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Title 8: Medicaid Page 69 Iowa Department of Health and Human Services Employees’ Manual Chapter C: Nonfinancial Eligibility Nonfinancial Non-MAGI-Related Eligibility Revised October 10, 2025 When the Department Follows an SSA Disability… SSA Disability Denial and Appeal Process Legal reference: 42 CFR 435.541; 441 IAC 50.1(249), 50.2(1), and 75 (Rules in Process) Policy: The Department is required to deny Medicaid eligibility based on a final Social Security Administration (SSA) decision that an applicant is not disabled. EXCEPTIONS: Medically Needy eligibility cannot be denied based on an SSDI (Title II) denial of disability. The Department must make a disability determination on medical impairments when the SSA has denied disability benefits because the person is engaging in substantial gainful activity but the person could qualify under Medicaid for Employed People with Disabilities (MEPD). The Department will determine disability when the client is claiming that a new disabling condition or a worsening of the original condition has occurred after a final SSA denial. Comment: There is a specific meaning for a “final” SSA decision. When the SSA determines that a claimant (applicant) is not disabled, the person may appeal the decision. There are four levels to the SSA appeal process:
Appeal Level Process 1. Initial determination The claimant has 65 days from the date the SSA denial is issued to request a reconsideration of the disability determination. 2. Reconsideration The claimant has 65 days from the date the SSA reconsideration is issued to request an appeal hearing with a SSA administrative law judge (ALJ). 3. Decision by an SSA ALJ The claimant has 65 days from the date the SSA appeal denial is issued to request a review by the SSA Appeals Council. In some cases the ALJ may not issue a decision, but instead may recommend a decision and send it on to the Appeals Council. Recommended decisions are not considered a new SSI decision for Medicaid purposes until acted on by the Appeals Council.