Section 1040. Spenddown calculation

A. When countable income exceeds the Medically Needy Income Level (MNIL) for the budget period, certain medical and remedial care expenses incurred by an individual, family or financially responsible relative that are not subject to payment by a third party unless the third party is a public program of a state or territory or political subdivision of a state or territory shall be deducted from countable income.

B. Medical and remedial care expenses paid by a public program (other than a Medicaid program) of a state or territory shall be deducted from countable income. Once countable income is reduced (by applying these deductions) to an amount equal to the MNIL, the individual or family shall be income eligible.

C. Reasonable measures to determine the legal liability of third parties to pay for incurred expenses shall be taken. However, eligibility determination shall not be forestalled simply because third party liability cannot be ascertained or payment by the third party has not been received.

D. The time standards for reaching decisions on Medicaid eligibility must be met when determining eligibility through spenddown: 90 days for applicants who apply on the basis of disability and 45 days for all other applicants. These limits shall apply for receipt of third party payment or verification of third party intent to pay in order to determine deductible expenses under spenddown. Efforts to determine the liability of a third party shall continue through the last day of this period. If information regarding third party liability is not received by this date, eligibility must be established based upon the information available.

E. If the amount subject to payment by a third party cannot be determined based on information available, the bill in question to which the third party liability applies cannot be used in determining the spenddown. However, if information becomes available at a later date, the spenddown shall be recalculated and the effective date of eligibility revised.

Historical Notes

Derived from VR460-10-8.2600 § 3, eff. April 30, 1995; amended, Volume 25, Issue 14, eff. April 15, 2009.

Statutory Authority

§§ 32.1-324 and 32.1-325 of the Code of Virginia.