POST ELIGIBILITY TREATMENT OF INCOME (COST-OF-CARE)

570 POST ELIGIBILITY TREATMENT OF INCOME (COST-OF-CARE)

After being determined eligible for Medicaid, some individuals who are institutionalized, or who is receiving home and community-based (HCB) waiver services may be required to contribute a portion of their income toward the cost-of-care (COC) they receive. The post eligibility process involves determining the exact amount a recipient is obligated to pay to the medical institution, nursing home, or HCB Home and Community-Based waiver services provider. The provider is responsible for collecting from the recipient that recipient’s share of the cost-of-care. Medicaid reduces its payment to a medical institution or nursing home by the amount of the recipient’s cost-of-care liability.

A recipient of HCB Home and Community-Based waiver services who is eligible for Medicaid through the Special Long Term Care (LTC) eligibility category is subject to cost-of-care. Currently, Medicaid does not have a method for equitably reducing its payment to multiple HCB Home and Community-Based service providers. However, an HCB Home and Community-Based waiver service recipient still has a cost-of-care obligation to his or her HCB Home and Community-Based service providers. When a recipient pays a portion of the cost-of-care to a provider, that provider is required to reduce its claim to Medicaid by the amount received from the recipient.

A cost of care obligation is determined by using total gross income minus the allowable deductions and disregards listed below. When a cost of care obligation is determined for a waiver recipient who is utilizing a trust to be eligible for Medicaid, the income used to determine the cost of care is the total gross income before any of it is put into the trust (minus the allowable disregards and deductions listed below).

570 A. DEFINITIONS

Available Income: Income to which a community spouse has access and control.

Community Spouse: The spouse of an applicant or recipient of long-term care Medicaid. A community spouse resides outside of an institution and is not receiving HCB Home and Community-Based Home and Community-Based waiver services.

Continuous Period of Institutionalization: At least 30 consecutive days of institutionalization in a medical institution or nursing facility.

Dependent Children: A couples’ minor children who live with a community spouse and who may be claimed as a dependent by either member of a couple for income tax purposes.

Dependent Parent: A parent of either member of a couple who reside with a community spouse and who may be claimed as a dependent by either spouse for income tax purposes.

Dependent Sibling of a Couple: A brother or sister of either member of a couple (including a half-brother, or a half-sister) who reside with a community spouse and who may be claimed by either member of a married couple for income tax purposes.

Institutionalized Spouse: A spouse who is likely to reside in a medical institution or nursing facility for a continuous period of institutionalization.

Maintenance Needs Standard: Income standard to which community spouse’s and other family member's income is compared for purposes of determining the amount of allowances used in the post-eligibility calculation.

Medical Expense: A medical expense means that a licensed medical practitioner provided or prescribed an item or service to:

Prevent, diagnose, treat, or cure a disease or injury, or

Treat an affected part of the body.

Medical expenses incurred by the recipient that are not subject to payment by Medicaid or other third parties can be used a deductions towards cost of care.

Examples of allowable medical expenses are co-insurance and deductible payments, prescription drugs not covered, Medicare Part B or D premiums, dental services, and medical supplies. Examples of what is not considered allowable medical expenses are care repairs, taxi rides to and from medical appointments, and house repairs. This is not an all-inclusive list.

Medical Institutions or Nursing Facilities: Hospitals, skilled nursing facilities and intermediate care facilities (including ICF/IDD Intermediate Care Facility for the Intellectually Developmentally Disabled s).

Monthly Income Allowances: the amount deducted in the post-eligibility calculation for maintenance needs of a community spouse and other family members.

Remedial Expense: A remedial expense means it helps relieve, remedy, or reduce a medical or health condition.

Swing Bed: A hospital bed that can be used interchangeably to provide acute, skilled, or intermediate care.

Total Gross Income: Income that is used to determine eligibility (including monies deposited in a Medicaid Qualifying Trust) before any deductions or disregards are applied.

Note: Native Dividend income over $2,000 is countable even if deposited to a trust because it is not legally assignable to a trust.

570 B. INDIVIDUALS SUBJECT TO COST-OF-CARE ( COC Cost-of-care )

The following Medicaid recipients are subject to post-eligibility rules and may be required to pay a portion of their medical care cost:

Individuals eligible under any category that are residing in a medical institution or nursing facility unless exempt under Subsection C, who receive institutional long term care services.

Note: It is important to keep the nursing home informed of all changes in COC Cost-of-care obligations, since the majority of the nursing homes will deduct the COC Cost-of-care obligation from the amount that is billed to Medicaid prior to receiving the COC Cost-of-care payment from the recipient. If there is a decrease in a recipient’s COC Cost-of-care obligation, the facility must be notified as it may significantly affect the billing and payment for the recipient’s care.

Example: Mr. Steele is an APA Adult Public Assistance cash and related Medicaid recipient. He recently entered a nursing home and is expected to remain in the nursing home for the duration of his life. He does not have a spouse or dependents. His current income consists of $600 Social Security retirement benefits. The cost-of-care determination is completed for Mr. Steele because he is residing in a nursing facility.

2. HCB Home and Community-Based waiver recipients who are eligible for HCB Home and Community-Based waiver services under the Special Long Term Care eligibility category.

Example: Mr. Kreher receives SSDI Social Security Disability Insurance and is eligible for HCB Home and Community-Based waiver services. He receives waiver approval starting in the month of June. He has a QIT Qualifying Income Trust with $2,000 of income being placed into the trust. Mr. Kreher is Medicaid eligible under the Special LTC Long Term Care eligibility category only and is obligated to pay toward his cost-of-care.

570 C. INDIVIDUALS NOT SUBJECT TO COST-OF-CARE

The following Medicaid recipients are not subject to cost-of-care:

SSI Supplemental Security Income , APA, Adult Public Assistance and Refused Cash Medicaid recipients, unless they are institutionalized. See section 570 B .

A recipient who continues to receive SSI Supplemental Security Income or APA Adult Public Assistance cash benefits because they are temporarily institutionalized for 90 days or less. See APA Manual Section 470-2 .

HCB Home and Community-Based waiver service recipients receiving Medicaid under any eligibility category other than the Special LTC Long Term Care category.

Example: Mrs. Avery receives APA Adult Public Assistance and Medicaid with HCB Home and Community-Based waiver services. In June, she reports to her caseworker that she was in a vehicle accident and anticipates a $6,000 insurance settlement. She expects the settlement payment in July. On July 6, Mrs. Avery reports to her caseworker that she just received the $6,000 check. In this situation, Mrs. Avery is an APA Adult Public Assistance recipient and not living in an institution. Therefore, she does not have a cost-of-care obligation. She remains eligible for APA Adult Public Assistance and Medicaid for July because it is too late to provide a timely notice of adverse action. Note: The caseworker must watch for resource eligibility in August.

Institutionalized recipients in a nursing home who have less than $200 in countable income.

Pregnant Women

Child under 18 receiving waiver services

MAGI Modified Adjusted Gross Income Medicaid recipients

Note: The No Cost of Care Due (M003) notice is only sent to individuals who are subject to cost of care as outlined in MS 570(B) . If the individual is not subject to cost of care, a cost of care notice is not sent.

570 D. INCOME DISREGARDED IN THE COST-OF-CARE DETERMINATION

The following income is not included in the total gross income when making the cost-of-care determination:

1. Payments from the Department of Veteran Affairs for Unusual Medical Expenses ( UME Unusual Medical Expenses ) and Aid and Attendance ( AAA Aid and Attendance ).

Exception: For a recipient residing in a state Veteran’s Home, a VA Department of Veterans Affairs payment that exceeds $200 including UME Unusual Medical Expenses and AAA Aid and Attendance counts as income in the cost-of-care determination. This provision applies only to a veteran without a spouse or child and to a surviving childless spouse of a veteran. At this time, the Alaska Veterans and Pioneer Home is the only designated veteran's home in the state.

2. The withheld portion of an SSA Social Security Administration overpayment.

3. SSI Supplemental Security Income Payments made under 1619(a) or (b) to an institutionalized individual. If a Medicaid recipient receives SSI Supplemental Security Income under the 1619(a) or (b) provisions prior to entering an institution, SSI Supplemental Security Income will continue to pay full SSI Supplemental Security Income benefits up to two months after being institutionalized. The SSI Supplemental Security Income income is disregarded when completing the cost-of-care determination.

4. SSI Supplemental Security Income / APA Adult Public Assistance Payments made to Recipients Living in an Institution. The SSI Supplemental Security Income / APA Adult Public Assistance benefits that are continued at the full community payment rate for up to the first three months after the month of entry into an institution are disregarded in the cost-of-care determination.

5. Income from Interest Bearing Trust Accounts. Interest payments of $4/month or less made to an interest bearing trust account.

570 E. ALLOWABLE DEDUCTIONS FOR COST-OF-CARE DETERMINATIONS

To determine the amount of money the individual must contribute toward his or her cost-of-care ( COC Cost-of-care ), the caseworker must deduct the following allowances from the individual’s total gross income as applicable:

Note: All deductions must be verified before they are allowed as a deduction from the individual's total gross income. The caseworker will determine eligibility without a deduction if the expense is not verified within 30 days of the initial application filing date. If verification is provided at a later date, the change is effective the first day of the month of the agency's receipt of the report of change. See APA MS 480-3(C) .

1. Personal Needs Allowance (PNA)

The personal needs allowance is the amount intended to cover the personal and maintenance needs of the individual. The amount varies depending upon the individuals living situation.

Deduct the following minimum PNA Personal Needs Allowance from total gross income:

$ 200 Institutionalized Individuals in a Nursing Home or Swing Bed Facility. If SSI Supplemental Security Income is the sole income of the individual he or she will receive $30 from SSI Supplemental Security Income and $170 from APA Adult Public Assistance every month to cover the minimum $200 PNA Personal Needs Allowance . $ 200 Veteran in a Nursing Home or Swing Bed Facility . This applies only to a veteran without a spouse or a dependent child who receives a $200 Veterans nursing facility pension. $1,656 Recipient of HCB Home and Community-Based Waiver Services Living at Home. This applies to a recipient of HCB Home and Community-Based waiver services who is living in his or her own home and who is eligible under the Special LTC Long Term Care Income category. This high amount recognizes the fact that unlike a nursing home resident, this individual is still responsible for maintaining their own home. $1,396 Recipients of HCB Home and Community-Based Waiver Services Living in an Assisted Living Home. This applies to a recipient of HCB Home and Community-Based waiver services who is living in an assisted living home, including a Pioneer Home.

Adjustment to the Minimum PNA Personal Needs Allowance :

Taxes: The PNA Personal Needs Allowance may be increased to cover mandatory withholding from earned and unearned income to cover federal, state, and local taxes. The PNA Personal Needs Allowance is also increased to cover the amount of taxes that are not subject to mandatory withholding but are owed and actually paid. This increase does not apply to any tax that is deducted under another provision in the post-eligibility process (e.g. property taxes paid on a home for which a home maintenance allowance is made).

Garnishment for Child Support: The PNA Personal Needs Allowance may be increased to cover the amount of income garnished for child support during the same period covered by the PNA Personal Needs Allowance . This increase does not apply to any amount of garnishment that is deducted under another provision in the post-eligibility process, such as the family member allowance.

Residents of ICF/MR Institutions: The PNA Personal Needs Allowance may be increased by the amount of income needed to fulfill an approved plan for achieving self-support. See APA Manual Section 442-1C .

Guardian and Conservator Fees: The PNA Personal Needs Allowance may be increased by the fee actually charged to the recipient by a court-appointed guardian or conservator, not to exceed $100 per month.

2. Community Spouse Allowance

The community spouse of either an institutionalized or HCB Home and Community-Based waiver recipient may be entitled to a spousal allowance. A spousal allowance is the amount deducted from the recipient’s income that, when combined with all of the community spouse’s own income, can raise the community spouses’ total gross income to the Community Spouse Monthly Maintenance Need Standard. See Addendum 1 . The spousal allowance is deducted from the recipient’s gross income.

Adjustment: The spousal allowance may be increased by a spousal support order or a hearing officer’s decision that a greater monthly amount is needed due to exceptional circumstances resulting in extreme financial duress of the community spouse.

3. Family Member Allowance

The institutionalized or HCB Home and Community-Based waiver recipient is entitled to a dependent allowance for each dependent child, dependent parent, or dependent sibling. A dependent for deeming purposes is the same as a dependent for federal income tax purposes. If a dependent is claimed on the community or institutionalized spouse's personal income tax return, a family member allowance can be considered. The amount deducted from the recipient's income is based on the living arrangement of the dependent.

If the dependent:

Resides with the community spouse

The dependent allowance is equal to the Monthly Need Standard for Additional Household Members, less the dependent's own income ( SSA Social Security Administration , SSI Supplemental Security Income , etc.). See Addendum 1 .

Does not reside with the community spouse

The dependent allowance is equal to the ATAP Alaska Temporary Assistance Program ANI Adult Not Included (Child Only) Need Standard for the number of dependent family members, less the dependent's own income ( SSA Social Security Administration , SSI Supplemental Security Income , etc.) See ATAP Alaska Temporary Assistance Program Addendum 2 .

For example: the ATAP Alaska Temporary Assistance Program ANI Adult Not Included Need Standard for one (Child Only 1) is used for one dependent (in 2026 the Need Standard is $1,048) and the ATAP Alaska Temporary Assistance Program ANI Adult Not Included Need Standard for two (Child Only 2) is used for two dependents (in 2026 the Need Standard is $1,286).

Adjustment: The allowance may be increased by court order or a hearing officer’s decision affirming or establishing that a greater monthly amount is needed due to exceptional circumstances resulting in extreme financial duress of the dependent child, dependent parent or dependent sibling.

4. Insurance Premium Allowance

An allowance for non-reimbursed Medicare and other health insurance premiums paid by the recipient may be deducted from gross income. If this premium is paid by the spouse for the recipient, it can also be deducted; however, if it is a joint premium, only the portion applicable to the institutionalized or HCB Home and Community-Based waiver recipient may be deducted.

5. Unpaid Medical Expense Allowance

An allowance for incurred medical or remedial expenses that are not subject to payment by a third party (Medicaid, Medicare, or any other health insurance) may be deducted from the gross income. This includes unpaid medical expenses that may be outstanding prior to when the person became a Medicaid recipient. Please see ADLTC MS 570(A) for the definitions of medical and remedial expenses.

If the recipient has a very large bill outstanding, make a reasonable effort to carefully document the expense in the deductions on the income credit and in the case notes, as there is no guarantee that the recipient will contribute the deduction toward the unpaid bill. The amount of an unpaid bill may only be deducted once (even though it may take several months to allow the full amount to be deducted). If the recipient does not pay off the bill through income credit deductions allowed for that reason, the bill may not be deducted again.

6. Home Maintenance Allowance

If a Medicaid recipient without a community spouse or a dependent enters a medical institution or nursing facility and a physician has certified that the stay will be six months or less, the recipient can receive a home maintenance allowance deducted from the gross income.

In this situation, the home maintenance allowance is up to or equal, but cannot exceed, the Expanded Refused Cash standard for an individual living independently. See ADLTC Aged, Disabled, and Long Term Care Manual Addendum 1 . This home maintenance allowance can be deducted for a maximum of six months beginning with the 1st of the month after the month of admission to the medical institution or nursing facility.

Take the following steps:

a. Get a physician certification stating the stay will be six months or less and document the receipt of the certification.

b. If the recipient is not expected to leave the institution, end the deduction and send the recipient adequate notice.

c. If the recipient is expected to leave the institution within six months, the home maintenance allowance can continue.

d. Set an alert on the ETAL Eligibility Technician Alerts screen screen for the fifth month to check with the institution and the physician whether the recipient's status of discharge will occur in the sixth month.

e. Get verification of the rent/mortgage and utility costs to determine the amount of home maintenance allowance.

570 F. WHEN A COST-OF-CARE LIABILITY BEGINS AND ENDS

A cost-of-care liability is not incurred in the month of admission, the month of application for Medicaid, or the month of discharge from the facility. This policy is intended to help a recipient make the transition to and from institutional living. A recipient who enters a nursing home after the first of the month will have already incurred community living expenses (e.g., paid rent or mortgage) for that month and a recipient leaving an institution will have to pay new living expenses in the community. Cost-of-care starts the month after HCB Home and Community-Based waiver is approved if the individual is already receiving Medicaid in a different category.

Example: A recipient has an ongoing Medicaid case with a QIT Qualifying Income Trust . The HCB Home and Community-Based waiver is approved with a start date of April 1. The cost of care liability starts the month of May.

A cost-of-care liability is not incurred when a late review is received and there is a break in Medicaid coverage. If a review is received the month after a case is closed for no review, we would still invoke a cost-of-care liability.

Example: A Medicaid case closes February 28 for failure to submit the required review form. If the client reapplies for Medicaid on March 29 and is found eligible, cost-of-care is applied for March. If the client does not reapply for Medicaid until April 2, and is found eligible, there would not be any cost-of-care applied for April.

Note: The monthly cost-of-care liability may not exceed the actual cost-of-care provided in that month.

Once the medical benefit is paid for a benefit month, the liability amount cannot be changed for that month; the change must be done in a future month through use of the adjustment line on the EIS Eligibility Information System COCA Cost of Care screen.

Exception: If only a screening coupon (DE 25 or WD 19) was issued, the caseworker must notify the EIS Eligibility Information System Help Desk to add a cost-of-care liability amount on the EIS Eligibility Information System COCA Cost of Care screen for that month.

570 G. RETROACTIVE COST-OF-CARE ADJUSTMENTS

Retroactive adjustments can be made for an overstated or understated cost-of-care ( COC Cost-of-care ) liability at any time. There is no time limit to correct a COC Cost-of-care error. Retroactive adjustments are treated the same for institutionalized persons and HCB Home and Community-Based waiver recipients. An understated liability occurs when a recipient fails to report income or has a one-time lump sum payment that causes an increase in the COC Cost-of-care . An overstated amount is when a recipient has a previously unreported or a one-time medical expense.

This is especially useful for interest bearing trust accounts in which the monthly interest does not warrant making an adjustment, yet the accumulated amount over several months may result in an increase in COC Cost-of-care obligation. However, in order to avoid a payment error, all adjustments must be made within four months of the change in income. If the adjustments cannot be accomplished in four months, notify Systems Support for a correction of the liability amount.

When making a retroactive adjustment that results in a larger liability, the caseworker must provide timely notice of adverse action taken. Complete a new COCA Cost of Care screen for the following month to ensure that the COC Cost-of-care reverts to the correct amount for the subsequent months. See Addendum 4 - COCA Cost of Care Processing when making retroactive adjustments.

Example 1 - Overstated liability: Mr. Shafaat currently has a monthly COC Cost-of-care of $1,025. In July, he went to the podiatrist and the cost of the visit was $200. He reported this expense on July 21. The caseworker does not have time to send a 10-day adverse action notice to adjust COC Cost-of-care for August.

Step 1: Access the September COCA Cost of Care screen and enter the $200 medical expense; Step 2: Recalculate the COC Cost-of-care for September and send notice M715 - Cost of Care Change; and Step 3: Access the October COC Cost-of-care , remove the $200 medical expense, recalculate COC Cost-of-care , and send a second COC Cost-of-care change notice.

Example 2 - Understated liability: Ms. Martinez currently has a COC Cost-of-care of $300 per month. On August 26, she reports receiving a $5,000 pay out from an old retirement account of her deceased husband and the money was deposited into her Qualifying Income Trust (QIT) account to maintain her eligibility.

Step 1: Access the October COCA Cost of Care screen and enter the $5,000; Step 2: Recalculate October COC Cost-of-care with the $5,000 and send notice M715 - Cost of Care Change; Step 3: Access the November COCA Cost of Care screen, remove the $5,000 and recalculate COC Cost-of-care ; and Step 4: Send a second COC Cost-of-care change notice.

Note: Understated liability can be captured in more than one month for example, when a lump sum or lump sums were reported late. The case worker can increase the cost of care for multiple months when multiple lump sums were received in separate months. Example: Client receives a $5,000 payment for April, July and September, reports it late in October. The case worker should do adjustments in the months following the report, one adjustment for each month if the amount received is too high to capture in one month.

570 H. NURSING HOME EXAMPLES

Example 1: Mr. Webber is an 85 year-old widower who resides in an assisted living home. He receives APA Adult Public Assistance and HCB Home and Community-Based waiver services. His physician has determined that his needs would be better met in a long-term care facility. On October 5, Mr. Webber moves into a nursing home. Mr. Webber’s income includes $1050 Social Security retirement benefits and APA Adult Public Assistance . On October 6, the LTC Long Term Care caseworker is notified by DSDS Division of Senior and Disabilities Services that Mr. Webber’s HCB Home and Community-Based waiver will end due to nursing home placement. The caseworker verifies with the facility that his stay will last longer than 90 days. The APA Adult Public Assistance worker ends Mr. Webber’s APA Adult Public Assistance cash effective October 31, and converts the case to Nursing Home Medicaid. Mr. Webber reports no expenses.

Step 1: Determine the COC Cost-of-care obligation by deducting the personal needs allowance ( PNA Personal Needs Allowance ) from Mr. Webber’s SSA Social Security Administration ; and $1050 - 200 ( PNA Personal Needs Allowance ) $850 (COC obligation) Step 2: Send Mr. Webber notice M120 - Cost-of-Care / LTC Long Term Care Facility, informing him that his COC Cost-of-care obligation will begin November 1, and send a copy to the nursing home and guardian (if applicable).

Example 2: Yusef is married and both he and wife Aiyla each receive a $1050 per month Social Security benefit. Their combined resources are within allowable limits. The couple would be eligible for an APA Adult Public Assistance cash payment but has never applied. Yusef enters a medical institution on March 15 and applies for Medicaid. His countable income in March and subsequent months is $1050.

Step 1: Determine the allowed spousal allowance by deducting Aiyla’s income from the community spousal need standard: $4,066.50 (2026 Community Spouse Monthly Maintenance Need Standard) - 1050 (Social Security benefit) $3,016.50 (allowable spousal deduction) Step 2: Deduct Yusef’s PNA Personal Needs Allowance , and community spouse allowance from his income: $1050 (income of institutional spouse) - 200 ( PNA Personal Needs Allowance ) - 850 (amount allocated to the community spouse*) $ 0 total individual must pay toward cost-of-care * This is the amount that may be allocated to the community spouse because the maximum community spouse allowance of $4,066.50, less community spouse's $1050 income, equals $3,016.50, which is more than the spouse's income, so the community spouse allowance is all of the institutionalized spouse’s income after the PNA Personal Needs Allowance has been deducted.

570 I. COST-OF-CARE FOR RECIPIENTS OF HCB Home and Community-Based WAIVER SERVICES

Recipients of HCB Home and Community-Based waiver services are allowed the same COC Cost-of-care deductions as nursing home recipients. An HCB Home and Community-Based recipient who has a COC Cost-of-care obligation must work with his or her care coordinator in determining what services are subject to a COC Cost-of-care obligation. A recipient’s cost-of-care can only go toward services not covered by regular Medicaid. If a care coordinator or recipient has any questions on what constitutes a covered HCB Home and Community-Based service versus a regular Medicaid service, refer the care coordinator or recipient to DSDS Division of Senior and Disabilities Services for assistance. Adverse action notice is required for COC Cost-of-care obligations.

Step 1:

Send notice M130 - Cost-of-care / Waiver to the recipient, and copy the recipient’s care coordinator and trustee and/or guardian; and

Step 2:

Document the medical expenses used to determine the COC Cost-of-care obligation in the case notes ( CANO Case Notes ).

570 J. HOME AND COMMUNITY-BASED WAIVER CASE EXAMPLES

Example 1 - Applicant: Mrs. Kepner is a 60 year-old applicant for HCB Home and Community-Based waiver services and the level-of-care ( LOC Level of Care ) and Support Plan have been approved by DSDS Division of Senior and Disabilities Services . Her monthly disability and pension income totals $3,822. She has an approved QIT Qualifying Income Trust that has been registered with the court. Mrs. Kepner is married and her husband has earnings of $2,000 per month. Mrs. Kepner lives in her own home with her husband. All children are grown and living on their own. Mrs. Kepner has a $50 health insurance premium expense.

Step 1: Determine the allowed spousal allowance by deducting Mr. Kepner’s gross wages from the allowed spousal allowance; $4,066.50 (2026 Community Spouse Monthly Maintenance Need Standard) - 2,000 (Mr. Kepner’s gross wages) $2,066.50 (spousal allowance) Step 2: Deduct Mrs. Kepner’s PNA Personal Needs Allowance , spousal allowance and health insurance premiums from her gross income; $3,822 - 1,656 ( PNA Personal Needs Allowance ) $2,166 - 2,066.50 (spousal allowance) - 50 (health insurance premium) $ 49.50 ( COC Cost-of-care obligation) Step 3: Approve and authorize Medicaid with HCB Home and Community-Based waiver service; Step 4: Send appropriate approval notice; Step 5: Send notice M130 - Cost of Care / Waiver; and Step 6: Document the medical expense in the case notes.

Example 2 - Recipient: Mr. Shepard is a 70 year-old HCB Home and Community-Based waiver service recipient eligible for Medicaid under the Special LTC Long Term Care income standard of $2,982. He entered a Pioneer Home in August. Mr. Shepard has monthly income of $1,650 from his retirement pensions. Mr. Shepard will incur a cost-of-care obligation.

Step 1: Deduct Mr. Shepard PNA Personal Needs Allowance from his gross income. $1,650 (gross income) - 1,396 ( PNA Personal Needs Allowance for ALH Assisted Living Home ) $ 254 (Medicaid COC Cost-of-care obligation)

Step 2: Check for adverse action notice. Because it is August 25, there is no time for adverse action notice so Mr. Shepard's Medicaid COC Cost-of-care obligation will not begin until October 1. Step 3: Send Mr. Shepard notice M130 - Cost-of-Care / Waiver explaining his Medicaid COC Cost-of-care obligation beginning October 1, and a copy to the care coordinator.

Example 3 - Lump Sum Income: Ms. Obu is an HCB Home and Community-Based waiver service recipient with a COC Cost-of-care obligation of $200 per month. In July, she reports to her caseworker that she is anticipating a $25,000 cash inheritance payment from her deceased grandmother and she is expecting to receive and have the check deposited into her QIT Qualifying Income Trust in August. Because the money is anticipated to be received in August, Ms. Obu's COC Cost-of-care obligation for this month will increase. However, her COC Cost-of-care obligation cannot exceed the actual waiver service expenses she receives in a month.

Step 1: In July, request a copy of Ms. Obu’s current Support Plan from DSDS Division of Senior and Disabilities Services . Step 2: Review the Support Plan for any one-time large sum costs such as environmental modifications and deduct these expenses from the overall Support Plan costs. Step 3: Divide this amount by 12 to determine the monthly Support Plan cost. Step 4: Send Ms. Obu a notice informing her that the COC Cost-of-care obligation for the month of August will be her entire monthly Support Plan cost. In September, her COC Cost-of-care obligation will return to $200 per month.

570 K. COCA NOTICE REQUIREMENTS

In addition to the notice requirements outlined in Admin MS 108 , the cost of care notices must include what income was counted (source and amount, along with the calculation), what allowances were given (or not if any where denied), and any other factor that affected the cost of care obligation.

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