain individual bank accounts on behalf of the facility's patients. These accounts shall be interest bearing accounts if commercially available and fiscally prudent. Interest earned in any such account shall be credited to the patient. Alternatively, the facility may deposit up to a set amount, established by the Department by policy, of a patient's funds in a group bank account so long as an individual record is maintained of each patient's deposits and withdrawals, and interest is appropriately apportioned among the patients in the group.
(b) The facility must have written policies and procedures concerning internal controls and accounting procedures for the management of patient funds on deposit with the facility.
(c) The facility director or designee must file an annual report with the Department's Chief Financial Officer, or designee, listing all group accounts and individual bank accounts that were maintained by the facility during the year. The report shall include the beginning and ending balances of each account and the name of the individual(s) and facility listed on the account. Each annual report shall be in the form and manner prescribed by the Department's Chief Financial Officer.
(d) Record of Funds. All funds received from a patient or received on his or her behalf shall be accounted for, and a record made showing the amount of funds received, date received and source of the funds. Additionally all funds disbursed shall be accounted for, and a record made showing the amount of funds disbursed, date disbursed, reason for disbursement and to whom funds were disbursed.
(e) Accounting for Funds. The following persons shall, upon their request, be provided a complete written account of all funds of a patient or, if requested, a written or oral statement of the current balance of funds of the patient:
1. the patient;
2. if the patient is determined unable to manage or spend all or part of his or her funds, the staff designated as responsible for expenditures for the patient under 104 CMR 30.01(8)(a) and (b);
3. the patient's legally authorized representative;
4. the patient's treatment team;
5. other person who has deposited funds with the facility for the patient's benefit, but, in this instance, the accounting will be limited to an accounting for the funds actually deposited with the facility by said person: and
6. the Department's Chief Financial Officer or designee.
(10) Making Purchases on Behalf of Patients. The facility shall have an obligation to assist patients in making purchases, and to inform patients of the availability of a shopping service for those patients who are unable to leave the facility. The shopping service shall be responsive to the individual needs and tastes of the patients.
(11) Social Security and Veterans Administration Income. When the facility director is designated by the Social Security Administration or the Veterans Administration as the representative payee of a patient, federal regulations govern the use of such funds. Accordingly, the facility director must comply with any policy directives or letters from the Social Security Administration or the Veterans Administration in regard to the use of these funds and income. To the extent allowed by Social Security or Veterans Administration requirements, the facility director may delegate the actual management of such funds to appropriate facility staff in accordance with the facility's written policies and procedures. In addition, 104 CMR 30.01 shall be followed to the extent that it is not inconsistent with Social Security or Veterans Administration requirements.


104 CMR 30.01
Amended by Mass Register Issue 1286, eff. 5/8/2015. Amended by Mass Register Issue 1359, eff. 2/23/2018. Amended by Mass Register Issue 1384, eff. 2/8/2019.

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