Income Considerations 510-05-85-05

(Revised 10/1/2025 Release 25.16 )

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(N.D.A.C. Section 75-02-02.1-34)

The following discusses income situations to consider:

1. All income which is actually available must be considered.

Income is actually available when: It is at the disposal of an applicant, recipient, or anyone acting on behalf of an applicant or recipient; or The applicant, recipient, or anyone acting on behalf of an applicant or recipient has a legal interest in a liquidated sum and has the legal ability to make the sum available for support, maintenance, or medical care; or The applicant, recipient, or anyone acting on behalf of an applicant or recipient has the lawful power to make the income available or to cause the income to be made available. Medicaid applicants and beneficiaries are not required to apply for other benefits as a condition of Medicaid eligibility (as described in Manual Section 510-05-35-90, Application for Other Benefits). An individual may have rights, authority, or powers that he or she does not wish to exercise. Example: An individual who allows a relative to use excluded assets for free or at a reduced rental. In such cases, a fair rental amount will be counted as available income whether the applicant or recipient actually receives the income. If an applicant requests coverage for the three prior months and the applicant or another Medicaid Unit member has an excluded retirement account (as defined in #22 under Manual Section 510-05-70-30, Excluded Assets ) eligibility can be determined for the three prior months as those retirement accounts are excluded assets. In addition, if the retirement account is not yet paying out any benefits, we would not consider any income for any of the three prior months. Any payments would be counted when they are actually received. Example: An IRA was annuitized in June and will begin receiving monthly payments in July. The 1st month the payments would begin to be counted as income is July. Income that is withheld because of garnishment or to pay a debt or other legal obligation is still considered available. Title II and SSI overpayments being deducted from Title II benefits are normally considered to be available because the applicant or recipient can pursue a waiver of the overpayment. Only if the waiver has been denied after a good faith effort, can the Title II or SSI overpayment deductions be considered unavailable. Occasionally other delinquent debts owed to the federal government may be collected from an individual’s federal payment benefit (i.e. Title II, Civil Service, and Railroad Retirement). These other reductions of federal benefits are not allowed to reduce the countable benefit amount. The award amount of the federal payment benefit is counted as available except to the extent an undue hardship is approved for the individual. Requests for undue hardship exceptions must be submitted to the Medicaid Eligibility Unit where a determination will be made whether an undue hardship exists. An undue hardship may be determined to exist for all or a portion of the debt owed, or all or a portion of the reduction from the monthly income. An undue hardship will be determined to exist only if the individual shows all of the following conditions are met: The debt is a debt owed to the Federal government; The deduction from the individual’s federal payment benefit was non-voluntary; The amount of the deduction exceeds the Medicaid income level(s) to which the individual and the individual’s spouse is subject; The individual has exhausted all lawful avenues to get the reduction waived, forgiven, or deferred; and The individual or their spouse does not own assets that can be used to pay for the debt.

2. The financial responsibility of any individual for any applicant or recipient of Medicaid will be limited to the responsibility of spouse for spouse and parents for children under age 21.

Such responsibility is imposed as a condition of eligibility for Medicaid. Except as otherwise provided in this section, the income of the spouse and parents is considered available even if that income is not actually contributed. Natural and adoptive parents, but not stepparents, are treated as parents (exceptions to counting a stepparent’s income applies when the stepparent is the only eligible caretaker and is eligible for Medicaid because of the child, as described in Manual Section 510-05-35-20(2), Relative Responsibility .

3. All spousal income is considered actually available unless:

A court order, entered following a contested case, determines the amounts of support that a spouse must pay to the applicant or recipient;

The spouse from whom support could ordinarily be sought, and the property of such spouse, is outside the jurisdiction of the courts of the United States; or

The applicant or recipient is subject to marital separation, with or without court order, and there has been no collusion between the applicant or recipient and his or her spouse, to render the applicant or family member eligible for Medicaid.

4. All parental income is considered actually available to a child unless:

The child is disabled and at least age eighteen18;

The child is living independently ; or

The child is living with a parent who is separated from the child’s other parent, with or without court order, if the parents did not separate for the purpose of securing Medicaid benefits.

5. Monthly income is considered available when determining eligibility for Medicaid, however, an individual may die before their income is actually received for the month.

An income payment received after death is not considered income, but instead an asset to the individual’s estate. In circumstances where the Department will pursue estate recovery, Medicaid eligibility can be re-determined counting only that income which was received prior to the individual’s death; resulting in the elimination or reduction of the client share/recipient liability.

When a Medicaid provider reports that a recipient’s current month recipient liability was not paid as of the date of death, determine whether the following conditions are met:

There is no surviving spouse;

There is no surviving minor or disabled child; and

Countable monthly income was not received prior to death.

If all conditions are met, refer the case to the Medicaid Eligibility Unit and provide the date of death and the dates of the month in which each source of income is received. The Medicaid Eligibility Unit will determine whether Medicaid estate recovery is being pursued and an adjustment to recipient liability can be approved. If approved, the Medicaid Eligibility unit will process the adjustment.

6. Income may be received weekly, biweekly, monthly, intermittently, or annually.Regardless of the frequency income is received, a monthly income amount must be computed.

7. Income deposited on a debit card could be considered earned or unearned income by applying the appropriate policy.

Example : Unemployment Insurance Benefits (UIB), Child Support benefits, Workforce Safety and Insurance (WSI), Social Security Administration (SSA) benefits, and Supplemental Security Income (SSI) benefits. Example: Gifts or bonuses in the form of gift cards, debit cards, prepaid credit cards or ‘in-store credits’. Others may be bonus or commission payments, compensation for work performed, or Tribal Gaming Per Capita Distributions from gaming revenues etc.

8. Payments that are normally disregarded as income, such as SNAP or TANF benefits, disregarded Tribal payments (other than per capita payments from gaming revenues), Supplemental Security Income (SSI) and occasional small gifts, continue to be disregarded as income regardless of the form of payment (Refer to Manual Sections 510-05-85-25, Post Eligibility Treatment of Income , 510-05-85-30, Disregarded Income – Medicaid , 510-07-40-30, Disregarded Income – Healthy Steps).

9. Distributions to the beneficiary of a Special Needs Trust are NOT considered to be a 'cash or cash equivalent' distribution and are not income to the beneficiary.

All other such payments are counted as income.

10. IRA’s and Roth IRAs that are receiving a payout within the individual’s life expectancy or the required minimum distribution (RMD) are considered income.

Note: If they are receiving payments, but it will not pay out within their life expectancy or are not receiving the RMD, it is considered an asset and the income they are receiving is also counted.