*** The Health Care Programs Manual (HCPM) has been replaced by the Minnesota Health Care Programs Eligibility Policy Manual (EPM) as of June 1, 2016. Please refer to the EPM for current health care program policy information. ***

Chapter 21 - Income Calculation (Community)

Effective:  February 1, 2009

21.55 - Budgeting Lump Sum Income

Archived:  June 1, 2016

Budgeting Lump Sum Income

Follow the policies below when budgeting counted lump sum income for all health care programs except MinnesotaCare. Do not count lump sum income for MinnesotaCare.

Note:  See RSDI and SSI for information on treating lump sum payments of RSDI and SSI.

Treat lump sums as unearned income in the month received and an asset if retained beyond the month of receipt.

l  Do not change eligibility or spenddown amounts for previous or current months, based on the receipt of an unanticipated lump sum.

Exception:  LTC income calculations may be adjusted retroactively. See LTC Spenddowns and Waiver Obligations.

l  Do not change eligibility for future months for which you cannot give 10-day notice, based on the receipt of an unanticipated lump sum.


Maria, Lawrence and their two children are eligible for MA without a spenddown as of March 1. On May 5, Maria reports the family received a $50,000 insurance settlement on April 25. She indicates they already spent $20,000 to pay off their home.


Update the income calculation for April with the lump sum, after deductions. This income creates a spenddown for the family. Close their eligibility effective June 1 after giving 10-day notice if the family cannot meet the spenddown. Eligibility for March, April and May cannot be changed retroactively.

The family retained $30,000 of the lump sum into May. Also close Maria and Lawrence for excess assets if this amount puts the asset total over their asset limit.

l  Do anticipate and budget an expected lump sum when determining initial and continuing eligibility based on income calculation rules.


Elmer receives RSDI monthly. He also receives a rental payment every June and December. His budget period is January - June.


Count the RSDI and the rental payment, because it can be anticipated, in the income calculation for the budget period.

l  Lump sums may affect eligibility for people who have an asset limit in the month following receipt if the lump sum is retained and creates excess assets.

l  Lump sums may result in a spenddown or a change in spenddown or eligibility.

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