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The prospective eligibility period may not include months in which the applicant/recipient is ineligible for MA for reasons other than being over-income. For example, an individual who is over the applicable resource limit cannot be eligible for MA during the prospective budget period, even if s/he has met his/her spend-down deductible.

Certification or Conditional Denial 7.6.3

The Department is required to process MA applications and determine eligibility for benefits within 45 days from the application date (see Section 2.3: Time Standards in Part III and Section 2.2.6: Salazar Court Order in Part I).

During the prospective MA eligibility determination, the applicant/recipient may present outstanding or new bills within the first 45 days of the prospective budget period. If all other eligibility criteria have been met, the Agency will notify the applicant/recipient in writing of the conditional denial, but will also note that the case, including medical expenses, is being transferred to the IMA Spend-Down Unit for further processing. If the expenses presented during the application process are equal to or greater that the spend-down deductible, the applicant/recipient must be certified as eligible within the prescribed time period for the month in which s/he incurred a medical expense which brings his/her total medical expenses above the spend-down deductible amount and for all subsequent months up to a maximum of six months of prospective eligibility.

If within the first 45 days of the prospective budget period, the applicant/recipient does not present accrued medical expenses which total or exceed his/her spend-down deductible amount, MA eligibility is 'conditionally denied' and the case is transferred to the IMA Spend-Down Unit. The Department will notify the applicant in writing of the conditional denial and the spend-down deductible for the prospective budget period. The IMA Spend-Down Unit will notify the applicant in writing of the remaining amount of medical expenses needed to meet the spend-down liability and will continue to monitor the application and recalculate spend-down deductible if additional allowable medical expenses are submitted by the applicant/recipient.

TWO METHODS FOR DETERMINING ELIGIBILITY THROUGH SPEND-DOWN PROCESS 7.7

There are two methods which can be used to determine whether a group is eligible for MA through the spend-down process. These methods apply both to determining retroactive and prospective eligibility.

Month-by-Month 7.7.1

Under this method, each month's medical expenses are compared to the monthly spend-down deductible. If the month's expenses exceed the monthly spend-down deductible, MA will pay for all covered medical expenses in excess of the group's spend-down deductible in that month.

Example 1

Retroactive Eligibility

Ms. Garay applies for Medicaid in August. She is found to be over-income for Medicaid. Her spend-down deductible is $50 per month. Ms. Garay incurred monthly medical expenses of $375 in May, $300 in June, and $400 in July and wants to apply for retroactive eligibility. Using the month-by-month method, Ms. Garay would qualify for Medicaid in May, June, and July because each month's medical expenses exceeded her monthly spend-down deductible. In each month, Medicaid pays the covered expenses in excess of her spend-down deductible.