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Wisconsin Department of Health and Family Services Obsolete Medicaid Eligibility Handbook For the current MEH, see http://www.emhandbooks.wi.gov/meh-ebd/ For the current BC Plus Handbook, see http://www.emhandbooks.wi.gov/bcplus/ |
5.16.6.3 Gross Social Security
5.16.6.5 Interest and Dividends
5.16.6.6 Self-Employment Earnings
5.16.6.7.1 Retirement Benefits
5.16.6.8.1 Allocated Income from a MA Recipient’s Spouse
5.16.6.8.4 Veterans’ Disability
Income Income is anything you receive in cash or in kind that you can use to meet your needs for food, clothing, and shelter. information for SC is based on the applicant’s good faith estimate of income for the next 12 months beginning with the month of application. Last year’s information from tax returns or other sources may be used as a guide when determining the estimate.
All income should be rounded to the nearest whole dollar when entering the amount on the application or renewal application.
There is no asset test for SC. In general, cash that is received as a result of converting an asset from one form to another, is not income. This includes withdrawals from savings and/or checking accounts, certificates of deposit, or money market accounts. However, special provisions apply to retirement benefits (5.16.6.7.1). Income generated from any assets that the SC participant may have is considered budgetable income and must be reported on the application or renewal application.
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Example: Eric has a savings account with $5,000 in it. Eric’s savings account is considered an asset, but the interest that he anticipates earning is countable income.
Eric anticipates withdrawing $1,000 from his savings account during the coming year. This amount does not count as income. It is an asset that has been converted to cash. Only the interest Eric anticipates receiving from the savings account is countable income. Any withdrawals from his savings account are considered the conversion of an asset, and are not counted as income. |
The income of a spouse who is in the SC FTG is included in the estimate of the annual budgetable income, even if s/he does not apply or is non-financially ineligible.
Annual income is determined prospectively from the month of application through the next 12 calendar months. Income exempted for MA eligibility is also exempted for SC (4.1.2), including Earned Income Tax Credit ( EITC ) and income tax refunds (4.1.5.8).
Budgetable income consists of projected gross annual income, except for self-employment income, which uses net income. (5.16.6.6).
In the following income related sections, policy is defined according to the categories on the SeniorCare Application Form ( HCF 10076 ). All income listed in the following sections should be prospectively budgeted for a 12-month period beginning with the month of application.
When calculating anticipated gross annual Social Security income, add any deductions for Medicare Part B or D and court ordered guardianship fees, alimony and/or child support to the net payment amount.
Exception: If a SC applicant is receiving Medicare premium assistance (5.14), his/her monthly payment already includes the Medicare Part B premium.
The applicant should contact the Social Security Administration at 1-800-772-1213 if s/he does not know his/her Medicare premium amount.
When the applicant is a surviving spouse receiving benefits under his/her spouse’s Social Security number, the amount should be considered the applicant’s income and reported under the applicant’s income column of the application.
Budgetable gross earnings consist of all gross earned income, except for self-employment income, which uses net income (5.16.6.6). Gross earnings include the following:
AmeriCorp (4.1.5.10),
Contractual Income (4.1.5.2),
Governor’s Central City Initiative (4.1.5.7),
Income In Kind (4.1.5.1),
Income Received By Members of a Religious Order (4.1.4.16, 4.1.5.13),
Jury Duty Payments (4.1.5.4),
Salary,
Severance Pay (4.1.5.12),
Wage Advances (4.1.5.5),
Wages,
Wages and salaries received from a program funded under Title V – Older Americans Act of 1965 (4.1.5.14),
Worker’s Compensation (4.1.5.6),
Respite Care Payment for Services
The SC applicant must report the estimated gross amount of all interest and dividends that s/he expects to receive in the next 12 months, beginning with the month of application. Sources of interest and dividends include, but are not limited to the following:
Bonds,
Certificates of Deposit ( CD ),
Checking Accounts,
Money Market Accounts,
Savings Accounts
Stocks,
Capital Gains (5.16.6.5.1)
Trusts (5.16.6.5.2)
Individual Retirement Accounts (4.1.4.4)
Annuities
Land Contracts (4.1.4.7)
Loans (4.1.4.8)
Payments do not need to be directly received. If they are rolled back into the asset, they still must be reported.
Irrevocable interest that a SC applicant receives for an irrevocable burial trust is not budgetable income.
Note: Unlike MA, income that is received irregularly infrequently, and under $20 per month should be reported as budgetable income for SC applicants.
Budgetable income consists of all anticipated capital gains that would be reportable as capital gains to the IRS for tax purposes. All anticipated losses should be subtracted from the gross capital gains amount, and the net capital gain amount should be reported if it is greater than zero. Negative amounts should not be reported and shall not be used to offset other types of income.
The principal or initial investment in the capital asset that the person receives in cash when s/he sells the asset is not considered income. That portion is considered a conversion of an asset from one form to another.
All anticipated payments (including interest, dividends and withdrawals from principal) from a trust to the applicant are counted as income.
Irrevocable interest that a SC applicant receives for an irrevocable burial trust is not budgetable income.
Note: Unlike MA, withdrawals from principle are counted for SC as income in the month received.
Each person who is a holder in a joint savings account is assigned an equal share of the interest earned. The applicant/applicant’s spouse should report only his/her share of the interest.
If the applicant and his/her spouse are not living together and hold a joint savings account, the applicant should only report his/her share of the interest
SC will budget net self-employment income, which is calculated by deducting estimated business expenses, losses, and depreciation from gross self-employment income.
If the net self-employment earnings are anticipated to be a loss, the amount should be reported as zero.
Negative amounts should not be reported and shall not be used to offset other income. (4.2.5.2)
If rental income is reported to the IRS as self-employment income and is subject to the federal self-employment tax for rental income (usually real estate agents or individuals in a business where extensive services are provided to the renters), depreciation should also be deducted from the gross rental income.
Refer to 5.16.6.8.3 if rental income is not reported as self-employment income.
Note: See section 4.1.5.3, items #1 and 2, for more information about calculating net rental income for SC participants.
Examples of income that should be included in the gross pension amount include:
Railroad Retirement Benefits,
Retirement Benefits (5.16.6.7.1),
Veteran’s Benefits. (4.1.2.27)
Retirement benefits are work-related plans for providing income when employment ends (e.g., pension, disability, or retirement plans administered by an employer or union). Other examples are funds held in an individual retirement account ( IRA ) and plans for self-employed individuals, sometimes referred to as Keogh plans.
Retirement accounts, including individual retirement accounts ( IRA ), Keogh, etc., are assets, and are therefore not counted for SC.
Periodic payments received from a retirement account or annuity are counted as income. A periodic payment is any partial payment from a retirement account. Withdrawal of the full amount from any retirement account that has never had a withdrawal made from it is not considered a periodic payment and is not countable income.
Note: Rolling over an IRA (transferring the funds from one IRA to another) is the conversion of an asset from one form to another. Any potential income from an IRA rollover is countable income for SC.
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Example: Mike owns a $2000 IRA and plans to withdraw all of it this year. Mike has not withdrawn any money from this IRA in the past.
If Mike withdraws the full $2,000 at one time, the $2,000 continues to be considered an asset. This is a conversion from one form of an asset to another.
If Mike were planning to make a one time withdrawal of $1,000 of the $2,000 from his IRA in the next 12 months, the $1,000 would be considered income on his SeniorCare application.
If Mike were planning to withdraw $100 monthly from his IRA in the next 12 months, the $100 he plans to receive monthly from the IRA is counted as income on his SeniorCare application. |
Examples of other income are:
Allocated income from a MA recipient spouse (5.16.6.8.1),
Child Support (4.1.4.14),
Federal Farm Subsidy (5.16.6.8.2),
Gifts (4.1.4.6),
Profit sharing (4.1.4.15),
Sick/Disability benefits (4.1.4.2),
Rental income (5.16.6.8.3),
Unemployment Compensation (4.1.4.3),
Veteran’s Disability Payments (5.16.6.8.4)
SC applicants with an MA recipient spouse living outside of the home (e.g. in a nursing home) must report the spousal income allocation amount (5.10.6) as income.
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Example: Betty is an MA recipient and in the nursing home. She is allowed to allocate up to $1,000 to her spouse, Carl, according to the notice she receives. Betty only actually has $650 available, and of that $45 is set aside as her personal needs allowance. $605 per month that she allocates to Carl would be counted as unearned income for Carl. He would report $7,260 as “Other Income” on his SeniorCare Application. |
A SC applicant with an MA recipient spouse living in the home (e.g. a community waivers participant) should not report income that is allocated to him/her. The allocated amount must be included in the income estimate for the MA recipient spouse, because s/he is living in the home.
The SC applicant must report anticipated farm subsidy payments. The SC applicant must also report payments from the Conservation Reserve Enhancement Program ( CREP ), a program where the landowner is paid to install conservation practices for a period of 10 to 15 years.
All expected rental income will be budgeted for SC. Annual operating expenses should be deducted from the annual amount of gross rental income. Operating expenses include ordinary and necessary expenses such as insurance, utilities, taxes, advertising for tenants, and repairs. Repairs include expenses such as repainting, fixing gutters or floors, plastering and replacing broken windows.
Refer to 5.16.6.6.1 if rental income is reported to the IRS as self-employment income.
Veterans’ disability payments should be reported as income.
Do not count as income the portion of a veterans disability payment that is for: unusual medical expenses, aid and attendance, or a housebound allowance.
The applicant should check with the Veterans Administration at 1-800-827-1000 to determine if any portion of the payment is considered an allowance for unusual medical expenses, aid and attendance or housebound allowance.
Reimbursement from the Veterans Administration for medical costs does not count as income.
The applicant should not report income anticipated from any of the following:
Active Corp. of Executives ( ACE ) (4.1.2.2)
Adoption assistance payments (4.1.2.19)
Agent Orange Settlement Fund payments (4.1.2.10)
Disaster and emergency assistance payments made by federal, state, county and local agencies or other disaster assistance agencies (4.1.2.4)
Earned Income Tax Credit (4.5.7.8)
Earnings of a census enumerator (4.1.2.2)
Emergency Fuel Assistance payments (4.1.2.2)
Foster Care payments (4.1.2.18)
Foster Grandparents Program (4.1.2.2)
Governmental rent or housing subsidies (4.1.2.2)
Homestead Tax Credit (4.1.2.2)
Income Tax Refunds (both state and federal) (4.5.7.7)
Individual Development Account payments (4.1.2.5)
Kinship Care payments (4.1.2.24)
Low-Income Energy Assistance Program (4.1.2.2)
Older American Community Service Program (except for wages or salaries which are counted) (4.1.2.2)
Payments made to individuals because of their status as victims of Nazi persecution (4.1.2.12)
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 (4.1.2.22)
Penalty payments made when the state does not correctly process child support refunds.
Radiation Exposure Act program payments made to compensate injury or death due to radiation from nuclear testing and uranium mining (4.1.2.11).
Reimbursement from private insurance company for medical, long-term care, or dependent care expenses (4.1.2.8).
Restitution payments to individual Japanese-Americans (or 5.16.6.9 their survivors) and Aleuts who were interned or relocated during WWII (4.1.2.20).
Retired Senior Volunteer Program ( RSVP ) (4.1.2.2)
Reverse mortgage payments (4.5.7.2.1)
Service Corp. of Retired Executives ( SCORE ) (4.1.2.2)
University Year for Action Program (4.1.2.2)
Volunteers in Service to America ( VISTA ) (4.1.2.2)
W-2 payments for transitional jobs and community service jobs (4.1.2.25)
Wisconsin’s Family Support Program (4.1.2.2)
Do not count payments from Indian Health Services. Note: Payments to Native Americans listed in 4.1.2.1must be counted.
This page last updated in Release Number: 07-01
Release Date: 01/12/07
Effective Date: 01/12/07