H-3410 Variable Income
Revision 09-4; Effective December 1, 2009
When projecting variable income, it is permissible to overlap months (or to skip a month), if verification is unavailable.
The case is reviewed in February and verification of variable income for January is unavailable. The options are:
- Average variable income from July through December (total divided by six months), and project that average through the following August. (This is true even though variable income received in July was used in the average calculated at the preceding semi-annual review in August [when the income from the preceding February through July was averaged].) Also at this February semi-annual review, reconcile the months of August through December. (Do not reconcile for July, since that month was reconciled at the previous semi-annual review last August. Never reconcile the same month twice!)
- Average variable income from August through December (total divided by five months), and project that average through the following August. Reconcile for August through December.
Options at the next annual review (the following August) are:
- Average variable income received from January through July (total divided by seven months), and project that average through the following February. Reconcile for January through July.
- Skip January altogether, and average February through July (total divided by six months), and project that average through the following February. Reconcile for January through July.
- If verification of variable income received in July is unavailable, average variable income received from February through June (total divided by five months), or variable income received from January through June (total divided by six months), and project that average through the following February.
H-3420 Incurred Medical Expenses (IMEs)
Revision 09-4; Effective December 1, 2009
- IMEs which have been projected in the co-payment budget must be re-budgeted at least every six months.
Exception: If the person's only IME is a fixed amount and there is no variable income, the IME may be projected for a 12-month period. The case is monitored at regular intervals (such as every six months for monthly, quarterly and semi-annual payments) to ensure that payments continue, but reconciliation is not required unless payments were not made or the amount paid is different from the amount projected.
- IMEs which have not been paid in preceding months, but which are anticipated to occur in subsequent months, may be projected. This will afford the person sufficient income to pay the expense.
- A relative has been paying the person's insurance premium, but the person will begin paying it in March. The IME is calculated into the co-payment budget in February to be effective March.
- The person will pay for dental work in monthly installments. Both the dental work and the payments begin in March. The monthly payment is calculated into the co-payment budget in February to be effective March.
- For fixed IMEs paid on a monthly basis, the amount to be projected is based on anticipated amounts for the coming six-month period.
Example: The case is being worked in October, and the person has been making monthly premium payments of $25, which are not anticipated to change. During the preceding six months (April through September), no payment was made in May, but a double payment ($50) was made in June. The amount projected (from November through April) is $25 ($150 total payments ÷ 6 months = $25 average).
- If an IME is expected to cease, such as payments on a dental bill will be completed, schedule a special review to delete the IME from the budget effective the month payment is to cease.
H-3430 Both Variable Income and Incurred Medical Expenses (IME)
Revision 13-4; Effective December 1, 2013
- Variable income/IMEs which have been projected in the co-payment budget must be re-budgeted at least every six months.
Exception: If the co-payment is $0 and is not expected to change, a 12-month average may be used, and semiannual reviews are not required.
- If it is discovered after the case is worked that the person receives variable income or pays IMEs, or if variable income/IMEs begin on an active case, base the projected amount on income received/expenses paid in the preceding six-month period, or however many months during the preceding six-month period in which payments/expenses occurred, or the amount expected to be received/paid. The average of the preceding months may be used to project the budget.
- An annual review was completed in January. Monthly variable income payments totaling $300 were received during the preceding six months (July through December). The projected variable income amount was $50 ($300 total ÷ 6 months = $50 average). A semiannual review was scheduled for the following July. In April, the eligibility specialist is notified that the person will begin making monthly payments of $50 for dentures. These payments begin in May and are to continue for 48 months. The $50 monthly IME (the amount expected to be paid) is calculated into the co-payment budget in April to be effective in May.
At the semiannual review in July, the eligibility specialist verifies that the $50 monthly payments for dentures continue, and he averages variable income received from January through June.
- An intermediate care facility for individuals with an intellectual disability or related conditions (ICF/IID) application was certified in January, at which time a monthly premium of $60 on an assignable general health insurance policy was projected as an IME. A semiannual review was scheduled for the following July. In April, the eligibility specialist is notified that the person began participating in a sheltered workshop in March and was paid $25 that month. This $25 variable income payment is calculated into the co-payment budget in April to be effective in May.
At the semiannual review the following July, the eligibility specialist verifies that the person continues to pay the $60 monthly health insurance premium. The eligibility specialist verifies that variable income received from March through June totals $110. The IME amount to be projected for the coming six months continues to be $60. The variable income amount to be projected for the coming six months is $27.50 ($110 total ÷ 4 months = $27.50 average). The annual review is scheduled for the following January.
- An application was certified in January. There were no variable income or IMEs, and the annual review is due the following January. In March, the eligibility specialist is notified that in February the person began renting out her home for $200 per month. There have been no repair/upkeep expenses, and real property taxes are not due until December. However, annual real property insurance totaling $200 will be paid in June.
The eligibility specialist opts to synchronize the semiannual variable income reviews with the annual review cycle, so a semiannual review is scheduled for July (six months from the January certification). The amount of variable income to be projected through July is $150. This is calculated as follows: $200 annual real property insurance ÷ 4 months (the projection period – April through July) = $50 monthly average; $200 gross monthly rents − $50 allowable deductions = $150 net monthly rents).
In May, the eligibility specialist is notified that in April the person began paying a quarterly premium of $150 on an assignable general health insurance policy. The eligibility specialist calculates $50 ($150 quarterly premium ÷ 3 months = $50 average) as an IME into the co-payment budget in May to be effective in June.
At the July semiannual review, the eligibility specialist verifies that the person continues to pay the $150 quarterly ($50 monthly average) health insurance premium. The eligibility specialist also projects rental income through the following January, deducting the real property taxes due in December from gross rents anticipated to be received.
- Verification of amounts of variable income/IMEs should be for recent months before the month the case is worked. If verification is not available for the month immediately preceding the month in which the case is being worked and there is no anticipated change (such as variable income/IMEs will not terminate nor will the amounts significantly change), do not delay case action pending receipt of verification for the immediate preceding month.
Example: The case is being reviewed in February, and the preceding six months are August through January. IMEs are a fixed amount and have not changed. Verification of variable income received in January is unavailable. Take an average of the variable income received from July through December (six months), or from August through December (five months), and project that average through August.
- Temporary fluctuations in the amounts of variable income received/IMEs paid, such as up to two consecutive months in which no variable income was received or IMEs were paid, do not disrupt the six-month review cycle. Variable income/IMEs that cease for three or more consecutive months and that are not anticipated to resume should be deleted from the budget.
- If receipt of variable income/payment of IMEs resumes after having been deleted from the budget, the new projected amount is based on the amount of variable income/IMEs expected to be received/paid. Historical data may be used for the projection.
- The eligibility specialist may elect to synchronize or not to synchronize semiannual reviews of variable income/IMEs with the annual review cycle. If the specialist chooses to synchronize, more frequent reviews than every six months may be required.
Example: The specialist is working in a 10-month review cycle and chooses to synchronize variable income/IME reviews with annual reviews. Variable income reviews would be conducted every five months.