361.5 Medical Expense Deductions

Certain paid and unpaid medical expenses for members of an applicant/recipient group may be deducted from income when determining eligibility for MNO (see Appendix B). Allowable medical expenses must be in the retroactive period.    

  55 Pa. Code § 181.14(d)

NOTE:  There are three Medical Coverage (MCV) Codes to choose from on CAMEDX in CIS or Expenses/Medical in e-CIS. The correct use of these codes is instrumental in the determination of spend-down and patient pay liability. The three codes and their descriptions are as follows:

Reminder: When determining net income, the CAO must deduct expenses for medical and remedial care for members of an applicant/recipient group that are paid by a public program (other than MA) of a state, including programs run by political subdivisions of the state.

If the net income of an applicant/recipient group is more than the income limit in Chapter 369, Appendix A, the CAO must allow deductions from net income for certain paid and unpaid medical expenses to reduce the amount of income that is over the limit.

361.51 Unpaid medical expenses

A medical expense is an allowable deduction if the following requirements are met:     

  55 Pa. Code § 181.14(d)(1)

NOTE:    When legal action is being taken for third-party coverage (for example, a Workers Compensation claim has been filed) and the case is not likely to be settled within thirty days, the coverage cannot be considered available for payment of a individual’s medical bills. The medical bills can be considered an unpaid expense, and a deduction can be given for those medical bills. When the legal action is settled, if the third-party coverage is approved, the CAO must treat the approval as a change in the individual’s situation. It will complete a renewal determination of the individual’s MA eligibility and send information about the case and the third-party coverage to:

Third-Party Liability
P.O. Box 8486
Harrisburg, PA 17105

NOTE: The medical expense may be for someone other than a member of the applicant/recipient group. The CAO must use the expense only if a member is held legally responsible for payment.

NOTE:  For medical insurance premiums, the date of the expense is the date when the bill was issued.

NOTE:  A payment plan is not required, but the individual must show proof that the bill has not been written off by the provider and payment is still required.

For continuing MNO, the CAO must count unpaid expenses from the retroactive period or unpaid expenses that are expected in the six-month period.

55 Pa. Code § 181.14(d)(1)

361.52 Paid Medical Expenses

A paid medical expense is an allowable deduction if the following conditions are met:     

   55 Pa. Code § 181.14(d)(2)

For retroactive or continuing MNO, the CAO must use expenses that were paid in any of the retroactive months or in the month of application.

55 Pa. Code § 181.14(d)(3)(iii)

Example: A case’s renewal due date is April 30. All required documents are received by the CAO on April 28. The CAO does not complete the renewal until May 15. The CAO can use any medical bills paid through May 15 to determine continuing eligibility.

The CAO must use the actual medical expenses that were charged or paid in a calendar month.     

  55 Pa. Code § 181.14(d)

Example: A quarterly insurance premium can be used only in the month when it was charged or paid.

The CAO must deduct the following medical expenses:

NOTE:  The CAO may need to contact the medical provider to determine whether the individual has to pay an entire bill or only the part not covered by Medicare or medical insurance.

NOTE:  When determining on a individual’s MA eligibility, the CAO must deduct any medical insurance premiums through the spend-down process. When a Health Insurance Premium Payment (HIPP) referral results in HIPP covering the premium and the individual’s income is over the income limit for MA, the individual is still eligible because the insurance premium is still considered a deduction.

NOTE:  The copayment deduction is subject to the copayment fee set by the DHS. See Chapter 338, Medical Assistance Benefits, Appendix D, for a list of the copayment amounts for medical services.

The payment for each prescription for a individual who is eligible for the Pharmaceutical Assistance Contract for the Elderly (PACE) program.

 55 Pa. Code § 181.14(e)(3)

The individual has good cause for not being in the program. Good cause includes, but is not limited to, the following:

NOTE:  Payment for aspirin, nutritional supplements or other over-the-counter drugs can be allowed if a doctor says that the individual needs the drug for a physical or mental condition.

NOTE:  Burial and individual care home costs are not medical expenses and cannot be used as deductions when determining a individual’s eligibility.

NOTE:  This includes patient-pay amounts from earlier periods of MNO eligibility, if they are in the allowable retroactive period. See Chapter 369, Determining Eligibility for MNO, Section 369.13.

If a individual has no or limited medical expenses when he or she applies, the CAO must let the individual know that medical expenses can be used when he or she applies in the future. The medical expenses must be within the allowable time periods. (See Appendix B.)

 

Updated February 14, 2012, Replacing January 13, 2009