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MEDICAL SERVICES POLICY MANUAL,SECTION O O-700 Income Determination for Medically Needy Program

O 750 Treatment of Third Party Resources

chronological deduction of incurred expenses coverable in the Spend Down quarter). These expenses would be comprised of all services incurred during the Spend Down quarter for individuals potentially eligible for Medically Needy services and apparently coverable under the program (includes the cost of Medicare copayments and/or deductibles) on assigned claims and the cost of any prescribed drug(s) covered by the Medicaid program (name brand drugs must be certified by the physician as medically necessary if lower cost generic equivalent drugs are available). For maternity expenses, any payments will be deducted on the date of such payments and the balance will be deducted on the date of delivery (if applicable).  NOTE A:Incurred medical expenses used to achieve eligibility cannot be used in future Spend Down Determinations, except as noted in MS O-742 #5.  NOTE B: Medical expenses paid by a credit card or loan within the spend down period and the client is still liable for the loan may be used in the chronological spend down to reduce excess income. Medical expenses incurred before the spend down period that were paid by a credit card or loan can be used as a non-coverable expense.

O-750 Treatment of Third Party Resources MS Manual 01/01/14 A third party resource is insurance or some other form of entitlement which helps defray the cost of medical services. Third party resources recognized by the Medicaid program include Medicare, private health insurance, public and private liability insurance, workman’s compensation, veteran’s insurance, CHAMPUS, etc. Third party resources make specific payment for medical services and/or are assignable to a medical provider. Insurance which makes nonspecific payments (i.e., pay whether or not medical services are rendered) and is non- assignable to a medical provider (i.e., pays to the individual only) is not considered a third party resource. Payments from this type of insurance are considered as unearned income. However, insurance which makes nonspecific payments and is assignable will be considered a third party resource (Re. MS O-753). Payments which are received from third party resources within a reasonable period of time will be applied to the cost of incurred medical expenses to determine the liability of the individual. Any portion of incurred medical expenses paid by third party resources is not the liability of the individual and cannot be deducted from excess income. Any portion of incurred medical