3000, Eligibility

Revision 09-1; Effective February 27, 2009



3100 Recipient Financial Eligibility

Revision 06-2; Effective December 12, 2006


The purpose of this subsection is to provide hospice staff with a basic understanding of Medicaid eligibility determinations for general discussions with families, nursing facility (NF) staff, hospital staff and other service providers. However, Health and Human Services Commission (HHSC) Medicaid eligibility (ME) staff are the experts in this area. Consult ME staff and keep them informed on all issues related to the eligibility of an applicant or recipient.

The Social Security Administration (SSA) through Supplemental Security Income (SSI) or HHSC determines if an individual is eligible for Medicaid. Hospice is only one program that can be paid by Medicaid. Some Medicaid recipients are not eligible for nursing facility (NF) services or for the home and community-based waiver services, because of transferred assets (that is, recipient deletes name from joint bank account, transfers home to a relative, etc.). Not all Medicaid recipients are eligible for all Medicaid services. Each individual Medicaid service has certain criteria that must be met in order to qualify.

The ME determination process for non-SSI eligible individuals begins when an application is submitted to HHSC ME. The process involves an investigation of the applicant's financial status, proof of citizenship, and ends with a decision of approval or denial. If an institutionalized applicant or one who seeks home and community-based waiver services is determined eligible, the ME staff determines the amount of income he must apply toward the cost of his care (copay). Denial of Medicaid eligibility may be appealed through a request to the HHSC ME staff.

Determining Medicaid eligibility may be a complex and lengthy process that varies with each applicant. ME staff must complete the process within 45 days, except in unusual situations. Payment does not begin until DADS establishes a record of eligibility in its central computer.

HHSC staff use Form 1230, Notification of Eligibility - Regular Medicaid Benefits, to inform the recipient and the hospice provider of the individual's eligibility for Medicaid benefits and the initial amount of copay, if applicable. HHSC Form H4808, Notice of Change in Applied Income/Notice of Denial of Medical Assistance, is used for subsequent denials and copay adjustments. The hospice provider receives these and any other appropriate eligibility forms directly from HHSC ME staff.

When an individual is a full vendor SSI Medicaid recipient and receives Medicaid hospice services in an NF or ICF/MR-RC, the hospice provider is responsible for notifying SSA. SSA must have this information so the SSI payment to the recipient can be reduced to $30 a month, which is the federal benefit rate (FBR) for an institutionalized individual.

ME staff determine financial eligibility for medical assistance only (MAO). Eligibility determination is a complex procedure— do not attempt to advise applicants, recipients or their families. Direct any questions about a recipient's eligibility for Medicaid benefits to the ME staff at HHSC. The following information is intended to be a guide for referral of individuals to ME staff.

HHSC issues Form H3087, Medicaid Identification, to eligible Medicaid recipients each month. This card ensures that the recipient, whose name appears on it, is eligible for services for the specific dates indicated on the card. Individuals may be eligible if they meet certain income and resource requirements. Aged or disabled individuals with very low or no income should apply to SSA for SSI benefits to obtain Medicaid coverage.

Ask to see and review the hospice individual's Medicaid Identification before the Medicaid hospice election and at the first of each month thereafter to verify the individual's Medicaid eligibility.

HHSC considers payments for services the responsibility of the individual receiving the service if:

  • the services received are not a benefit covered by Medicaid,
  • the applicant is not eligible for medical services under the Medicaid program, or
  • the applicant has been denied eligibility before the date of service.


3200 Three-Month Prior Eligibility

Revision 06-2; Effective December 12, 2006


Applicants for medical assistance may be eligible for Medicaid coverage as early as the first day of the third month before the month of application for assistance. Eligibility depends on the applicant's unpaid or reimbursable bills for Medicaid-covered medical services provided during the three-month period. The applicant also must meet all other eligibility criteria during that period. A bona fide agent may apply for coverage on behalf of a deceased individual. Applications for prior coverage must be filed with HHSC.

For certified SSI applicants, Medicaid coverage is automatically added for the month before the first SSI payment. Medicaid coverage also is available for the two preceding months, if all eligibility requirements were met and the applicant had unpaid, reimbursable medical bills. An application must be filed with HHSC for prior-month eligibility determination.

For denied SSI applicants with unpaid, reimbursable medical bills, the retroactive period is the three months before the SSI application month. An application must be filed with HHSC for prior-month eligibility determination.

HHSC encourages providers to maintain open communication with individuals, NF staff and family members so the hospice provider will be immediately aware if and when an individual may be eligible for Medicaid. When an individual applies for Medicaid, Medicaid eligibility may be established both prospectively, and for the three months prior to the application, if the individual met all Medicaid eligibility criteria during the prior three months. If an individual becomes eligible for Medicaid for the three months prior to application, the NF is required to refund any payments received for NF care to the individual. The NF bills HHSC for those three months and will be paid the NF rate for those three months. Once ME has been established, the individual can elect Medicaid hospice. If the individual is dually eligible, they must elect both the Medicaid and Medicare hospice programs. For more information regarding dual eligibility, see Item 3640, Dually Eligible Recipients. For the prospective period of Medicaid eligibility, the room and board payment for the NF must pass through the hospice, since the individual has elected out of the Medicaid NF program. This does not negate the provider's responsibility when an individual is dually eligible. For information regarding room and board, see Item 4540, Room and Board. For information regarding per diem rates, see Item 6310, Hospice-Nursing Facility Per Diem Rate.


3300 Supplemental Security Income (SSI) and Medicaid

Revision 08-1; Effective November 12, 2008


When an individual is in a lower income situation (TP12, manual certification or TP13, automated certifications), SSA staff determine the applicant's Medicaid eligibility as an SSI recipient. The recipient is then eligible for Medicaid services, which includes hospice, in the home, community, NF, hospital, ICF/MR-RC and other type facilities. Only SSI Medicaid hospice individuals are eligible for Medicaid in an NF without being in a Medicaid-contracted bed. An SSI recipient in the NF who is not in a Medicaid bed still may be eligible for SSI; however, HHSC will not pay room and board for his care.

When an individual qualifies under higher income limits (TP14), the HHSC ME staff determine the applicant's eligibility for Medicaid. The individual is eligible for Medicaid services only when he resides in a Medicaid-contracted bed in an NF. Under these circumstances, the hospice provider follows the HHSC copay procedures, outlined under Section 3400, Copay. Form 3071, Individual Election/Cancellation/Update, substitutes for the medical necessity requirement in determining eligibility. HHSC ME staff must have verification of the applicant's Form 3071 and Minimum Data Set (MDS), if applicable, in order to approve and continue the Medicaid eligibility status of the applicant or individual. This may be a copy of a statement from the provider. ME staff may contact NFs for trust fund information or earnings information.

A private-pay NF resident can occupy a Medicaid, Medicare or a non-participating bed. A facility cannot make a private-pay resident move to accommodate a Medicare or Medicaid resident.


3400 Copay

Revision 09-1; Effective February 27, 2009


An individual on hospice may have a copay if he resides in an NF or ICF/MR-RC. Copay is the amount Medicaid recipients pay for part of their NF care. The copay is based on the amount of income they receive in excess of $60 a month and certain other allowable deductions. Certain Veterans Administration (VA) beneficiaries are allowed to keep an additional $90 a month. HHSC ME staff calculates the copay.

Hospice providers are responsible for collecting copay from individuals. The amount is the same each month, regardless of the number of days in the month. If an individual does not live in an NF every day during a month, except for therapeutic home visits, the copay amount is prorated. The copay amount is divided by the number of days in the month, and the result is multiplied by the number of days the individual is in an NF. Example: If an individual with a $93 monthly copay enters an NF on Sept. 21, and is discharged on Oct. 11, the copay collected from the individual will be $31 for September ($93 divided by 30 = $3.10 x 10 days = $31) and $30 for October ($93 divided by 31 = $3.00 x 10 days = $30).

Copay amounts may change occasionally, because of changes in an individual's financial status or corrections of income information. If an individual is overcharged copay, the hospice provider receives a corrected billing statement and must refund the amount of the overcharge to the individual. Report all apparent discrepancies regarding copay to ME staff.

The following forms relate to copay:

  • Form 1259, Correction of Applied Income, notifies the hospice provider of prospective changes in an SSI recipient's copay and of past over or under collections and of copay amounts to be reconciled.
  • Form H4808, Notification of Change in Applied Income/Denial of Medical Assistance, notifies the MAO recipient of HHSC's decisions to prospectively increase or reduce the amounts of copay payable to the hospice provider or to deny medical assistance.

Occasionally, there are problems with the receipt of amount of SSI checks received by recipients. When problems occur and there is no immediate solution, contact SSA. Notify the ME staff if an institutionalized individual, who receives SSI, also received income from other sources.

Promptly notify the ME staff of any changes in an individual's income (including non-recurring payments), resources of any individual or transfers of assets, so that appropriate and timely corrections to copay can be made. The hospice provider is responsible for ensuring that copay problems are handled according to the requirements and in the protective interest of the individual.


3500 Medicaid Eligibility and Other Programs

Revision 06-2; Effective December 12, 2006


The applicant must meet the requirement for 30 consecutive days (in a Medicaid bed) in one or more Medicaid NFs and ICF/MR-RC's, and must meet all other Medicaid eligibility criteria before that applicant can be Medicaid certified. After the 30 days, the applicant may be Medicaid eligible from the first day of application. Death, hospital stays after admission, and therapeutic home visits not exceeding three days do not break the 30-consecutive-day period. If the individual dies in the NF, ICF/MR-RC or hospital before the 30 consecutive days have passed, the requirement is considered to be met.

ME staff also determine eligibility for certain federally mandated, community-based Medicaid programs that use the SSI limits with certain special income disregards. These are Type Programs 03, 18 and 22 (Social Security cost-of-living exclusion programs).


3600 Eligibility for Participation in the Medicaid Hospice Program

Revision 02-3; Effective Upon Receipt


The Medicaid Hospice Program is available to applicants who satisfy the requirements listed below, regardless of type of residence.


3610 Hospice Election and Physician Certification

Revision 06-2; Effective December 12, 2006


Hospice providers must advise applicants to apply for Medicaid at either an HHSC office or the nearest SSA office, whichever is appropriate, in order to become a Medicaid recipient. HHSC or SSA determines and approves the financial eligibility of applicants. Providers must verify Medicaid eligibility. Contact the local DADS Community Care Aged and Disabled (CCAD) case manager and HHSC ME staff to advise them that a potential or current Medicaid recipient is interested in or has elected the Medicaid Hospice Program. Keep the HHSC ME staff and DADS CCAD case manager informed as changes occur in the applicant's hospice status, financial condition, marital status, living arrangements, etc. Providers must maintain contact with HHSC ME staff in order to be informed regarding an individual's Medicaid eligibility status, especially in those instances where an individual is dually eligible for Medicare and Medicaid.

Applicants must elect hospice care by signing and dating Form 3071, Individual Election/Cancellation/Update, with an approved Medicaid hospice provider.

The elections remain in effect unless the individual and the hospice representative sign and date Form 3071 to cancel hospice coverage in both programs.

A physician provides a written statement on Form 3074, Physician Certification of Terminal Illness, which certifies that an applicant has a prognosis of six months or less to live. This prognosis must be current in order for Medicaid coverage to start and to continue.

In order to receive payment, providers must correct and resubmit all rejected election forms and physician certifications to the Texas Medicaid & Healthcare Partnership (TMHP). TMHP must have Form 3071 and Form 3074 before payments can be made for Medicaid hospice services and room and board. For more information regarding form submission, see Section 4200, Claims Management System (CMS).


3620 Changing Hospices

Revision 06-2; Effective December 12, 2006


To change the Medicaid hospice provider designation, the old and new hospice providers complete Form 3071, Individual Election/Cancellation/Update, as an update for each provider and submit it to the Texas Medicaid & Healthcare Partnership (TMHP). For more information regarding form submission, see Section 4200, Claims Management Systems (CMS).

Note: When an individual is transferred from one hospice provider to another, the transferring hospice cannot bill for services on the date of transfer. The receiving hospice bills for services on that day.

Change of ownership of a hospice provider is not considered a change in a hospice individual's designated hospice provider. Note: A change of ownership that results in a new contract number requires an updated Form 3071 in order to transfer all individual information to the new provider.


3630 Hospice Cancellation

Revision 06-2; Effective December 12, 2006


When the Medicaid hospice individual cancels the Medicaid Hospice Program election, designated staff complete Form 3071, Individual Election/Cancellation/Update. The individual or responsible party and the hospice provider representative sign and date Form 3071. The provider submits Form 3071 to the Texas Medicaid & Healthcare Partnership (TMHP). For more information regarding form submission, see Section 4200, Claims Management Systems (CMS).

When a physician signs and dates a statement that an individual on Medicaid hospice is not suitable for the Medicaid Hospice Program, DADS places the Medicaid hospice coverage and payments on hold. The Medicaid hospice coverage remains on hold until the hospice provider validates the six-month certification and individual election with another physician's statement and individual's Medicaid hospice election. If this is not accomplished in 30 days, DADS cancels the individual's coverage under the Medicaid Hospice Program retroactive to the original date the physician stated that the individual was not suitable for the Medicaid Hospice Program.

When an individual dies, complete Form 3071 without the signature and date by the individual. Complete all other applicable items.


3640 Dually Eligible Recipients

Revision 06-2; Effective December 12, 2006


A resident in a Medicaid-certified NF who is dually eligible may elect to participate in either the Medicaid or Medicare Hospice Program. When a dually eligible NF resident elects hospice under either Medicaid or Medicare, the hospice benefit must be elected or revoked under both programs and each program notified as to the resident's decision. The hospice and NF must have a written agreement under which the hospice takes full responsibility for the professional management of the resident's hospice care and the facility agrees to provide room and board to the individual.

Providers must submit Form 3071, Individual Election/Cancellation/Update, and Form 3074, Physician Certification of Terminal Illness, for dually eligible individuals regardless of their place of residence. For more information regarding form submission, see Section 4200, Claims Management Systems (CMS).

In order to receive payment from DADS for room and board for dually eligible residents, a hospice provider must have a valid Medicaid provider agreement.Information on room and board is outlined in Item 4540, Room and Board. Information on Medicaid eligibility is outlined in Section 3200, Three-Month Prior Eligibility.

Information on hospice program requirements for dually eligible individuals for both the Medicaid and Medicare programs may be found in several Centers for Medicare and Medicaid Services publications:

  • State Operations Manual, Section 2082, Election of Hospice Benefit by Resident of SNF, NF, ICF/MR or Non-Certified Facility;
  • Hospice Manual, Section 204.2, Skilled Nursing Facility and Nursing Facilities Residents and Dually Eligible Beneficiaries; and State Medicaid Manual, Section 4305, Hospice Services.