State of Wisconsin Department of Health Services

Release 24-02 August 22, 2024

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25.2 Disabled Adult Child (DAC)

25.2.1 Disabled Adult Child Introduction

A DACDisabled Adult Child is a person who meets the following criteria:

• At least 18 years old at the time SSISupplemental Security Income. A program based on financial need operated by the Social Security Administration that provides monthly income to low income people who are age 65 or older, blind, or disabled. was lost.
• Classified by SSASocial Security Administration. A federal agency which administers the SSI, OASDI, and Medicare programs. as disabled before age 22.
• Receives an OASDIOld Age, Survivors, and Disability Insurance Program. Old-Age, Survivors, and Disability Insurance Program payments, known as “Social Security” by the Social Security Administration (SSA) include SSA Retirement, Disability, Survivors benefits, and any other benefits covered in Title II of the Social Security Act. (DAC) payment that is based on the earnings of a parent who is disabled, retired, or deceased.

  Note:

  Receipt of Railroad Retirement is not considered OASDI for this policy.

• Was receiving SSI but lost SSI eligibility because the OASDI (DAC) payment or an increase in the OASDI (DAC) payment exceeded the SSI income limits.

Federal law requires that the IMincome maintenance agency provide Medicaid eligibility to any DAC for whom the following condition exists:

• Total countable income, excluding the "DAC" disregarded income, is less than or equal to the SSI-related categorical income limits.
• Total countable assets are less than or equal to the categorical asset limit for SSI-related Medicaid.

25.2.2 Disabled Adult Child Payment Disregard

When a Disabled Adult Child applies for Medicaid, disregardAn amount not counted when determining a person's total net income. all OASDI (DAC) payments which caused him or her to lose SSI eligibility.

Example 1:

Disregard the entire OASDI (DAC) payment when the initial OASDI (DAC) payment caused the member to be ineligible for SSI: Harvey is an SSI recipient. While his father worked, Harvey received a monthly SSI payment of $686.78. When his father retired, Harvey began receiving an OASDI (DAC) payment of $900. The OASDI payment exceeded the SSI income limits, causing his SSI to end. It is not necessary for the payments to be received concurrently (in fact, often they will not be) but the SSI payment must have ended because of the OASDI increase. When Harvey applies for EBDElderly, Blind, or Disabled Medicaid, the entire initial OASDI (DAC) payment of $900 (and any subsequent COLA disregards) will be disregarded when his EBD Medicaid eligibility is determined.

 

Example 2:

George is an SSI recipient. While his father worked, George received a monthly SSI payment of $686.78. When his father retired and began receiving social security retirement, George began receiving an OASDI (DAC) payment of $500 a month. While George’s SSI payment decreased, the initial OASDI (DAC) payment did not cause him to lose SSI eligibility. When his father died, George's OASDI (DAC) payment increased to $750 a month. The increased amount put him over the SSI income limit, and he lost SSI. George applies for EBD Medicaid. The IM worker must disregard the OASDI (DAC) payment increase of $250 ($750 - $500 = $250) because it was the increase that caused George to lose SSI eligibility.

 

Example 3:

Jane is an SSI recipient. While her father worked, Jane received a monthly SSI payment of $686.78. When her father retired and began receiving social security retirement, Jane began receiving an OASDI (DAC) payment of $1372 a month. The OASDI payment exceeded the SSI income limits, causing her SSI to end.   When Jane applies for EBD Medicaid, the entire initial OASDI (DAC) payment of $1372 (and any subsequent COLAs) will be disregarded when her EBD Medicaid eligibility is determined. Two years later, Jane’s DAC payment increased to $2539 because her brother graduated from high school. Because this increase did not cause Jane to lose her SSI, only the initial DAC payment ($1372 plus any subsequent COLAs) is disregarded.

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

25.2.3 COLA Disregard

When a Disabled Adult Child applies for Medicaid, disregard all OASDI COLAs since the last month he or she was eligible for and received both OASDI and SSI benefits.  Calculate the COLAcost-of-living adjustment. An increase in income to compensate for inflation. disregard amount (25.1.2 Identifying a "503" AG).

If the Disabled Adult Child was receiving SSI-ESupplemental Security Income Exceptional Expense, disregard both the state SSI-E Supplement (39.4 Elderly, Blind, or Disabled Assets and Income Tables) and the COLA.

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

Example 4:

In Example 1, because Harvey received SSI concurrently with the OASDI (DAC) payment, he is also eligible for a COLA disregard for any OASDI payments he receives.

 

Example 5:

In Example 2, because George received SSI and an OASDI (DAC) payment concurrently and then lost SSI eligibility, he must also receive a COLA disregard on any OASDI payments he receives.

25.2.4 Disregards For People Who Lose SSI Eligibility As A Result of Initial Receipt Or An Increase in DAC Benefits

People who lose their SSI eligibility due to the receipt of an initial OASDI (DAC) benefit or increase in their current OASDI (DAC) benefit is entitled to the following disregards when their Medicaid eligibility is being determined:

1. The OASDI (DAC) payment, either the initial payment or the increase in payment, whichever made them ineligible for SSI.
2. The SSI-E supplement, if they were receiving the E supplement at the time they became ineligible for SSI.
3. All COLAs received since the last month that they were eligible for and received both OASDI (DAC) and SSI benefits.

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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