25.0 Special Status Medicaid Introduction

Federal provisions require DHS to continue to consider specified groups of former SSI beneficiaries as SSI beneficiaries for Medicaid purposes, as long as they would otherwise be eligible for SSI payments “but for” the income disregards required to be given in each special status group.

These “special status” Medicaid groups include the following:

503 cases (see Section 25.1 "503" Eligibility)
DAC (see Section 25.2 Disabled Adult Child)
Widows and widowers (see Section 25.3 Widows and Widowers)
1619 cases (see Section 25.5 1619 Cases)

When determining the eligibility for special status Medicaid applicants and members, the appropriate COLA and OASDI income disregards, as described in the policy for each group, must be given.

25.1 "503" Eligibility

25.1.1 "503" Introduction

Federal law requires that the IM agency provide Medicaid eligibility to any person for whom the following conditions exist:

He or she is receiving OASDI benefits.
He or she was receiving SSI concurrently with OASDI but became ineligible for SSI for any reason.
Total countable income, excluding the "503" disregarded income, is less than or equal to the categorical income limits for SSI-related Medicaid.
Total countable assets must be below the categorical asset limits for SSI-related Medicaid.

Note: "Concurrent" includes situations in which OASDI eligibility is granted retroactively for months in which the person was also receiving SSI. It also includes situations in which SSA recovers the SSI payment because the OASDI payment covers the same time period for which the person received SSI. On the other hand, "concurrent" does not include situations in which SSI eligibility is granted retroactively for a period in which the person was also receiving OASDI benefits.

An assistance group with these two characteristics is often referred to as a "503" assistance group. The name comes from Section 503 of the law that implemented this policy (Public Law 94-566).

Example 1: Kathy received SSI and SSSS (Social Security Surviving Spouse) payments for five years. She lost her SSI payment due to an increase in unearned income when she began receiving a pension payment in January of this year. While an increase in the COLA was not the reason for her loss of the SSI payment, she is still entitled to receive a COLA disregard on any OASDI payments she receives because she received OASDI concurrently with SSI and lost SSI.

Kathy will receive COLA disregards on her SSSS payment in order to determine her eligibility for special status Medicaid.

25.1.2 Identifying a "503" Assistance Group

When a "503" assistance group applies for Medicaid, disregard all OASDI COLAs the assistance group has received since the last month he or she was eligible for and received both OASDI and SSI benefits.

To identify a "503" assistance group, complete the following steps:

Determine whether, after April 1977, there has ever been a month in which one of the following conditions existed for the applicant or member:

- He or she was eligible for both OASDI and SSI (a person who received SSI fraudulently does not qualify as a "503" case).
- He or she received an OASDI check or a retroactive OASDI check and a SSI check for the same month in which he or she was eligible for both OASDI (or retroactive OASDI) and SSI.

1. If the answer to both questions is "No," the applicant or member is not considered a "503" assistance group.
2. If the answer to either of the questions is "Yes," the applicant or member is no longer receiving SSI. Proceed to Step 2.

Determine if the applicant or member is now receiving an OASDI check.
1. If the answer is "No," he or she is not a "503" assistance group.
2. If the answer is "Yes," he or she is a "503" assistance group and will receive a COLA disregard. Enter “Y” on the Individual Nonfinancial>Prior SSI page in CWW .

If the applicant or member was receiving SSI-E , the state SSI-E will also be deducted (see Section 39.4.1 Elderly, Blind, or Disabled Assets and Income Table). SSI-E assistance groups are SSI recipients who receive a higher state supplement than regular SSI. People who receive SSI-E payments must live in one of the following:

In substitute care
At home and need more than 40 hours a month of primary long-term support services.

25.1.3 Calculating the Cost-of-Living Adjustment Disregard

To calculate the COLA disregard amount, do the following:

Find the assistance group's current gross OASDI income. The gross OASDI income is the amount of the OASDI check plus any amount that has been withheld for a Medicare premium plus any amount withheld to repay an earlier overpayment.

Do not include in the gross income any Medicare Plan B premiums, which the state has paid for the assistance group.

On the COLA Disregard Amount Table (see Section 39.6 Cost-of-Living Adjustment), find the last month in which the person was eligible for and received a check for both OASDI (or retroactive OASDI) and SSI.

Find the decimal figure that applies to this month.

Multiply the person's current gross OASDI income by the applicable decimal figure. The result is the COLA disregard amount.

Example 2: Newby's current gross OASDI income is $820. He is not currently receiving SSI benefits. The last month in which he was eligible for both OASDI and SSI and received benefits from both was April 2013. On the COLA Disregard Amount Table (see Section 39.6 Cost-of-Living Adjustment), April 2013 falls between January – December 2013.

The decimal figure that applies to April 2013 is 0.031247. Multiply 0.031247 by $820 to find Newby's COLA disregard amount of $25.62. Subtract the $25.62 disregard amount from the $820 OASDI. Newby’s income is then $794.38. This amount is below the EBD income limit of $816.78, which makes him eligible.

Periods of Medicaid ineligibility do not affect this disregard. When the person reapplies, give the disregard again.

This page last updated in Release Number: 17-01

Release Date: 05/05/2017

Effective Date: 05/05/2017