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Effective: December 1, 2006 |
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24.10.05ar1 - Automated Monthly Spenddowns (Archive) |
Archived: January 1, 2010 |
An automated monthly spenddown is one type of medical spenddown. It is used for clients who meet specific criteria.
The automated monthly spenddown amount is the difference between the total net countable income a client receives in a month and the applicable Federal Poverty Guideline (FPG) standard for a single month. This spenddown amount is applied to each month of the certification period.
MSHO and Automated Monthly Spenddowns
Automated Monthly Spenddown Calculation.
Automated Monthly Spenddown Calculation - Renewal.
To use an automated monthly spenddown both of the following criteria must be met:
l Monthly income does not vary except for cost of living adjustments or other annual adjustments. Examples include RSDI, SSI or Veteran’s Administration (VA) benefits.
l The client has recurring monthly medical expenses that equal or exceed the monthly spenddown amount.
The following clients must choose to use an automated monthly spenddown, if they meet the criteria for use:
l Their spouse or children with whom they live apply for MA and choose an automated monthly spenddown.
l They are hospitalized and are a household member of a family enrolled in MinnesotaCare. See MinnesotaCare Expenses Used to Meet Spenddown for more information on how these expenses are processed.
l They choose to use the Client Option Spenddown.
The client option allows clients eligible for an automated monthly spenddown to choose to pay their spenddown obligation to DHS.
l They choose to use the Designated Provider Spenddown.
Clients who receive personal care attendant services, certain waivered services, or child welfare-targeted case management services may choose to pay their spenddown to a specific provider.
MSHO and Automated Monthly Spenddowns
Clients with an automated monthly spenddown may continue Minnesota Senior Health Options (MSHO) enrollment if they:
l Were on MSHO prior to July 2005 with an automated monthly spenddown.
l Acquired an automated spenddown after being enrolled in MSHO.
MSHO clients with an automated spenddown are required to pay the spenddown amount to DHS directly each month. DHS bills the client directly.
l MSHO clients with automated monthly spenddowns should stay enrolled in MSHO only if their monthly MA-covered medical expenses are routinely more than the amount of their medical spenddown.
l MSHO enrollees with an automated monthly spenddown are not using a client option spenddown and should not be coded in the system as such.
l Spenddown payments can be made by:
n Mail. Send spenddown payments to:
DHS MSHO (or MnDHO),
PO Box 64836,
St. Paul, MN 55155-3863.
n Automatic Withdrawal Plan (AWP). To request a sign-up form, clients can access the DHS-3389 online, or they can call 651-431-3366 or 1-888-234-1321.
n Web payment at http://payments.dhs.state.mn.us
Follow these steps to determine if a client can use an automated monthly spenddown:
1. Determine a client’s monthly net countable income.
2. Determine the monthly spenddown amount.
Subtract the applicable monthly Federal Poverty Guideline from the monthly net countable income for each month of the certification period. The results are the client’s automated monthly spenddown amount.
3. Determine if the client meets the automated monthly criteria and/or is required to use an automated monthly spenddown.
4. Determine if the client meets the spenddown amount with health care expenses.
Apply current health care expenses to the spenddown amount for each month of the certification period. This determines the recipient amount (if any) for each month.
Note: There is not a satisfaction date for an automated monthly spenddown. The system will reject claims submitted by providers until the recipient amount has been met, at which time all other claims will be paid by MA.
Clients will be notified of which medical bills were used to meet the spenddown amount and for which they are responsible. This notification, the Explanation of Medical Benefits (EOMB) is sent to clients. The EOMB lists specific health care expenses submitted by providers and indicates expenses for which the client is responsible.
Health care expenses must be applied to an automated monthly spenddown in the following order on the dates provided:
a. H Bills:
Apply health insurance and Medicare premiums on the first day of the month in which they are due.
Exceptions:
n If health insurance premiums are not paid monthly, do not enter them as an automated monthly spenddown expense.
n Do not allow premiums paid by MA, due to cost-effective status or payment by a Medicare Savings Program (MSP), as a health care expense.
b. M Bills:
The unpaid balances of M bills are applied on the first of the month. They may be applied in two ways:
n Chronologically starting with the earliest date of service, until the full amount is used.
n If a client will be paying one of the M bills first, the application of the bills to the spenddown can be prioritized to give the client the advantage of a greater M Bill balance owed at the next recertification.
Verify that the unused amounts of M bills used to meet previous spenddowns remain unpaid when using the bill to meet a current spenddown.
Document the amount of the portion of an M Bill used to meet the spenddown on a copy of the bill itself and in case notes.
c. P Bills:
Apply P bills on the first day of the month in which they were incurred.
Note: The remedial care expense deduction may be an allowable health care expense if the client is living in a regional treatment center, group residential housing, or assisted living.
d. R Bills:
Apply R bills on the date incurred.
5. Update the MMIS system with the spenddown and recipient amount.
6. Send the client the appropriate notification of the spenddown, including the spenddown amount, bills the client remains responsible for and the recipient amount.
Example:
Jerome, who is receiving RSDI due to a disability, is applying for MA. His monthly spenddown amount is $300. Jerome has verified the following medical expenses:
l An unpaid doctor bill from four months ago for $50.
l A monthly health insurance premium of $50.
l Monthly has prescription costs of $600 each month.
Action:
Following the steps provided:
1. The income calculation has been completed.
2. The monthly spenddown amount is $300.
3. Jerome may use an automated monthly spenddown because his income does not vary and he has recurring medical expenses.
4. Jerome is eligible to meet his monthly spenddown amount. He will have a recipient amount of $200 for the first month of the certification period and $250 for the remainder of the certification period.
a. The health insurance premium (H bill) of $50 is first applied to the spenddown amount on the first of each month of the certification period. Jerome will be responsible to pay this premium monthly.
b. The unpaid doctor bill (M bill) of $50 is next applied to the spenddown, but only for the first month of the certification period as the full unpaid amount will be used.
c. The monthly prescriptions costs (R bill) are the last to be applied to the spenddown. These must be paid as the recipient amount.
5. Update the system with spenddown amount of $300 for each month. The recipient amount must be updated for the first month of the certification period ($200) and the remaining months ($250).
6. The worker must add a worker comment to tell Jerome his spenddown amount, stating he will be responsible to pay his health insurance premium each month and that he will continue to be responsible for the unpaid doctor bill (which cannot be used to meet another spenddown) and for the recipient amount.
Each month an EOMB will be sent to Jerome informing him of the amount he will be responsible for and to which provider.
Automated Monthly Spenddown Calculation - Renewal
To calculate an automated monthly spenddown at renewal follow these steps:
1. Determine a client’s monthly net countable income.
2. Determine the monthly spenddown amount.
3. Clients continue to meet the automated monthly spenddown criteria or continue to be required to use an automated monthly spenddown.
4. Determine if the client meets the spenddown amount with health care expenses. Anticipated bills for the next certification period may be used to meet the automated spenddown amount for the next certification period.
a. Health care expenses from the fifth month of the previous certification period may be used as a guide to determine eligibility for the next certification period. Verification of these health care expenses are obtained by reviewing MMIS to determine if the client’s spenddown was met.
n If the fifth month of the previous certification period shows that the recipient amount was equal to the used amount, do not require further verification.
n If you cannot clearly determine that the client met the spenddown amount in the fifth month, request verification of health care expenses.
Examples of health care expense verification include but are not limited to:
m A printout from the client’s pharmacy.
m Copies of the latest EOMB.
b. Estimate the client's health care expenses for the new certification period. Apply the anticipated health care expenses on the first day of the first month of the new certification period.
l If it appears that the client will continue to have enough expenses to meet the monthly spenddown for every month of the certification period, approve the renewal.
Example:
John completed his renewal on May 15 for the new certification period starting June 1. Verification was received that John had prescription and clinic expenses in April sufficient to meet an ongoing monthly spenddown.
Action:
The prescription and clinic expenses are used as June 1 expenses for the renewal; ongoing eligibility is approved.
Example:
Andrew completed a renewal on May 15 for June 1. The new monthly spenddown amount will be $100 per month beginning in June. Andrew incurred $80 of pharmacy costs on April 10 which is the fifth month of the current certification period. It was verified that Andrew's ongoing medical need will include a $20 ongoing clinic expense each month.
Action:
Andrew will meet the new spenddown. The prescription cost of $80 and $20 in clinic costs are used as June 1 expenses for the renewal.
l If the client does not have anticipated medical bills to meet the automated monthly spenddown in the next certification period consider:
m Other spenddown types. If the client is not eligible with any spenddown type, close MA at the end of the current certification period.
m Consider MinnesotaCare eligibility.
Advise the client to reapply if there is a change in medical expenses, income, or other circumstances.
5. Update the MMIS system with the spenddown and recipient amounts, or close eligibility.
6. Send the client the appropriate notification of eligibility.
For clients with continued eligibility with an automated monthly spenddown provide information on the spenddown, including the spenddown amount, bills the client remains responsible for and the recipient amount.