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Families and Children Manual Policy Manual Number: 010.050 Section: Financial Eligibility Chapter: Medically Needy Spenddown

February 2, 2026 Division of TennCare 5 2. Bills incurred during TennCare eligibility which are subject to TennCare reimbursement are not considered outstanding for subsequent spenddown periods even if not paid by TennCare.

d. Medical/Health Insurance Premiums Health insurance premiums may be deducted as a spenddown expense only when payment is due, even if paid in another month. Premiums are deducted for health insurance that share the following characteristics:

i. It is reported to TennCare as a third party medical resource; ii. Benefits are assignable and the eligible individual has agreed to assign them to the state; and iii. The premiums are paid by the eligible individual, not a third party. Note: The State pays the Medicare premiums for individuals eligible for SSI, Pickle Pass Along, and Disabled Adult Child (DAC). Do not deduct Medicare premiums for individuals in the EDG who are approved as Qualified Medicare Beneficiary (QMB), Special Low-Income Medicare Beneficiary (SLMB) or Qualifying Individual (QI). e. Third Party Payments If a medical expense is subject to partial payment by a third party, include only the portion for which the individual is liable in the determination of total incurred medical expenses.

Always verify, if possible, the reimbursement or medical expense by third parties before allowing a deduction. If verification of the reimbursement cannot be obtained within time limit constraints (application or change report processing period), determine from the third party the:

i. Type of expense it will cover; ii. Rate or percentage or anticipate amount of reimbursement; and iii. Anticipated date of reimbursement.

If all possible efforts have been made and verification cannot be obtained about third party payment, allow the portion of the expense the individual/EDG states they are responsible for. f. Budgeting Medical Expenses and Carry Forward Regular recurring medical expenses (i.e., insurance premiums or installment payments) are counted as incurred on the date of application.

Only the portion of the medical expense that is necessary to meet spenddown will be used.

Any remaining medical expenses to carryover for the next spenddown period will be used if still owed or paid during the spenddown reapplication month in question.