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Effective: December 1, 2006 |
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23.40.40ar1 - LTC Family Allocation (Archive) |
Archived: February 1, 2008 |
LTC clients using a LTC income calculation may deduct a portion of their monthly income and allocate it for the needs of their family. This allocation is the amount the LTC client may give to specific family members.
l This deduction is also allowed on the QMB and SLMB income calculation for EW and LTC clients.
l This is an optional allocation. The use of this allocation will reduce the LTC spenddown or waiver obligation for the LTC spouse.
For information on allocations to the community spouse, see LTC Community Spouse Allocations.
Who May Receive a Family Allocation?
Beginning the Family Spouse Allocation.
Children Not Living with Community Spouse.
Family Living with Community Spouse.
Family Member MHCP Eligibility.
Who May Receive a Family Allocation?
The client’s children under age 18, regardless of whether they live with the community spouse may receive an allocation from the LTC client.
The following people may receive an allocation from the EW or LTC client if they live with the community spouse and have one of the following relationships to the client or the community spouse:
l Children under age 21.
l Children age 21 or older who are claimed as dependents for tax purposes.
l Parents who are claimed as dependents for tax purposes.
l Siblings who are claimed as dependents for tax purposes.
Beginning the Family Allocation
Begin the Family Allocation deduction the month the LTC spouse enters the facility or receives services through EW.
End the Family Allocation:
l The month following the end of using the LTC income calculation for the LTC client’s eligibility.
l If the family member becomes ineligible for an allocation because of a change in circumstances, end the allocation as noted for each of the following situations:
n The family member enters an LTCF or begins receiving EW services. End the allocation starting the first month in which the family member is no longer eligible for the allocation.
Example:
Brian resides in an LTCF. His daughter, Jane (age 16) resides in the community and receives an allocation from Brian’s income. Jane enters an LTCF on January 10 after a skiing accident.
Action:
End the allocation for February (the first full month of LTC residence).
n The family member dies. End the allocation for the month after the month of death.
n A child is no longer eligible for an allocation. End the allocation for the month after the month of the change. Ineligibility for the allegation may be due to:
m Change in age.
m Loss of tax dependency status for children over 21.
m Moves away from the community spouse.
Note: For children under age 21 a move away from the community spouse will change the family allocation calculation only.
Example:
Gerard is divorced and resides in an LTCF. His 17-year-old daughter Tracy lives with Gerard’s ex-wife and receives an allocation from Gerard’s income. Tracy turns 18 years old in December.
Action:
Tracy is no longer eligible for a family allocation because she is now 18 and does not live with a community spouse. End the family allocation to Tracy, and the deduction from Gerard’s income for January.
n A sibling or parent is no longer eligible for an allocation due to the loss of tax dependency status or because he or she moves away from the community spouse. End the allocation for the month after the month of the change.
n There is no longer a community spouse. End the allocation for the month after the month of the change.
Examples include if the community spouse:
m Dies.
m Begins receipt of EW services.
m Enters an LTCF.
m Divorces the LTC spouse.
Children Not Living with Community Spouse
Follow these steps to determine the family allocation amount for children under age 18 who do not live with the community spouse:
1. Determine the child’s total gross earned and unearned monthly income.
Note: If there are two or more children to allocate to, and who do not live with the community spouse, calculate their total monthly income separately.
n Include in the total monthly income:
m Interest earned.
m If the Veteran’s Administration (VA) grants an apportionment of the LTC spouse’s VA benefits for the child, the apportionment may be considered income to the child.
m When the child receives income less often than monthly, add together all the irregular income received during a calendar year and divide by 12 to determine the monthly amount of income.
Note: This is only used for the family allocation and not for irregular income received by the LTC spouse. The LTC spouse’s income calculation budgets the income in the month received.
n Allow deductions from the income that the child has no control over, such as FICA and garnished court-ordered child support payments.
Example:
Joanie, age 16, is working at a local pizza joint. Her father, who is in an LTCF, allocates money to her.
Action:
When determining Joanie’s family allocation allow the amount of FICA tax deducted from her paycheck as a deduction from her total monthly income.
n Do not allow work expenses or other taxes as deductions.
n Do not allow MA disregards and deductions from gross income.
2. Total the total monthly income of all children under 18 who do not live with a community spouse.
3. Determine the appropriate income standard using 100% FPG and a household size equal to the number of children not living with the community spouse.
4. Subtract the total monthly income (Step 2) from the income standard (Step 3) to determine the amount of the family allocation.
This amount will be allowed as a deduction on the LTC spouse’s income calculation.
n Do not allow an allocation deduction from VA Aid and Attendance benefits received by the LTC spouse. Allow the deduction from other types of income.
Example:
Ronald lives in an LTCF. He has two children, Jeremy (age 17) and Anne (age 15). The kids live with Ronald’s ex-wife.
l Jeremy is employed part-time earning $400 per month. His employer deducts FIC taxes each month of $31.
l Anne does not have income.
Action:
Determine the family allocation amount following the steps:
1. Total each child’s total monthly income.
m Jeremy’s total monthly income is $369 ($400 earnings - $31 FICA tax)
m Anne does not have income.
2. The total income for both Jeremy and Anne is $369.
3. 100% FPG for a household size of 2 = $1101.
4. Subtract the total monthly income (Step 2) from the FPG figure (Step 3) to determine the family allocation amount.
$1101 FPG figure - $369 total monthly income = $732.
Ronald’s family allocation amount is $732. This amount is used as a deduction on Ronald’s LTC income calculation.
Family Living with Community Spouse
Follow these steps to determine the family allocation amount for family members who live with the community spouse:
Note: A separate determination is used for each family member.
1. Determine the family member’s total gross earned and unearned monthly income. Include in the total monthly income:
n Interest earned.
n If the Veteran’s Administration (VA) grants an apportionment of the LTC spouse’s VA benefits for the family member, the apportionment may be considered income to that person.
n If the family member is self-employed count the adjusted gross income of the self-employment.
Note: Allow self-employment business expenses as a deduction from the total business gross income to arrive at the adjusted gross income.
n When the family member receives income less often than monthly, add together all the irregular income received during a calendar year and divide by 12 to determine the monthly amount of income.
Note: This is only used for the family allocation and not for irregular income received by the LTC spouse. The LTC spouse’s income calculation budgets the income in the month received.
n Allow deductions from the income that the family member has no control over, such as FICA and garnished court-ordered child support payments.
n Do not deem income from one person to another.
n Do not allow work expenses or other taxes as deductions.
n Do not allow MA disregards and deductions from gross income.
2. Subtract the family member’s total monthly income from the community spouse’s minimum monthly income allowance.
3. Divide the result of Step 2 by three. Round to the nearest dollar.
This amount is allowed as a deduction on the LTC client’s income calculation.
Note: Do not allow an allocation deduction from VA Aid and Attendance benefits received by the LTC spouse. Allow the deduction from other types of income.
Example:
Sandra lives in an LTCF. Her daughter Marcy (age 18) lives with Sandra’s husband Steve. Marcy receives $250 of RSDI monthly because of Sandra’s disability. She also earns $300 each month from a part-time job. FICA tax is not taken out of her wages.
Action:
Determine Marcy’s family allocation.
1. Determine Marcy’s total monthly income.
$250 RSDI + $300 earnings = $550 total monthly income.
2. Subtract the total monthly income from the minimum monthly income allowance.
$1650 min. monthly income allowance - $550 earnings = $1100.
3. Divide $1100 by three, rounding to the nearest dollar. The result is $367.
Marcy’s family allocation from her mother is $367. This amount is used as a deduction on Sandra’s LTC income calculation.
Verify income for the family member at the LTC spouse application or when a change is reported at renewal or at another time.
Do not allow a family allocation if the verifications are not provided.
The family allocation must be counted as unearned income when determining the family member’s eligibility for Minnesota Health Care Programs (MHCP).
Note: County workers must alert the MinnesotaCare (MCRE) worker of the allocation, so that it may be included in the MCRE income calculation.
The family allocation may increase the person’s spenddown or premium amount, or create ineligibility due to the increase in income. The family member may choose to either:
l Continue the allocation and pay the higher premium or meet the higher spenddown amount.
l Reduce or end the allocation. This will increase the amount of the LTC spouse’s LTC spenddown.