LUMP SUM PAYMENT: NONRECURRING (RESOURCES) SR 11-30, 07/11 (FAM-A)

Lump sum payments that are treated as lump sum income for *FANF financial assistance are treated as a lump sum resource for FANF medical assistance. See Chapter 500, INCOME.

Lump sum payments that are nonrecurring include:

• awards, lotteries, prizes, windfalls;

• conversion of resources to cash;

• corrective payments;

• inheritances;

• insurance claims;

• lump sum Earned Income Tax Credit payments;

• retirement benefits;

• retroactive benefits or payments;

• sale of property;

• settlement of personal injury or property claims;

• third-party lump sum medical payments. If payments for medical expenses were previously paid by Medicaid, send all details regarding lump sum medical payments to Medicaid Administration Bureau, Third Party Liability (TPL) at State Office. TPL will determine the dollar amount the individual must reimburse to the Department of Health and Human Services (DHHS);

• rebates or credits; and

• refunds of security deposits on rental property or utilities.

Treatment: Countable Resource in the month after the month payments were received.

Exceptions:

VA payments to children born with spina bifida (including adult children) of Vietnam veterans are excluded per Sections 421 and 422(c) of Public Law 104-204.

Count the Earned Income Tax Credit and corrective payments by DHHS as a resource in the second month after receipt.

Reduce the value of the lump sum payment by any directly related expenses such as:

• attorney fees;

• cost of repair or replacement of the resource (such as a car damaged in an accident) for which the lump sum was paid;

• a portion used to reimburse DHHS for past medical or financial assistance; or

• a portion used to pay medical bills directly associated with a personal injury settlement.

See Lump Sum Death Benefits, Lump Sum Earned Income, and Corrective Payments for the treatment of those types of nonrecurring lump sum payments.