Income Changes

Clients are required to report changes in income within 10 days of learning about the change. Income changes can occur when a client or other household member:

l  Starts or ends a job.

l  Receives a wage increase or decrease.

l  Starts or stops receiving unearned income.

This chapter contains policy on when income changes must be reported, when a change is acted upon and how to process a change. All of these change components vary by program.

MinnesotaCare.

Income Change Reported at Renewal.

Income Change Reported at Times Other than at Renewal.

Change in Self-Employment Income.

Medical Assistance (MA).

General Provisions.

Spenddowns.

Change in Self-Employment.

Medical Assistance for Employed Persons with Disabilities (MA-EPD).

Income Change Reported at Renewal.

Income Change Reported at Times Other than at Renewal.

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MinnesotaCare

This section explains what to do when a MinnesotaCare client reports a change in income.

Income Change Reported at Renewal

Act on all income changes reported at renewal.

Require verification of income at renewal.

Do not require verification that employment has stopped.

Income Change Reported at Times Other than at Renewal

Act immediately on all income changes when reported.

Do not require verification of an income change that is reported between renewals.

Do not require verification that employment has stopped.

n  Change eligibility effective the next month if the change is an income decrease that results in more favorable eligibility (for example, lower premium or better benefit set).

n  Act on the change for the next available month if the change is an income increase that results in less favorable eligibility. The next available month for MinnesotaCare is the first month for which a ten-day notice can be given.

Provide 10-day notice of any negative actions.  

Update MMIS information to decrease or increase the premium amount.

Document changes in case notes.

Note:  Households that voluntarily cancel coverage due to active military duty may re-enroll following the tour of duty without regard to increases in income or assets. Disregard increases in income or assets reported at the time of or after re-enrollment until the household’s annual renewal. See Four Month Penalty - Special Provisions.

Example:
Ellen contacts her worker and reports she has received a wage increase.

Action:
Act upon the change immediately. Provide 10-day notice for any negative actions, including an increase in premium amount.

Example:
On May 21, Rita calls to report her husband, Karl, left the household. Karl did not have coverage, but his income was counted to determine the household's premium.

Action:
Act to remove Karl's income and decrease the household size immediately.

Example:
Anthony calls to report that his Unemployment Insurance (UI) stopped and he began a job. The wages he reports from the job are higher than the UI and would result in an increased premium.

Action:
Act on the change to increase Anthony’s premium giving 10-day notice.

Example:
Jackson reports changes in his household's employment. He received a raise and his wife started a new job at a lower hourly rate. The combined effect of the two changes is decreased household income that would result in a lower premium.

Action:
Act on the income changes immediately.

Change in Self-Employment

When an enrollee reports a change in self-employment income, recalculate self-employment income based on the enrollee’s description of the change.

Example:

Mr. Jones is a dairy farmer. He sold half his herd at the end of the last tax year. He expects his income for the coming year to be about one-half of the previous year’s income.

Action:

Use tax forms or business records on file to recalculate self-employment income.

Example:

William has been enrolled in MinnesotaCare for several years. He owned a small jewelry shop until he recently had to shut down. He reports the closure of his business to MinnesotaCare.

Action:

Recalculate William’s income. Do not include the self-employment income in the income calculation.

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MA

This section explains what to do when an MA Method A, MA Method B, or Medicare Savings Programs, client reports a change in income. See Adding a Household Member for information on when to add the income of a person who moves into an existing household.

Note:  For information on how to treat changes in income for people using LTC income calculations see LTC Spenddowns and Waiver Obligations.

General Provisions

Act immediately on all income changes reported at renewal or between renewals.

Provide 10-day notice of all negative actions.

Exception:  10-day notice is not required for retroactive adjustments to a LTC budget. See LTC Spenddowns and Waiver Obligations for more information.

Document all income changes in case notes.

Spenddowns

Determine if the income change creates or changes a spenddown.  

l  Do not change the spenddown type.

l  For monthly spenddowns recalculate beginning with the month the change occurred.

l  For six-month spenddowns recalculate the spenddown for the certification period.

See Spenddown Adjustments to determine when the recalculated spenddown amount actually affects the spenddown.

Document the specifics of the income change in the case record. Explain the income calculation completed as a result of the reported change.

Example:
Bridget receives MA for herself and her two children. Their current certification period is June - November. The household’s only income is child support for the children. All household members are eligible without a spenddown. On September 5, Bridget reports that she began a job on September 1.

Action:
Re-determine eligibility for each household member for the current certification period.

n  Bridget:  For June through August, count $0 income for Bridget. The children’s child support is not deemed to her. For September through November, project anticipated earnings.

n  The children:  For June through November, count child support for each child who receives it. For September through November, add Bridget’s projected net earnings for each child.

Determine whether the household members remain eligible for MA without a spenddown, are eligible for MA with a spenddown or become eligible for TYMA.

Example:

Delbert receives MA with a six-month spenddown. His current certification period is January - June. He met his spenddown on January 14 with a large hospitalization bill from early January. On April 9, Delbert reports his work hours had been cut in half.

Action:

Recalculate the spenddown for the entire certification period. The decrease in income results in a decreased spenddown amount and an earlier satisfaction date. Update MMIS with the new data. Advise Delbert that the earlier satisfaction date may allow MA to pay bills with dates of service between the original and new dates.

See Medical Spenddowns for more information on what to do when changes in income create or change a spenddown amount.

Change in Self-Employment

A substantial change in self-employment income does not include normal fluctuations from year to year. Review and evaluate the potential effect on self-employment income if the nature or scope of the business has changed.

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MA-EPD

This section explains what to do if an MA-EPD client reports a change in income.

Income Changes Reported at Renewal

Verify and act immediately on all income changes reported at renewal.  

Provide 10-day notice of all negative actions.

Document changes in case notes.

Income Changes Reported at Times Other Than Renewal

Do not verify income changes reported between renewals.

If a MA-EPD enrollee reports a change in income at a time other than renewal but during the certification period, and the change results in:

l  A decreased premium:  Change the premium.

n  Notify the DHS Premium Billing Unit (PBU) by sending a SIR webmail message to dhs.made@state.mn.us. The PBU will bill the new amount on the next billing cycle.

n  Document changes in case notes.

l  An increased premium:  Do not take action to increase the premium until the next six-month income review or annual recertification.

For more information on MA-EPD and MA-EPD premiums, see:

Basis of Eligibility - MA-EPD.

Premiums.

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