ALABAMA MEDICAID AGENCY

ADMINISTRATIVE CODE

CHAPTER 560-X-25 MEDICAID ELIGIBILITY

TABLE OF CONTENTS

560-X-25-.01 Governing Authorities

560-X-25-.02 Administrative Responsibilities

560-X-25-.03 Coverage Groups

560-X-25-.04 Application, Initial Determination Or Denial Of Eligibility, And Redetermination Of Eligibility

560-X-25-.05 General Categorical Eligibility Criteria

560-X-25-.06 Financial Eligibility Criteria - Resources

560-X-25-.07 Development Of Ownership Interest In Nonliquid Resources For SSI-Related Individuals

560-X-25-.08 Development Of Ownership Interest In Liquid Resources For SSI-Related Individuals

560-X-25-.09 Transfer Of Assets Affecting Eligibility

560-X-25-.10 Income Criteria For SSI-Related Individuals

560-X-25-.11 Additional Criteria For Institutional Care

560-X-25-.12 Periods Of Entitlement

560-X-25-.13 Adults In Need Of Protective Services

560-X-25-.14 Pregnant Women And Young Children With Income Equal To Or Below 133% Of The Federal Poverty Level And Children With Income Equal To Or Below 100% Of The Federal Poverty Level

560-X-25-.15 Medicaid For Low Income Families, Extended Medicaid Benefits Due To State Collected Child Support, And Transitional Medicaid Benefits

560-X-25-.16 Income And Resources Of A Married Couple For Institutional Care

560-X-25-.01 Governing Authorities.

(1) In determining eligibility for Medicaid, the Agency's rules and regulations are governed by the Social Security Act (hereinafter referred to as the Act), Titles XVI and XIX; 20 C.F.R. (Part 416); 42 C.F.R. (Part 435); and the Alabama State Plan for Medical Assistance.

(2) Any part of the Code of Federal Regulations cited herein is adopted by reference as a part of the Rule in which it is cited.

Author:

Statutory Authority: Code of Ala. 1975, §41-22-9.

History: Rule effective October 1, 1982.

560-X-25-.02 Administrative Responsibilities.

(1) The Alabama Medicaid Agency determines the eligibility of SSI-related individuals for Medicaid benefits in accordance with Title XIX of the Act.

(2) The Social Security Administration determines the eligibility of individuals for Supplemental Security Income under Title XVI of the Act.

(3) The Alabama Department of Pensions and Security determines the eligibility of individuals for various forms of assistance in accordance with Titles IV-A, IV-E, and XIX of the Act.

Author:

Statutory Authority: Social Security Act, Titles XVI, XIX; 20 C.F.R. (Part 416); 42 C.F.R. (Part 435); State Plan.

History: Rule effective October 1, 1982.

560-X-25-.03 Coverage Groups.

(1) The following are the general groups of individuals designated as categorically eligible under the State Plan for Medical Assistance, and who as a result are Medicaid eligible:

(a) Aged, blind or disabled persons who receive Supplemental Security Income (SSI) under Title XVI;

(b) Persons who are residents of Title XIX institutions but who are not eligible for SSI, Optional Supplementation or AFDC because their income exceeds $50.00 per month but is not more than 300 percent of the current SSI benefit amount payable to an individual in his own home who has no income;

(c) Persons who would be eligible for SSI or Optional Supplementation but for the fact that they are residents of a Title XIX institution;

(d) All aged, blind and disabled persons who were residents of a Title XIX institution as of December 31, 1973 and who were converted from the former State program (OAP, APTD, AB). If ineligible under current eligibility rules these individuals are entitled to use the rules for determining eligibility which were in effect under the State's Plan for Medical Assistance in December 1973;

(e) Persons who:

1. are currently receiving Old Age Survivors Disability Insurance (OASDI);

2. are ineligible for SSI due to income;

3. were contemporaneously eligible for both OASDI and SSI in the same month after April 1977; and

4. would be eligible for SSI but for OASDI cost-of-living increases received since the last month of contemporaneous OASDI and SSI eligibility.

(f) Individuals receiving mandatory or optional State

Supplementation payments;

(g) Individuals who would be eligible for SSI, except for the increase in OASDI benefits under Pub. L. 92-336 (July 1, 1972), who were entitled to OASDI in August 1972, and who were receiving cash assistance in August 1972 or who were eligible for such cash assistance but for the fact that they were residents of a medical institution or intermediate care facility;

(h) Medicaid for Low Income Families: Individuals

eligible for Medicaid through the Medicaid for Low Income Families Program or who meet the eligibility criteria for Medicaid for Low Income Families based on policies in effect for the AFDC program as it existed on July 16, 1996 based on Section 1931 of the Social Security Act.

The following individuals are deemed to be eligible for Medicaid for Low Income Families:

1. AFDC qualified pregnant women whose family income and resources fall within the standards for Medicaid for Low Income Families.

2. Individuals under age 18 who would qualify for Medicaid for Low Income Families but do not qualify as dependent children, since they are children for whom public agencies have assumed full or partial financial responsibility and who are in foster homes or private institutions.

(i) All individuals receiving assistance under Title IV-E of the Act, including children for whom adoption assistance or foster care payments are made in Alabama or out of state;

(j) Individuals who are eligible for Medicaid solely because they require and receive services under CMS approved home and community based services waiver. See Appendix C of the waiver document for a complete description of eligibility groups served by a specific waiver.

(2) The following groups of individuals are eligible under the Deficit Reduction Act of 1984 and as amended by Public Law 100-203 and Public Law 101-508.

(a) Pregnant women in intact families in which the principal wage earner is unemployed (as defined by federal regulations) meeting Medicaid for Low Income Families income and resource standards.

(b) Children under age 7 born on or after October 1, 1983, in intact families meeting Medicaid for Low Income Families income and resource standards.

(c) Children born to Medicaid eligible mothers on or after October 1, 1984, are deemed eligible for up to one year of age so long as the mother remains Medicaid eligible and the child remains in the mother's home.

(d) Children born to Medicaid eligible mothers on or after January 1, 1991, are deemed eligible for up to one year of age as long as the child remains in the mother's home.

(3) The following coverage is mandated by the Consolidated Omnibus Budget Reconciliation Act, Section 9501 of Public Law 99-272.

(a) All pregnant women who otherwise meet Medicaid for Low Income Families income and resource criteria.

(b) sixty-day postpartum coverage to women who were eligible for and receiving Medicaid on the date the pregnancy ended.

(4) The following coverage is mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, Section 12202 of Public Law 99-272. Coverage is extended to disabled widows or widowers if he or she meets all of the following criteria:

(a) was entitled to a monthly insurance benefit for December 1983 under Title II of the Social Security Act;

(b) was entitled to and received a widow's or widower's benefit for January 1984 based on a disability under Section 202(e) or (f) of the Social Security Act;

(c) became ineligible for SSI/SSP in the first month in which that increase was paid to him or her (and in which a retroactive payment of that increase for prior months was not made) because of the increase in the amount of the widow's or widower's benefit which resulted from the elimination of the reduction factor for disabled widows and widowers entitled before age 60;

(d) has been continuously entitled to a widow's or widower's benefit under Section 202(e) or (f) of the Act from the first month that increase in the widow's or widower's benefit was received;

(e) would be eligible for SSI/SSP benefits if the amount of that increase, and any subsequent cost-of-living adjustments in widow's or widower's benefits provided under Section 215(i) of the Act, were disregarded; and

(f) makes written application for benefits under this provision before July 1, 1988.

(5) The following coverage is mandated by Section 1634(c) of the Social Security Act as amended by Section 6, P.L. 99-643. Individuals who lose eligibility for SSI because of entitlement to, or an increase in Social Security benefits received as a Disabled Adult Child (DAC) shall continue to be eligible for Medicaid if they meet the following criteria:

(a) meet current SSI income and resource limits after a disregard of the entitlement to, or an increase in Social Security benefits.

(b) makes written application for continuation of Medicaid coverage no later than 30 days after notification of possible eligibility by the Medicaid Agency.

(6) The following coverage is provided by state option under the Omnibus Budget Reconciliation Act of 1986 (P.L. 99-509):

(a) All pregnant women with a family unit income, as defined by Title IV-A criteria, not in excess of 100 percent of the current federal poverty line;

(b) Pregnant women eligible for Medicaid will continue eligible for prenatal, delivery, and postpartum care, without regard to changes in income, to the end of the 60-day postpartum period;

(c) Infants eligible under SOBRA will be Medicaid eligible up to one year of age while residing in a family unit whose income does not exceed 100 percent of the current federal poverty line.

(7) The following coverage is mandated by the Omnibus Budget Reconciliation Act of 1987, (P.L. 100-203, Section 9116). Disabled widows and widowers may be eligible for and able to retain Medicaid benefits if they meet all of the following criteria:

(a) have reached 60 but not age 65;

(b) not eligible for Part A Medicare;

(c) eligible for and receiving Title II benefits (OASDI) and,

(d) lost SSI as a result of receiving early widows/widowers benefits.

(8) The following coverage is mandated by the Medicare Catastrophic Coverage Act of 1988 (P.L. 100-360, Section 301) as amended by P.L. 101-508. This limited coverage is described in the State Plan for Medical Assistance. Individuals may be eligible for Catastrophic Coverage as Qualified Medicaid Beneficiaries alone or may be dually eligible if they meet the criteria of the other categorical eligibility as described in this Chapter. Aged, blind, or disabled individuals may be eligible under these provisions if they meet the following criteria:

(a) Entitled to Part A Medicare.

(b) Have resources at or below twice the resources allowed for a recipient of Supplemental Security Income. Resource standards are a federal requirement, but are not an eligibility requirement for Alabama’s program.

(c) Have income at or below the following limits:

Income for 1989 will be 85% of federal poverty level

Income for 1990 will be 90% of federal poverty level

Income for 1991 will be 100% of federal poverty level

Income for 1992 and afterwards will be 100% of federal poverty level.

(9) Section 4501(b) of the Omnibus Budget Reconciliation Act of 1990 amended 1902(a)(10)(E) of the Social Security Act to mandate coverage of Specified Low Income Medicare Beneficiaries beginning January 1, 1993. This provision requires medical assistance payment of Medicare Part B premiums for eligible individuals. The Specified Low Income Medicare Beneficiaries (SLMBs) must meet all of the eligibility requirements for Qualified Medicare Beneficiary (QMB) status with the exception of income limits. The SLMBs must have income within the limits listed below:

Income for 1993 cannot be less than 100% and not more than 110% of federal poverty level.

Income for 1994 cannot be less than 100% and not more than 110% of federal poverty level.

Income for 1995 and afterwards cannot be less than 100% and not more than 120% of federal poverty level.

Resource standards are a federal requirement, but are not an eligibility requirement for Alabama’s program.

(10) The following coverage is mandated by the Balanced Budget Act of 1997 (Public Law 105-33, Section 4732). Qualifying Individuals (QI-1).

(a) Individuals who are entitled to hospital insurance benefits under Medicare Part A (but not pursuant to an enrollment under section 1818A of the Act);

(b) Whose income exceeds 120 percent of the federal poverty level but does not exceed 135 percent of the federal poverty level;

(c) Whose resources do not exceed twice the maximum standard under SSI; Resource standards are a federal requirement, but are not an eligibility requirement for Alabama’s program.

(d) Who is not eligible for any other Medicaid program; and

(e) Who has been awarded benefits when federal funds are available for the program. Eligibility is awarded on a first-come, first-served basis.

(Medical assistance for the above group is limited to payment of the Medicare Part B premiums under Section 1839 of the Act.)

(11) The following coverage is mandated by the Omnibus Budget Reconciliation Act of 1989 (OBRA 89) Section 6401 of P.L. 101-239).

(a) All pregnant women with a family unit income, as defined by Title IV-A criteria, not in excess of 133 percent of the current federal poverty level;

(b) Pregnant women eligible for Medicaid under this provision will continue eligible for prenatal, delivery, family planning, and postpartum care, without regard to changes in income, to the end of the month in which the 60th day of the postpartum period falls; and

(c) Children under age 6 with a family unit income, as defined by Title IV-A criteria, not in excess of 133 percent of the current federal poverty level.

(12) Children under 21, who would be eligible for Medicaid for Low Income Families, ACFC, SSI or otherwise Medicaid eligible if they were in their own home, but who are admitted as inpatients of a psychiatric facility.

(13) Qualified Disabled and Working Individual - A Qualified Disabled and Working Individual is an individual:

(a) under age 65;

(b) who has been entitled to Title II Disability Insurance Benefits (DIB);

(c) whose DIB ended due to earnings exceeding the Substantial Gainful Activity (SGA) level;

(d) who continues to have the same disabling physical or mental condition and not expected to improve;

(e) not otherwise entitled to Medicare;

(f) entitled to enroll in Medicare Part A under the provisions of 6012 (i.e., DIB terminated because of work, still working) and

(g) whose income, based on SSI rules, is under 200% of the Federal Poverty Level (FPL);

(h) whose resources, based on SSI rules, do not exceed twice the SSI resource limit;

(i) who is not otherwise eligible for medical assistance under Title XIX.

(14) The following coverage is mandated by Section 5103 of P.L. 101-508, the Omnibus Budget Reconciliation Act of 1990, (OBRA '90) and is applicable to disabled widows/widowers and disabled surviving divorced spouses.

Effective January 1, 1991, individuals who lose SSI because of receipt of a Title II benefit resulting from the change in the definition of disability will be deemed to be receiving SSI if:

(a) They were receiving SSI for the month prior to the month they began receiving the Title II benefit;

(b) They would continue to be eligible for SSI if the amount of the Title II benefit were not counted as income; and

(c) They are not entitled to Medicare Part A.

(15) The following coverage is mandated by Section 4601 of P.L. 101-508, the Omnibus Budget Reconciliation Act of 1990 and is effective July 1, 1991. This provision requires a year by year phase in of children born after September 30, 1983 and is applicable to children who:

(a) Have attained age six;

(b) Are under nineteen years of age; and

(c) Have family incomes below 100% of the federal poverty level.

(16) Children who are Medicaid eligible as determined by the State Department of Human Resources, receive state adoption subsidies and have a special need for medical or rehabilitative care.

(17) The following coverage is mandated by the Balanced Budget Act of 1997 (Public Law 105-33, Section 4913). Grandfathered children. Children who were receiving Supplemental Security Income (SSI) as of August 22, 1996 and who were terminated from SSI due to the change in definition of disability by the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996. These children will remain eligible for Medicaid as long as they continue to meet the eligibility requirements of SSI but for the change in definition of disability.

(18) Emergency services, as defined by the Alabama Medicaid Agency, will be covered for illegal aliens who would be otherwise eligible for Medicaid except for enumeration, citizenship and alienage requirements.

(19) The following coverage is allowed by PL 106-354, the Breast and Cervical Cancer Prevention and Treatment Act (BCCPTA) of 2000. Medicaid coverage is available to women who:

(a) have been screened for breast or cervical cancer under the Centers for Disease Control and Prevention Breast and Cervical Cancer Early Detection Program established under title XV of the Public Health Service Act in accordance with the requirements of section 1504 of that Act and need treatment for breast or cervical cancer, including a pre-cancerous condition of the breast or cervix:

(b) are not otherwise covered under creditable coverage, as defined in section 2701(c) of the Public Health Service Act.

(c) are not eligible for Medicaid under any mandatory categorically needy eligibility group;

(d) meet Medicaid citizenship and alienage status; and,

(e) have not attained age 65.

(20) The Plan First waiver extends Medicaid eligibility for family planning services to all women of childbearing age 19 through 44 (who have not had a sterilization procedure performed) with incomes at or below 133% of the federal poverty level that would not otherwise qualify for Medicaid.

Authors: Elizabeth Cole, Policy/Research Specialist, Policy and Program Implementation, Certification Support Division

Statutory Authority: Social Security Act, Titles XVI, XIX; 20 C.F.R. Part 416; 42 C.F.R. Part 435; §§2361, 2362 Deficit Reduction Act of 1984; State Plan for Medical Assistance, Attachment 2.2A; §9501, Public Law 99-272 and §§1905(n)(1)(c) and 1902(e)(5) Social Security Act and §12202 Consolidated Omnibus Budget Reconciliation Act of 1985; Social Security Act §1634(c), P.L. 99-643, 99-509, SSI Improvement Act of 1986; P.L. 100-203, §§9108, 9116, 9119; Medicare Catastrophic Coverage Act of 1988 (Public Law 100-360, §301); Omnibus Budget Reconciliation Act of 1989 §6401 of P.L. 101-239; §6408(d) OBRA 1989; 42 C.F.R. §§435.231, 1611(b)(1); Omnibus Budget Reconciliation Act of 1990(P.L. 101-508), §§4501, 4601, 4603, 5103; P.L. 99-272, §9529. Section 4501(b) of OBRA '90 and 42 CFR 435.222. Section 1903(v) of the Social Security Act.

History: Rule effective October 1, 1982. Emergency rule effective July 1, 1985. Amended: effective July 9, 1985. Emergency rule effective July 22, 1985. Amended: effective October 9, 1985. Emergency rule effective July 1, 1986. Amended: effective September 8, 1986; February 9, 1987; June 10, 1987; August 10, 1987. Emergency rule effective January 8, 1988. Amended effective April 12, 1988. Emergency rule effective July 1, 1988. Amended: effective July 12, 1988; September 9, 1988. Emergency rule effective October 1, 1988; January 1, 1989. Amended: effective January 10, 1989; April 14, 1989. Emergency rule effective April 2, 1990; June 1, 1990; July 2, 1990. Amended: effective July 14, 1990; September 13, 1990. Emergency rule effective October 9, 1990. Amended: effective January 15, 1991. Emergency rule effective January 9, 1991. Amended: effective April 17, 1991; July 13, 1991; October 12, 1991; June 12, 1992; November 12, 1992; January 13, 1993; March 13, 1993. Amended: June 8, 1993; effective July 13, 1993. Amended: Filed July 7, 1993; effective August 11, 1993. Amended: Filed December 8, 1997; effective January 12, 1998. Emergency rule effective February 26, 1998. Amended: Filed March 9, 1998; effective April 13, 1998. Amended: Filed August 4, 1998; effective September 9, 1998. Amended: Filed February 19, 1999; effective March 26, 1999; operative April 1, 1999. Amended: Filed August 10, 2001; effective September 14, 2001. Amended: Filed January 9, 2004; effective February 13, 2004.

560-X-25-.04 Application, Initial Determination Or Denial Of Eligibility, And Redetermination Of Eligibility.

(1) An application is a specific written request on the designated agency application form which has been completed, dated and signed by the applicant and/or applicant's representative or guardian to have eligibility for categorical assistance determined. Application is required before an individual may be determined eligible for Medicaid benefits.

(2) Any person completing an application for Medicaid benefits on behalf of another must have written authority to do so. If the person being represented is unable to sign an authorization, it must be signed by his or her legal guardian, if there is one, or if there is none, then by his or her sponsor. A form entitled, "Appointment of Representative," available from the Alabama Medicaid Agency must be completed and signed by the applicant's representative. A copy of the form is in Rule 560-X-28-.01(16) of this code.

(3) A determination of eligibility is the process by which the Medicaid Agency's worker obtains the facts of the situation of the individual applying for Medicaid as related to each factor of eligibility. In the eligibility determination process, all facts and information related to eligibility which are alleged by the applicant must be substantiated, verified, and documented.

(4) A redetermination of eligibility must be made by the Medicaid Agency, the Department of Pensions and Security, or the Social Security Administration for every Medicaid recipient at least once every twelve months. More frequent redeterminations are necessary for recipients whose circumstances are likely to change or from whom information indicates conditions have changed.

(5) When an applicant/recipient fails or refuses to provide needed information within his/her capacity, he/she may be denied Medicaid, or Medicaid may be terminated because eligibility cannot be determined or redetermined.

(6) Submission of an application for benefits containing a material misstatement, a material omission, or a material false statement shall result in a denial or termination of eligibility as appropriate, under such application or reapplication.

(7) Any Medicaid eligible child under age 19 who has been correctly determined Medicaid eligible is deemed to be eligible for a total of 12 months regardless of changes in circumstances other than attainment of the maximum age stated above, as long as the child remains a resident of Alabama.

Authors: Arthur H. Miller, John H. Ziegler

Statutory Authority: Social Security Act, Titles XVI, XIX; 20 CFR (Part 416); 42 CFR (Part 435).

History: Rule effective October 1, 1982. Amended: effective April 15, 1983; July 9, 1985; January 8, 1986; January 14, 1987. Amended: Filed August 4, 1998; effective September 9, 1998.

560-X-25-.05 General Categorical Eligibility Criteria. In order to qualify for Medicaid, AFDC-related individuals must meet the nonfinancial eligibility criteria of the AFDC programs. SSI - related individuals must meet general categorical criteria of age, disability or blindness, residence, and citizenship for the appropriate coverage groups:

(a) Age Requirements -- To be eligible, the individual must be 65 years of age or older. This factor is based on SSI policy and must be verified based on evidence requirements stated in SSI policy.

(b) Disability -- If under age 65, an individual must be blind or disabled. Disability is defined as the inability to engage in any substantial gainful activity by reason of a medically determinable physical or mental impairment(s) which can be expected to last for a continuous period of not less than 12 months.

(c) Blindness -- An individual meets blindness criteria when his central vision acuity is 20-200 or less (even with glasses) or a limited visual field of 20 degrees or less in the better eye. A person determined to be blind for purposes of SSI benefits also qualifies as blind for purposes of Medicaid.

(d) Citizenship -- To be eligible for Medicaid, a person must be a citizen of the United States, or, if an alien, must be a qualified alien. For qualified aliens arriving before 8/22/1996, they must be a lawful permanent resident, American Indian born in Canada, refugee, asylee, Cuban/Haitian entrant, battered immigrant, Amerasian, person whose deportation has been withheld, honorably discharged veteran, active duty U.S. military, person granted parole for 1 year by INS, or person granted conditional entry under 203 of the immigration law in effect before 4/1/1980. For qualified aliens arriving on or after 8/22/1996, they must be a refugee, asylee, person whose deportation has been withheld, Cuban/Haitian entrant (proceeding groups are eligible for 7 years from date of entry), honorably discharged veteran, active duty U.S. military, Amerasian (eligible for 5 years from date of entry) or lawful permanent resident in U.S. at least 5 years. Aliens should have records to establish naturalization or lawful admission. Non-qualifying aliens are eligible only for emergency services for treatment of emergency medical conditions.

(e) State Resident -- A person must be a resident of Alabama during the period covered by application, must indicate intent to remain, and must be capable of indicating such intent.

(f) Interstate residency Agreements -- The only time the above residency rule is not applicable is where the state has entered into a residence agreement with another state. Where this occurs, the state where the person physically resides is his residence for Medicaid purposes. A list of states with which Alabama has entered into residency agreements may be obtained from the Alabama Medicaid Agency.

(g) Eligibility for Other Benefits -- An individual is required to apply for any payments or benefits from other sources for which he may be eligible. If an individual is already receiving or is entitled to receive benefits from other sources which are in excess of agency standards or is receiving benefits under a VA contract, the individual is not eligible for Medicaid benefits.

(h) Assignment of Third Party Payments -- To be eligible for Medicaid, an individual must assign all third party benefits to the State. Third Party benefits are any benefits for which an entity is or may be liable to pay all or part of the medical cost of an applicant or recipient.

(i) Eligibility for Medicaid benefits ends with the month in which the individual dies.

(j) Social Security Account Number -- An individual is required to furnish his Social Security Account Number or verification that he has made application for one.

Author: Shawn White, Policy Research Specialist, Certification Support Division

Statutory Authority: Social Security Act, Titles XVI, XIX; 42 C.F.R., §§401, et seq.; 20 C.F.R. §§401, et seq.; State Plan.

History: Rule effective October 1, 1982. Amended: effective March 15, 1983; September 8, 1983. Emergency rule effective April 1, 1985. Amended: effective July 9, 1985. Amended: Filed August 5, 1997; effective September 9, 1997. Amended: Filed November 8, 2001; effective December 13, 2001. Amended: Filed September 10, 2002; effective October 15, 2002. Amended: Filed October 10, 2003; effective November 14, 2003.

560-X-25-.06 Financial Eligibility Criteria-Resources.

(1) General - In order for an AFDC-related individual to be eligible for Medicaid, he or she must meet the AFDC financial criteria. An SSI-related individual or couple must not have total countable resources in excess of $2,000 for an individual or $3,000 for a couple. An individual must not have total countable resources in excess of $4,000 for an individual or $6,000 for a couple to be eligible under the Qualified Medicare Beneficiary Program created by the Medicare Catastrophic Coverage Act of 1988.

(a) Liquid vs. Nonliquid Resources. Resources are those assets including both real and personal property which an individual or couple possess. It includes all liquid (spendable) assets, as well as nonliquid assets. Nonliquid resources are assets which are neither cash nor financial instruments. They are resources which cannot be converted to cash within 20 days.

(b) Income vs. Resources. Income is anything of value an individual/couple receives during a month. Resources are the assets such as those described above, which the individual/couple already has at the beginning of a month in which eligibility for Medicaid is being determined. An item cannot be counted as both income and a resource in the same month.

(2) Minimum exclusions of Nonliquid Resources - The following types of assets may be excluded from countable resources under certain conditions:

(a) Motor vehicles. An automobile may be excluded to the extent that its value does not exceed the amount specified in 20 CFR §416.1218.

(b) Life Insurance. Life insurance owned by an individual (and spouse, if any) may be excluded to the extent provided in 20 CFR §416.1230.

(c) Household Goods and Personal Effects. Household goods and personal effects worth no more than $2000 are totally excluded from countable resources.

(d) Burial Funds and Burial Spaces.

1. Burial Funds. In determining the resources of an individual (and spouse, if any) there shall be excluded an amount not in excess of $1500 each of funds designated for burial arrangements of the individual or individual's spouse and which are to be used for no other purpose. The applicant/recipient must submit documented evidence of the specific designation of burial funds. Each person's $1500 exclusion must be reduced by:

(i) the face value of insurance policies on the life of an individual owned by the individual or spouse if the face value is $1500 or less and the cash surrender value of those policies has been excluded from the countable resource limit and

(ii) amounts in an irrevocable trust (or other irrevocable arrangement) available to meet the burial expense.

2. Burial spaces. In determining the resources of an individual, the value of burial spaces for the individual, the individual's spouse, or any member of the individual's immediate family will be excluded from resources. The opening and closing of the grave and headstones are considered as burial space items.

(e) Real Property.

1. Home. If the home is the individual's principal place of residence, and if the individual's or his representative's signed statement identifies the reason for being away from home and the intent to return to the home, it will be excluded as a resource. If an eligible or ineligible spouse resides in what was the individual's principal place of residence prior to institutionalization, it will be excluded as long as the spouse continues to live there.

2. The home may be excluded if a dependent relative is living in the home. (For this purpose a relative is defined as: son, daughter, stepson, stepdaughter, in-laws, mother, father, stepmother, stepfather, grandmother, grandfather, grandson, granddaughter, aunt, uncle, sister, brother, stepsister, stepbrother, half-sister, half-brother, niece, nephew, cousin.) Dependency may be of any kind; e.g., financial medical, etc. If a relative, other than a spouse, is living in the home and is not dependent upon the claimant, he or she is not a dependent relative, then the home cannot be excluded on this basis. The dependency must have been immediately prior to the applicant's admission to the nursing home, and the dependent's situation must be checked periodically to determine if the dependency continues to exist.

3. Jointly-Owned Home Property. Jointly-owned home property will be excluded from resources if the sale would cause the other owner undue hardship due to the loss of housing. Undue hardship is defined as when; the property serves as the principal place of residence for one of the owners; the sale of the property would result in the loss of that residence; and no other housing would be readily available for the other owner.

4. Income-Producing Property. Income-producing property is excluded from resources when the equity in the property does not exceed $6000 and the property produces net annual return of at least 6 percent of equity.

(i) Where the value of the property is in excess of $6000, the amount in excess can be counted toward the resource limitation as long as the individual remains eligible and the property nets at least 6 percent of its equity value per anum.

(ii) Where the property is not excluded because the net annual return is less than 6 percent of the equity value, the total value is an includable resource.

(iii) Where the home is associated with self-support activities, the value of the home, contiguous land, and buildings on the land will be excluded. Total equity in other assets used for producing income must be $6,000 or less and the activity must produce at least 6 percent on the equity. Where the equity value of assets for producing income is in excess of $6,000, the amount in excess will be applied to the resource limitation. Resources used to produce items only for home consumption or tools required by employer are assumed to be netting reasonable rate of return. Property does not have to be utilized if it, in combination with other resources, does not exceed the liquid resource limit.

5. Bona Fide Effort to Sell Interest in Real property. Real property may be excluded as long as a bona fide effort is being made to sell the property. A bona fide effort to sell is defined as an attempt to sell through listing with a real estate agent or by attempt to sell by the owner. A period in excess of 7 days during which no attempt is made to sell voids this exclusion. To qualify for this exclusion, the property must have been listed for sale as of the first moment of the month that eligibility is being sought. Applicant must agree to reimburse the Agency for expenses incurred during the effort to sell and make prompt repayment after sale. Bona fide effort to sell will be reviewed periodically to verify a continuing effort.

6. Property that is specifically designated for a Plan of Self-Support for the Blind or Disabled, as provided in 20 C.F.R. (Part 416), may be excluded.

(3) Valuation of Resources -- The value of an individual's resources for Medicaid eligibility purposes is based upon the individual's equity interest in the resource. Equity is defined as the current market value (or fair market value) of the resource less any recorded indebtedness against the resource, such as a mortgage or lien. A lien taken by the Medicaid Agency under the provisions of 42 U.S.C. §1396p and Chapter 33 of this Code does not operate to reduce the current market value of the property until such lien becomes enforceable in accordance with the terms of the above-cited authorities.

(a) In the case of real property, the current market value of the property, for Medicaid eligibility purposes, is the appraised value of the property established by the current tax assessment notice from the tax assessor's office in the county in which the property is located.

1. This appraised value will be used unless the tax assessment:

(i) Is more than one year old;

(ii) Is a special purpose assessment;

(iii) Is under appeal;

(iv) Is based on a fixed rate per acre method;

(v) Does not provide an appraised value or an assessment ratio for determining such value;

2. Only if one of the above conditions exists, other evidence, such as appraisals or estimated from knowledgeable sources, may be used to establish current market value.

(b) In the case of a life estate or remainder interest in real property, the value of the individual's interest is determined by first establishing the current market value of the property and then multiplying that value by the appropriate life estate or remainder factor, based upon the age of the individual, set forth in the Life Estate and Remainder Tables, 26 CFR §20.2031.7.

1. The value obtained shall be presumed correct unless the individual furnishes clear and convincing evidence establishing a lower value. Such evidence includes, but is not limited to:

(i) efforts to sell the property interest, as evidenced by such factors as the price at which the property interest is offered for sale, marketing and advertising exposure given and offers and negotiations;

(ii) appraisals of the property interest by knowledgeable and experienced sources;

(iii) extent and results of negotiations with owners of other interests in the property or owners of adjoining property.

(4) The following are more liberal resource requirements than SSI for determining the eligibility of individuals as Qualified Medicare Beneficiaries, Specified Low Income Medicare Beneficiaries, Qualifying Individuals-1 and Qualifying Individuals-2:

(a) All resources of the applicant and the resources of the applicant’s spouse are excluded.

(b) All interest and dividend income is excluded.

(5) The following are more liberal resource requirements than SSI for determining the eligibility of individuals eligible under the institutional Medicaid program:

(a) The required net annual income of six percent is waived for the excluded $6,000 in equity value for income- producing property essential to self-support.

(b) The consideration of a life estate interest in real property is waived.

(c) Personal effects such as clothing, jewelry, furniture, etc., are excluded up to $4,000.00

(d) Cash value of life insurance policies with combined face value less than $5,000.00 is excluded.

(e) The burial fund exclusion is increased $5,000.00.

(f) Commingling of burial funds is allowed.

(g) Long-Term Care Insurance.

1. Medicaid will not consider resources of a person equal to the amount of long-term care insurance benefit payments in determining Medicaid eligibility when the long-term care insurance policy has paid at least the first three years of nursing home care and/or home health care services.

2. The exclusion shall be for the life of the purchaser provided he or she maintains obligations pursuant to the long-term care insurance policy and shall be excluded from any subsequent recovery by the state for payment of medical services.

3. Insurance benefit payments made on behalf of a claimant, for payment of long-term care services, shall be considered to be expenditures of resources as required for eligibility for medical assistance to the extent that the payments are all of the following:

(i) For services Medicaid approves or covers for its recipients.

(ii) In an amount not in excess of the charges of the health services provider.

(iii) For nursing home care and/or home health care services.

(iv) For services delivered after October 1, 1997.

Author: J. D. Schremser, Director, E/D Certification Division

Statutory Authority: Social Security Act, Titles XVI, XIX; 1902(r)(2); 20 C.F.R. §§401, et seq.; State Plan; Public Law 100-203, §9103; Medicare Catastrophic Coverage Act of 1988 (P.L. 100-360, §301); 20 C.F.R. §416.1212; 42 C.F.R. §§401, et seq.; 26 C.F.R. §20.2031.7.

History: Rule effective October 1, 1982. Amended: effective March 15, 1983; May 15, 1983; September 8, 1983; September 8, 1984. Emergency rule effective January 1, 1985. Amended: effective March 11, 1985. Emergency rule effective September 1, 1985. Amended: effective December 9, 1985. Emergency rule effective January 1, 1986. Amended: effective April 11, 1986. Emergency rule effective June 9, 1986. Amended: effective August 11, 1986; August 10, 1987. Emergency rule effective January 8, 1988. Amended: effective February 9, 1988. Emergency rule effective August 1, 1988. Amended: effective November 10, 1988. Emergency rule effective January 1, 1989. Amended: effective April 14, 1989; July 13, 1991; January 14, 1992; May 13, 1993. Emergency Rule effective June 1, 1993. Amended: effective May 11, 1993. Amended: Filed July 7, 1993; effective August 11, 1993. Amended: Filed July 7, 1994; effective August 12, 1994. Amended: Filed July 6, 1995; effective September 1, 1995. Amended: Filed July 9, 1996; effective August 14, 1996. Amended: Filed October 6, 1997; effective November 10, 1997. Amended: Filed March 9, 1998; effective April 13, 1998. Amended: Filed June 5, 1998; effective July 10, 1998. Amended: Filed June 8, 1999; effective July 13, 1999. Amended: Filed August 19, 2002; effective September 23, 2002.

560-X-25-.07 Development Of Ownership Interest In Nonliquid Resources For SSI-Related Individuals.

(1) Ownership interest in Real Property -- Establishment of ownership interest may be obtained by:

(a) Assessment notice;

(b) Recent tax file;

(c) Current mortgage statement;

(d) Deed;

(e) Report of title search;

(f) Wills, court records, or relationship documents which show rights of an heir to the property after death of the former owner.

(2) The laws of the State of Alabama regarding the validity of deeds, wills, mortgages, and other instruments which convey legal title to real property will govern all such determination.

(3) Types of Ownership -- The type of ownership in real property is determined by the instrument, if any, conveying the real property, and by Alabama law. Ownership interests arising through the death of a spouse or other relative are governed by the Alabama laws of descent and distribution and by those Alabama laws providing for the spouse and family of a decedent.

Author:

Statutory Authority: State Plan; Social Security Act, Titles XVI, XIX; 42 C.F.R. §§401, et seq.; 20 C.F.R. §§401, et seq.

History: Rule effective October 1, 1982.

560-X-25-.08 Development Of Ownership Interest In Liquid Resources For SSI-Related Individuals.

(1) Cash -- Cash on hand is always counted as liquid resource except when it is a business asset necessary to the operation of a trade or business that is excluded as necessary for self-support or under an approved plan for achieving self-support in the case of the blind or disabled.

(2) Checking, Savings, and Other Accounts.

(a) General. These are countable resources if the applicant/recipient has unrestricted legal access to the accounts. This rule applies to individual accounts and joint accounts as well as certificates of deposit, savings certificates, and all forms of time deposits, whether held individually or jointly. This rule applies to accounts, deposits, etc., in any financial institution or being held by any financial or brokerage service or agency.

(b) Joint Accounts.

1. When only one holder of a joint account is an applicant/recipient who has unrestricted access to the funds in the account it is presumed that the applicant/recipient owns the total funds in the account.

2. When two or more eligible individuals or applicants are holders of the same joint account and each has unrestricted access to the funds in the account it is presumed that the eligible individual or applicant owns an equal share of the total funds in the account, regardless of the source of the funds.

3. Unrestricted access depends upon the legal structure of the account. When the account reads "or" or "and/or" and the applicant/recipient is legally able to withdraw funds from the account, he/she is considered to have unrestricted access to the total funds in the account.

(c) Rebuttal of Presumption. The opportunity to rebut the presumption of ownership shall be afforded all applicants/ recipients. In order for an applicant/recipient to rebut successfully the presumption of full or partial ownership, all of the following documentation is required:

1. A statement by the applicant/recipient on a form 234, giving:

(i) His/her allegation regarding no ownership or partial ownership of the funds documented by a statement from the financial institution, copy of the bank book, account book, certificate of deposit, etc., verifying the language of the account, and a copy of the signature card;

(ii) The reason for establishing the joint account;

(iii) Who made deposits to and withdrawals from the account, and how withdrawals were spent, documented with evidence such as wage statements, deposit slips, and employer's statements verifying source of deposits and cancelled checks; and

(iv) Corroborating statements on form 234 from the other account holder(s), or, if the co-holder of the joint account is incompetent or a minor, a statement from a third party who has knowledge of the circumstances surrounding the establishment of the joint account.

2. If the rebuttal is successful and it is determined that the funds in the account do not belong to the applicant/ recipient and should be excluded as a countable resource, a change in the account designation removing the applicant/ recipient's name from the account or restricting access to the account must be executed and verification of such submitted as evidence before eligibility can be determined. If this change is not made and evidence is not submitted by the applicant/recipient within ten (10) days following notification, the presumption of ownership will apply.

(3) Promissory Notes, Loans, and Property Agreements (Mortgages) -- Promissory notes, loans, and property agreements are considered resources, if the owner had the legal right to sell them. If so, the resources should be counted in the amount of the outstanding principal balance.

(4) Trusts -- Whether the principal of a trust is a resource to the applicant/recipient depends on its availability to the applicant/recipient by the terms of the trust instrument itself.

Trusts, or other similar legal devices may be excluded from consideration as a resource. Medicaid shall determine whether the requirements for exclusion expressed in the current statutory authorities have been meet.

(5) Annuities – A lump sum annuity that can be sold, cashed in, surrendered or revoked will be considered a resource in the amount of the current value of the annuity unless a lesser value is satisfactorily documented.

(6) Stocks, Bonds, and Mutual Fund Shares -- These are considered countable liquid resources according to their market value.

(7) Life Insurance -- The cash surrender value of any life insurance policy owned by the applicant/recipient is a countable resource to the extent provided in 20 C.F.R. §416.1230.

(8) The foregoing are not intended to be an all-inclusive list of liquid resources. Any resource readily convertible into cash may be considered a liquid resource.

Author: Audrey Middleton, Associate Director, Policy Program Implementation Unit, Certification Support Division

Statutory Authority: State Plan; Social Security Act, Titles XVI, XIX; 42 C.F.R. §§401, et seq.; 20 C.F.R. §§401, et seq.

History: Rule effective October 1, 1982. Amended: effective August 10, 1988. Amended: Filed August 5, 1997; effective September 9, 1997. Amended: Filed January 9, 2004; effective February 13, 2004.

560-X-25-.09 Transfer Of Assets Affecting Eligibility.

(1) This rule, as amended, shall apply to all original, initial applications received on or after July 1, 2004 or transfers occurring on or after July 1, 2004. Applications received prior to July 1, 2004 will be processed using the rules that were in effect at that time. An individual who is an applicant or recipient of institutional Medicaid or home and community based waiver services, or the spouse of such individual, who transfers an asset at any time on or after look-back date, as defined in paragraph (9)(k), for less than fair market value for the purpose of establishing or maintaining eligibility will cause the individual to be charged with the difference between the fair market value of the asset and the amount of any compensation received. The difference is referred to as uncompensated value and is counted toward the resource limit of the individual for a period of time determined in accordance with paragraph (6).

(2) When a stream of income or the right to a stream of income, such as an annuity, is transferred, Medicaid shall make a determination of the total amount of income expected to be transferred during the owner’s life, based on an actuarial projection of the owner’s life expectancy as established by federal life expectancy tables, and calculate a penalty period based on the projected total income.

(3) The purchase of an irrevocable non-salable, non-transferable lump sum annuity at anytime on or after the 60-month look-back date for the purpose of establishing or maintaining eligibility, will cause the individual to be charged with uncompensated value based upon the price of the annuity at the time of purchase. This uncompensated value is counted toward the resource limit of the individual for a period of time determined in accordance with paragraph (6).

(4) A transfer of an asset for less than fair market value is presumed to have been for the purpose of establishing or maintaining Medicaid eligibility unless the individual presents convincing evidence that the transfer was exclusively for some other purpose, in accordance with paragraph (8).

(5) Any individual who fails to disclose in an application a transfer of assets which occurred on or after the look-back date or who fails to report a transfer which occurs after eligibility is awarded, or who receives Medicaid benefits prior to discovery of a transfer of assets in violation of this rule shall be subject to recoupment action and suspension of benefits pursuant to Code of Ala. 1975, Section 22-6-8 and Chapters 4 and 33 of this Administrative Code. Such individual and/or his representative may also be subject to criminal prosecution under Code of Ala. 1975, Section 22-1-11 and Section 1128B of the Social Security Act (42 U.S.C. Section 1320a-7b).

(6) Penalty Period for Transfer of Assets.

(a) This period is applicable to nursing facility services as defined in the State Plan, a level of care in any institution equivalent to that of nursing facility services as defined in the State Plan, and home and community based waiver services.

(b) The total, cumulative uncompensated value of the assets transferred on or after the look-back date will be divided by the average monthly cost to a private patient for nursing facility services in the state (at the time of application) as determined by Medicaid. This quotient, less the fractional remainder, shall be the number of months the uncompensated value is counted (the penalty period for the fractional remainder is incurred but not imposed, unless additional transfers occur in that month). This penalty period shall begin the first month after the month of transfer and shall run continuously under this rule, except that in the case of multiple transfers, no penalty period based on any transfer will begin before the first month after the month of that particular transfer.

(c) Transfers that result in a fractional remainder are not penalized for the month of the remainder, unless another transfer occurs during that month. In that case the penalty period must be recalculated using the cumulative total of the transferred assets. This is referred to as an overlapping penalty period.

(7) Transfers Not Considered. An individual shall not be ineligible for medical assistance to the extent that:

(a) The assets transferred were a home and title to the home was transferred to:

1. The individual's spouse or child who is under age 21, or who is blind or permanently and totally disabled; for use as his or her residence;

2. A sibling of such individual who has an equity interest in such home and who has been residing in such individual's home, for a period of at least one year immediately before the date the individual becomes an institutionalized individual; or

3. A son or daughter of such individual (other than a child described in clause 1) who was residing in such individual's home for a period of at least two years immediately before the date of such individual becoming an institutionalized individual, and who (as determined by Medicaid) provided care to such individual which permitted such individual to reside at home rather than in such an institution or facility.

(b) The assets were transferred to (or to another for the sole benefit of) the individual's spouse or the individual's child who is blind or permanently and totally disabled. All funds transferred must be spent only for the benefit of the spouse or the child who is blind or permanently and totally disabled within a time frame actuarially commensurate with the life expectancy of the beneficiary.

(c) A satisfactory showing is made to Medicaid that the individual intended to dispose of the assets either at fair market value, or for other valuable consideration, or the assets were transferred exclusively for a purpose other than to qualify for Medicaid.

(d) Medicaid determines that denial of eligibility would work an undue hardship.

(e) The assets were transferred to a trust which is determined to be exempt from consideration under §1917(d) of the Social Security Act.

(f) All assets transferred on or the look-back date for less than fair market value have been returned to the individual. A return of the assets may cause ineligibility based on excess resources.

(8) Rebuttal.

(a) The burden is upon the individual to rebut the presumption that a transfer of an asset was made for the purpose of establishing or maintaining Medicaid eligibility by furnishing Medicaid with convincing evidence that the asset was transferred exclusively for some other purpose. Convincing evidence may be pertinent documentary or non-documentary evidence which shows, for example, that the transfer was ordered by a court, or that at the time of transfer the individual could not have anticipated becoming eligible due to the existence of other circumstances which would have precluded eligibility. A subjective statement of intent or ignorance of the provisions of this Rule is not sufficient, by itself, to rebut the presumption raised.

(9) Definitions. As used in this rule:

(a) "Transfer" is, and occurs at the time, when an individual or spouse (or a parent, guardian, court or administrative body, or anyone acting in place of or on behalf of or at the request or direction of the individual or spouse), by either affirmative act or failure to act, loses or relinquishes all rights of legal access to an asset or interest therein.

(b) "Compensation" is all money, real or personal property, food, shelter or services received by the individual or spouse at or after the time of transfer in exchange for the asset in question. Money, real or personal property, food, shelter or services received prior to the transfer are compensation only if they were provided pursuant to a legally enforceable agreement to provide such items in exchange for the asset in question. Payment or assumption of a legal debt owed by the individual or spouse in exchange for the asset is also compensation.

(c) "Fair market value" is the current market value of an asset at the time of the transfer or contract of sale, if earlier. Current market value shall be determined in accordance with Rule 560-X-25-.06(3), except that if a remainder interest in property is transferred, whether or not a life estate is retained, the uncompensated value will be based on the fair market value of the entire property at the time of the transfer or contract of sale, if earlier.

(d) "Uncompensated value" is the fair market value of the asset minus the amount of any compensation received by the individual or eligible spouse in exchange for the asset.

(e) A "home" is any shelter in which the individual (and spouse, if any) has an ownership interest and which is used by the individual (and spouse, if any) as his principal place of residence. The home includes any land that appertains thereto and any related outbuildings necessary to the operation of the home.

(f) The "month of application" is the month in which the original, initial application of an individual is received and accepted by the Medicaid Agency.

(g) In situations where an individual has admitted that an asset has been transferred for less than fair market value for the purpose of obtaining Medicaid benefits, the Agency may still grant an exemption from the penalty period where the individual demonstrates by clear and convincing evidence that the imposition of such a penalty will cause the individual to suffer undue hardship. Undue hardship will only be considered in extreme cases where the individual has been denied admission to or discharged from an institutional facility or denied home and community based waiver services which are necessary to preserve the individual’s life. Undue hardship does not exist where a transfer penalty causes a individual or the individual’s family to experience inconvenience or would cause a individual to restrict his/her lifestyle but would not place him/her at serious risk of being deprived of care of services necessary to sustain life.

In determining the existence of "undue hardship" Medicaid will consider all circumstances involving the transfer and the situation of the individual, including but not limited to, the following:

1. Whether the individual has been determined to be a person in need of care and protection pursuant to the Adult Protective Services Act, Code of Ala. 1975, §38-9-1, et seq.;

2. Whether the individual or his representative has exhausted all reasonable efforts to obtain a return of, or compensation for, the transferred asset, including voiding the transfer pursuant to Code of Ala. 1975, §35-1-2 or §8-9-12, or other criminal or civil action available to recover the asset;

3. Whether the individual was deprived of an asset by fraud or misrepresentation. Such claims must be documented by official police reports or civil and/or criminal legal actions against the perpetrator;

4. Whether the individual or his representative has exhausted all reasonable efforts to meet his needs from other available sources.

(h) "Assets" are all income or resources of the individual or the individual's spouse. This term includes income or resources which the individual or individual's spouse is or was entitled to but does not receive.

(i) "For the sole benefit of: "A transfer is considered to be for the sole benefit of a spouse, or a blind or disabled child, if the transfer is arranged in such a way that no individual or entity, except the spouse or the blind or disabled child, can benefit from the assets transferred in any way, whether at the time of the transfer or any time in the future.

(j) "Institutionalized individual" is an individual who is:

1. An inpatient in a nursing facility; or

2. An inpatient in a medical institution for whom payment is based on a level of care provided in a nursing facility.

For purposes of this rule, a medical institution includes an intermediate care facility for the mentally retarded (ICF/MR), as defined in 42 CFR 435.1009.

(k) "Look-back date" for an institutionalized individual is the date that is 36 months (or in the case of a trust, annuity or similar legal instrument, 60 months) immediately prior to the later of the first day of the month of the original, initial application or the first day of the month that the individual becomes an institutionalized individual. For home and community based waiver cases, the "look-back date" is the date that is 36 months (or in the case of a trust, annuity or similar legal instrument, 60 months) immediately prior to the later of the first day of the month of the original, initial application or the first day of the month in which the individual disposes of assets for less than fair market value.

Author: Audrey Middleton, Associate Director, Policy/Program Implementation Unit, Certification Support Division

Statutory Authority: Social Security Act, §§1613, 1917; 20 C.F.R. §416.1246; Code of Ala. 1975, §§35-1-2, 8-9-12; State Plan; Medicare Catastrophic Coverage Act of 1988 (Public Law 100-360, Section 303); §608(d) Family Support Act; and Section 13611 of the Omnibus Budget Reconciliation Act of 1993; and 42 C>F>R. 430 Subpart B.

History: Rule effective October 1, 1982. Repealed and New Rule adopted in lieu thereof effective June 9, 1986. Amended: effective January 14, 1987. Emergency rule effective September 30, 1988. Repealed and New Rule adopted in lieu thereof effective January 10, 1989. Amended: June 16, 1989; May 14, 1991. Emergency Rule effective June 1, 1993. Filed: July 7, 1993; effective August 11, 1993. Amended: Filed June 6, 1995; effective July 11, 1995. Amended: Filed December 6, 1995; effective January 11, 1996. Amended: Filed January 9, 2004; effective February 13, 2004. Amended: Filed May 27, 2004; effective July 1, 2004.

560-X-25-.10 Income Criteria For SSI Related Individuals.

(1) The income limit for the institutional Medicaid program and certain home and community based waiver programs is determined by the Agency and published in the State Plan for Medical Assistance. The income limit is equal to 300 percent of the current SSI benefit amount payable to an individual in his own home who has no income.

(2) The income limit for certain recipients of home and community based waiver services who are eligible for Medicaid solely because they require and receive services under a home and community based services waiver is the SSI federal benefit rate plus the $20.00 general disregard.

(3) Rules in 20 C.F.R. 416 Subpart K govern types of countable income and income exclusions except as further limited by §36-27-21.1, Code of Ala. 1975.

(4) In determining the amount of income an individual has to apply to his cost of care in an institution, the following are deducted:

(a) amounts of income protected for personal needs subject to the limits as set forth in the Agency State Plan, Attachment 2.6-A.

(b) amounts of income protected for the maintenance needs of the ineligible spouse and dependents living outside the facility.

(c) amounts of income protected for health insurance premiums that are paid by the applicant/recipient.

(5) The following are more liberal income requirements than SSI for determining the eligibility of individuals as Qualified Medicare Beneficiaries and Specified Low Income Medicare Beneficiaries:

(a) The consideration of in-kind income support and maintenance in the income calculation is waived.

(b) Fluctuating income may be averaged for the past six months and projected for twelve months.

Authors: Phillip Tyler, Arthur Miller, John H. Ziegler, Theresa G. Herring

Statutory Authority: State Plan; Social Security Act, Titles XVI, XIX; 1902(r)(2); 42 C.F.R. §§401, et seq.; Code of Ala. 1975, §36-27-21-.1; 42 C.F.R. §435.725; 42 C.F.R. §§435.231, 1611(b)(1); §§1915(c), §1902(a)(10)(A)(ii)(VI).

History: Rule effective October 1, 1982. Emergency rule effective August 4, 1983. Amended: effective November 10, 1983; July 9, 1984; July 9, 1985. Emergency rule effective January 8, 1988. Amended: effective April 12, 1988; July 14, 1990. Emergency rule effective October 9, 1990. Amended: effective January 15, 1991; July 13, 1991; November 12, 1992. Emergency Rule effective May 1, 1993. Amended: Filed July 7, 1993; effective August 11, 1993.

560-X-25-.11 Additional Criteria For Institutional Care.

(1) In addition to the rules covered in Rules 560-X-25-.05 through .11 the following criteria must also be met for an individual to qualify for Medicaid in a Title XIX institution:

(a) The individual must be certified as needing the level of care received in an institution and as having a continuing need for institutionalized care.

(b) The individual must be in a facility certified to participate in the Medicaid program and which has a current provider agreement with the Medicaid Agency.

(2) In order for an individual institutionalized in a hospital or nursing home to qualify for the maximum income limit allowed for institutionalized Medicaid recipients, as described in Rule No. 560-X-25-.10, the individual must have been a resident of a Title XIX medical institution for 30 consecutive days or longer. Being a resident of an institution for 30 consecutive days means being a resident for the period beginning with day one until the last instant of the 30th consecutive day.

Authors: Arthur Miller, John H. Ziegler

Statutory Authority: Social Security Act, Title XIX; 42 C.F.R. §§401, et seq.; State Plan; Chapter 10 this Code; Social Security Act §1902(a)(10)(A)(ii)(V) as amended by §9510 of COBRA 1985.

History: Rule effective October 1, 1982. Amended: effective March 15, 1983. Emergency rule effective July 1, 1987. Amended: effective August 10, 1987.

560-X-25-.12 Periods Of Entitlement.

(1) The earliest date of entitlement for Medicaid is the first day of the month of application for assistance under one of the categorical programs, provided the individual meets all factors of eligibility for that month. The individual who is eligible on the first day of the month is entitled to Medicaid for the full month.

(2) An exception to (1), above, is Retroactive Medicaid Coverage. Individuals who have incurred medical expenses for the three months immediately preceding the month of application for Medicaid or the three months prior to the receipt of the first SSI check (for SSI cases), may become eligible for Medicaid benefits during that time provided all eligibility requirements are met for each month. Application for Retroactive Medicaid must be made within six months from the month of notification of award of Medicaid benefits and/or cash assistance.

(3) When a family is terminated from Medicaid for Low Income Families because of earnings of the caretaker relative, including earnings from new employment or increased earnings or increased hours of employment, Medicaid may be provided for up to 12 calendar months beginning with the month Medicaid for Low Income Families is terminated, provided the family correctly received Medicaid for Low Income Families in 3 of the immediately preceding 6 months. To be eligible for the first 6-month Medicaid extension, the assistance unit must continue to include a dependent child. To be eligible for the second 6-month Medicaid extension, the assistance unit must have complied with specified reporting requirements in the initial 6 months of benefits; continue to include a dependent child; have a gross family income (less work-related child care expenses) that does not exceed 185% of the Federal poverty level in the immediately preceding 3 months; and the caretaker relative must have earnings in one or more of the immediately preceding 3 months.

Authors: John H. Ziegler, Theresa Herring

Statutory Authority: Social Security Act, Titles IV-A, XVI, XIX; 42 C.F.R. §435.914; State Plan.

History: Rule effective October 1, 1982. Amended: effective March 11, 1986; January 14, 1987; September 13, 1990. Amended: Filed October 7, 1993; effective November 12, 1993. Amended: Filed December 8, 1997; effective January 12, 1998.

560-X-25-.13 Adults In Need Of Protective Services. For adults in need of protective services (as defined by Code of Ala. 1975, §§38-9-2, et seq.), property may be excluded during the period from the date the petition is filed to the date of the court order, but in no event for a period to exceed 120 days.

Author: Aljanetta C. Rugley, Policy/Research Specialist, Policy Program Implementation, Certification Support Division

Statutory Authority: Code of Ala. 1975, §§38-9-2, et seq.

History: Rule effective October 1, 1982. Amended: Filed July 12, 2001; effective August 16, 2001.

560-X-25-.14 Pregnant Women And Young Children With Income Equal To Or Below 133% Of The Federal Poverty Level And Children With Income Equal To Or Below 100% Of The Federal Poverty Level.

(1) Medicaid coverage under poverty provisions is available for pregnant women and young children meeting the requirements listed below:

(a) The family unit income must be equal to or less than 133% of the current federal poverty level.

(b) For pregnant women, pregnancy must be verified.

(c) Children’s eligibility will continue through the month of their 6th birthday.

(d) The person to be covered must be living in Alabama and must be a United States citizen or meet alienage requirements.

(e) Any private insurance benefits must be assigned to the state.

(f) Application must be made for any other benefits for which the person's family appears eligible.

(g) Changes in income and/or living arrangements must be reported at annual review.

(h) The person to be covered must furnish or apply for a Social Security number.

(2) Medicaid coverage under poverty provisions is available to children with income below 100% of the Federal Poverty Level meeting the requirements listed below:

(a) The family unit income must be equal to or less than 100% of the current federal poverty level.

(b) The child must be at least six years of age.

(c) Children’s eligibility will continue through the month of their 19th birthday.

(d) The child to be covered must be living in Alabama and must be a United States citizen or meet alienage requirements.

(e) Any private insurance benefits must be assigned to the State.

(f) Application must be made for any other benefits for which the person's family appears eligible.

(g) Changes in income and/or living arrangements must be reported at annual review.

(h) The person to be covered must furnish or apply for a Social Security number.

Author: Audrey Middleton, Associate Director, Policy and Program Implementation, Certification Support Division

Statutory Authority: Section 6401 of P.L. 101-239, Omnibus Budget Reconciliation Act of 1989 (OBRA 89). Section 4601 of P.L. 101-508, Omnibus Budget Reconciliation Act of 1990 (OBRA 90).

History: Emergency rule effective September 1, 1991. Permanent rule effective December 12, 1991. Amended: Filed December 12, 2001; effective January 16, 2002. Amended: Filed June 12, 2002; effective July 17, 2002. Amended: Filed June 11, 2003; effective July 16, 2003.

560-X-25-.15 Medicaid For Low Income Families, Extended Medicaid Benefits Due To State Collected Child Support, And Transitional Medicaid Benefits.

(1) Medicaid for Low Income Families (MLIF): "Medicaid for Low Income Families" means individuals eligible for Medicaid through the Medicaid for Low Income Families Program or who meet the eligibility criteria for Medicaid for Low Income Families based on policies in effect for the AFDC program as it existed on July 16, 1996, as follows:

(a) Financial Requirements:

The family must have a child in need by Agency rules. To be considered "in need" a family may not have (1) total gross monthly income which exceeds the established gross income limit; or (2) net monthly income which equals or exceeds the eligibility standard. In establishing need, income of all persons in the family is considered. Before earned income is counted, the following deductions are allowed from gross earnings: $90 per month for work expenses; $30 plus 1/3 of the remainder of earned income and child/dependent care for up to $200 per month for the care of each dependent under age 2 and up to $175 per month for each dependent age 2 and older or incapacitated adult. A $50 disregard is allowed per family for child support received. Lump-sums are considered income and added to other monthly income, this amount is then compared to the agency need standard to determine periods of ineligibility.

(b) Medicaid Standards:

Family Size Gross Income Limit Eligibility Standards Needs Standard

1 845 111 457

2 1042 137 563

3 1245 164 673

4 1467 194 793

5 1704 225 921

6 1909 252 1032

7 2172 287 1174

8 2375 315 1289

9 2599 344 1405

10 2812 372 1520

11 3025 400 1635

12 3239 428 1751

13 3452 457 1866

14 3665 485 1981

15 3879 513 2097

16 4092 541 2212

(c) Family Criteria

1. "Family" means all persons included in determining family size. Generally, persons to be included are the natural or legal parents and blood related or adoptive siblings of the child(ren) living in the home, who meet the age requirements and are otherwise eligible for Medicaid. (If the child or a sibling group is included, all his siblings who reside in the home and who meet the age requirements and are otherwise eligible can be included). Families whose countable income equals or exceeds the eligibility standard for the appropriate family size are not eligible for Medicaid for Low Income Families, but some members may be eligible for another category of Medicaid administered by the Alabama Medicaid Agency.

2. Degree of relationship must be verified and the caretaker must be of a specified degree of relationship to the child. A relative other than a parent may be eligible if their income does not exceed the Medicaid Standard. The persons must be blood relatives of the half-blood or the whole-blood and relatives who have ever been "in-law" or "step" within the degrees listed below. This is an exclusive listing:

(i) Females – mother, adoptive mother, stepmother (but not her parents), sister, adoptive sister, stepsister, sister-in-law, aunt, great-aunt, great-great aunt, aunt-in-law, grandmother, great-grandmother, great-great grandmother, great-great-great grandmother, step-grandmother (meaning the subsequent wife of the child’s natural grandfather), adoptive grandmother (meaning the mother of a parent who was adopted), niece, first cousin, first cousin once removed (meaning the first cousin of the dependent child’s parent or the child of the dependent child’s first cousin.), spouses of any individual listed under males.

(ii) Males – Father, adoptive father, stepfather (but not his parent), brother, adoptive brother, stepbrother, brother-in-law, uncle, great-uncle, great-great uncle, uncle-in-law, grandfather, great grandfather, great-great grandfather, great- great-great grandfather, step-grandfather (meaning the subsequent husband of the child’s natural grandmother), adoptive grandfather (meaning the father of a parent who was adopted), nephew, first cousin, first cousin once removed (meaning the first cousin of the dependent child’s parent or the child of the dependent child’s first cousin.), spouses of any individual listed under females.

3. Forms of verification:

(i) Primary sources: Birth record, school records, sworn, notarized or witnessed statement of applicant/recipient, affidavit of paternity, hospital birth record, court orders signed by the judge where the relationship is acknowledged as claimed and there is no evidence to the contrary. If no primary documentation use Declaration of Natural Relationship form with the applicant/recipient or other persons with knowledge of the relationship and secure secondary verification.

(ii) Secondary sources: Insurance policy, other agency records, (example Red Cross, SSA, Census records, VA, Department of Senior Services records, Department of Human Resources), bible records, income tax records, official records, (example school report card, juvenile court), other hospital records, clinic or Health Department records, church records, military records, statement from a minister, priest or rabbi, baptismal certificate or other.

(d) Technical Requirements:

1. The child must be living in the home of a parent or other close relative (relationship must be verified in all cases).

2. The child must be under age 19.

3. The child must be a U.S. citizen or an alien in satisfactory immigration status.

4. The child must not be receiving at the same time in his own right any other form of Medicaid.

5. The caretaker must cooperate with the Department of Human Resources and Alabama Medicaid Agency in Medical Support Enforcement Activities and in Third Party Medical Liability Activities unless good cause for not cooperating is determined.

6. When application is made for a child(ren) the relative who cares for him/her (them) automatically assigns to the State all medical insurance or medical support benefits to the extent medical assistance is provided him/her or a child in their care.

7. The parent/caretaker must furnish all Social Security numbers for everyone in the household or apply for a Social Security number for anyone who does not have a number and furnish the number upon receipt. (These numbers will be used in addition to any other means of identification in the administration of the program as provided for in Section 402(a)(25) of the Social Security Act). The number provided will be used in computer matches, program reviews and audits. Eligibility and income information will be requested regularly from the Internal Revenue Service, Social Security Administration, Alabama Department of Industrial Relations and other public and private organizations.

8. The parent/caretaker must apply for any other benefits for which they or other members of the household appear to be eligible, such as Veteran Benefits, Social Security, Unemployment Compensation, etc.

(e) The Agency uses less restrictive income and resource methodologies than those in effect as of July 16, 1996, as follows:

1. Resources are excluded.

2. A child shall be considered to be deprived of parental care of one or both parents if the family income does not equal or exceed the eligibility standards for the appropriate family size, even though both parents may live in the home.

3. The $90 work expense, $30 and 1/3 disregards are applied for 12 consecutive months.

4. Contributions of $50 per individual per quarter is allowed.

5. Income may be deemed for: spouse to spouse, senior parent to minor parent, and stepparent to spouse based on income that exceeds the Standard.

(f) The following individuals are deemed to be eligible for Medicaid for Low Income Families:

1. MLIF qualified pregnant women whose family income falls within the standards for Medicaid for Low Income Families.

2. Individuals under age 19 who would qualify for Medicaid for Low Income Families but do not qualify as dependent children because they are children for whom public agencies have assumed custodial and financial responsibility and they are in foster homes or private institutions.

(2) Extended Medicaid Benefits due to State Collected Child Support. All persons who are correctly members of the household that becomes ineligible for Medicaid for Low Income Families due wholly or partly to the collection or increased collection of child support are entitled to extended Medicaid coverage for four months (children eligible for 12 continuous months) provided:

(a) The case was terminated (wholly or partly) due to the collection or increased collection of child support; and

(b) The household (or any member of the household) correctly received Medicaid in Alabama for at least three of the six months immediately prior to the first month of ineligibility.

(3) Transitional Medicaid Benefits. When a family loses eligibility for MLIF because of earned income and has correctly received MLIF under this group in at least three of the preceding six months, the family is entitled to up to 12 months Transitional medical assistance. This is known as Transitional Medicaid benefits. Once eligibility is established, children are eligible for 12 continuous months following the month of the transitional Medicaid eligibility determination. In order to be eligible, the family must file timely quarterly reports and the family’s earned income, minus the cost of child care, must not exceed 185 percent of the Federal poverty level.

(a) The household is eligible for Transitional Medicaid for the initial six months provided:

1. The household correctly received MLIF in Alabama for at least three of the six months immediately prior to the first month of ineligibility, and

2. The case was terminated due wholly or partly to the parent/caretaker’s increased earnings or hours of employment, or

3. The case was terminated due wholly or partly to expiration of the $30 and 1/3 disregards applied to any adult(s).

(b) The parent/caretaker is eligible for the first six months of Transitional Medicaid coverage based on the termination reason. Children are eligible for 12 continuous months. The only reason (other than to return to regular MLIF eligibility) Transitional Medicaid coverage may be terminated in any one of the first six months is that the household ceases to include a child and then, only the Transitional Medicaid of the adult(s) may be terminated.

(c) Medicaid coverage may be extended to the parent/ caretaker for an additional six months provided:

1. The parent/caretaker is employed in each of the 12 months unless there is good cause for terminating employment, and

2. The household continues to include a child, and

3. The household’s average gross earnings, less child care expenses necessary for the employment of the parent/ caretaker, do not exceed 185% of the federal poverty level, and

4. The household submits a completed quarterly report by the 21st of the fourth, seventh and tenth months of the extended benefits period. The quarterly report must contain information regarding gross earnings and childcare expenses for the three months prior to the month the report is due. Income must be verified.

Author: Audrey Middleton, Associate Director, Policy and Program Implementation, Certification Support Division

Statutory Authority: Personal Responsibility and Work Opportunity Reconciliation Act of 1996.

History: Emergency rule effective September 1, 1991. Permanent rule effective December 12, 1991. Amended: Filed February 19, 1999; effective March 26, 1999; operative April 1, 1999. Amended: Filed December 12, 2001; effective January 16, 2002. Amended: Filed June 12, 2002; effective July 17, 2002. Repealed and New Rule: Filed June 11, 2003; effective July 16, 2003.

560-X-25-.16 Income And Resources Of A Married Couple For Institutional Care.

(1) The Medicare Catastrophic Coverage Act (MCCA) of 1988 provides for the special treatment of income and resources of a married couple. The special treatment is to protect the income and resources for the maintenance needs of the community spouse while the spouse is in a medical institution or nursing facility. The MCCA provisions apply to all claimants admitted to the medical institution or nursing facility on or after 9/30/89.

(2) The following definitions apply:

(a) SPOUSE - Person legally married to another under State law. The SSI definition as applied to the QMB/SLMB cases is not applicable to spousal cases. Legal marriage is a traditional marriage conducted by legal authority or a common law marriage recognized by a court.

(b) INSTITUTIONALIZED SPOUSE (IS) - Legally married person who resides in a medical institution or nursing facility and can reasonably be expected to continue to reside in the medical institution or nursing facility for a continuous period.

(c) COMMUNITY SPOUSE (CS) - Legally married person who is not living in a medical institution or nursing facility, and has a spouse residing in a medical institution or nursing facility.

(d) CONTINUOUS PERIOD OF INSTITUTIONALIZATION - At least 30 consecutive days of institutionalization in qualified medical institutions and/or nursing facilities.

(e) OTHERWISE AVAILABLE INCOME - Income that would be used to determine eligibility without benefit of disregards (including federal, state and local taxes) - gross income as defined by SSI.

(f) MAINTENANCE NEEDS STANDARDS - Income standards against which community spouses' and other family members' incomes are compared for purposes of determining the amount that can be allocated in the post-eligibility calculation.

(g) MONTHLY MAINTENANCE NEEDS ALLOWANCE - An allowance made from the institutionalized spouse to the community spouse or other dependent family members to meet his or her needs in the community.

(3) A monthly maintenance amount (allocation) can be protected for the spouse and family dependents at home.

(a) Spousal Impoverishment - To determine eligibility for an institutionalized claimant, who becomes institutionalized on or after September 30, 1989 and who has a community spouse, all resources {assets} (whether owned jointly or individually by either spouse) must be combined beginning with the point that a spouse was institutionalized. A spousal share is the greater of the minimum protected resource amount or 1/2 of the combined countable resources {assets}, not to exceed the maximum federal limit. The determination will be made using the total combined resources {assets} at the point a spouse is institutionalized. The assessment is to be completed at the request of either of the married couple, a representative acting on behalf of either spouse, or at the time of application for Medicaid benefits. The assessment is to be accomplished in a prompt manner.

(b) When a married couple is both institutionalized and both apply, each is treated as individuals rather than as a couple. Treatment as individuals begins as of the first day of the month following the month both are institutionalized. Spousal impoverishment rules do not apply and an assessment of resources shall not be conducted.

(c) If a married couple is institutionalized and only one applies for Medicaid, they are treated as individuals as of the beginning of the first full month of separation. Income and assets of the ineligible spouse must be deemed during the partial month.

(d) Spousal Impoverishment rules apply to legally married couples when one enters a medical institution or nursing facility while the other remains in the community. The institutionalized spouse must remain in an institution 30 continuous days or longer.

(e) Spousal impoverishment does not apply if a claimant is not legally married at the time he/she enters the medical institution or nursing facility, unless he or she subsequently marries.

(f) If there is a change in circumstances such that there is no community spouse or institutional spouse, spousal impoverishment provisions cease to apply. The effective date of the cessation is the first full month following the change in status, for example, the community spouse enters a medical institution or nursing facility; or if the marriage is ended by death, divorce or annulment.

(g) The spousal impoverishment resource {asset} provisions do not apply to a claimant who is in a medical institution or nursing facility before 9/30/89. It would apply after readmission, if the claimant was originally admitted before 9/30/89 but left an institutional facility for 30 consecutive days or longer and then reenters the institution or facility.

(h) In order for spousal impoverishment rules to apply there must be a community spouse both at the point of institutionalization and at the point of application.

(i) If the claimant marries after the initial determination of eligibility, spousal rules apply. The resource assessment is computed based on the assets owned by the couple, individually or jointly, at the beginning of the institutionalized spouse's most recent continuous period of institutionalization even though that point precedes the point in time where there is a known community spouse.

(j) If both spouses enter an institution at the same time, but one spouse returns to the community, an assessment must be completed. The assessment is computed based on the resources (assets) owned by the couple (individually or jointly) at the beginning of the institutionalized spouse's most recent continuous period of institutionalization, even though both spouses were institutionalized at that point.

(4) When a claimant for Medicaid was divorced during the look-back period (36-60 months), the district office should review the divorce settlement. If the claimant did not receive an equal share of the marital estate, it may be considered to be a transfer of resources.

(5) The following rules apply in determining ownership of income for eligibility purposes:

(a) Consider available to each spouse one-half of any income paid in the name of both spouses,

(b) Consider any income paid solely to each spouse as income to that spouse,

(c) Consider income paid in the name of another party and both spouses, or one spouse, available to each spouse in proportion to each spouse's interest (or one-half of the total amount to each when payment is made to both spouses),

(d) Consider available to each spouse, one-half of any income that has no instrument establishing ownership. The institutionalized spouse is allowed to submit evidence to Medicaid to rebut the determination of available income (other than trust income). Prenuptial agreements are not binding nor considered for Medicaid eligibility purposes or for spousal impoverishment.

(e) If the institutionalized spouse is the grantor of a trust providing for payment of income to him or her, the maximum amount payable by the terms of the trust will be counted as available. No income paid only to a community spouse shall be counted in determining eligibility or amount of the payment to the nursing home for the institutionalized spouse for any month of institutionalization. The rule on trust income incorporates Section 1902(k) of the Social Security Act, the Medicaid Qualifying Trust provision.

(6) Compare the institutionalized spouse's countable income to the institutional income limit.

(a) After the institutionalized spouse has been determined income and resource eligible, determine the amount of income, if any, to be applied toward the cost of institutional care (i.e., liability amount) by deducting the following from the institutionalized spouse's income in the following order:

1. Personal Needs Allowance,

2. Community Spouse Monthly Maintenance Needs Allowance, if applicable,

3. Family Maintenance Needs Allowance, if applicable,

4. Amount for Health Insurance premiums, if applicable.

The remainder should be the amount the claimant must pay to the nursing facility. In the case of a divorced couple, alimony is not considered to be an income deduction for decreasing the liability amount to be paid to the nursing facility.

(7) The minimum monthly maintenance needs standard for the community spouse is recalculated each year. Changes, if any, in this amount are effective in July. The community spouse monthly maintenance needs allowance is determined as follows: Deduct the community spouse's monthly income from the minimum monthly maintenance needs standard. This amount is published each year by HCFA and is 150 percent of the federal poverty level for a couple. Available income of the community spouse includes income that would be used to determine eligibility for the claimant, without benefit of disregards (including federal, state, and local taxes) (gross income according to SSI standards). Any remaining amount is the monthly maintenance needs allowance (if allocated to the spouse). This amount is used in the post-eligibility calculation for allocation to the community spouse. If in excess, an allowance is not made available. When allowances are not made available to (or for the benefit of) the community spouse, Medicaid will not deduct the allowance. The following are mandated deductions for the institutionalized spouse and may reduce the monthly maintenance needs allowance for the community spouse:

1. personal needs allowance,

2. aid and attendance allowance,

3. Veterans Administration payments for unusual medical expenses.

(8) A maintenance needs allowance may be provided from the institutionalized spouse to other dependent family members. The dependent family member is defined as: a minor child, dependent adult child, dependent parent, or dependent sibling of either spouse, who is living with the community spouse and who is listed on the federal tax forms as a dependent (Internal Revenue Service tax dependent) of the community spouse.

(a) Allowances for each family member are determined as follows:

Step 1. Deduct the gross income of the family member from the community spouse minimum monthly maintenance standard;

Step 2. Divide the remainder in Step 1 by 3.

Step 3. The remainder in Step 2, rounded down to the nearest dollar, is the minimum family monthly maintenance needs allowance used in the post-eligibility calculation to be allocated to the family member.

If in excess, an allowance is not made available, deduct allowances for other family members, regardless of whether institutionalized spouses make their income available to such persons.

(b) When there is no community spouse and there are other family members, the current TANF (formerly AFDC) payment standard will be used. The total number of family members at home will be computed against this table. This standard will be used when there are other family members, even though in some instances the needs allowance will be less than that of a spouse only. Any income of the family at home will be deducted from the standard to determine allocation. If the family at home has no income, the standard will be allocated. If the income of the institutionalized spouse is below the standard, the entire income will be allocated except for the protected personal needs allowance and the veterans aid and attendance allowance, veterans reimbursement for continuing unusual medical expenses. The current TANF (formerly AFDC) definition of family units will be used in determining who is a family member.

(9) Medicaid shall "pool" the resources {assets} of an institutional and a community spouse when:

(a) Either spouse requests an assessment at the beginning of the institutionalized spouse's first continuous period of institutionalization beginning on or after September 30, 1989.

(b) Although the couple may not have requested an assessment at the time one of the married couple was institutionalized, the agency shall determine total combined resources {assets} existing at the point of institutionalization when an application is filed. At the time of application for Medicaid, the Medicaid Agency computes the total combined value of the resources {assets} of the couple and a spousal share which is equal to 1/2 of the total value, or the minimum protected resource amount, whichever is greater. The assessment will be conducted at the time and date of institutionalization, and at the time of initial eligibility determination (i.e., eligibility or ineligibility). All the resources {assets} owned by either the institutionalized spouse or the community spouse, or both, shall be considered to be available to the institutionalized spouse, except for a specific "protected amount" for the community spouse (i.e., the spousal share) not to exceed the maximum federal limit.

At the beginning of a continuous period of institutionalization of a spouse, the district office shall use the following criteria to determine Medicaid eligibility for the first month of a continuous period of institutionalization:

1. Step 1. List all combined countable resources {assets} owned individually or jointly by the couple at the date and time of entry to the medical institution or nursing facility. The following types of otherwise excluded resources {assets} shall be included in the assessment: Equity value of real property normally excluded from assets due to a bona fide effort to sell; equity value of real property normally excluded from assets because it is jointly owned, and the sale of the property would cause the other owner undue hardship because of the loss of housing; and/or equity value of real property normally excluded because of a legal impediment; equity value of real property normally excluded because it is income producing.

2. Step 2. Determine total value of items listed in the above procedure. If the total in Step 2 is less than State Standard, stop here. All resources {assets} may be assessed to and for the use of the community spouse. If the amount in Step 2 exceeds the State Standard, go to Step 3.

3. Step 3. Determine 1/2 of total resources {assets} in Step 2.

4. Step 4. Compare amount in Step 3 with the Maximum Protected Resource Amount. If the amount is less than the Maximum Protected Resource Amount, protect that amount for the community spouse. If it is more than the Maximum Protected Resource Amount, protect the maximum amount allowed for the community spouse.

5. Step 5. Subtract the amount in Step 4 from the total amount in Step 2 above. The remaining amount is a countable resource {asset} to be used for the institutionalized spouse. If this amount exceeds the current resource {asset} limit for an institutionalized case, the claimant is ineligible until those assets and any assets accumulated during the spend down period are spent down to the appropriate level.

6. During the continuous period of institutionalization, after the month in which an institutionalized spouse is determined to be eligible, no resources {assets} of the community spouse shall be deemed to the institutionalized spouse.

7. Once an assessment has been made, a new assessment can only be made if the claimant is discharged from the nursing facility or medical institution for 30 continuous days and then readmitted for another 30 continuous day period. The assessment can be reevaluated if it is determined that inaccurate information was provided during the original assessment. Only the resources {assets} on hand at the point of continuous institutionalization of the institutionalized spouse, and the value of those resources {assets} can be used in the reevaluation of the assessment. After the assessment is completed, the amount attributed to the institutionalized spouse and any additional money accumulated or acquired by either spouse, must be spent down to $2,000.00 on the institutionalized spouse in order to be eligible. Gifts do not qualify as spend down. The institutionalized spouse may spend the money on nursing home care, items he or she needs in the nursing home, to pay legitimate debts belonging solely to him or her, maintenance on property in proportion to the ownership interest, or other appropriate expenses. If the community spouse or institutionalized spouse acquires additional resources {assets} during the spend down period, those additional resources {assets} must be spent down also. The only amount that the community spouse can retain, at the time of award, is the protected amount determined in the assessment.

8. For claimants who become institutionalized on or after September 30, 1989, under the resource {asset} rules, the community spouse resource {asset} allowance is deducted from the couple's combined countable resources {assets} at the point of continuous institutionalization, and at the point of award in determining the eligibility of the institutionalized spouse.

(10) The procedure for applying spousal impoverishment in situations when the community spouse cannot be located, is alleged deceased, or refuses to cooperate with the claimant shall be as follows:

The record shall contain a sworn statement of the claimant or other person regarding the community spouse. The sworn statement should be completed by the spouse and/or anyone with knowledge of the whereabouts of the community spouse and must show the following: Last known name; last known address; forwarding address at the post office; last known employment; circumstances surrounding disappearance; health of the individual at time of disappearance; state of mind of the individual at time of disappearance; efforts to locate; SSN/VA claim number/other identifying information on the individual; if alleged to be deceased, obtain death certificate from the Department of Public Health.

The eligibility specialist must follow up on any leads noted above and must verify the following: financial accounts, property, and employment.

When evaluating information on resources, the following applies:

1. If sufficient information is available to determine that excess resources do not exist, the case may be awarded.

2. If insufficient information is available to determine if the resources are or are not within the resource limit such as knowledge of resources but the value cannot be verified, the case must be denied.

3. If information is available to make a determination that excess resources exist and the claimant or sponsor claims an undue hardship exists, the case will be sent to the Elderly/Disabled Certification Division so that the Office of General Counsel can determine if an undue hardship exists. If the undue hardship exists, the case may be awarded. If there is no undue hardship, the case must be denied.

(11) Transfers by the community spouse to a person or persons other than the institutionalized spouse result in periods of ineligibility for nursing home payments for the institutionalized spouse. The institutionalized spouse will need to actually transfer (within 12 months) sufficient resources {assets} to equal the amount of the allowance to the community spouse so that such resources {assets} do not continue to cause ineligibility.

(12) All countable resources in excess of the amount protected for the community spouse, in the assessment, shall be countable resources to the institutionalized spouse whether they are in the name of the institutionalized spouse or community spouse.

(13) RULES BEFORE SEPTEMBER 30, 1989 AND BEFORE OCTOBER 1, 1990 RELATED TO COUPLES - TREATMENT OF INCOME AND RESOURCES

(a) Before the Medicare Catastrophic Coverage Act of 1988 (MCCA), treatment of a couple's income and resources depended on the living arrangement as of the first of a month. The rules below apply to persons admitted to the nursing facility before 9/30/89. Income and resources are deemed from spouse to spouse during the partial month (month of separation) when one spouse enters an institution and the other spouse remains at home. The institutionalized spouse is treated as an individual effective the first day of the month he or she fulfills the institutional residency requirement. Deeming of income and resources no longer applies. If eligible, the community spouse and/or family members could receive a designated allocation amount at home. This allocation is deducted from the institutionalized spouse's liability amount.

(b) Before 10-1-90, income and resources of a couple were treated as two individuals after they had been living together (sharing a room) in an institution for six months. Beginning 10-1-90 when both members of a couple are institutionalized and both apply, both members are treated as individuals rather than as a couple from the point both are institutionalized (includes partial months). If only one member of the couple applied for Medicaid, the income and resources of the ineligible spouse was required to be deemed during the partial month.

Author: Alabama Medicaid Agency

Statutory Authority: 42 USC 1396r-5. Social Security Act, Section 1924(a) through (g).

History: New Rule: Filed August 4, 1998; effective September 9, 1998.