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COMBINED MEDICAID 702-1 Medical Expense Option Supersedes: FMA & MA 703-1 (07/01/08) Reference: 42 CFR 435.831; 42 CFR 440.60, .170, 180, .441; and ARM 37.82.101, .1107, .1111 Overview: Clients must meet their spend down obligation before medically needy Medicaid coverage is established. Clients can choose to meet their spend down by incurring medical expenses equal to the spend down amount. EXPENSES THAT CAN BE USED TO MEET/REDUCE SPEND DOWN: Medical expenses that meet the following criteria can be used to reduce/meet the spend down obligation: 1. The client or a financially responsible relative received the service; 2. The service is recognized under Montana State law as Medicaid payable; 3. The client is financially responsible for the service; and, 4. The service is medically necessary. NOTE: Waiver services are those services furnished 'under a waiver' (i.e., a waiver program is open). Because private-pay charges in an assisted living facility are not furnished under a waiver, they are not recognized as medical expenses under either the Montana Medicaid State Plan or under state law. As such, assisted living facility private-pay charges cannot be used to reduce the spend down. FINANCIALLY RESPONSIBLE RELATIVE: Family: If living in the home, the client’s, their parents and their minor siblings expenses can be used to meet the client’s spend down. For Qualified Pregnant Woman, all filing unit member’s medical expenses can be used. ABD: Only the client’s and their deemed spouse’s (if married adult) or their deemed parents’ (if a minor) medical expenses can be used to reduce the spend down obligation. Use the following to determine whose bills can be used: 1. Only the client’s bills – deemed income was not used to determine the client’s eligibility; 2. The client’s and their ineligible parents’ bills – parental income was deemed to the client and used to determine income eligibility;