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Title 8: Medicaid Page 83 Iowa Department of Health and Human Services Employees’ Manual Chapter C: Nonfinancial Eligibility Nonfinancial Non-MAGI-Related Eligibility Revised May 22, 2026 When the Department Determines Disability

Test 3: Work Activity Evaluate by determining countable income:  A person who earns more than $1,690 per month meets the criteria for engaging in SGA, which results in not being considered disabled.  See the procedures for Substantial Gainful Activity for an Employee. Comment:

Mr. Q applies for Medically Needy on the basis of disability. His wife is employed and her earnings put their joint income higher than the MEPD income limit of 250% of the federal poverty level. Mr. Q explains that he is not able to work full time because of his heart condition, but he has a self-employment business building bookcases, which averages $600 per month net income after business expenses are deducted. He pays his adult son $50 per month to deliver the lumber to his home workshop and to deliver the finished bookcases. The worker evaluates Mr. Q’s self-employment for SGA by applying the three tests in order: Test 1. Significant services and substantial income:  Mr. Q is not able to do all the work for his business himself.  Mr. Q earns less than $1,690 per month.  Mr. Q’s income has dropped significantly from his previous full-time earnings.  There is no one else in the local community who builds custom bookcases, so the worker cannot compare Mr. Q’s income to the same type of work done by others. Test 2. Comparability of work:  Mr. Q formerly worked at least 40 hours per week and often more due to overtime assignments.  Mr. Q currently has to take frequent rest breaks as he tires easily due to the heart condition. He works an average of ten hours per week. Test 3. Work activity: Mr. Q earns less than $1,690 per month. The worker determines that Mr. Q does not engage in SGA, so he is referred for a Department disability determination.