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Health Care Finance and Administration Section: Financial Eligibility Policy Manual Number: 010.035 Chapter: Reasonable Compatibility and Verification

Is above the income eligibility threshold. Is not available. Attested income is used. The individual is ineligible. The reasonable compatibility test is not required.

Reasonable Compatibility Calculation

a. Reasonable Compatibility Calculation with Reported Income from the Hub

Step 1: Individual has PASSED the Income Eligibility Determination. Step 2: Modified Adjusted Gross Income (MAGI) from the Hub (converted to a monthly amount) is available and:

• If the Hub value is less than the Category Income Standard, the individual is income-eligible and the reasonable compatibility test is NOT required. • If the Hub value is greater than the Category Income Standard, the reasonable compatibility test is required. Continue to Step 3.

Step 3: Determine the Hub Reasonable Compatibility Maximum Amount:

MAGI from the Hub minus 10% of the MAGI from the Hub amount = the Hub Reasonable Compatibility Maximum

Step 4: Compare individual’s attested income amount (prior to the 5% FPL disregard, if applied) to the Hub Reasonable Compatibility Maximum and:

• If the attested income is less than the Hub Reasonable Compatibility Amount, then income verification is required. • If the attested income is greater than the Hub Reasonable Compatibility Amount, no verification is required and individual is considered to be income eligible.

Example: Mr. Jones is applying for coverage for himself, his wife and 2 children. Mr. Jones is the sole income earner and attests to earning $1,750 a month. The Caretaker Relative Income Standard for a family of 4 is $1,867, so Mr. Jones is income eligible for the Caretaker Relative category.

Income information from the Internal Revenue Service (IRS) is available from the Hub (MAGI from Hub), and it is reported that Mr. Jones’ income on his last tax return was $1,900 per month. Given that the Hub data is greater than the Caretaker Relative Income Standard, the reasonable compatibility test is applied:

Attested Income: $1,750 June 4, 2015 HCFA 2