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Income overview 4: exclusions and allocations continued
Purpose: To describe how various types and amounts of income affect an individual’s eligibility for Categorically Needy (CN) or Medically Needy (MN) health care coverage.
WAC 182-512-0840 SSI-related medical -- Work and agency-related income exclusions.
Effective April 14, 2014.
The agency excludes the following when determining eligibility for Washington apple health (WAH) SSI-related medical programs:
- Work related expenses:
- That enable an SSI-related person to work; or
- That allows a blind or disabled person to work and that are directly related to the person's impairment.
- First sixty-five dollars plus one-half of the remainder of earned income. This is considered a work allowance/incentive. This deduction does not apply to income already excluded.
- Any portion of self-employment income normally allowed as an income deduction by the Internal Revenue Service (IRS).
- Earned income of a person age twenty-one or younger if that person meets the definition of a student as defined in WAC 182-512-0820.
- Veteran's aid and attendance, housebound allowance, unusual/unreimbursed medical expenses (UME) paid by the VA to some disabled veterans, their spouses, widows or parents. For people receiving WAH long-term care services, see chapter 182-513 WAC.
- Department of veterans affairs benefits designated for the veteran's dependent as long as the SSI-related applicant is not the dependent receiving the income. If an SSI-related applicant receives a dependent allowance based on the veteran's or veteran's survivor claim, the income is countable as long as it is not paid due to unusual medical expenses (UME).
- Payments provided in cash or in-kind, to an ineligible or nonapplying spouse, under any government program that provides social services provided to the person, such as chore services or attendant care.
- SSA refunds for medicare buy-in premiums paid by the person when the state also paid the premiums.
- Income that causes a person to lose SSI eligibility, due solely to reduction in the SSP.
- Tax rebates or special payments excluded under other statutes.
- Any public agency refund of taxes paid on real property or on food.
The Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) programs include a number of employment support provisions commonly referred to as work incentives. Many of these incentives help individuals receiving such benefits maintain their eligibility for health care coverage. For a general description of these work incentives, see the Social Security Red Book.
There are several different types of veteran's benefits issued by the U.S. Department of Veteran's Affairs (VA). The benefit type, who the benefit is for, and what the intention of benefit determines how the Agency treats the income source for SSI-related Apple Health.
The VA publishes its current payment standards in the VA benefits chart which is available from the ADSA website.
Verification of VA income may be obtained by requesting a copy of the VA award letter or by using the information in the PARIS cross match. The VA claim number must be coded in ACES to ensure the cross-match data is current and accurate.
Listed below are common types of VA income sources. VA income may be needs-based which means other income affects the total VA payment or it may be compensation based on disability or death.
Service-Connected Disability Compensation
Service-connected disability compensation is a benefit paid to a veteran because of a service-related injury or disease. These benefits are countable income for SSI-related Apple Health eligibility. Since these benefits are not needs-based, other income of the veteran or their family is not taken into consideration when determining the amount of the payment. However the payment may include an amount for the veteran’s dependents (spouse or children). Any portion of the VA payment designated as a dependent’s income must be split out of the total VA compensation amount and coded as that individual’s income. A dependent’s income is not considered the veteran’s income for SSI-related Apple Health purposes.
Example: John receives VA compensation based on 40% disability. He has two children under the age of 18. The total payment John receives is $651.84 per month. The Veterans Compensation Benefits Rate Table shows the VA payment at 40% disability includes:
$620.17 for the veteran (John) + one child; and
$31.67 for each additional child under age 18.
$588.50 is John's countable income and $31.67 is countable income for each child.
Dependency and Indemnity Compensation (DIC)
DIC is a tax-free monetary benefit generally payable to a surviving spouse, child, or parent of service members who died while on active duty, active duty for training, or inactive duty training, or to survivors of veterans who died from their service-connected disabilities. Parents DIC is an income-based benefit for parents who were financially dependent on of a service member or veteran who died from a service-related cause. The VA payment was based on a different formula for veterans who died prior to January 1, 1993. After January 1993, the VA switched to a basic rate with add-on amounts for dependent children or aid and attendance expenses.
As with service-connected disability, any amount designated for a dependent child needs to be identified and coded on that dependent’s screen in ACES. Both the widow’s and the child’s income are countable income for SSI-related Apple Health, although any amount designated as aid and attendance is not counted. If there is no surviving spouse, DIC benefits may be paid directly to children through the age of 18 or 21 if a student is still in school. DIC compensation has its own allowances.
Example: Jose is the surviving spouse of a veteran who was killed on active duty in 2009. He has one child, age 14. Jose receives a total VA payment of $1538.75:
$1233.23 = basic rate payment. This is Jose's countable VA income.
$305.52 = dependent allowance. This is the child's countable VA income.
Parent’s Dependency and Indemnity Compensation (PDIC)
PDIC is a tax free income-based monthly benefit for the parent(s) of military Service members who died in the line of duty or veterans whose death resulted from a service-related injury or disease. It is countable income for SSI-related Apple Health. All income received by the household is taken into consideration when determining the amount of the VA payment.
The parent(s) may also be eligible to receive an additional amount to cover aid and attendance (A&A) expenses. Amounts designated for A&A are not countable for SSI-related medical. The VA benefits chart provides a breakdown of the payment amount and any A&A amount. Amounts designated for A&A are not countable for SSI-related Apple Health.
Disability pensions are benefits paid to wartime veterans with limited income who are no longer able to work. Pensions are available to veterans, surviving spouses, and children if the veteran has qualifying service, there is financial need, and the veteran has a qualifying disability. In addition to the veteran’s pension amount, the VA may increase the payment by a dependent allocation, an aid and attendance or housebound allowance, or monies to reimburse veterans for unusual medical expenses (UME). Any portion of the payment determined to be the pension is countable income to the veteran. Any portion of the payment determined to be the dependent’s income is countable income to that dependent. A&A, housebound allowance and UME are not countable income for the purposes of SSI-related Medicaid.
Currently, the only pension program that the VA accepts applications for is the Improved Pension. However, veterans who applied for a pension prior to 01/01/1979 may be receiving one of the following pension types:
- Old Law Disability or Death Pension
- Section 306 Disability or Death Pension; or
- Improved Pension
Old Law and Section 306 Pensions (approved prior to 1979)
These plans have an income cap. Veterans may have household income up to the cap and still be eligible for the full benefit amount. Veterans continue to be eligible for these pensions as long as they:
- Remain disabled
- Don't lose a dependent
- Don't have assets over the limit set by the VA
- Don't exceed the annual income limit set by the VA
A surviving spouse or child is eligible for this pension as long as he or she retains surviving spouse or child status.
Improved pensions are directly affected by other household income. The VA pays the difference between the household’s annual income from all sources (except SSI) and the VA’s annual income standard. The improved pension amounts listed in Part 1 of the VA benefit chart show the maximum benefit the veteran would be eligible for based on the household having no other income.
Example: Joe receives $600 per month in Social Security Disability Benefits (SSDI) and $385 per month in veteran's pension benefits. In reviewing the VA benefit chart, you see that the maximum VA pension benefit for a veteran with no dependents is $985 (Dec.08 amount). The benefit Joe receives is $985 less the $600 SSDI for a total VA payment amount of $385. Code the $385 as VI income in ACES.
Example: Imagine Joe has a dependent child living at home. Joe would now be entitled to receive a total VA payment of $691. In reviewing the VA benefit chart, you see that the maximum VA pension benefit for a veteran with a single dependent is $1291. Again the VA subtracts the $600 SSDI benefit from the maximum payment. Line 2 on the chart shows you that the dependent's allowance is $306. Code $385 VI income in Joe's UNER screen and $306 VI income on the child's UNER screen.
Note: Subtract the dependent's income in ACES to correctly determine allocations and deeming to dependents for SSI-related purposes. In some situations the VA may pay a dependent allocation for a child that does not live in the home. That income is counted for the veteran if he keeps the money and is not counted if he gives the income to that dependent.
It is extremely important to separate out the dependent’s income in ACES so that the ACES system can correctly determine allocations and deeming to dependents for SSI-related purposes. In some situations the VA may pay a dependent allocation for a child that does not live in the home. In those situations, the income is countable income to the veteran if he keeps the money and noncountable if he gives the income to the dependent it's intended for.
Aid and Attendance/Housebound Allowances (VT code in ACES)
These are additional benefits paid to veterans, their spouses, surviving spouses, and parents. This allowance is available within all compensation, DIC and pension programs. Aid and Attendance (A&A) is paid based on the need for personal care services from another person or based on a specific disability. The housebound allowance is paid based on certain specific disabilities and is a lesser amount than A&A. Any amount designated as A&A or a housebound allowance is excluded income for SSI-related Apple programs.
Example: Use the same example above of Joe and his child, but Joe tells you he's now been approved for A&A. Joe's total income is $1349 VA income plus the $600 SSDI income, for total income of $1949 per month. Of this, $385 is his pension payment (code as VI in ACES), $306 is his child's income (code as VI on the child's screen in ACES) and $658 is A&A (code as VT in ACES), which is exempt income for SSI-related Medicaid. Joe's total countable income is $985 per month.
Unusual Medical Expenses (UME) (VU code in ACES)
Individuals or surviving spouses who receive Improved Pension or Improved Death Pension benefits may be eligible to receive UME which provides a higher VA pension benefit. UME is paid to offset increased medical costs, similar to an income reimbursement. Amounts designated for UME are not countable for SSI-related Apple Health and must be split out from the total VA payment amount.
Example: Joe receives $600 SSDI benefits and a VA Improved Pension benefit of $985 for total monthly income of $1585. Joe doesn't have a dependent in this example and is not getting A&A. We know from the example above that the maximum pension benefit Joe could receive is $385 based on the other income of $600 SSDI, so he must be receiving an allowance for unusual medical expenses in the amount of $600. (The VA 'offsets' his SSDI income by the amount he is expending on high medical expenses). In ACES $385 is his VA pension (code as VI), $600 is UME (code as VU), and $600 is his SSDI income.
The UME calculator. In some cases, you can tell if an individual is receiving an allowance for UME by checking the PARIS interface data. However, for new applicants there may not be a recent cross-match available to review and the VA award letter does not give this information. The UME calculator breaks down the amount of benefits that have been restored due to UME for veterans receiving the Improved Pension. You need to know the following information to use the UME calculator:
- Total VA payment amount,
- The type of VA pension benefit,
- Whether the payment includes an amount for A&A, housebound allowance, or a dependent allowance,
- All other family income amounts.
UME restores benefits in a certain order – A&A/Housebound, then dependent allowance, then the basic pension. The calculator is programmed with this logic and displays the correct amounts and codes to enter into ACES.
Note: The calculator still uses the ACES code VA for the improved pension and not the VI code. Please record this as VI income in ACES).
Example: Maria is a disabled veteran who receives an improved pension and A&A. Her total VA income is $1643 per month. She also receives $800 in Social Security Disability Benefits (SSDI). Since $1643 is the maximum amount the VA pays for someone with no other income, the VA must be offsetting her SSDI benefits of $800 with unusual medical expenses (UME). If this information is entered to the UME calculator, you can determine that Maria receives $658 in A&A (code as VT in ACES), $800 in UME (code as VU in ACES) and $185 in improved pension benefits (code as VI in ACES). The VA restores the A&A benefit before it restores the improved pension benefit. Total countable income for Maria is $985.
WAC 182-512-0860 SSI-related medical -- Income exclusions under federal statute or other state laws.
Effective April 14, 2014.
The Social Security Act and other federal statutes or state laws list income that the agency excludes when determining eligibility for Washington apple health (WAH) SSI-related medical programs. These exclusions include, but are not limited to:
- Income tax refunds;
- Federal earned income tax credit (EITC) payments for twelve months after the month of receipt;
- Compensation provided to volunteers in the Corporation for National and Community Service (CNCS), formerly known as ACTION programs established by the Domestic Volunteer Service Act of 1973. P.L. 93-113;
- Assistance to a person (other than wages or salaries) under the Older Americans Act of 1965, as amended by section 102 (h)(1) of Pub. L. 95-478 (92 Stat. 1515, 42 U.S.C. 3020a);
- Federal, state and local government payments including assistance provided in cash or in-kind under any government program that provides medical or social services;
- Certain cash or in-kind payments a person receives from a governmental or nongovernmental medical or social service agency to pay for medical or social services;
- Value of food provided through a federal or nonprofit food program such as WIC, donated food program, school lunch program;
- Assistance based on need, including:
- Any federal SSI income or state supplement payment (SSP) based on financial need;
- Basic Food;
- State-funded cash assistance;
- TANF; and
- Bureau of Indian Affairs (BIA) general assistance.
- Housing assistance from a federal program such as HUD if paid under:
- United States Housing Act of 1937 (section 1437 et seq. of 42 U.S.C.);
- National Housing Act (section 1701 et seq. of 12 U.S.C.);
- Section 101 of the Housing and Urban Development Act of 1965 (section 1701s of 12 U.S.C., section 1451 of 42 U.S.C.);
- Title V of the Housing Act of 1949 (section 1471 et seq. of 42 U.S.C.);
- Section 202(h) of the Housing Act of 1959; or
- Weatherization provided to low-income homeowners by programs that consider income in the eligibility determinations.
- Energy assistance payments including:
- Those to prevent fuel cutoffs; and
- Those to promote energy efficiency.
- Income from employment and training programs as specified in WAC 182-512-0780.
- Foster grandparents program;
- Title IV-E and state foster care maintenance payments if the foster child is not included in the assistance unit;
- The value of any childcare provided or arranged (or any payment for such care or reimbursement for costs incurred for such care) under the Child Care and Development Block Grant Act, as amended by section 8(b) of P.L. 102-586 (106 Stat. 5035);
- Educational assistance as specified in WAC 182-512-0760;
- The excluded income described in WAC 182-512-0770 and other income received by American Indians/Alaska Natives that is excluded by federal law;
- Payments from Susan Walker v. Bayer Corporation, et al., 96-c-5024 (N.D. Ill) (May 8, 1997) settlement funds;
- Payments from Ricky Ray Hemophilia Relief Fund Act of 1998, P.L. 105-369;
- Disaster assistance paid under Federal Disaster Relief P.L. 100-387 and Emergency Assistance Act, P.L. 93-288 amended by P.L. 100-707 and for farmers P.L. 100-387;
- Payments to certain survivors of the Holocaust as victims of Nazi persecution; payments excluded pursuant to section 1(a) of the Victims of Nazi Persecution Act of 1994, P.L. 103-286 (108 Stat. 1450);
- Payments made under section 500 through 506 of the Austrian General Social Insurance Act;
- Payments made under the Netherlands' Act on Benefits for Victims of Persecution (WUV);
- Restitution payments and interest earned to Japanese Americans or their survivors, and Aleuts interned during World War II, established by P.L. 100-383;
- Payments made from the Agent Orange Settlement Funds or any other funds to settle Agent Orange liability claims established by P.L. 101-201;
- Payments made under section six of the Radiation Exposure Compensation Act established by P.L. 101-426; and
- Any interest or dividend is excluded as income, except for the community spouse of an institutionalized person.
- Assistance based on need that is not counted as income include payments wholly funded by a State or not of its political divisions. For this purpose, an Indian tribe is considered a political subdivision within the geographical boundary of a State. When such payments are provided under a program that uses the amount of an individual's income to determine eligibility, the payments are not counted as income. If the individual's income is used only for determining the amount of a payment, however, and not also for eligibility for the program under which the payment is made, then the payment is counted as unearned income.
- Some tribes, such as the Muckleshoot Indian Tribe, provide this type of cash assistance to its elder members. When eligibility for this assistance is based on the individual's income, the payments are not counted when determining eligibility for Apple Health. These payments are excluded under 20 CFR § 416.1124(c)(2) – Unearned income we do not count.
- It is important to understand that the Tribal General Welfare Exclusion Act of 2014 amends the Internal Revenue Service (IRS) code. The bill language does not add any new exclusions from Indian income to the SSI program. Its primary purpose is to codify that certain payments, programs, or services provided by tribal governments for the general welfare of their people that meet the requirements under the Tribal Act are excluded from federal income tax, as are TANF and SSI benefits. For more information, go to the Social Security Administration's American Indians and Alaska Natives (AIAN) webpage.