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3455.05.05 BUDGETING INCOME OF APPLICANT/RECIPIENT AND SPOUSE (MED 1) The policies in this section apply to the MA A, MA B, and MA D categories of assistance. The non-exempt income of the applicant/recipient and the non-exempt income of his spouse who is not receiving TANF are counted together in the eligibility budget computation. This does not apply when one spouse is in a long-term care (LTC) facility or receiving HCBS waiver services; the spouses are budgeted separately in that instance. When an applicant/recipient has stepchildren living in the home, his spouse's income must first be allocated to meet the needs of the spouse's own biological or adoptive dependent children who are under age 18 or students between age 18 and 21 who are not receiving TANF and who are living with the couple. The amount to be allocated is the income standard minus the child's non-exempt income. The spouse's remaining income is then combined with the applicant's/recipient's income in the budget computation. Income is not allocated from the income of the applicant/recipient to stepchildren.7 Income of a stepparent in the household of a child applicant/recipient under age 18 is deemed too the child unless the child’s natural/adoptive parent is deceased, or the couple is divorced. Effective June 1, 2014, child support payments made by the non-recipient spouse of an applicant/recipient in compliance with a court order or Title IV-D are disregarded. The eligibility budget is displayed on Non- MAGI Initial Budget page. 3455.05.05.05 DISREGARD OF RSDI 20% COLA IN OCTOBER 1972 (MED 1)

The policy stated in this section only applies to the MA A, MA B, and MA D categories of assistance. The amount of the 20% increase in Social Security benefits received in October 1972 under Public Law 92-336 is disregarded if, for the month of August 1972, the non-institutionalized applicant/recipient was a recipient of Old Age Assistance, Blind Assistance, or Disabled Assistance.8 3455.05.05.10 DISREGARD OF RSDI COLA IN TRANSITION MONTHS (MED 1, 4) The Cost of Living Adjustment (COLA) received annually in January by Social Security beneficiaries is disregarded until April of the same year for individuals eligible under MA L, MA J, and MA I.9 This disregard also applies to individuals eligible for MA A, MA B, and MA D that live in the community and whose income determination is under 100% of the federal poverty level (FPL).10 This results in the RSDI benefit increase coinciding with the income standard increase which occurs when the new Federal Poverty Guidelines are published. The months of the COLA disregard are referred to as "transition months".