Effective Date: November 1, 2021

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A. MAGI methodology

To be eligible for CHIP, an individual's countable income must not exceed the income limit for the CHIP household size using the Modified Adjusted Gross Income (MAGI) methodology. The MAGI methodology follows federal tax rules for determining a household size, whose income counts and the amount of that income for each individual applying for medical assistance. There are some exceptions to the tax rules when determining household size and countable income. There are also some individuals for whom we will use non-tax filer rules to determine their household size.

B. Non-Financial rules

Individuals being determined eligible using the MAGI methodologies must meet the basic non-financial rules such as citizenship or non-citizen status, state residency, provision of a Social Security number, TPL, etc. (Sec. 200)

MAGI methodology uses tax rules to determine a MAGI household. Relationship rules are used for non-tax-filing MAGI households. (See 401-3 )

C. Steps in using the MAGI method

Following federal income tax rules, and in some cases, relationship rules, the steps used to determine eligibility under the MAGI methodology are:

1. Determine the household size and composition for each individual applying for medical assistance.

2. Determine whose income counts for each individual.

3. Determine the modified adjusted gross income of each person whose income counts for the individual, and the total income for the applicable household.

4. Determine the eligibility of each individual.

Each of these steps will be described in detail in subsequent sections.