4300, Procedures and Terminology When Determining PHC Eligibility

Revision 23-2; Effective Sept. 15, 2023

Potential Eligibility and Referral to Other Programs

Screening for other benefit programs must be documented on the Application for Program Benefits form. The PHC program is the payor of last resort. Applicants must be screened for Medicaid, CHIP, Medicaid for Pregnant Women, CHIP Perinatal, and any other benefit programs. PHC will not reimburse for services provided to clients who are potentially eligible for another funding source and who do not complete the respective eligibility application process. Applicants who do not fully comply with applying for other benefit programs they appear eligible for, are not eligible for PHC and grantees will not be reimbursed for services provided.  

If a client appears eligible for any of these other benefit programs, they must be granted Presumptive Eligibility for PHC while awaiting benefit determination. The grantee must notify the client they must apply for any program for which they appear eligible. The client is responsible for submitting proof of application or a denial letter before the presumptive eligibility period ends. If a client does not appear eligible for any other program, this must be documented on the application.

All Medicaid, CHIP, Medicaid for Pregnant Women, CHIP Perinatal, or other benefit program applications must be submitted promptly following PHC eligibility assessment. If a client was denied Medicaid or CHIP services, the denial letter must be included with the application. Grantees may use the HHSC Your Texas Benefits website to assist in the screening of client eligibility. More information about HHSC benefits can also be obtained by calling 2-1-1.


The household consists of a person living alone, or a group of two or more persons related by birth, marriage (including common law) or adoption, who reside together and are legally responsible for the support of the other person. If an unmarried applicant lives with a partner, only count the partner’s income and children as part of the household group if the applicant and their partner have mutual children together. Also include unborn children. 

A child must be under 18 years old to be counted as part of a larger family. Eligibility will end on the last day of the month the child becomes 18 unless the child is:

  • a full-time high school student as defined by the school, attends an accredited GED class or regularly attends vocational or technical training in place of high school; and
  • expected to graduate from one of the above before or during the month of his or her 19th birthday.

Legal responsibility for support exists between:

  • people who are legally married including common-law marriage;
  • a legal parent and a minor child, including unborn children; or
  • a managing conservator and a minor child. A managing conservator is a person designated by a court to have daily legal responsibility for a child.

Documentation of Family Composition

If family relationships are unclear, request one of the following items:

  • Birth certificate
  • Baptismal certificate
  • School records
  • Other documents or proof of family relationship determined valid by the grantee to establish the dependency of the family member upon the client or head of household.

Family members who receive other health care benefits are included in the family count. 

Documentation of Residency

To be eligible for PHC services, a person must: 

  • be physically present within the geographic boundaries of Texas;
  • have the intent to remain within the state, whether permanently or for an indefinite period; and
  • not claim residency in any other state or country.

If a person is less than 18 years old, their parent or legal guardian must be a resident of Texas and meet the criteria above.

There is no requirement for the length of time a person must live in Texas to establish residency for the purposes of PHC eligibility.

If the grantee requires a client to provide proof of residency, the type of proof provided by client should be documented on Form 3029 , Application for Program Benefits. For documentation of residency, one of the following items may be provided:

  • Valid Texas driver license
  • Current voter registration
  • Rent or utility receipts for one month prior to the month of application
  • Motor vehicle registration
  • School records
  • Medical cards or other similar benefit cards
  • Property tax receipt
  • Mail addressed to the applicant, their spouse, or children if they live together
  • Other documents considered valid by the grantee

If none of the listed items are available, residency may be verified through one of the following:

  • Observance of personal effects and living arrangement
  • Statements from landlords, neighbors or other reliable sources

If an applicant’s residency is unclear or questionable, explain and document concerns on Form 3029. If a family is otherwise eligible, but residency is in question, the household is entitled to services until residency information is verified.

Individuals do not lose their residency status because of temporary absences from the state. For example, a migrant or seasonal worker who may travel during certain times but maintains a home in Texas and returns to that home after these temporary absences.


All income received must be included. Income is calculated before taxes or pre-tax deductions (gross). Income is reviewed and determined either countable or exempt (based on the source of the income), as defined in Appendix I, Definition of Income. Grantees must have a written PHC income verification policy.

Documentation of income for PHC services must be provided to complete Form 3029, Application for Program Benefits. Declarations of “unknown” will not be accepted as documentation.

The following are examples of documentation that could be included in the grantees’ verification of income policy:

  • at least two pay periods that accurately represent their earnings dated within the 60 days before the application processing date; or
  • one month’s pay (only if paid same gross amount monthly) unless special circumstances are noted on the application.

The pay periods must accurately reflect the individual’s usual and customary earnings. Proof may include, but is not limited to:

  • copy or copies of the most recent paycheck(s) stub or monthly earning statement(s);
  • employer’s written verification of gross monthly income or Form 3049, Employment Verification;
  • award letters;
  • domestic relation printouts of child support payments received;
  • statement of support;
  • unemployment benefits statement or letter from the Texas Workforce Commission;
  • court orders or public decrees to verify support payments;
  • notes for cash contributions; and
  • other documents or proof of income determined valid by the grantee.

Grantees must require income verification for countable income. In cases when submitting the income verification jeopardizes the client's right to confidentiality or imposes a barrier to receipt of services, the grantee must waive this requirement and document the reason.

Monthly Income Conversions

If income payments are received in lump sums or at longer intervals than monthly, such as seasonal employment, the income is prorated over the time the income is expected to cover. Income received weekly, every two weeks, or twice a month must be converted as follows:

  • Weekly income is multiplied by 4.33
  • Income received every two weeks is multiplied by 2.17
  • Income received twice monthly is multiplied by 2

Calculation of Applicant's Federal Poverty Level (FPL) Percentage 

The grantee must determine the household FPL percentage. The maximum monthly income amounts by household size are based on the U.S.  Department of Health and Human Services federal poverty guidelines . The guidelines are subject to change at the beginning of each calendar year. 

The steps to determine the household FPL percentage are:

  • Determine the household’s total monthly gross income amount.
  • Determine the household size.
  • Divide the household’s total monthly gross income amount by the monthly poverty guideline based on the household size.
  • Multiply by 100. 

Income Deductions 

Dependent care expenses may be deducted from total income. This expense must be both necessary for employment and incurred by an employed person. Documentation must be provided. Allowable deductions are actual expenses up to:

  • $200 per child per month for children under 2; 
  • $175 per child per month for each dependent 2 or older; and 
  • $175 per adult with disabilities per month.

Legally obligated child support payments made by a member of the household may also be deducted from the total income. Documentation of payments must be provided. Convert payments made weekly, every two weeks, or twice a month by using one of the conversion factors listed above.

Documenting Special Circumstances 

There may be special circumstances where an applicant is unable to provide required documentation for verification purposes. These types of special circumstances should be appropriately documented.

Client Fees and Copays 

Grantees may assess a copay for services for PHC clients. If the grantee does assess copays for clients, the grantee must also have a policy that outlines how the copayment amounts are determined, using the following copay guidelines:

  • No PHC client shall be denied services based on an inability to pay.
  • Clients with a household FPL at or below 100% shall not be charged a copay, as calculated using the U.S. HHS Poverty Guidelines.
  • Clients with a household FPL above 100% may be charged a copay of no greater than $30 per visit.
  • Grantees must have a written copay policy which clearly defines how copay amounts will be determined.
  • Clients who are assessed a copay must be presented a billing statement at the time of service and a copy shall be kept in the client’s record.
  • Clients who declare an inability to pay a copay shall not be denied services. Any outstanding balance shall not be turned over to a collection agency or reported delinquent to a credit reporting agency.
  • All policies and procedures regarding copay collection must be approved by the grantee’s Board of Directors. 
  • Copays must be reported as program income in the Monthly Reimbursement Packet (MRP). The grantee must complete B25 and E25. 

Grantees may use the optional copay table available in the Appendix II, Optional Co-Pay Table Based on Monthly Federal Poverty Level .

Other Fees 

Do not charge clients administrative fees for items such as processing or transfer of medical records or copies of immunization records. Grantees can bill clients for services outside the scope of PHC allowable services if the service is provided at the client’s request and the client is made aware of their financial responsibility for the charges before services are provided.

Client’s Responsibility for Reporting Changes

A client must report the following changes no later than 30 days after the client is aware of the change: 

  • income; 
  • family composition; 
  • residence; 
  • current address; 
  • employment; 
  • types of medical insurance coverage; or
  • receipt of Medicaid, CHIP, CHIP Perinatal, or other third-party coverage benefits. 

The client may report changes by mail, phone, in-person, or through someone acting on the person’s behalf. If changes result in the client no longer meeting eligibility criteria, the client’s eligibility will terminate. Upon termination, the grantee must issue Form 3047, Notice of Ineligibility, to the client, including the date of termination. 

Continuation of Services  

Upon expenditure of awarded grant funds, grantees must continue serving their existing PHC clients through the end of their clients’ determined eligibility periods. Any funding sources other than PHC awarded program funds used to provide PHC services, must be reported as “non-HHSC” funds on the Monthly Report Form and the quarterly Financial Status Report (FSR), also known as Form 269A.

Additionally, grantees are required to screen potential new clients for program eligibility once awarded grant funds are exhausted. However, if screenings are completed and potential clients are determined eligible, the grantee must provide services to those clients.

<Date Eligibility Begins 

The program eligibility start date for a person or household is determined by the grantee, and typically begins on the date that a completed and signed application is submitted to the grantee. To notify an applicant of eligibility, the grantee must issue the following forms to the client: 

Presumptive Eligibility  

PHC emphasizes the importance of prevention and early intervention. The goal of PHC is for clients to be part of the health care system and not rely on episodic acute care. An applicant’s medical needs shall be met quickly and appropriately, using available resources in the community.

Presumptive eligibility is the short-term availability and access to health care services (up to 90 days) when the client screens potentially eligible for services but lacks verification to achieve full eligibility. For clients who are determined to be fully eligible during the presumptive period, the eligibility expiration date will include the days of presumptive eligibility (expiration date is 365 days, dating from eligibility determination).

When full eligibility is granted during or at the end of the 90 days, the eligibility period end date is 12 months from the presumptive eligibility start date. The grantee may waive the requirement to submit the eligibility documentation and approve full eligibility on a case-by-case basis, if the grantee determines submitting the documentation will create a barrier to care and no other documentation is available.

Potential Eligibility and Referral to Other Possible Qualifying Programs

In general, individuals are not eligible for the PHC program if they are enrolled in another third-party payer, such as private health insurance, Medicaid or Medicare, TRICARE, Workers’ Compensation, Veterans Affairs Benefits, or other federal, state or local public health care coverage that provides the same services. If an applicant is eligible for another program that covers the same services, they may still be eligible for the PHC program. The grantee should inform the applicant of their possible eligibility for the other program, suggest that they also apply for services from that program, and proceed with the eligibility determination process for PHC. The grantee must document in the applicant’s record that they were informed and referred to the other program.

Supplemental Benefits

In some cases, applicants receiving benefits from other sources, such as Medicaid or Medicare, may be eligible for partial PHC coverage. This supplemental or wraparound coverage is limited to services provided by PHC but not covered by other sources. Whenever federal, state, private or other benefits are available for payment of clients receiving PHC covered services, no PHC funds shall be used to pay for such care. An example of supplemental benefits would be providing health education services to Medicaid-eligible clients since Medicaid does not provide health education services. The grantee must communicate to the client that supplemental services are of limited scope.

Adjunctive Eligibility

An applicant is considered adjunctively (automatically) eligible for PHC program services at an initial or renewal eligibility screening if the applicant is currently enrolled in one or more of the following:

  • Children’s Health Insurance Program (CHIP) Perinatal; 
  • Medicaid for Pregnant Women;
  • Special Supplemental Nutrition Program for Women, Infants and Children (WIC);
  • Supplemental Nutrition Assistance Program (SNAP); or 
  • Healthy Texas Women (HTW) Program. 

The applicant must be able to provide proof of active enrollment in the adjunctively eligible program. Acceptable eligibility verification documentation may include:   

CHIP PerinatalCHIP Perinatal benefits card
Medicaid for Pregnant WomenYour Texas Benefits card (Medicaid card)*
WICWIC verification of certification letter, printed WIC-approved shopping list or recent WIC purchase receipt with remaining balance
SNAPSNAP eligibility letter
HTWYour Texas Benefits card with "Healthy Texas Women" printed in the upper right corner

*Note: Presentation of the Your Texas Benefits card does not completely verify current enrollment in the HTW program or the Medicaid for Pregnant Women program. To verify enrollment, grantees must call Texas Medicaid & Healthcare Partnership (TMHP) at 800-925-9126 or access TexMedConnect on the TMHP website at  www.tmhp.com . For a client's current enrollment status, grantees must enter two of the following four data elements for the client:


  • patient control number;
  • date of birth;
  • Social Security Number; or
  • last name.

If the applicant’s current enrollment status cannot be verified during the eligibility screening process, adjunctive eligibility is not granted. The grantee would then determine eligibility according to usual protocols.


Applicants with insurance may be eligible for services provided by PHC when the applicant’s confidentiality is a concern or if the applicant’s insurance deductible is 5% or greater than their income. Most insurance deductibles are given as an annual amount. PHC household incomes are figured as a monthly amount. To compare an annual deductible with a monthly income, multiply the monthly income by 12 and then determine 5% of that amount. See the example below for a monthly household income of $1,000:

  • Determine the total household’s monthly income.
  • Determine the total household’s annual income by multiplying the monthly income by 12 (months).
  • Determine 5% of the total annual income by multiplying it by 0.05 (5%).
Total Monthly Household IncomeTotal Annual Household Income5% of Total Annual Household Income
$1,000 x 12 (months) =$12,000 x 0.05= $600
If the applicant's annual insurance deductible is any amount over $600, they are eligible under this criterion for PHC.  

Another way to make the comparison is to divide the annual insurance deductible into a monthly amount. See the example below for an annual insurance deductible of $6,000 and a monthly household income of $1,000:

  • Determine the household’s monthly insurance deductible by dividing the annual deductible by 12 (months).
  • Determine 5% of the total monthly household income by multiplying it by 0.05 (5%).
Household Annual Insurance DeductibleHousehold Monthly Insurance DeductibleTotal Monthly Household Income5% of Total Monthly Household Income
$6,000 ÷ 12= $500$1,000 x 0.05= $50
If the applicant's monthly insurance deductible is any amount over $50, they are eligible under this criterion for PHC.   

The completed eligibility form must be maintained in the client medical record, indicating the client's poverty level and the copay amount the client will be charged.


Annual Recertification 

Annual eligibility determination and recertification is required for all clients who receive PHC services. Client eligibility must be redetermined every 12 months, using Form 3029. Grantees must have a system in place to track client eligibility and renewal status on an annual basis.