Medicare Savings Programs Income Calculation (Archive)

The purpose of the income calculation is to determine a person’s countable net income. This net income will be compared to the appropriate income standard to determine if the client is income eligible for QMB Qualified Medicare Beneficiary. A Medicare Savings Program which pays for some Medicare expenses including premiums, co-payments and deductibles., SLMB Service Limited Medicare Beneficiary. A Medicare Savings Program that pays for the Medicare Part B premium., QI Qualified Individual. A Medicare Savings Program which pays for the Medicare Part B premium. and QWD Qualified Working Disabled Adult. A person eligible for payment of the Medicare Part A premium. The person cannot receive MA or QMB benefits..

Note:  Follow this income calculation regardless if the client is in an LTCF Long-Term Care Facility. A place such as a skilled nursing facility, Intermediate Care Facility for the Developmentally Disabled (ICF/DD) or medical hospital in which the individual receives skilled nursing services. Group Residential Housing (GRH) and Housing with Services Establishments are not long-term care facilities. or receiving EW services.

Income calculation steps for the Medicare Savings Programs are:

1. Determine countable gross income.

2. Deduct disregards and deductions in the listed order to arrive at countable net income:

Note:  The rules for whom and when a disregard or deduction can be used are found in the section of the same name.

l  Unearned Income:

a. Widow/Widower Disregard.

b. Pickle Disregard.

c. Disabled Adult Child Disregard.

d. RSDI Cost of Living Adjustment Disregard.

e. PASS Deduction.

f. Standard Deduction.

l  Earned Income:

a. PASS Deduction.

b. Blind Disabled Student Child Disregard.

c. Standard Deduction remaining after use for unearned income.

d. $65 Earned Income Disregard.

e. Work Expense for disabled basis of eligibility.

f. One-half of remaining earned income.

g. Work Expense for blind basis of eligibility.

h. LTC/EW only:  Spousal Allocation.

i. LTC/EW only:  Family Member Allocation.

3. Compare the appropriate income standard to the net income to determine if the client is income eligible.

l  If the client’s income is at or below the income standard the client is income eligible.

l  If the client’s net income exceeds the income standard the client is not eligible for the program.

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