State of Wisconsin Department of Health Services

HISTORY

The policy on this page is from a previous version of the handbook. 

23-03 Version of 4.6.4 Medical Expenses

The medical expense deduction is determined using verified allowable monthly medical expenses incurred by elderly, blind, or disabled food unit members exceeding $35 per month (see Section 1.2.4.8 Medical Expense Verification for verification requirements).

4.6.4.1 Allowable Medical Expenses

Allow previously acquired charges (not yet paid) and current payments when calculating a medical expense deduction. Previously acquired charges include charges incurred any time before or during the certification period, as long as the person is still obligated to pay the expense and the incurred expense has not been previously allowed as a FoodShare deduction.

Past unpaid medical bills can be used to prospectively budget recurring medical expenses.

One-time medical expenses (such as, hospital bills) can be budgeted for one month or averaged over the remaining certification period.

Medical expense payments made during the certification period are allowable. Medical expenses paid prior to the certification period are not allowable.

Example 1

Jack has surgery in January and receives a hospital bill for $400 in February. Jack then applies and becomes eligible for FoodShare in April. At the time of application, Jack has not made any payments toward the medical bill. The IM worker can use the entire $400 hospital bill when calculating Jack's medical expense deduction.

 

Example 2

Jack has surgery in January and receives a hospital bill for $400 in February. He makes his first $50 monthly payment toward his medical bill in March. Jack then applies and becomes eligible for FoodShare in April. The IM worker cannot use the $50 March payment when calculating the medical expense deduction. The IM worker can, however, use the remaining $350 of the hospital bill ($400 - $50 = $350) to calculate the deduction.

Allowable medical expenses include:

• Medical and dental care (including psychotherapy and rehabilitation services) provided by a state-licensed practitioner, other qualified health professional, chiropractor, or acupuncturist.
• Hospitalization, outpatient treatment, nursing care, and nursing home care. This includes payments by the food unit for a person who was a food unit member immediately before entering a state-recognized hospital or nursing home.
• Prescription drugs when prescribed by a licensed medical practitioner authorized under state law. This includes the cost of postage for mail-order prescription drugs.
• Over-the-counter medication when approved by a licensed practitioner or other qualified health professional.

  Note

  Certain over-the-counter hemp products are allowable expenses when a licensed medical practitioner or qualified health professional has prescribed or approved them. Current federal guidance states that only products that contain a delta-9 tetrahydrocannabinol (delta-9 THC) concentration of no more than 0.3% on a dry weight basis can be considered allowable. Medical marijuana and other Schedule 1 controlled substances are not allowable medical expenses.

• Sickroom equipment (including rental), other prescribed equipment, and medical supplies.
• Health insurance premiums, hospitalization insurance premiums, Medicare premiums, and monthly HealthShare contributions.
  • Nursing home care insurance policies are deductible only if the policy states that the benefits are intended to pay medical bills. If the policy is intended to pay medical bills, it is reasonable to conclude that the food unit member intends to use the benefits for paying medical bills rather than normal living expenses.
  • Only allow the premium of the elderly, disabled, or blind food unit member.

    Example 3

    A mother pays $165 for herself and her disabled son. If she only covered herself, the payment would be $100. Therefore, $65 is the expense for the childA person's biological, step, or adopted son or daughter, regardless of age. If a child is adopted, the adoption severs the biological tie to the parent.. Count the $65 as an allowed medical expense.

    If the premium amount intended for the eligible food unit member is unknown, prorate the premium and allow the EBDElderly, Blind, or Disabled member's portion of the premium as the expense.

    Example 4

    A disabled husband, a non-disabled wife, and two children have a family health insurance plan. It cannot be readily determined how much of the premium is for the disabled husband. The premium is $1,000 per month. To find the husband’s share of the premium divide the total premium $1,000 by the number of people covered under the plan, which is four. The premium amount per person is $250. The husband’s allowable premium expense is $250.

• Dentures, hearing aids, and prosthetics.
• Purchase and maintenance costs of any service animal specially trained to perform some function that the EBD food unit member cannot readily perform on their own.
  • This includes the cost of securing and maintaining a service animal (such as food and veterinarian care.)
  • This also includes companion animals specifically trained to assist the EBD food unit member with the medical issue for which a licensed practitioner prescribed the animal. (The trainer does not need to have any special credentials and can be the person claiming the deduction as long as the animal is trained to do a specific function the EBD person cannot do for themselves.)
  • Reimbursement for each expense is an allowable deduction if:
    • Only for the amount of the actual expense.
    • It does not represent a gain or benefit to the food unit as do normal living expenses such as rent or mortgage, personal clothing or food eaten in the home.
    • It is provided specifically for an identified expense.
    • It is used for the purpose intended.
• Eyeglasses and contact lenses prescribed by an ophthalmologist or optometrist.
• Reasonable cost of transportation and lodging to obtain medical care. For transportation when the expense has not or will not be reimbursed by a third party, allow:
  • The actual cost of the public carrier (taxi, bus, etc.)
  • If a private vehicle, the lesser of the mileage rate paid by the county (to employees) or by the state for unrepresented state employees. See the State of Wisconsin Travel Guide to obtain the current state rates.
• Charges for an attendant, homemaker, home health aide, child care, or housekeeper necessary due to age, infirmity or illness.
• Treat attendant care costs that qualify either as a medical or dependent care deduction as a medical deduction.
  • Deduct an amount equal to the one-person maximum allotment if the food unit furnishes the majority of the attendant's meals. Use the allotment in effect the last time eligibility was determined.
  • IM workers must update the amounts at the next scheduled renewal but may do so earlier.
  • Any cost-sharing, co-payment, or Medicaid deductible expense incurred by a Medicaid member, including Medicaid deductible pre-payments.
  • Payments made on a loan's principal if it was used to pay a one-time medical expense. Do not allow loan expenses, such as interest.
  • BadgerCare Plus and Medicaid Purchase Plan (MAPP) premiums.
  • The SeniorCare enrollment fee.
  • Lifeline/MedicAlert. The costs of Lifeline or MedicAlert devices used by persons to contact medical help in emergencies are an allowable medical expense deduction for FoodShare benefits if prescribed by a licensed practitioner or other qualified health professional.
  • Medical expenses billed on a charge card are allowable. The interest cannot be included as a deduction.
  • Exercise equipment prescribed by a licensed practitioner or qualified health professional. A recommendation or referral for the equipment is not valid justification to allow the expense.
  • The cost of a medically necessary app or any subscription fee associated with the app. This could include, but is not limited to, an insulin monitoring app or an app that reminds someone to take their medications. Verification that the app was prescribed and is medically necessary is required from a medical professional.

4.6.4.2 Medical Expenses Not Allowed

Do not allow:

1. Expenses paid by or that will be paid by insurance.

2. Expenses paid by or to be paid by any governmental program, including SSA, Medicaid, and Medicare.

3. Costs of health and accident policies such as: any payable in lump sum settlements for dismemberment or death, or income maintenance policies covering mortgage or loan payments while the beneficiary is disabled.

4. Loan repayments for anything other than the loan's principal.

5. Premiums for nursing home insurance policies that would not be used to cover allowed medical expenses.

6. Lying in costs for the birth of a child.

7. Special diets whether or not the diet is related to a medical condition.

8. Prescribed medical marijuana.

9. Expenses paid by or to be paid by a transportation vendor or other third party.

10. The monthly cost for internet access/subscription.

4.6.4.3 Budgeting Medical Expenses including Medicaid Deductible Expenses

Medical expenses for elderly, blind, or disabled members may be entered through one of the following budgeting methods:

• Budgeted as a recurring monthly expense,
• Budgeted as a one-time lump sum expense for one month,
• Budgeted for the remainder of a FoodShare certification period,
• Budgeted based on the terms of a payment plan, or
• Averaged over the time period a one-time medical expense was intended to cover (such as a prepaid or met medical deductible).

Under all of the budgeting options, the obligation amount (amount incurred) is counted rather than the amount paid. The member may or may not pay the bill, so it is important to make sure that the expense is not counted more than once.

A monthly medical expense obligation budgeted based on the terms of a payment plan can be claimed for as long as the original payment plan is in place. Amounts still due after they were budgeted during a previous FoodShare certification period may not be included as part of the monthly expense.

The averaging of the one-time medical expense cannot extend past the certification period in which the expense was originally counted.

Except when an expense is averaged during a certification period, the expense should be budgeted starting with the month it is billed or otherwise becomes due, regardless of when the member intends to pay the expense. Allow the expense in the next possible benefit month.  

For instructions on how to enter allowable medical expenses into CWW, see Process Help, Section 18.2.4 Other Medical Expenses - Medical Expenses Page.

4.6.4.3.1 Deductible Expenses

Deductible expenses actually incurred or anticipated to be incurred on a monthly basis may be used to determine the amount of the FoodShare medical expense deduction. The Medicaid deductible amount itself does not necessarily determine the amount of the FoodShare medical expense deduction and should not automatically be averaged over the FoodShare certification period to arrive at an excess medical expense deduction.  

However, if an individual makes a pre-payment or incurs a one-time medical expense that may be used to meet the Medicaid deductible, they may choose to have the expense budgeted as a lump sum one month deduction, averaged over the remainder of the FoodShare certification period, averaged over the period it was intended to cover (the deductible period), or budgeted based on the terms of a payment plan (if a payment agreement exists).

4.6.4.3.2 Examples

Example 5

IM worker is processing a FoodShare application for Ernie. Ernie is disabled. He has provided verification of an outstanding payment agreement for dental care he received. The terms of the payment agreement include a repayment obligation of $40 per month for 24 months. Ernie has been making his monthly payments and has 17 months remaining in his payment plan (total remaining responsibility of $680). The remaining obligation of $680 is an allowable deduction. The $280 that Ernie has already paid is not an allowable deduction.

 

Example 6

IM worker Cory is processing an application for Alena, a disabled FoodShare member in October. Alena has an outstanding hospital bill from September with a remaining patient responsibility of $230 and November due date. Alena may choose to have the expense budgeted as a lump sum for one month or budgeted over the FoodShare certification period. After discussing the budgeting options for FoodShare with Alena, Cory determines that budgeting the expense for one month (the month of November) will result in the best outcome for Alena.

 

Example 7

A food unit member has a Medicaid deductible of $400 for a six-month Medicaid certification period. Based on the verified medical expenses in the previous six months, the person anticipates he will incur $100 per month in medical expenses. Enter $100 in expenses on the Medical Expenses page and CWW will allow $65 in excess medical expenses for each month ($100 - $35 = $65). When the FoodShare/Medicaid assistance group member meets the Medicaid deductible and Medicaid opens, the IM worker should remove the monthly excess medical deduction. Remember to check the medical expense screens whenever Medicaid opens and adjust the expenses accordingly.

 

Example 8

A food unit member who is disabled has a Medicaid deductible of $600. He meets the deductible with a one-time expense of $850. He chooses to average the expense over the period it was intended to cover. The IM worker averages the non-reimbursable portion of the expense, $600, over the remaining months of the Medicaid deductible period.

 

Example 9

A member is certified for 12 months for FoodShare and six months for Medicaid with an $800 deductible. During month two, the member incurs a one-time medical expense of $4,000. The Medicaid deductible is met and the person becomes eligible for Medicaid for the rest of the Medicaid certification period. The non-reimbursable amount is $800 since Medicaid pays the remainder of the bill after the deductible is met. For purposes of FoodShare eligibility, they can do one of these: Choose to have the entire non-reimbursable expense ($800) applied to one month as an excess expense in the next possible benefit month. Enter into a payment plan with the provider and the incurred monthly payment amount due is used to determine the excess medical expense. The payment plan can extend beyond the FoodShare certification period as long as no part of the medical expense is counted more than once. For instance, if the payment plan calls for $40 payments to be made each month for 20 months, the $40 expense can be counted each month for 20 months. However, if the member falls behind in the payment plan and in the 21st month enters into a second payment plan to cover the remaining balance, do not allow the remaining balance as a medical expense because it was already deducted during the previous 20 months. Request that the $800 be averaged over the remaining 10 months of the FoodShare certification period. In which case, the monthly excess medical expense deduction would be: $80 - $35 = $45 each month for 10 months. Request that the $800 be averaged over the remaining four months of the Medicaid certification period, or the period the expense is intended to cover. In which case, the monthly excess medical expense deduction would be $200 - $35 = $165 each month for four months.

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Publication Number: P-16001