No. 41211 (Amendment): Rule R414-304. Income and Budgeting

(Amendment)

DAR File No.: 41211
Filed: 01/26/2017 07:58:40 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this change is to align the budgeting of expenses with the budgeting of income for family medically needy programs.

Summary of the rule or change:

Insurance premiums used as an expense for the medically needy family, pregnant woman or child medicaid programs will now be factored if the expense is paid weekly or bi-weekly. This amendment also removes duplicate language and makes other technical changes.

Statutory or constitutional authorization for this rule:

• Pub. L. No. 111-148
• Section 26-1-5
• Section 26-18-3

Anticipated cost or savings to:

the state budget:

The Department does not anticipate any impact to the state budget because individuals will pay the same amount of insurance premiums over the course of their eligibility span.

local governments:

There is no impact to local governments because they neither fund Medicaid services nor make eligibility determinations for the Medicaid program.

small businesses:

The Department does not anticipate any impact to small businesses because individuals will pay the same amount of insurance premiums over the course of their eligibility span.

persons other than small businesses, businesses, or local governmental entities:

The Department does not anticipate any impact to Medicaid providers and to Medicaid recipients because individuals will pay the same amount of insurance premiums over the course of their eligibility span.

Compliance costs for affected persons:

The Department does not anticipate any impact to a single Medicaid provider or to a Medicaid recipient because individuals will pay the same amount of insurance premiums over the course of their eligibility span.

Comments by the department head on the fiscal impact the rule may have on businesses:

There is no fiscal impact to business as this change affects only individual eligibility for Medicaid.

Joseph K. Miner, MD, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Health
Health Care Financing, Coverage and Reimbursement Policy
CANNON HEALTH BLDG
288 N 1460 W
SALT LAKE CITY, UT 84116-3231

Direct questions regarding this rule to:

• Craig Devashrayee at the above address, by phone at 801-538-6641, by FAX at 801-538-6099, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

03/17/2017

This rule may become effective on:

03/24/2017

Authorized by:

Joseph Miner, Executive Director

RULE TEXT

R414. Health, Health Care Financing, Coverage and Reimbursement Policy.

R414-304. Income and Budgeting.

R414-304-2. Definitions.

(1) The definitions in Rule R414-1, Rule R414-301, and Rule R414-303 apply to this rule. In addition:

(a) "Aid to Families with Dependent Children" (AFDC) means a State Plan for aid that was in effect on June 16, 1996.

(b) "Allocation for a spouse" means an amount of income that is the difference between the Social Security Income (SSI) federal benefit rate for a couple minus the federal benefit rate for an individual.

(c) "Basic maintenance standard" or "BMS" means the income level for eligibility for Medicaid coverage of the medically needy based on the number of family members who are counted in the household size.

(d) "Benefit month" means a month or any portion of a month for which an individual is eligible for medical assistance.

(e) "Best estimate" means that income is calculated for the upcoming certification period based on current information about income being received, expected income deductions, and household size.

(f) "Deeming" or "deemed" means a process of counting income from a spouse or a parent, or the sponsor of a qualified alien, to decide what amount of income after certain allowable deductions, if any, must be considered income to the applicant or recipient.

(g) "Eligible spouse" means the member of a married couple who is either aged, blind or disabled.

(h) "Factoring" means [that ]the eligibility agency calculates the monthly income or income deductions by prorating income to account for months when an individual receives a fifth payment when paid weekly, or a third paycheck with paid every other week. Weekly income is factored by multiplying the weekly income amount by 4.3 to obtain a monthly amount. Income paid every other week is factored by multiplying the bi-weekly income by 2.15 to obtain a monthly amount.

(i) "Family Medicaid" means medical assistance for families caring for dependent children and is a general term used to refer to Medicaid coverage for medically needy parents, caretaker relatives, pregnant women, and children.

(j) "Family member" means a son, daughter, parent, or sibling of the client or the client's spouse, the spouse of the client, and the parents of a dependent child.

(k) "Full-time employment" means an average of 100 or more hours of work a month or an average of 23 hours a week.

(l) "Full-time student" means a person enrolled for the number of hours defined by the particular institution as fulfilling full-time requirements.

(m) "Income annualizing" means using total income earned during one or more past years, or a shorter applicable time period, and anticipating any future changes, to estimate the average annual income. That estimated annual income is then divided by 12 to determine the household's average monthly income.

(n) "Income averaging" means using a history of past income and expected changes, and averaging it over a determined period of time that is representative of future monthly income.

(o) "Income anticipating" means using current facts regarding rate of pay and number of working hours, and reasonably expected future income changes, to anticipate future monthly income.

(p) "In-kind support donor" means an individual who provides food or shelter without receiving full market value compensation in return.

(q) "Prospective budgeting" is the process of calculating income and determining eligibility and spenddown for future months based on the best estimate of income, deductions, and household size.

(r) "School attendance" means enrollment in a public or private elementary or secondary school, a university or college, vocational or technical school or the Job Corps, for the express purpose of gaining skills that lead to gainful employment.

(s) "Presumed maximum value" means the allowed maximum amount an individual is charged for the receipt of food and shelter. This amount will not exceed one-third of the SSI federal benefit rate plus $20.

(t) "Temporarily absent" means a member of a household is living away from the home for a period of time but intends to return to the home when the reason for the temporary absence is accomplished. Reasons for a temporary absence may include an absence for the purpose of education, medical care, visits, military service, temporary religious service or other volunteer service such as the Peace Corps.

 

R414-304-9. Aged, Blind and Disabled Non-Institutional Medicaid and Medically Needy Family, Pregnant Woman and Child Non-Institutional Medicaid Income Deductions.

(1) The Department shall determine income deductions based on[adopts and incorporates by reference] the financial methodologies in[required by] 42 CFR 435.601, and the deductions defined in 42 CFR 435.831[, October 1, 2012 ed].

(2) For aged, blind and disabled individuals eligible under 42 CFR 435.301(b)(2)(iii), (iv), and (v), described more fully in 42 CFR 435.320, .322 and .324, the eligibility agency shall deduct from income an amount equal to the difference between 100% of the federal poverty guideline and the current BMS income standard for the applicable household size to determine the spenddown amount.

(3) Health insurance premiums:

(a) The[To determine eligibility for and the amount of a spenddown under medically needy programs, the] eligibility agency shall deduct from income health insurance premiums the client or a financially responsible family member pays. [providing]The coverage must be for the client or any family members living with the client.[in the month of payment.] The eligibility agency shall also deduct from income [the amount of a health insurance premium the month it is due when]premiums the Department pays [the premium ]on behalf of the client as authorized by Section 1905(a) of Title XIX of the Compilation of the Social Security Laws, except no deduction is allowed for Medicare premiums [that ]the Department pays for recipients.

( b[a]) [The]For Aged, Blind and Disabled programs, the eligibility agency shall deduct the entire payment in the month it is due and may not prorate the amount.

(c) For Medically Needy Family, Pregnant Woman and Child programs, factor premiums due weekly or bi-weekly before deducting. For payments due on any other basis, deduct the actual amount in the month due.

( d[b]) The eligibility agency may not deduct health insurance premiums to determine eligibility for the poverty-related medical assistance programs or coverage groups subject to the use of MAGI-based methodologies.

( e[4]) [To determine the spenddown under medically needy programs, the eligibility agency shall deduct from income health insurance premiums that the client or a financially responsible family member pays in the application month or during the three-month retroactive period. The eligibility agency shall allow the deduction either in the month paid or in any month after the month paid to the extent the full amount was not deducted in the month paid, but only through the month of application.]For medically needy programs, the actual amount of insurance premiums paid in a retroactive month will be deducted as follows:

(i) Deducted in the month paid; or

(ii) Deducted in a month after it was paid, but only through the month of application and only to the extent it was not already used as a deduction.

(5) To determine eligibility for medically needy coverage groups, the eligibility agency shall deduct from income medically necessary expenses that the client verifies only if the expenses meet all of the following conditions:

(a) The medical service was received by the client, a client's spouse, a parent of a dependent client, a dependent sibling of a dependent client, a deceased spouse, or a deceased dependent child;

(b) Medicaid does not cover the medical bill and it is not payable by a third party;

(c) The medical bill remains unpaid or the client receives and pays for the medical service during the month of application or during the three months immediately preceding the date of application. The date that the medical service is provided on an unpaid expense is irrelevant if the client still owes the provider for the service. Bills for services that the client receives and pays for during the application month or the three months preceding the date of application can be used as deductions only through the month of application.

(6) The eligibility agency may not allow a medical expense as a deduction more than once.

(7) The eligibility agency may only allow as an income deduction a medical expense for a medically necessary service. The eligibility agency shall determine whether the service is medically necessary.

(8) The eligibility agency shall deduct medical expenses in the order required by 42 CFR 435.831(h)(1). When expenses have the same priority, the eligibility agency shall deduct paid expenses before unpaid expenses.

(9) A client who pays a cash spenddown may present proof of medical expenses paid during the coverage month and request a refund of spenddown paid up to the amount of bills paid by the client. The following criteria apply:

(a) Expenses for which a refund can be made include medically necessary expenses not covered by Medicaid or any third party, co-payments required for prescription drugs covered under a Medicare Part D plan, and co-payments or co-insurance amounts for Medicaid-covered services as required under the Utah Medicaid State Plan;

(b) The expense must be for a service that the client receives during the benefit month;

(c) The Department may not refund any portion of any medical expense that the client uses to meet a Medicaid spenddown when the client assumes responsibility to pay that expense;

(d) A refund cannot exceed the actual cash spenddown amount paid by the client;

(e) The Department may not refund spenddown amounts that a client pays based on unpaid medical expenses for services that the client receives during the benefit month. The client may present to the eligibility agency any unpaid bills for non-Medicaid-covered services that the client receives during the coverage month. The client may use the unpaid bills to meet or reduce the spenddown that the client owes for a future month of Medicaid coverage to the extent that the bills remain unpaid at the beginning of the future month;

(f) The Department shall reduce the refund amount by the amount of any unpaid obligation that the client owes the Department.

(10) For poverty-related coverage groups and coverage groups subject to the MAGI-based methodologies, an individual or household is ineligible if countable income exceeds the applicable income limit. The eligibility agency may not deduct medical costs from income to determine eligibility for poverty-related or MAGI-based medical assistance programs. An individual may not pay the difference between countable income and the applicable income limit to become eligible for poverty-related or MAGI-based medical assistance programs.

(11) When a client must meet a spenddown to become eligible for a medically needy program, the client must sign a statement that says:

(a) the eligibility agency told the client how spenddown can be met;

(b) the client expects his or her medical expenses to exceed the spenddown amount;

(c) whether the client intends to pay cash or use medical expenses to meet the spenddown; and

(d) that the eligibility agency told the client that the Medicaid provider may not use the provider's funds to pay the client's spenddown and that the provider may not loan the client money for the client to pay the spenddown.

(12) A client may meet the spenddown by paying the eligibility agency[ the amount with cash or check], or by providing proof to the eligibility agency of medical expenses [that ]the client owes equal to the spenddown amount.

(a) The client may elect to deduct from countable income unpaid medical expenses for services [that ]the client receives in non-Medicaid covered months to meet or reduce the spenddown.

(b) Expenses must meet the criteria for allowable medical expenses.

(c) Expenses may not be payable by Medicaid or a third party.

(d) For each benefit month, the client may choose to change the method of meeting the spenddown[by either presenting proof of allowable medical expenses to the eligibility agency or by presenting a cash or check payment to the eligibility agency equal to the spenddown amount].

(13) The eligibility agency may not accept spenddown payments from a Medicaid provider if the source of the funds is the Medicaid provider's own funds. In addition, the eligibility agency may not accept spenddown payments from a client if a Medicaid provider loans funds to the client to make a spenddown payment.

(14) The eligibility agency may only deduct the amount of prepaid medical expenses [that ]equal[s] to the cost of services received [in a given month]during the month in which the client pays the expenses. The eligibility agency may not deduct from income any payments [that ]a client makes for medical services in a month before the client receives the service[s].

(15) [For non-institutional Medicaid programs, the eligibility agency may only deduct medically necessary expenses. The Department determines whether services for institutional care are medically necessary.

(16) ]The eligibility agency may not require a client to pay a spenddown of less than $1.

(16[7]) Medical costs that a client incurs in a benefit month may not be used to meet a spenddown when the client is enrolled in a Medicaid health plan.

(17) Bills for mental health services that a client incurs in a benefit month may not be used to meet spenddown if Medicaid contracts with a single mental health provider to provide mental health services to all recipients in the client's county of residence.

(18) Bills for mental health services a client pays[that a client receives] in a retroactive or application month [that a client pays ]may be used to meet a spenddown [only ]if the services were not provided by a Medicaid-contracted mental health provider[does not provide the services].

 

R414-304-11. Aged, Blind and Disabled Institutional Medicaid and Family Institutional Medicaid Income Deductions.

(1) The Department shall determine income deductions based on[adopts and incorporates by reference] the financial methodologies in[required by] 42 CFR 435.601 and the deductions defined in 42 CFR 435.725, 435.726, 435.832, and 42 USC 1396a(r)(1), and 1396r-5(d).[435.832, October 1, 2012 ed. The Department also adopts and incorporates by reference Subsections 1902(r)(1) and 1924(d) of the Compilation of the Social Security Laws, in effect January 1, 2013.]

(2) Health insurance premiums:

(a) For institutionalized and waiver eligible clients, the eligibility agency shall deduct from income health insurance premiums only for the institutionalized or waiver eligible client and only if paid with the institutionalized or waiver eligible client's funds. [The eligibility agency shall deduct health insurance premiums in the month the payment is due. ]The eligibility agency shall deduct [the amount of a health insurance premium for the month it is due if]premiums the Department is paying[the premium] on behalf of the client as authorized by Section 1905(a) of Title XIX of the Social Security Act, except no deduction is allowed for Medicare premiums that the Department pays for recipients.

(b) For Aged, Blind and Disabled programs, the eligibility agency shall deduct health insurance premiums in the month the payment is due.

(c) For Medically Needy Family, Pregnant Woman and Child programs, factor premiums due weekly or bi-weekly before deducting. For payments due on any other basis, deduct the actual amount in the month due.

(d[b]) The eligibility agency shall deduct from income the portion of a combined premium attributable to the institutionalized or waiver-eligible client if the combined premium includes a spouse or dependent family member. The client's portion must be paid from the funds of the institutionalized or waiver-eligible client.

(3) The eligibility agency may only deduct medical expenses from income under the following conditions:

(a) the client receives the medical service;

(b) Medicaid or a third party will not pay the medical bill;

(c) a paid medical bill can only be deducted through the month of payment. No portion of any paid bill can be deducted after the month of payment.

(4) [To determine the cost of care contribution for long-term care services, the eligibility agency may not deduct medical or remedial care expenses that the Department is prohibited from paying when the client incurs the expenses for the transfer of assets for less than fair market value. The eligibility agency may not deduct medical or remedial care expenses that the Department is prohibited from paying under Section 1917(f) of the Social Security Act in effect January 1, 2013, when the equity value of the individual's home exceeds the limit set by law. The eligibility agency may not deduct the expenses during or after the month that the client receives the services even when the expenses remain unpaid.]The eligibility agency may not deduct from income to determine cost-of-care contribution for long-term care services, or when a client incurs expenses for medical or remedial care services, even if the expense remains unpaid when:

(a) a client is in a penalty period resulting from a transfer of assets; or

(b) a client's residential home exceeds the equity value as defined in 42 U.S.C. 1396p(f).

(5) The eligibility agency may not allow a medical expense as an income deduction more than once.

(6) The eligibility agency may only allow as an income deduction a medical expense for a medically necessary service. The eligibility agency shall determine whether the service is medically necessary.

(7) The eligibility agency may only deduct the amount of prepaid medical expenses [that ]equal[s] to the cost of services received [in a given month]during the month in which the client pays the expenses. The eligibility agency may not deduct from income any payments [that ]a client makes for medical services in a month before the client receives the service[s].

(8) When a client must meet a spenddown to become eligible for a medically needy program or receive Medicaid under a home and community based care waiver, the client must sign a statement that says:

(a) the eligibility agency told the client how spenddown can be met;

(b) the client expects his or her medical expenses to exceed the spenddown amount;

(c) whether the client intends to pay cash or use medical expenses to meet the spenddown; and

(d) [that ]the eligibility agency told the client that [the ]Medicaid provider s may not use the provider's funds to pay the client's spenddown or[and that the provider may not] loan the client money for the client to pay the spenddown.

(9) A client may meet the spenddown by paying the eligibility agency[the amount with cash or check], or by providing proof to the eligibility agency of medical expenses [that ]the client owes equal to the spenddown amount.

(a) The client may elect to deduct from countable income unpaid medical expenses for services [that ]the client receives in non-Medicaid -[ ]covered months to meet or reduce the spenddown.

(b) Expenses must meet the criteria for allowable medical expenses.

(c) Expenses may not be payable by Medicaid or a third party.

(d) For each benefit month, the client may choose to change the method of meeting spenddown by either presenting proof of allowable medical expenses to the eligibility agency or by [presenting a cash or check]making a payment to the eligibility agency equal to the spenddown amount.

(10) The eligibility agency may not accept spenddown payments from a Medicaid provider if the source of the funds is the Medicaid provider's own funds. In addition, the eligibility agency may not accept spenddown payments from a client if a Medicaid provider loans funds to the client to make a spenddown payment.

(11) The eligibility agency shall require institutionalized clients to pay all countable income remaining after allowable income deductions to the institution in which [they]an individual resides, as [their]the individual's cost-[]of-[ ]care contribution.

(12) A client who pays a cash spenddown or a cost-of-care amount to the medical facility in which he resides, may present proof of medical expenses paid during the coverage month and request a refund of spenddown or cost-of-care paid up to the amount of bills. The following criteria apply:

(a) Expenses for which a refund can be made include medically necessary medical expenses not covered by Medicaid or any third party, co-payments required for prescription drugs covered under a Medicare Part D plan, and co-payments or co-insurance amounts for Medicaid-covered services as required under the Utah Medicaid State Plan;

(b) The expense must be for a service [that ]the client receives during the benefit month;

(c) The eligibility agency may not refund any portion of a[ny] medical expense [that ]the client uses to meet a Medicaid spenddown or to reduce his cost-of-care to the institution when the client assumes that payment responsibility;

(d) A refund cannot exceed the actual cash spenddown or cost-of-care amount paid by the client;

(e) The eligibility agency may not refund a spenddown or cost-of-care amounts paid by a client based on unpaid medical expenses for services [that ]the client receives during the benefit month. The client may present to the eligibility agency any unpaid bills for non-Medicaid-covered services [that ]the client receives during the coverage month. The client may use these unpaid bills to meet or reduce the spenddown [that ]the client owes for a future month of Medicaid coverage to the extent [that ]the bills remain unpaid at the beginning of the future month , and the bills are not payable by a third party;

(f) The Department shall reduce a refund by the amount of any unpaid obligation [that ]the client owes the Department.

(13) The eligibility agency shall deduct a personal needs allowance for residents of medical institutions equal to $45.

(14) When a doctor verifies [that ]a single person or a person whose spouse resides in a medical institution is expected to return home within six months of entering a medical institution or nursing home, the eligibility agency shall deduct a personal needs allowance equal to the BMS for one person defined in Subsection R414-304-13(6), for up to six months to maintain the individual's community residence.

(15) A client is not eligible for Medicaid coverage if medical costs are not at least equal to the contribution required towards the cost of care.

(16) Medical costs [that ]a client incurs in a benefit month may not be used to meet a spenddown when the client is enrolled in a Medicaid health plan.

(17) Bills for mental health services [that ]a client incurs in a benefit month may not be used to meet a spenddown if Medicaid contracts with a single mental health provider to provide mental health services to all recipients in the client's county of residence.[Bills for mental health services that a client receives in a retroactive or application month that a client pays may be used to meet spenddown only if the Medicaid-contracted mental health provider does not provide the services.]

(18) Bills for mental health services a client pays in a retroactive or application month may be used to meet a spenddown if the services are not provided by a Medicaid-contracted mental health provider.

 

KEY: financial disclosures, income, budgeting

Date of Enactment or Last Substantive Amendment: [July 1, 2016]2017

Notice of Continuation: January 23, 2013

Authorizing, and Implemented or Interpreted Law: 26-18-3

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