SR 16-10 Dated 08/16

 

STATE OF NEW HAMPSHIRE

INTER-DEPARTMENT COMMUNICATION – Division of Family Assistance (DFA)

 

FROM OFFICE OF THE DIRECTOR, DFA:

Kerry Nelson for Terry R. Smith

DFA SIGNATURE DATE:

July 28, 2016

FROM OFFICE OF THE DIRECTOR, OMBP:

Deborah Fournier

OMBP SIGNATURE DATE:

July 27, 2016

AT (OFFICE):

Division of Family Assistance (DFA)

TO:

District Office Supervisors

 

SUBJECT:

Changes in the Renewal Process for the Categories of Medical Assistance (MA) that Use Modified Adjusted Gross Income (MAGI); Related Policy Clarification Associated with the Treatment of Social Security Income, Trust Disbursements, Clergy/Religious Worker Income in MAGI MA; The Presumed Maximum Value (PMV) Figures for 2016; The 2015 Federal Tax Filing Requirements Thresholds

EFFECTIVE DATE FOR ALL POLICY EXCEPT THE TREATMENT OF SSA INCOME:

August 1, 2016

EFFECTIVE DATE FOR THE TREATMENT OF SSA INCOME:

June 1, 2016
     

 

 

SUMMARY

 

This SR releases the following changes in the renewal process for the categories of medical assistance (MA) that use the modified adjusted gross income (MAGI) method in the eligibility determination process:

 

·    MAGI MA households who are not eligible to have their MAGI MA automatically renewed for 12-months are referred to as non-passive MAGI MA renewal cases. Notification of the renewal requirements for non-passive MAGI MA renewal cases will continue to occur via New HEIGHTS-generated CS0006, MAGI Mail In Rede Letter, or CS0027, Online Rede Letter, but where previously the non-passive MAGI MA casehead was not required to return the case information in the CS0006/CS0027 that was used to determine whether renewal could happen automatically, now every non-passive MAGI MA casehead must sign, date, and return or electronically submit this case information, with all changes noted, for MAGI MA renewal to be considered complete. Failure to return or submit the corrected signed and dated paper or electronic information within renewal timeframes results in termination of the MAGI MA case.

·    The verifications checklist section in the CS0006/CS0027 has been modified to include:

-  all the verifications required in non-passive renewals for MAGI-only renewals, such as:

a)    SSN and Citizenship verification, if verification for these areas is required at renewal;

b)    employment verification if at least one place of employment cannot be verified by DHHS through electronic cross-matching, discrepant information is discovered, new employment has been added for an individual in the household, or existing employment has been modified. Note: Individuals who have been newly added to the MAGI MA household who attest to employment will have their eligibility based upon their attestation of the details of their employment and verification will not be requested at renewal. Verification of employment of these newly added individuals will be requested post-eligibility, if needed, according to current policy (if electronic cross-matching of their employment attestation cannot occur, is unsuccessful, or is discrepant/exceeds the 10% threshold standard);

c)    self-employment verification, regardless of whether this income has been verified in the past, and including if self-employment has been added for an existing household member. Note: individuals who have been newly added to the MAGI MA household who attest to self-employment income will have eligibility based upon this attestation and will not be required to verify this income for the renewal (a separate post-eligibility verification request will be sent in this circumstance);

d)    unearned income verification. Previously, this type of income was not requested in MAGA MA renewals at all. Now verification for any type of unearned income that is countable for MAGI MA, except for Unemployment Compensation (UC) and SSA, will be requested during all MAGI renewals and added to the verification checklist. UC income will be added to the verification checklist only if it cannot be verified by DHHS through electronic cross-matching or if the UC income associated with the MAGI MA case has been added or modified during the renewal process. SSA income that has been successfully cross-matched with the SSA is considered verified, so will not be included on the checklist. Note: individuals who have been newly added to the MAGI MA household who attest to receiving a type of unearned income will have eligibility based upon this attestation and will not be required to verify this income for the renewal (a separate post-eligibility verification request will be sent in this circumstance); and

-   a verification request for allowable deductions. Previously, proof of deductions was not requested at MAGI MA renewals at all. Now, deductions that are relevant for MAGI MA programs will be populated on the MAGI MA verification checklist at renewals, regardless of the current verification status of the deductions. Note: individuals who have been newly added to the MAGI MA household who attest to having a type of MAGI MA allowable deduction will have eligibility based upon this attestation and will not be required to verify this deduction for the renewal (a separate post-eligibility verification request will be sent in this circumstance).

·   When a case includes multiple programs of assistance as well as MAGI MA, redeterminations/recertifications for the non-MAGI programs will continue to be aligned to coincide with the most frequent redetermination/recertification required by the cash, Food Stamp, non-MAGI category of Medicaid, or child care assistance program. However:

-   if the MAGI MA case is not being renewed at the same time, the New HEIGHTS-generated CS0001, Rede interview, CS0005, Mail-In Rede Letter, CS0027, Online Rede Letter, or CS0031, Phone Scheduling Rede Letter, will continue to be sent to the case, but the letters will specify the non-MAGI category of MA that is being redetermined, if any, and include text indicating that if the letter does not mention a MAGI category of MA, renewal is not occurring for those categories at that time and the MAGI MA case needs to do nothing to continue to receive medical assistance.

-  If the MAGI MA case is being renewed at the same time as the other programs, though, the recipient will now receive two (2) renewal packages: a redetermination/recertification package for all the other categories of assistance for which eligibility must be redetermined, and a renewal package solely associated with the continued eligibility for the MAGI MA category of assistance. The case must complete both renewal packages for continued eligibility to be determined for all programs. Failure to complete both renewal packages within redetermination/renewal timeframes results in termination of the programs of assistance for which the renewal packages were not completed, per current policy.

·   MAGI MA renewal recipients are provided with a 90-day “grace period” in which to provide MAGI MA renewal verifications after MAGI MA is terminated at renewal for failure to provide those verifications. When a MAGI MA household files a new MA application during the 90-day grace period, the MAGI MA household is still considered to be in renewal mode and is not considered to be a new applicant during which self-attestation for certain claims is allowed:

-   the new signed and dated application can be accepted in lieu of the signed and dated renewal information that the non-passive MAGI MA case is now required to submit as a condition of renewal; but

-   all verifications originally requested at the renewal must still be supplied within that 90-day grace period. Meaning, self-attestation cannot be accepted as verification during the 90-day grace period. FSS must re-request the required verification from the applying household, ensuring that whatever remains of the 90-day grace period is used as the “due by” date rather than the generic 10-day “due-by” date.

If during the 90-day grace period the household still fails to supply the requested verification, MAGI MA remains terminated and is neither reopened back to the close date nor to the new application date.

 

These changes reflect mandates implemented at 42 CFR 435.916, the latest NH decisions related to those mandates, as well as feedback from the Centers for Medicare and Medicaid Services (CMS).

 

As a result of the changes identified above, the content and/or triggering of the following New HEIGHTS-generated letters were altered:

 

·   CS0001, Rede interview;

·  CS0005, Mail-In Rede Letter;

·  CS0006, MAGI Mail In Rede Letter;

·  CS0027, Online Rede Letter;

·  CS0030, MAGI Online Rede Passive Letter; and

·  CS0031, Phone Scheduling Rede Letter.

 

Additionally, this SR releases related policy clarifications based upon feedback recently received from CMS regarding:

 

·    the treatment of Social Security income when making an eligibility determination for MAGI MA. Generally, only taxable sources of income count in determining household MAGI-based income. However, all Social Security income of tax filers is counted in the MAGI MA eligibility determination process, even those SSA benefits that are not taxable. For tax dependents, though, except those individuals claimed as a tax dependent by someone other than a parent or spouse, Social Security income is only counted if the tax dependent is required to file taxes. The tax dependent individual is required to file taxes if one-half of the Social Security income plus all other income exceeds $25,000. In many cases, children will not be required to file a tax return and therefore the child’s social security income will not be included in the total MAGI MA household income. If the child is required to file taxes, though, then all of the dependent’s income, including non-taxable Social Security income, is included in the total MAGI MA household’s income. For individuals who are claimed as a tax dependent by someone other than a parent or a spouse, regardless of whether he or she is required to file taxes, all of the individual’s income, including all Social Security benefits, counts toward his or her eligibility, regardless of whether he or she meets the tax-filing threshold. Note: Supplemental Security Income (SSI) continues to be excluded for all categories of MA including MAGI, per current policy;

Exception: For individuals who are claimed as a tax dependent by someone other than a parent or a spouse, regardless of whether he or she is required to file taxes, all of the individual’s income, including all Social Security benefits, counts toward his or her eligibility, regardless of whether he or she meets the tax-filing threshold.

·    the treatment of trust disbursements when making an eligibility determination for MAGI MA. The only trust disbursements that count in a MAGI case are the taxable portions of the trust disbursements, regardless of the type of trust or how the disbursement is spent; if the trust income and disbursements are taxable, they count in MAGI. The Presumed Maximum Value (PMV) Figures for 2016 used in special needs trust disbursement determinations and the 2015 Federal Tax Filing Requirement Thresholds are also being released in this SR; and

·    the treatment of clergy member and religious worker income and housing allowances when making an eligibility determination for both MAGI and non-MAGI MA. The clergy member’s or religious worker’s income is counted in both MAGI and non-MAGI categories of MA, but:

-        if a housing allowance is also received, exclude it in MAGI MA and count it as unearned income for non-MAGI categories of MA; and

-     if the individual has taken a vow of poverty, exclude any income for MAGI MA but count any income for non-MAGI categories of MA in accordance with the source and nature of the income.

 

FORMER MAGI RENEWAL POLICY

NEW MAGI RENEWAL POLICY

The CS0006/CS0027 was used to notify non-passive MAGI MA renewal cases of renewal requirements and it included a request that the casehead contact DHHS to report any corrections that needed to be made to the information that DHHS used to review continued eligibility for MAGI MA. However, the return of this information was not required in the non-passive MAGI MA renewal process, and the eligibility worker was directed to never close any MAGI MA recipients for failure to return this information.

Non-passive MAGI MA renewal cases must correct the information in the CS0006/CS0027 that DHHS used to review continued eligibility for MAGI MA, sign and date the information, and return this packet of information along with any requested verifications, as a condition of continued eligibility for MAGI MA. For the CS0027, the information is electronically verified and submitted. Failure to return or electronically submit the signed and dated information with corrected information and all required verification within MAGI MA renewal timeframes results in termination of the MAGI MA case.

The verification checklist for:

·   non-passive MAGI MA renewals was not as thorough as it needed to be and did not include unearned income.

·   MAGI MA renewals did not request proof of MAGI MA allowable deductions.

The following enhancements have been made to the verification checklist for MAGI MA renewals:

·   the verification checklist, among other additions, will now include requests for proof of unearned income;

·   all MAGI MA renewals will include a request for proof of MAGI MA allowable deductions; and

·   enhancements in the checklist have been made for citizenship/SSNs, employment, and self-employment.

When a case included multiple programs of assistance and MAGI MA, redeterminations/ recertifications were aligned to coincide with the most frequent redetermination/ recertification required by the cash, Food Stamp, non-MAGI category of Medicaid, or child care assistance program received.

·    If this regularly scheduled redetermination/ recertification date also aligned with the regularly scheduled renewal date for MAGI MA:

-   The notification associated with the type of redetermination/recertification scheduled for the cash, Food Stamp, non-MAGI category of Medicaid, or child care assistance program was generated. E.g., the New HEIGHTS-generated CS0001, Rede Interview, was generated if the case was scheduled for a personal interview, the New HEIGHTS-generated CS0005, Mail-In Rede Letter, was generated if the case was eligible for a paper redetermination/recertification, the New HEIGHTS-generated CS0027, Online Rede Letter, was generated if the case was eligible to complete the redetermination online, or the New HEIGHTS-generated CS0031, Phone Scheduling Rede Letter, was generated if the case was eligible to complete the redetermination over the phone.

-   If all eligibility factors for the MAGI MA case could be verified through electronic cross-matching, the MAGI MA case’s regularly scheduled renewal period was supposed to be automatically advanced another 12 months. This was considered a “passive” renewal. However, if the passive MAGI MA case included other non-MAGI categories of assistance, the 12-month renewal date was continually aligned with the earlier non-MAGI redetermination date causing the MAGI MA case to be on a continual 6-month renewal schedule.

-   If all MAGI MA eligibility factors for the case could not be verified through electronic cross-matching (referred to a as a “non-passive MAGI renewal”), the case’s regularly scheduled renewal period was not automatically advanced 12 months, but the request for proof needed to determine continued MAGI MA eligibility was not specific to MAGI MA. Instead, the checklist would often request verifications needed only for the non-MAGI categories of assistance, and did not specify what verification was required to renew which programs.

·    If the regularly scheduled redetermination/ recertification date did not align with the regularly scheduled renewal date for MAGI MA, the MAGI MA renewal date was not supposed to have been impacted at all, but it was. The MAGI MA case would be called in early for a renewal, and the MAGI case would potentially close if the renewal did not go successfully.

When a case includes multiple programs of assistance and MAGI MA, redeterminations/ recertifications for the non-MAGI categories of assistance continue to be aligned to coincide with the most frequent redetermination/ recertification required by the cash, Food Stamp, non-MAGI category of Medicaid, or child care assistance program received. However:

·    If the regularly scheduled redetermination/ recertification date also aligns with the regularly scheduled renewal date for MAGI MA, two (2) letters will now be generated to the case:

-   The notification associated with the type of redetermination/recertification scheduled for the cash, Food Stamp, non-MAGI category of Medicaid, or child care assistance program is generated. E.g., the New HEIGHTS-generated CS0001, CS0005, CS0027, or CS0031; and

-  The CS0006/CS0030 is generated for the passive MAGI MA case or the CS0006/CS0027 is generated for the non-passive MAGI MA case.

·    If this regularly scheduled redetermination/ recertification date does not align with the regularly scheduled renewal date for MAGI MA, the MAGI MA renewal date is not impacted at all and remains unchanged. The redetermination/recertification letters will only be generated to the non-MAGI MA categories of assistance.

MAGI MA renewal recipients were provided with a 90-day “grace period” in which to provide MAGI MA renewal verifications after MAGI MA was terminated at renewal for failure to provide verifications. If a MAGI MA household then filed a new application during that 90-day grace period, rather than providing the verifications as required, eligibility processes in the field were varied about how to approach the situation. Sometimes the application was considered a “new application” and self-attestation instead of proof of statements was accepted, sometimes the application was considered a “new application” and the household was allowed 10-days to provide needed verification (whether this 10-day period extended the 90-day grace period or shortened the 90-day grace period), and other times the application was denied.

When a MAGI MA household files a new MA application during the 90-day grace period, the MAGI MA household is still considered to be in renewal mode and is not considered to be a new applicant during which self-attestation for certain claims is allowed:

·    the new signed and dated application can be accepted in lieu of the signed and dated renewal info that the non-passive MAGI MA case is now required to submit for renewal; but

·    all verifications originally requested at the renewal must still be supplied within that 90-day grace period. Meaning, self-attestation cannot be accepted as verification during the 90-day grace period. The FSS must re-request the originally requested verification from the household, ensuring that the due-by date for the verification reflects the remaining amount of days in the 90-day grace period, as opposed to an automatic 10-day due-by date.

If during the 90-day grace period the household still fails to supply the required verification, MAGI MA remains terminated and is neither reopened back to the close date nor to the new application date.

FORMER MA POLICY

NEW MA POLICY

The SSA income of a child/dependent was counted as unearned income to the MAGI MA household when the income was over $1,050 (in 2015).

All SSA income of tax filers is counted in the MAGI MA eligibility determination process, even those SSA benefits that are not taxable. For tax dependents, SSA income is only counted if the tax dependent is required to file taxes. The tax dependent individual is required to file taxes if one-half of his or her SSA income plus all other income exceeds $25,000. If the child is not required to file a tax return, the child’s SSA income is not included in the total household income. If the child is required to file taxes, though, all of the dependent’s income, including the non-taxable SSA income, is included in the total household’s income. SSI income, however, continues to be excluded for all MA categories, including MAGI MA. Exception: For individuals who are claimed as a tax dependent by someone other than a parent or a spouse, regardless of whether he or she is required to file taxes, all of the individual’s income, including all Social Security benefits, counts toward his or her eligibility, regardless of whether he or she meets the tax-filing threshold.

Before there were MAGI categories of MA:

·   trust disbursements from revocable, irrevocable, and third party trusts were treated as follows for MA:

-        any disbursements made to the individual were counted as unearned income;

-        disbursements made directly to the trustee for administration of the trust were not counted; and

-        any other disbursements from the trust were considered to be an asset transfer for less than fair market value.

·    trust disbursements from Special Needs Trusts, Pooled Special Needs Trusts, and Third Party Special Needs Trusts were treated as follows for MA:

-        any disbursements from the Special Needs Trust made directly to the individual were counted as unearned income;

-        disbursements from the Special Needs Trust made to a third party for food or shelter were counted as unearned income up to the “presumed maximum value (PMV)” figure set by the SSA; and

-        any disbursements from Special Needs Trusts that were not made directly to the individual or that resulted in receipt of food or shelter, were not counted. Examples of disbursements from Special Needs Trusts that fell into this category and were not counted were disbursements made directly to the trustee for administration of the trust, disbursements for therapy, educational expenses, phone bills, recreation, medical services not covered by Medicaid, entertainment, etc.

The treatment of trust disbursements for non-MAGI categories of MA remains unchanged.

For MAGI categories of MA, count only the taxable portion of trust disbursements as unearned income, regardless of the use of the disbursement or the type of trust. Trust disbursements that are not taxable are not counted in the MAGI MA eligibility determination process. Meaning, if a MAGI MA case has a special needs trust and the disbursements are used for medical, educational, entertainment, phone bills, or trust administration and those disbursements are taxable, they now count as unearned income in the MAGI household. If those disbursements are not taxed, they are not counted in the MAGI household.

The treatment of clergy member’s or religious worker’s income, especially the treatment of a housing allowance, was not specifically addressed in policy.

Count clergy member’s or religious worker’s income for both MAGI and non-MAGI categories of MA, but:

·   if a housing allowance is also received:

-   exclude it for MAGI categories of MA; and

-  count it as unearned income for non-MAGI categories of MA.

·   if the clergy member has taken a vow of poverty:

-   exclude any income for the MAGI categories of MA; and

-   count the income for the non-MAGI categories of MA in accordance with the source and nature of the income.

 

POLICY

 

The following changes reflect the mandates of 42 CFR 435.916, the latest NH decisions related to those mandates, and feedback from the Centers for Medicare and Medicaid Services (CMS).

 

Non-passive MAGI MA renewal cases must correct the information in the CS0006/CS0027 that DHHS used to review continued eligibility for MAGI MA, sign and date the information, and return or electronically submit this packet of information along with all required verifications as a condition of continued eligibility for MAGI MA. Failure to return or electronically submit the signed and dated information with corrected information and all required verification within MAGI MA renewal timeframes results in termination of the MAGI MA case:

 

·    Terminate MAGI MA if the signed and dated CS0006/CS0027, or any requested verification required for the renewal, is not submitted to DHHS within renewal timeframes.

·    If the CS0006/CS0027 is returned without a dated signature, the eligibility worker must obtain a dated signature. Terminate MAGI MA for the case if the casehead fails to resubmit this information with a dated signature within the original renewal timeframes.

 

The CS0006/CS0027 now includes a signature field preceded by the following text:

 

All of the information I have provided on this Application is true to the best of my knowledge. I understand and agree to give proof of my statements as requested. I also understand and give permission to DHHS to contact other persons or organizations to get additional proofs of my eligibility and understand that the information I have provided will be used in computer matching with other agencies and that information obtained through matching programs may be used to determine and redetermine continued eligibility for my benefits.

 

The verifications checklist section in the CS0006/CS0027 now additionally includes:

 

·   all the verifications required in non-passive renewals for MAGI only renewals, such as:

-   SSN and Citizenship verification, if verification for these areas is required at renewal;

-  employment verification if at least one place of employment cannot be verified by DHHS through electronic cross-matching, discrepant information is discovered, new employment has been added for an individual in the household, or existing employment has been modified (such as indication that employment was terminated). Note: Individuals who have been newly added to the MAGI MA household who attest to employment will have their eligibility based upon their attestation of the details of their employment and verification will not be requested at renewal. Verification of employment of these newly added individuals will be requested post-eligibility, if needed, according to current policy (if electronic cross-matching of their employment attestation cannot occur, is unsuccessful, or is discrepant/exceeds the 10% threshold standard);

-   self-employment verification, regardless of whether this income has been verified in the past, and including if self-employment has been added for an existing household member. Note: individuals who have been newly added to the MAGI MA household who attest to self-employment income will have eligibility based upon this attestation and will not be required to verify this income for the renewal (a separate post-eligibility verification request will be sent in this circumstance);

-  unearned income verification. Verification for any type of unearned income that is countable for MAGI MA, except for Unemployment Compensation (UC) and SSA, will now be requested during all MAGI renewals and added to the verification checklist. UC income will be added to the verification checklist only if it cannot be verified by DHHS through electronic cross-matching or if the UC income associated with the MAGI MA case has been added or modified during the renewal process. SSA income cross-matched with the SSA is considered verified, so will not be included on the checklist. Note: individuals who have been newly added to the MAGI MA household who attest to receiving a type of unearned income will have eligibility based upon this attestation and will not be required to verify this income for the renewal (a separate post-eligibility verification request will be sent in this circumstance); and

·    a verification request for allowable deductions. Deductions that are relevant for MAGI MA programs will be populated on the MAGI MA verification checklist at renewals, regardless of the current verification status of the deductions. Note: individuals who have been newly added to the MAGI MA household who attest to having a type of MAGI MA allowable deduction will have eligibility based upon this attestation and will not be required to verify this deduction for the renewal (a separate post-eligibility verification request will be sent in this circumstance).

 

When a case includes multiple programs of assistance as well as MAGI MA, redeterminations/recertifications for the non-MAGI programs of assistance will continue to be aligned to coincide with the most frequent redetermination/recertification required by the cash, Food Stamp, non-MAGI category of Medicaid, or child care assistance program. However:

 

·    if the MAGI MA case is not being renewed at the same time, the New HEIGHTS-generated CS0001, CS0005, CS0027, or CS0031, will be sent to the case, but the letters will specify the non-MAGI category of MA that is being renewed, if Medicaid is being renewed at all, and include text indicating that if the letter does not mention a MAGI category of MA, renewal is not occurring for those categories at that time and the MAGI MA case needs to do nothing to continue to receive medical assistance.

·    If the MAGI MA case is being renewed at the same time as the other programs, though, the recipient will now receive two (2) renewal packages: a redetermination/recertification package for the non-MAGI MA categories of assistance for which eligibility must be redetermined, and a renewal package solely associated with continued eligibility for the MAGI MA category of assistance. If the MAGI renewal is non-passive, the MAGI case must complete both renewal packages for continued eligibility to be determined for all programs. Sending two separate renewal packages ensures that the recipients are receiving the correct information about what is required to renew the assistance the case is receiving and the timeframes in which these steps need to be taken. In these circumstances, the following text will be autopopulated on both letters:

 

Important: If you received two redetermination notices (one for MAGI Medicaid and one for other programs) you must complete and return both forms.

 

Failure to complete both renewal packages results in termination of the programs of assistance for which the renewal packages were not completed, per current policy.

 

MAGI MA renewal recipients are provided with a 90-day “grace period” in which to provide MAGI MA renewal verifications after MAGI MA is terminated at renewal for failure to provide those verifications. When a MAGI MA household files a new MA application during the 90-day grace period instead of providing the requested verifications, the MAGI MA household is still considered to be in renewal mode and is not considered to be a new applicant during which self-attestation for certain claims is allowed:

 

·    the new signed and dated application can be accepted in lieu of the signed and dated renewal info that the non-passive MAGI MA household is now required to submit as a condition of renewal; but

·    all verifications originally requested at the renewal must still be supplied within that 90-day grace period. Meaning, self-attestation cannot be accepted as verification during the 90-day grace period. The eligibility worker must again request the verification that was originally requested for the renewal, ensuring that the MAGI household retains the remainder of the 90-day grace period in which to submit it. The notice re-requesting the verification should not indicate a 10-day due date if that 10-day due date truncates the 90-day grace period or extends the 90-day grace period.

If during the 90-day grace period the household still fails to supply the required verification, MAGI MA remains terminated and is neither reopened back to the close date nor to the new application date.

 

RELATED MAGI MA POLICY CLARIFICATIONS

 

The following policy clarifications are based upon recent feedback received from CMS.

 

Treatment of Social Security (SSA) Income

 

Social Security (SSA) income includes retirement, survivor benefits, and disability (SSDI) payments. Generally, taxable income counts in determining household MAGI-based income. However, all SSA income of tax filers is counted in the MAGI MA eligibility determination process, even those SSA benefits that are not taxable.

 

For tax dependents, SSA income is only counted if the tax dependent is required to file taxes. The tax dependent individual is required to file taxes if one-half of the Social Security income plus all other income of the dependent exceeds $25,000. If a dependent child is not required to file a tax return, the child’s social security income is not included in the total MAGI household income. If the dependent child is required to file taxes, though, all of the dependent’s income, including non-taxable SSA income, is included in the total MAGI household’s income.

 

Exception: For individuals who are claimed as a tax dependent by someone other than a parent or a spouse, regardless of whether he or she is required to file taxes, all of the individual’s income, including all Social Security benefits, counts toward his or her eligibility, regardless of whether he or she meets the tax-filing threshold.

 

Supplemental Security Income (SSI) continues to be excluded in all categories of MA.

 

Treatment of Trust Disbursements

 

The treatment of trust disbursements in the medical assistance (MA) eligibility determination process differs based upon the type of trust involved and the type of MA received:

 

·      for all categories of Non-MAGI MA, trust disbursements from revocable, irrevocable, and third party trusts are treated as follows:

-  any disbursements made to the individual are counted as unearned income;

- disbursements made directly to the trustee for administration of the trust are not counted; and

-  any other disbursements from the trust are considered to be an asset transfer for less than fair market value.

·    for all categories of non-MAGI MA, trust disbursements from Special Needs Trusts, Pooled Special Needs Trusts, and Third Party Special Needs Trusts are treated as follows:

-  any disbursements from the Special Needs Trust made directly to the individual are counted as unearned income;

-  disbursements from the Special Needs Trust made to a third party for food or shelter are counted as unearned income up to the “presumed maximum value (PMV)” figure set by the SSA; and

-   any disbursements from Special Needs Trusts that are not made directly to the individual or that result in receipt of food or shelter, are not counted. Examples of disbursements from special needs trusts that fall into this category and are not counted are disbursements made directly to the trustee for administration of the trust, disbursements for therapy, educational expenses, phone bills, recreation, medical services not covered by Medicaid, entertainment, etc.

·    for all categories of MAGI MA, count only the taxable portion of trust disbursements as unearned income, regardless of the type of trust or use of the disbursement. If a MAGI case has a special needs trust and the disbursements are used for such things as medical services not covered by Medicaid, educational expenses, phone bills, therapy, recreation, entertainment, or trust administration (which allows the disbursements to be excluded for non-MAGI categories of MA), these disbursements are counted in the MAGI MA case as unearned income if the disbursements are taxable. If the disbursements are not taxable, they are not counted.

Exception: For tax dependents, such as children, receiving disbursements from a trust that total less than $1,050 (in 2015) and have no other income, none of the income is counted towards the MAGI household. If the trust disbursements exceed $1,050 or the dependent has other income that exceeds the tax filing threshold so the dependent must file taxes, then the tax disbursements and other income are counted towards the MAGI household’s income.

 

The PMV for 2016, per the POMS SI 00835.901 [https://secure.ssa.gov/poms.nsf/lnx/0500835901], is as follows:

 

·   $264.33 for an individual; and

·   $386.66 for an individual and either a spouse or needy essential person.

 

The 2015 Federal Tax Filing Requirement Thresholds, per IRS Publication 501 [https://www.irs.gov/pub/irs-pdf/p501.pdf], is as follows:

 

Filing Status

Age

Must File a Return if Gross Income Exceeds:

Single

Under 65

65 or Older

$10,300

$11,850

Head of Household

Under 65

65 or Older

$13,250

$14,800

Married Filing Jointly

Under 65 (both spouses)

65 or Older (one spouse)

65 or Older (both spouses)

$20,600

$21,850

$23,100

Married Filing Separately

Any Age

$4,000

Qualifying Widow(er) with Dependent Children

Under 65

65 or Older

$16,600

$17,850

 

The 2015 Federal Tax Filing Requirement Thresholds for single dependents, per IRS Publication 929 [https://www.irs.gov/pub/irs-pdf/p929.pdf], is as follows:

 

Filing Status

Age

Must File a Return if ANY of the Following Apply:

Single Dependent

Under 65 and

Not Blind

·   Unearned Income Exceeds $1,050.

·   Earned Income Exceeds $6,300.

·   Gross Income Exceeds the Larger of:

      -        $1,050; or

-    Earned Income (up to $5,950) plus $350.

Single Dependent

65 or Older or

Blind

·    Unearned Income Exceeds $2,600 ($4,150 if 65 or older and blind).

·    Earned Income Exceeds $7,850 ($9,400 if 65 or older and blind).

·     Gross Income Exceeds the Larger of:

      - $2,600 ($4,150 if 65 or older and blind); or

-  Earned Income (up to $5,950) plus $1,900 ($3,450 if 65 or older and blind).

 

It is anticipated that the PMV and IRS Federal Tax Filing Threshold figures will be updated during the January Mass Change in the future.

 

Treatment of Clergy Member’s/Religious Workers Income and Household Allowance

 

Unless tax exempt, count clergy member’s or religious worker’s income for both MAGI and non-MAGI categories of MA, but:

 

·   If a housing allowance is also received:

- exclude it for the MAGI categories of MA; and

- count it as unearned income for the non-MAGI categories of MA.

·   if the clergy member has taken a vow of poverty:

- exclude any income for the MAGI categories of MA; and

- count any income for the non-MAGI categories of MA in accordance with the source and nature of the income.

 

 

NEW HEIGHTS AND DISTRICT OFFICE PROCEDURES AND IMPLEMENTATION

 

MAGI Renewal Changes

 

New HEIGHTS and NH EASY have been updated to reflect the policies released in this SR. Additionally, the content or triggering of the following New HEIGHTS-generated letters were altered as follows effective for July’s generation of the August 2016 renewals:

 

·    the CS0001, Rede interview, CS0005, Mail-In Rede Letter, CS0006, MAGI Mail In Rede Letter, CS0027, Online Rede Letter, CS0030, MAGI Online Rede Letter, and CS0031, Phone Scheduling Rede Letter, were revised to add the following text for mixed households with non-passive MAGI MA cases: Important: If you received two redetermination notices (one for MAGI Medicaid and one for other programs) you must complete and return both forms;

·    the non-passive version of the CS0006 was revised to add a signature field; and

·    the CS0027 has been revised to eliminate the text associated with requesting a paper redetermination application when it is a mixed household with a non-passive MAGI MA case.

 

New HEIGHTS will release the new versions of the above letters under separate cover at a later date.

 

Social Security (SSA) Income Procedures

 

If in applying policy it is determined that a tax dependent’s SSA income is excluded in the total MAGI household income, enter the amount as “Other MAGI” on the “Other Allowable Deduction” screen.

 

POLICY MANUAL REVISIONS

 

Revised Medical Assistance Manual Topics

 

PART 157                               REDETERMINATION

Section 157.01                       Timely Notice

Section 157.03                       Required Verification for Redeterminations

Section 157.05                       Processing Redeterminations

Section 157.09                       Termination at Redetermination

PART 511                               INCOME TYPES: BENEFITS

PART 511                               INCOME TYPES: SOCIAL SECURITY ADMINISTRATION (SSA) BENEFITS

PART 511                               INCOME TYPES: SOCIAL SECURITY DISABILITY INSURANCE (SSDI) BENEFITS

PART 511                               INCOME TYPES: TRUST DISBURSEMENTS

PART 513                               LESS COMMON INCOME TYPES: EARNINGS OF CLERGY MEMBERS OR RELIGIOUS WORKERS

PART 601                               INCOME LIMITS: TABLE K, IRS Tax Filing Thresholds

 

IMPLEMENTATION

 

The policy released in this SR, other than the treatment of SSA income, is effective August 1, 2016. The treatment of SSA income was effective June 1, 2016. Apply the new SSA policy to all current cases at the next renewal or next case action, whichever is earliest. The updated New HEIGHTS-generated renewal letters were mailed out for the first time in July for the August 2016 MAGI MA renewals.

 

CLIENT NOTIFICATION

 

No special client notification is planned.

 

TRAINING

 

A remote training on these topics was posted in May. No other training is planned.

 

DISPOSITION

 

This SR may be destroyed or deleted after its contents have been noted and the revised manual topics released by this SR have been posted to the On-line manuals.

 

DISTRIBUTION

 

This SR will be distributed according to the electronic distribution list for DFA policy releases. This SR, and revised On-Line Manuals, will be available for agency staff in the On-Line Manual Library, and for public access on the Internet at www.dhhs.nh.gov/DFA/publications.htm, effective August 29, 2016. Additionally, this SR, and printed pages with posting instructions, will be distributed under separate cover to all internal hard copy holders of the Medical Assistance Manual.

 

DFA/JBV:s