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State of Wisconsin |
Release 24-03 |
"Disregard” and "exempt" in this section mean "do not count.” When calculating the total amount of income a person has received, disregard the following kinds of income:
Disregard adoption assistance payments.
Disregard payments received from the Agent Orange Settlement Fund or any other fund established in settling In Re "Agent Orange" Product Liability Litigation, M.D.L. No. 381 (E.D.N.Y.).
Apply this disregard retroactively to January 1, 1989, and continue to disregard these payments for as long as they are identified separately.
Disregard combat zone pay that goes to the household that is in excess of the military person's pre-deployment pay. The exclusion lasts while the military person is deployed to the combat area.
If the amount of military pay from the deployed absent family member is equal to or less than the amount the household was receiving prior to deployment, count all of the income to the household. Any portion of the military pay that exceeds the amount the household was receiving prior to deployment to a designated combat zone should be excluded when determining the household’s income.
| Example 1 |
John's wife Bonnie and their daughter have an open Medicaid case. John is in the military stationed overseas, and his monthly income is $1,000. John sends his wife $1,000 every month. When John is deployed to a combat zone his pay is increased to $1,300 a month, which is deposited into a joint account. Because the $300 is combat zone pay, it is exempt income and not counted in the determination. The pre-combat pay of $1,000 is budgeted as unearned income for Medicaid. |
Disregard any payments received from a state-established fund to aid victims of a crime.
Disregard major disaster and emergency assistance payments made by federal, state, county, tribal, or local government agencies, or disaster assistance organizations.
Disregard any penalty payment paid as a result of the Dottie Moore lawsuit.
These court-ordered $50-$200 penalty payments can be imposed when the IM agency or CSA does not correctly process child support refunds.
Disregard foster care payments. Foster care payments are considered to be the income of the child or adult who is receiving foster care and these payments are exempt income for the foster care recipient. However, in some situations the foster care recipient uses these payments to pay the foster parent for his or her room and board expenses. The room and board payments that are received by the foster parent are not disregarded and should be counted as non-exempt earned income (see Section 15.5.15 Earned Income Tax Credit) for the foster parent's Medicaid eligibility determination.
Disregard $20 from the EBD fiscal test group's net income.
Disregard IDA payments that are made in the form of matching funds to buy a home, start a business, or to complete post-secondary education.
Disregard income that is infrequent, irregular, and has no appreciable effect on ongoing need.
Infrequent income is defined as income that an individual receives only once during a calendar quarter from a single source and that the individual did not receive in the month immediately preceding that month or in the month immediately subsequent to that month, regardless of whether or not those payments occur in different calendar quarters.
Income is considered to be received irregularly if an individual cannot reasonably expect to receive it.
Exclude the following income that is received either infrequently or irregularly:
Disregard Kinship Care payments.
Disregard life insurance policy dividends.
Disregard benefits received from the following:
Disregard the following payments to Native Americans:
Disregard payments made under PL 103-286 to victims of Nazi persecution.
Disregard payments from any program under the Radiation Exposure Act (PL 101-426) paid to persons to compensate injury or death due to exposure to radiation from nuclear testing ($50,000) and uranium mining ($100,000). The federal Department of Justice reviews the claims and makes the payments. If the affected person is dead, payments are made to his or her surviving spouse, children, parents, or grandparents.
Apply this disregard retroactively to October 15, 1990, and continue to disregard these payments for as long as they are identified separately.
Disregard cash payments from the RCA program. RCA is administered by W-2 agencies and is made available for refugees who do not qualify for W-2.
Disregard federally funded "Reception and Placement" payments made to refugees during the first 30 days after their arrival in the U.S. Reception and Placement payments are made by voluntary resettlement agencies and may be a direct payment to the refugee individual or family or to a vendor.
A reimbursement is a payment that a person receives for out-of-pocket expenses. Disregard reimbursements for expenses an AG member has incurred or paid. Do not disregard reimbursements for normal household living expenses, such as rent, clothing, or food eaten at home (see Section 15.4.21 Reimbursement of Living Expenses).
The following are some examples of reimbursements you should disregard:
The reimbursement payment should not be more than the person’s actual out-of-pocket expenses. If it is more, count the excess amount as unearned income.
Under Wis. Stat. § 32.19, relocation payments are available to displaced persons. The following are examples of costs that the relocation payments are intended to cover: moving expenses, replacement housing, and property transfer expenses. Disregard the amounts paid by any governmental agency or organization listed in Wis. Stat. § 32.02. Disregard Title II, Uniform Relocation Assistance and Real Property Acquisition Policies Act payments. Its purpose is to treat people displaced by federal and federally aided programs fairly so that they do not suffer disproportionate injuries as a result of programs designed for the public's benefit.
Disregard Experimental Housing Allowance Program payments. The program's purpose is to study housing supply. Test areas, which include Brown County, were selected throughout the U.S., and contracts were entered into prior to January 1, 1975. A sample of families was selected to receive monthly housing allowance payments.
For Medicaid applicants or members, disregard housing assistance payments received under the following acts:
A repayment is money the member has received from an IM program and must give back because of a program error or violation. Since he or she is not entitled to the money, he or she must repay it. Therefore, it should not be counted as income to the member.
Disregard the following repayments:
| Example 2 | Richard receives $50 a month from the VA and $250 from Social Security. The income from the two sources is added together in one lump sum of $300. If the VA overpays Richard by $200, he can pay back to the VA only the $50 a month he receives from the VA. If he repays more, for instance, $75 a month, disregard only $50. |
Disregard income from all of the following:
Disregard payments made under PL 104-204 to any child of a Vietnam veteran for any disability resulting from the child's spina bifida.
Disregard payments received from the class action settlement of Susan Walker vs. Bayer Corporation. These payments are to hemophiliacs who contracted the HIV virus from contaminated blood products.
In Medicaid cases, disregard the value of any commercial transportation ticket that the member, the member's spouse, or the member's parents (if the member is a minor) receives as a gift if it is:
For veterans and surviving spouses who need help with activities of daily living or are housebound due to disability, a Department of Veterans Affairs (VA) benefit may include a monetary amount referred to as an “Aid & Attendance” (A&A) or “housebound” allowance (see SECTION 39.13 VA ALLOWANCE RATES).
Disregard A&A and housebound allowances when determining eligibility for any category of Medicaid.
Disregard A&A and housebound allowances when determining the patient liability or cost share amount for Institutional Medicaid and Community Waivers. This rule does not apply to State Veterans Home residents without dependents (see Section 15.3.26.3 Patient Liability Calculation for State Veterans Home Residents Without Dependents).
| Example 3 |
Jack is a single veteran living in his home. He receives a $2,051 monthly need-based VA pension. His VA pension includes an A&A allowance of $821 per month. The A&A allowance is disregarded for Medicaid eligibility. $2,051 VA pension - $821 A&A allowance (disregarded) = $1,230 budgetable income |
| Example 4 |
Donald is a married veteran living with his spouse and two children. He is disabled (as determined by the VA) and receives VA disability compensation benefits in the amount of $1,963 per month. He does not receive A&A or housebound allowances and the VA did not consider any unreimbursed medical expenses when calculating the VA disability compensation benefit amount. The full $1,963 is budgetable income to the household. |
When a single veteran or a surviving spouse without dependents is in a nursing home and enrolled in Medicaid, the VA is required to reduce the pension amount to no more than $90, except when the member is in a State Veterans Home. These reduced pensions of $90 or less are always considered A&A, so the full amount of these reduced pensions is disregarded for Medicaid eligibility as well as cost share or patient liability determinations.
| Example 5 | Patrick is a single veteran with no dependents who is in a nursing home and open for Institutional Medicaid. He receives a $90 monthly VA pension. The entire $90 VA pension amount is A&A and is disregarded for both his Medicaid eligibility and patient liability determinations. |
When the VA determines the amount of a need-based benefit payment, it may consider any unreimbursed medical expenses incurred by the beneficiary or a member of their household that exceed 5% of the VA’s basic Maximum Annual Pension Rate (MAPR). These expenses are sometimes referred to as “unreimbursed” or “unusual” medical expenses (UME). The VA deducts UME from countable income when computing the VA payment, resulting in a higher monthly payment.
Disregard any portion of a VA benefit that is for UME when determining eligibility for any category of EBD Medicaid.
Disregard any portion of a VA benefit that is for UME when determining the patient liability or cost share amount for Institutional or Community Waivers Medicaid. This rule does not apply to State Veterans Home residents without dependents (See Section 15.3.26.3 Patient Liability Calculation for State Veterans Home Residents Without Dependents).
| Example 6 |
Allan is a veteran who resides in an assisted living facility. He receives a $1,200 monthly Social Security benefit and a monthly VA pension. His VA pension includes an A&A allowance of $883 per month. When calculating his pension amount, the VA also considered Allan’s $42,000 annual ($3,500 monthly) assisted living fees as UME. The UME reduced his countable income (for VA purposes) to $0, resulting in a VA pension amount of $2,051 per month. The portion of the VA pension that is for A&A and UME is disregarded for Medicaid eligibility. Because Allan’s $883 monthly A&A allowance plus the $3,500 monthly UME amount that the VA considered is greater than the total pension amount, the entire pension amount is for A&A and UME and must be disregarded for Medicaid eligibility. $1,200 Social Security = $1,200 budgetable income |
For any veteran without a spouse or dependents (or for a surviving spouse without dependents) who resides at a State Veterans Home at King, Chippewa Falls, or Union Grove:
These special patient liability rules do not apply to State Veterans Home residents who have a spouse or other dependents.
If a veteran or surviving spouse in a State Veterans Home has dependents and receives a VA benefit, for Medicaid eligibility and patient liability, disregard any amount of the VA benefit that is an A&A or housebound allowance or is for UME.
| Example 7 | John is a single veteran with no dependents residing at the State Veterans Home at King. His total monthly income consists of a $90 VA pension and a $55 annuity payment. The $90 VA pension is totally disregarded for his Medicaid eligibility and patient liability calculation. John’s budgetable income is $55. After deducting the $45 personal needs allowance, he has a $10 patient liability. |
| Example 8 |
Scott is a single veteran with no dependents residing at the State Veterans Home at Chippewa Falls. His total monthly income consists of a $590 VA pension ($200 of which is for UME) and a $50 annuity payment. For his Medicaid eligibility determination, the $200 UME portion of his VA pension is disregarded. For his patient liability calculation, only $90 of the VA pension is disregarded. Eligibility Calculation Patient Liability Calculation |
| Example 9 |
Melvin is a veteran residing at the State Veterans Home at King. He has a spouse residing in the community. His total monthly income consists of a $1,400 monthly Social Security benefit and a $410 monthly VA pension ($200 of which is for UME). The portion of the VA pension that is for UME is totally disregarded for both his Medicaid eligibility and patient liability calculation. $1,400 Social Security |
Disregard restitution payments under PL 100-383 to individual Japanese-Americans (or their survivors) and Aleuts who were interned or relocated during World War II. There is no child support and maintenance disregard for Medicaid.
Disregard W-2 stipends and payments, including Case Management Follow-up Plus (CMF+) payments, made directly to a member as part of his or her participation in W-2. Earnings obtained through W-2’s subsidized employment programs, such as Trial Jobs or Transform Milwaukee Jobs, are countable earned income.
Disregard subsidized guardianship payments.
There is no uniform policy for how to count payment types related to the COVID-19 pandemic; some payment types are counted as income and some payment types are not counted as income. The criteria used to evaluate whether a payment type is counted as income include:
The payment types that do not count as income include but are not limited to:
See Section 15.4.25 Certain Payment Types Related to the COVID-19 Pandemic for countable types of pandemic-related unemployment compensation benefits.
The treatment of cash benefits received in conjunction with medical and social services depends on whether it is provided by a governmental or nongovernmental organization.
To be considered governmental, the program must be authorized by federal, state, or local law, statute, or ordinance to provide medical or social services. This includes entities that are under contract with a federal, state, or local government to provide services.
Disregard any cash benefits provided by a governmental medical or social services program.
Disregard cash benefits provided by a nongovernmental medical or social services organization if either of the following conditions is met:
Disregard all Medicare Advantage supplemental benefits.
A supplemental benefit is an item or service provided by a Medicare Advantage Plan that is not covered by original Medicare.
| Example 10 | Mariel received a prepaid debit card from her dual eligible special needs (D-SNP) plan as a wellness benefit that she can use to purchase healthy food and over-the-counter medications. The funds on the debit card must not be counted as income or assets. |
Federal income tax refunds (including refundable tax credits) and advance payments of any tax credits, including the Earned Income Tax Credit and the Child Tax Credit, are totally disregarded as income.
The annual Cost of Living Adjustment (COLA) increase to Social Security benefits is disregarded in certain months for the following programs and categories, which have income limits that are tied to the Federal Poverty Level (FPL):
The disregard begins the month of the COLA increase (usually January) and ends when the new FPL amounts are in effect (usually February 1 for new applications and March 1 for ongoing cases).
| Example 11 | In December, Ed’s Social Security payment was $875 per month. It increased to $900 in January. The current COLA disregard amount is calculated by subtracting Ed’s previous Social Security payment amount from his current payment amount. Ed’s current COLA disregard amount is $25, which is disregarded from January 1 until February 28. The disregard ends when the new FPL amounts go into effect on March 1. |
Guaranteed income from a privately funded, non-profit organization is excluded for all categories of Medicaid.
Guaranteed income includes, but is not limited to, payments from the Madison Forward Fund and The Bridge Project in Milwaukee.
See Section 16.7.34 Guaranteed Income Payments for information about asset treatment of guaranteed income payments.
Income is disregarded as Assistance Based on Need, also known as General Assistance, if it is:
This page last updated in Release Number: 24-03
Release Date: 12/18/2024
Effective Date: 12/18/2024
The information concerning the Medicaid program provided in this handbook release is published in accordance with: Titles XI and XIX of the Social Security Act; Parts 430 through 481 of Title 42 of the Code of Federal Regulations; Chapters 46 and 49 of the Wisconsin Statutes; and Chapters HA 3, DHS 2, 10 and 101 through 109 of the Wisconsin Administrative Code.
Notice: The content within this manual is the sole responsibility of the State of Wisconsin's Department of Health Services (DHS). This site will link to sites outside of DHS where appropriate. DHS is in no way responsible for the content of sites outside of DHS.
Publication Number: P-10030