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Change of circumstance
A person who is eligible for Medically Needy (MN) coverage with a spenddown liability is required to report changes in their circumstances following rules in WAC 182-504-0105. Whether the person has already met their spenddown liability or is still in pending status, we are required to consider the effect of the change on the individual's eligibility.
The following are some common examples of changes in circumstance and some guidance on the action needed by the worker.
The only eligible individual dies or becomes ineligible before the end of the base period
In this situation you will need to shorten the base period and recalculate the spenddown amount, whether the spenddown has been met or not.
Example: Dennis, an SSI-related individual, elected a 6-month base period and had a total spenddown liability of $738 ($123 per month). Sadly, Dennis passes away in month 4 of the base period. The worker should close the case. If Dennis was still in pending status and had not met spenddown, recalculate the spenddown based on a 4-month base period and send an amended letter showing the new amount to be $492. Note: There may be outstanding medical bills that can be applied to the spenddown even after Dennis' death.
The head of household/primary applicant passes away
When the HOH of a MAGI passes away, go to Healthplanfinder to report a change and remove the Primary Applicant (PA). This will close the deceased’s MAU as of the date of death.
If there are other active individuals receiving WAH under the deceased PA, those AUs will also close, but with advance and adequate notice.
When there is a surviving spouse and other dependents who are receiving WAH and there is enough information to redetermine eligibility, start a new application with the surviving spouse as the HOH and include the other dependents. Submit the application. Send them a general correspondence letter with the following text:
“Please accept our condolences for your loss. Based on the information we had on your household’s previous application, we have opened coverage with you as the head of household on a new application. If any of the information has changed or is incorrect, please create or log in to your Healthplanfinder account at www.wahealthplanfinder.org to correct the information. You may also call the Health Benefit Exchange call center at 1-855-923-4633 to report the change and update your application.”
If there is not enough information to redetermine eligibility, start an application, submit it, and request the needed information from the individual.
If there is no surviving spouse or the surviving spouse was not receiving WAH, those closed from MAGI will automatically receive a letter telling them to reapply.
The household reports an increase in income
If the individual reports an increase in income, we need to recalculate the spenddown amount for the remaining months in the base period.
If the individual has not met spenddown and is still in pending status, the worker needs to send a new letter to the individual indicating that their spenddown liability has increased.
If the individual has already met spenddown and the MN coverage is active, the worker needs to:
- Terminate the MN coverage (with advance and adequate notice),
- Recalculate the new spenddown liability for the remaining months in the base period, and
- Send an amended spenddown letter, showing the additional amount of spenddown liability the household needs to incur.
When calculating the additional spenddown liability amount, the individual must be given a credit for the remaining months in the base period. The example below shows how to calculate the amount of the credit. Enter the credit amount as a paid expense type 'MU' in ACES and document that this is a workaround to give the individual the benefit of the credit. When the individual reapplies for MN coverage, the credit will be applied to the individual's new spenddown.
Example: Norma receives social security disability of $720 per month. Her spenddown liability is $156 ($26 per month) based on a 6-month base period from February through July.
She met her spenddown on March 10 and is active on MN medical. On May 5, she reports that she started receiving a small pension in the amount of $115 per month. Terminate medical coverage effective the end of May.
Recalculate the spenddown liability for the months of June and July. Since Norma had already met her spenddown for a 6-month period, and she has only received coverage for a 4-month period, we need to allow her a credit towards the new increased liability based on the number of months left until the end of the original base period. In this example, her spenddown amount was $26 per month so she receives a 'credit' of $104. ($26 x 4 months). Code the $104 as a paid expense type 'MU' in ACES online, and the credit will be applied to the individual's next base period.
The household reports a decrease in income
If the individual reports a decrease in income that brings their income below the CN income standard:
- Close the medically needy assistance unit,
- Screen the individual for the categorically needy (CN) program,
- Recalculate the spenddown liability for the months prior to the approval for CN medical by shortening the base period, and
- Send an amended spenddown letter to reflect the new liability amount for this prior period.
Example: Josie, a pregnant woman has income over 193% FPL at the time of her application for pregnancy medical. Her baby is due in July. In April, she reports and verifies she is no longer working and her income is now below the CN standard. The worker would approve Josie for CN medical (Apple Health for Pregnant Women) effective April 1 (the first of the month in which she reported her change and was found CN eligible). She is now continuously eligible for CN coverage through the birth and the 2 months post partum period.
The worker would also recalculate the spenddown amount for the prior months and send an amended letter to advise her of the lower amount. If she incurred medical expenses through March that were more than the recalculated spenddown amount, she would qualify for MN coverage and the agency would cover her medical expenses for the time period after she met her recalculated spenddown and before she became eligible for CN coverage.
The household reports a change in household composition
When the household reports a change in household composition (someone moves into or out of the home), the worker needs to recalculate the spenddown for the balance of the base period and giving 10 days advance and adequate notice if this is an adverse action.
Example: Someone moves out of the household
Katie, an SSI-related individual, applies for medical coverage in December. She is married and has a 17 year old daughter Lucy. Her spenddown liability is $300 for a 6-month base period.
In February, Lucy moves out of the home. With Lucy no longer living in the home, Katie's spenddown amount will increase because she loses the child allowance.
If Katie has not yet met spenddown, the worker should recalculate the spenddown amount for March, April and May without the child allowance and send an amended spenddown letter for the new total liability amount.
If Katie has already met spenddown, the worker should terminate MN coverage (giving advance and adequate notice of the adverse action) and generate a new letter showing the increase in additional spenddown liability.
Example: Someone moves into the household, causing household to qualify for CN coverage
Ken is 68 years old and lives alone. He has monthly income of $857 Social Security disability and has a spenddown of $978 with a base period from June through November. In July, he reports that his new wife Valerie moved into his home. Valerie has no income and has a current disability determination. She is applying for medical coverage for herself also.
Recalculate medical eligibility for her and Ken. Based upon their reported income, you determine this household is now CN eligible.
If Ken has already met spenddown, close his MN coverage and screen in a CN medical program for both, effective the first of the month in which he reported the change and in which Valerie applied for medical coverage for herself.
If Ken had not already met spenddown, authorize the CN coverage effective the first of the month in which he reported the change. Recalculate the spenddown liability for the months prior to the CN approval and generate an amended MN spenddown letter showing the reduced liability amount.
Example: Same as previous example, except Valerie does not apply for coverage and Ken does not qualify for CN coverage
The facts are the same as the example above, except that Valerie is not applying for medical coverage for herself or is not SSI-related. The worker would still need to redetermine the effect of the change on Ken's medical coverage. Since Valerie is a nonapplying spouse, the worker would reduce Ken's countable income by allocating income to her.
If Ken has not already met spenddown, recalculate eligibility for the months of July through November. With the spousal allocation, he would be eligible for MN without spenddown. The worker would:
- Certify S95 coverage for Ken through the balance of the base period,
- Recalculate the spenddown liability for June by shortening the base period to the month of June only, and
- Send an amended spenddown liability for this month.
Ken will need to meet the new spenddown amount before June coverage could be approved.
Nonapplying spouse applies for medical coverage after applying spouse receives MN coverage
In many cases involving a married couple, individuals have to choose who will receive health care coverage because of the effects of income deeming. Couples may choose the same person for each base period or may alternate who gets coverage. However; there are some situations when MN coverage has already been certified for one spouse and the other spouse has a medical emergency where they also need coverage during the same base period. The following example explains the steps and calculations needed to determine eligibility for the new applying spouse.
Example: Jim and Carla are a married SSI-related couple. They have a 6-month base period from January through June. They both have income and the spenddown liability when both of them apply is too high for them to meet. However, when only one applies for coverage, their spenddown liability is reduced to $100 per month ($600 for six months). They opt to apply for MN coverage for Jim since he has a chronic ongoing health condition and he has no other coverage.
They present medical expenses to the agency in January, and they meet his spenddown liability of $600 on January 10.
On March 18, Jim calls his case worker and tells him that Carla was admitted to the hospital on March 3 and they need to apply for medical for her also. She was in the hospital for 4 days, and they now have a bill for $45,000 which they cannot pay.
The worker would do the following:
- Terminate MN coverage for Jim effective March 31.
- Screen in a new S02 AU with both Jim and Carla as applicants with a request date of March 1.
- Shorten the base period to match the original S99 certification through the end of June.
- Recalculate the spenddown liability for the period March through June (4 months) and send them a new letter showing the increased spenddown amount which includes both Jim and Carla's income.
- Since Jim has already paid for his share of the 4 full months remaining in his base period, credit them $400 towards the new higher spenddown liability (4 months x the original $100 per month liability).
- Code the $400 as a paid 'MU' expense in ACES so that it is credited towards the new spenddown amount.
- Use the $45,000 hospital bill incurred on March 3 to meet the spenddown for both.
They will be responsible for the spenddown amount, but the agency will be able to pay on the balance of the bill for them.
For more information on income deeming and allocation, see SSI-Related - Income - Allocation and Deeming.