*** The Health Care Programs Manual (HCPM) has been replaced by the Minnesota Health Care Programs Eligibility Policy Manual (EPM) as of June 1, 2016.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. ***
Effective: June 1, 2011 |
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24.10 - Spenddown Types |
Archived: June 1, 2016 (Previous Versions) |
This section of the manual will discuss the two types of medical spenddowns and what to consider when determining which spenddown type is most beneficial for a Medical Assistance (MA) client.
Which Medical Spenddown Type to Use.
There are two medical spenddown types:
l Six-Month.
n A six-month medical spenddown is used when:
m The client’s net six-month income total exceeds the six-month income standard for the household size.
m The client has medical expenses that equal or exceed the six-month spenddown amount.
n Clients who have a six-month spenddown interrupted may have a shortened spenddown.
A monthly medical spenddown, known in MAXIS and MMIS as an automated monthly spenddown, is used when:
n a six-month spenddown cannot be met or the six-month spenddown is not the most beneficial choice for the client.
n the client can meet the spenddown in one month of the processing period with medical expenses that equal or exceed the monthly spenddown amount.
Which Medical Spenddown Type to Use
Consider the following when determining the medical spenddown type:
l The type of spenddown in which the household will be responsible for the least amount of health care expenses. Follow these steps:
1. Determine the spenddown amounts for each type of medical spenddown for which the client meets the criteria.
Note: Clients whose net income exceeds the monthly standard but is within the six-month standard are eligible for MA without a spenddown.
Example:
Miranda’s certification period is May through October. Her monthly net income is over the income standard in July, but less than the income standard in all of the other months of the certification period. Her six-month net income is less than the six-month income standard.
Action:
Miranda is eligible for MA and does not have to meet a spenddown for this certification period.
2. Determine if the client is able to meet either of the spenddown amounts by comparing each spenddown amount to the amount of health care expenses the client has to meet each of the spenddowns.
3. Determine which spenddown type allows for MA to pay for more of the household health care expenses.
Example:
Mark, age 20, and his wife Melissa, age 19, apply for MA for themselves on October 5th and are not requesting retroactive coverage. Melissa must pay for an inhaler each month, which costs $45. She also has an emergency room bill from October 2 due to a severe asthma attack. The cost of the bill is $500.
Action:
Follow the steps provided.
After completing each of their income calculations (Step 1), Mark and Melissa meet the criteria for the following spenddown types with the listed spenddown amounts:
q Six-Month Spenddown - $150 for the total six-month period.
q Monthly Spenddown (Automated) - $25 each month.
Determine if the client meets each of the spenddown amounts (Step 2).
q The $75 six-month spenddown is met with the $500 hospital bill.
q The $25 monthly spenddown amount can be met with recurring prescription costs or with the unpaid hospital bill.
Determine which spenddown type allows more of the client’s health care expenses to be paid (Step 3).
q Six-Month Spenddown: Mark and Melissa would be responsible for $75, the total six-month spenddown amount, for the six-month period.
q Monthly Spenddown (Automated): Mark and Melissa would be responsible for $150 total ($25 X6) for the certification period.
Mark and Melissa would benefit from a six-month spenddown because they will be responsible for a lesser amount of their health care expenses.
l All household members with a spenddown must use the same spenddown type for the entire certification period.
Exception: Household members whose eligibility is based on a household size of one do not have to have the same spenddown type as the rest of the household.
n Clients do not have to meet both a six-month and a monthly spenddown to be eligible for MA.
n Some household members may not have a spenddown for a certification period. MA-eligible medical expenses of those members who have no spenddown cannot be used to meet the spenddown of other household members.
n The original spenddown and recipient amounts (and satisfaction dates if a six-month spenddown) may vary for each household member.
Example:
Alicia and Erik apply for MA for themselves and their two children, ages three and four. The children do not have spenddowns. Alicia and Erik’s net countable income exceeds the income standard.
Action:
Alicia and Erik may choose either a six-month or a monthly spenddown. They must each use the same spenddown type. MA-eligible expenses of their children cannot be used to meet their spenddown. Since they are married, Alicia and Erik’s original spenddown and recipient amounts should be the same. Their satisfaction dates should also be the same if they are on a six-month spenddown.
See Associated Recipients for information on how health care expenses of other MA household members' expenses are used to meet the spenddown.
l Clients with income over 100% FPG who do not receive MA-EPD and who receive one of the waiver services below can use either a monthly or a six-month spenddown. However, the spenddown amount has to be determined using the spenddown standard of 75% FPG.
n Community Alternative Care (CAC).
n Community Alternatives for Disabled Individuals (CADI).
n Developmental Disabilities (DD).
l MinnesotaCare may be a better program for the client or household. Some clients may be eligible for MinnesotaCare for months in the certification period after the month of application. This may be a better option for clients who do not anticipate incurring sufficient medical expenses to meet the monthly spenddown throughout the certification period or whose premium would be less than the spenddown.
Note: Some households may benefit from a combination of programs. For example, the household may need retroactive and current MA coverage but benefit from changing to MinnesotaCare for the future months.