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Effective: December 1, 2006 |
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21.15ar1 - Determining Gross Income - MA/GAMC (Archive) |
Archived: April 1, 2009 |
There are specific directions to determine the gross countable income for each health care program.
Determining gross income for MA and GAMC is a process dependent upon whether retroactive coverage has been requested, whether the income is considered varying, and whose income is being used.
This section provides rules for determining the MA and GAMC gross countable income.
Determining Countable Income - Steps 1 through 4.
Step 5 - Actual or Anticipated Income.
Step 6 - Varying or Unvarying Income.
Actual Income is the income a client has concretely received.
Anticipated Income is income the client can reasonably expect to receive in the future.
Income that is received that is always in the same amount for the same time period length is unvarying income. An example of unvarying income is Social Security Benefits such as RSDI or SSI.
Varying income is income for which the amount received or the time period length changes. An example of varying income is wages received weekly or biweekly.
Determining Countable Income - Steps 1 through 4
Before you can begin to calculate the income for MA or GAMC programs, you must make several determinations:
Note: Use actual dollars and cents to calculate income. Truncate the final monthly figure.
1. Determine if income from another household member must be deemed to the client.
2. Determine if any income is excluded or unavailable. Do not count excluded or unavailable income in a client’s total countable income.
3. Determine if appropriate verification of income has been received.
4. Determine annual net self-employment income for self-employed clients. Use the monthly figure derived from annualizing self-employment income for the retro months as well as the current and future months.
l The net self-employment income is calculated by deducting allowable business expenses.
l The net self-employment income is considered the gross countable income for that business.
Step 5 - Actual or Anticipated Income
The next step to calculating the client’s total countable income is to determine if actual or anticipated income should be budgeted for each month of the certification period.
l For current and future months: Budget anticipated income to be received in the six-month certification period. The amount of the anticipated income budgeted is determined based on whether it is varying or unvarying income.
l For months: Budget actual income received in the months for which you are determining eligibility.
Note: This includes clients receiving automatic health care coverage but who are also requesting retroactive MA. The client will be automatically eligible for the cash months. See Shortened Spenddown.
l For manual monthly spenddowns: Budget actual income received in the months for which you are determining eligibility.
Example:
Abigail applies for MA in April. She is requesting retroactive coverage beginning in January. Her six-month certification period is January - June. The worker processes the application on May 2.
Action:
Determine eligibility for the certification period using actual income received in January, February, and March. For April, budget the actual income received and anticipate the income for the remaining part of the month. Use anticipated income for May and June.
Example:
George applies for MA for himself and his family on October 9. He reports on the HCAPP that he works 40 hours per week at $8.00 per hour. He submits the following pay stubs:
n September 3 $360.
n September 10 $450.
n September 17 $430.
n September 24 $260.
n October 1 $320.
Based on the hours per week and pay rate George reported his paychecks should be approximately $320 each week. The worker contacts George to clarify the discrepancy between his regular reported wage and his recent check stubs. He explains that the company had a short-term project in late August and early September that resulted in overtime. In mid-September he took time off without pay because of a family emergency. He is now working his regularly scheduled 40 hours per week and does not expect any changes or further overtime.
Action:
Anticipate income beginning in October based on a weekly wage of $320.
Example:
Gerald and Suzanne receive MA for themselves and their two children. Both are employed. On their six-month renewal they report that Suzanne started a new job during the previous month. She has received two weekly paychecks so far. They submit her pay stubs from the past 30 days, which include her final checks from the previous job.
Action:
Use the paychecks from the new job to anticipate Suzanne’s income for the next certification period. Average Gerald’s income based on the 30 days of wages he submitted.
Step 6 - Varying or Unvarying Income
Step 6 is to determine if the income the client or the client’s deemer receives is varying or unvarying. This determination is needed to budget the correct amount of anticipated income.
l Unvarying income that is received monthly:
Budget the actual countable monthly benefit amount unless you know the amount will change during the certification period.
l Unvarying income that is received more often than monthly, such as Unemployment Insurance (UI) and varying income expected to be received consistently throughout the certification period.
There are two acceptable methods for anticipating the income amount. Use the method that most accurately reflects income expected during the certification period.
n Method One: Average.
m Determine the number of receipt dates expected during the remainder of the certification period.
m Multiply the biweekly or weekly amount by the number of receipt dates to anticipate the total for the certification period.
m Divide by the number of months in the period you are anticipating income to determine a monthly amount (if necessary).
n Method Two: Multiply income received:
m Twice monthly by 2.
m Every two weeks (biweekly) by 2.16.
m Every week (weekly) by 4.3.
Example:
Dave applies for GAMC in May. He receives UI of $125 per week every other Friday. He received checks on the second and fourth Fridays of May. He anticipates receiving a check every other Friday until the end of October (11 more checks).
Action:
Anticipate income for the entire budget period.
Method One: Multiply the payment amount by the total number of checks and divide by the number of months. Budget $542.67 for each month of the certification period. $250 X 13 = $3250 divided by 6 = $542.67.
Method Two: Multiply the biweekly payment by 2.16. Budget $540 for each month of the certification period. ($250 X 2.16 = $540).
Example:
Andrea applies for MA on April 5. She is requesting MA retroactive to January. She receives $80 every Friday from her parents to help with living expenses. She received five checks in January, four each in February and March, and one so far in April.
Action:
Budget the actual income received in January, February and March.
January - $80 X 5 = $400.
February and March - $80 X4 = $320 each month.
Anticipate income for April, May and June by either method:
Method One: Determine the number of pay dates in April, May and June. If there are four Fridays in April, five in May, and four in June, the anticipated monthly amount is $346.67. (13 checks x $80 =$1,040 divided by 3).
Method Two: Because Andrea is paid weekly multiply the income by 4.3 to get a monthly average of $344.
Example:
Bert applies for MA on July 10 and is not requesting retroactive coverage. He reports a job on the HCAPP and provides the following paystubs:
n June 4 $72.
n June 11 $113.75.
n June 18 $98.15.
n June 25 $82.
Action:
Anticipate income for each month of the certification period of July – December.
Method One: Determine the number of paydates in the certification period, in this case it is 26. Determine the average paycheck ($365.90 divided by 4 = $91.48). Multiply the average paycheck ($91.48) by 26 and divide by the number of months (6). Budget $396.41 for each month of the budget period.
Method Two: Because Bert is paid weekly multiply the average paycheck by 4.3 to determine the monthly average amount. Budget $393.36 each month of the budget period.
l Varying income expected to be received less often than monthly:
Count the full amount in the month it is received. Do not prorate the payment to convert it to a monthly amount.
Example:
Rodney applies for MA in February. He is not requesting retroactive coverage. He receives quarterly payments of $450 on a contract for deed. He receives the payments on 1st of January, April, July and October of each year.
Action:
Anticipate the income for the entire budget period. His certification period is February – July.
Anticipate $450 for the months of April and July. Do not budget an amount for February, March or May.