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 the financial methodologies in 42 CFR 435.601, and the deductions defined in 42 CFR 435.831.

  (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 eligibility agency shall deduct from income health insurance premiums the client or a financially responsible family member pays. The coverage must be for the client or any family members living with the client. The eligibility agency shall also deduct from income premiums the Department pays 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 the Department pays for recipients.

  (b) 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) 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) 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, or by providing proof to the eligibility agency of medical expenses the client owes equal to the spenddown amount.

  (a) The client may elect to deduct from countable income unpaid medical expenses for services 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.

  (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 equal to the cost of services received during the month in which the client pays the expenses. The eligibility agency may not deduct from income any payments a client makes for medical services in a month before the client receives the service.

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

  (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 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 in a retroactive or application month may be used to meet a spenddown if the services were not provided by a Medicaid-contracted mental health provider.