Six-Month Spenddown Example (Archive)

Luther lives with his five year old daughter, Nica. He is applying for MA in February for himself only and is requesting one month of retro coverage. Luther is working full-time and is not eligible for a monthly spenddown. He also receives spousal support each month but it is court-ordered to end in March.

Luther has a total net monthly countable income amount of $1500 for January through March and $1200 for April through June. The monthly FPG, using the non-spenddown standard, is $850. The monthly spenddown standard is $700.

Luther provided the following verified health care expenses:

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Action:

1. Luther’s total countable income for each month of the certification period of January through June has been determined already.

2. Total the net total countable income for all six months of the certification period.

($1500 X 3 months = $4500) + ($1200 X 3 months = $3600) = $8100.

3. Determine eligibility using the appropriate non-spenddown six-month FPG standard.

a. $850 monthly FPG standard X 6 months = $5100 non-spenddown standard.

b. The total net countable six-month income (Step 2) is greater than the non-spenddown standard (Step 3a). Luther is not eligible using the non-spenddown standard.

4. Determine the six-month spenddown amount using the applicable spenddown standard.

$700 monthly spenddown standard X 6 months = $3200.

5. The six-month spenddown amount is $4900.

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6. Determine if the client meets the spenddown amount with applicable health care expenses.

The bills are applied on a specific date for specific bill types.

a. Apply H bills to the first day of the month they are paid or if retroactive coverage is requested apply H bills paid for the retro months and the application month on the first day of the certification period.

Apply $100 for January and $100 for February for the health insurance premium Luther pays for Nica.

b. Apply M bills in the order they were incurred on the first day of the certification period.

c. Apply P bills to the first day of the month they are paid or if retroactive coverage is requested apply P bills paid for the retro months and the application month on the first day of the certification period.

d. Apply R bills based on the date of service.

Luther has enough health care expenses to meet a six-month spenddown.

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7. The satisfaction date is January 15, the day Luther meets or exceeds the spenddown amount.

The recipient amount is $200. This is the difference between the spenddown amount and the total amount of medical expenses applied through the day before the satisfaction date.

$4900 spenddown amount - $4700 in applied bills = $200.

Luther is eligible for MA through June 30th.

8. The MMIS system is updated with the spenddown amount ($4900), satisfaction date (January 15) and the recipient amount ($200). MMIS will deny claims received with a date of service prior to January 15 and $200 of claims with a service date of January 15 or later.

9. Luther is sent notification of his spenddown amount, which states he is responsible for all bills prior to January 15 and that $200 of claims billed to DHS with a service date of January 15th or later will be rejected and will be his responsibility to pay. Luther should request the doctor bill be submitted to MA.

He will receive an EOMB indicating to whom he should pay the $200.

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