SOCIAL AND HEALTH SERVICES
(Health and Recovery Services Administration)
Supplemental Notice to WSR 09-01-181.
Preproposal statement of inquiry was filed as WSR 08-19-032.
Title of Rule and Other Identifying Information: Amending WAC 388-519-0100 Eligibility for the medically needy program and 388-519-0110 Spenddown of excess income for the medically needy program; and other related rules as appropriate.
Hearing Location(s): Office Building 2, Auditorium, DSHS Headquarters, 1115 Washington, Olympia, WA 98504 (public parking at 11th and Jefferson. A map is available at
or by calling (360) 664-6094), on March 10, 2009, at 10:00 a.m.
Date of Intended Adoption: Not sooner than March 11, 2009.
Submit Written Comments to: DSHS Rules Coordinator, P.O. Box 45850, Olympia, WA 98504-5850, delivery 4500 10th Avenue S.E., Lacey, WA 98503, e-mail DSHSRPAURulesCoordinator@dshs.wa.gov, fax (360) 664-6185, by
5 p.m. on March 10, 2009.
Assistance for Persons with Disabilities: Contact Jennisha Johnson, DSHS rules consultant, by February 24, 2009, TTY (360) 664-6178 or (360) 664-6094 or by e-mail at firstname.lastname@example.org.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Clarifying text was inadvertently left out of the proposed rule filed under WSR 09-01-181 on December 24, 2008. In WAC 388-519-0100 (5)(d), additional text has been added to include language clarifying eligibility for income deductions.
Reasons Supporting Proposal: To comply with federal regulations and provide program transparency.
Statutory Authority for Adoption: RCW 74.04.050, 74.04.055, 74.04.057, 74.08.090, and 74.09.500.
Statute Being Implemented: 42 C.F.R. 435.831 (3)(e) and (f).
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Department of social and health services, governmental.
Name of Agency Personnel Responsible for Drafting: Jonell Blatt, P.O. Box 45504, Olympia, WA 98504-5504, (360) 725-1571; Implementation and Enforcement: Catherine Fisher, P.O. Box 45534, Olympia, WA 98504-5534, (360) 725-1357.
No small business economic impact statement has been prepared under chapter 19.85 RCW. This proposed rule does not increase or impose new costs or otherwise impact small businesses.
A cost-benefit analysis is not required under RCW 34.05.328. Per RCW 34.05.328 (5)[(b)](vii), client eligibility rules for financial and medical assistance programs are exempt from the cost-benefit analysis requirement.
January 27, 2009
Stephanie E. Schiller
A person who meets the institutional status
requirements of WAC 388-513-1320)) Meets the institutional
status requirements of WAC 388-513-1320; (( or))
A person who receives waiver services under chapter 388-515 WAC)) Resides in a medical institution as described in
WAC 388-513-1395; or
(c) Receives waiver services under a medically needy in-home waiver (MNIW) according to WAC 388-515-1550 or a medically needy residential waiver (MNRW) according to WAC 388-515-1540.
MN coverage is considered under this chapter when a
(a) Is not excluded under subsection (1) of this section; and
(b) Is not eligible for categorically needy (CN) medical coverage because they have CN countable income which is above the CN income standard)) An SSI-related individual who lives in a department contracted alternate living facility may be eligible for MN coverage under the rules described in WAC 388-513-1305.
MN coverage is available for children, for persons
who are pregnant or for persons who are SSI-related. MN
coverage is available to an aged, blind, or disabled
ineligible spouse of an SSI recipient even though that
spouse's countable income is below the CN income standard. Adults with no children must be SSI related in order to be
qualified for MN coverage)) An individual may be eligible for
MN coverage under this chapter when he or she is:
(a) Not covered under subsection (1) and (2) of this section; and
(b) Eligible for categorically needy (CN) medical coverage in all other respects except that his or her CN countable income is above the CN income standard.
A person not eligible for CN medical and who is
applying for MN coverage has the right to income deductions in
addition to those used to arrive at CN countable income. The
following deductions are used to calculate their countable
income for MN. Those deductions to income are applied to each
month of the base period and determine MN countable income))
MN coverage may be available if the individual is:
All health insurance premiums expected to be paid
by the client during the base period are deducted from their
income)) A child; (( and))
For persons who are SSI-related and who are
married, see the income provisions for the nonapplying spouse
in WAC 388-450-0210)) A pregnant woman; (( and))
For persons who are not SSI-related and who are
married, an income deduction is allowed for a nonapplying
(i) If the nonapplying spouse is living in the same home as the applying person; and
(ii) The nonapplying spouse is receiving community and home based services under chapter 388-515 WAC; then
(iii) The income deduction is equal to the one person MNIL less the nonapplying spouse's actual income)) A refugee;
(d) An SSI-related individual including an aged, blind or disabled individual with countable income under the CN income standard, who is an ineligible spouse of an SSI recipient; or
(e) A hospice client with countable income which is above the special income level (SIL).
A person who meets the above conditions is eligible
for MN medical coverage if their MN countable income is at or
below the medically needy income level (MNIL) in WAC 388-478-0070. They are certified as eligible for up to twelve
months of MN medical coverage. Certain SSI or SSI-related
clients have a special MNIL. That MNIL exception is described
in WAC 388-513-1305)) An individual who is not eligible for CN
medical and who is applying for MN coverage has the right to
income deductions in addition to, or instead of, those used to
arrive at CN countable income. Deductions to income are
applied to each month of the base period to determine MN
countable income. The following deductions are used to
calculate countable income for MN:
(a) All health insurance premiums, with the exception of medicare Part A, Part B, Part C and Part D premiums expected to be paid by the individual during the base period(s);
(b) Any allocations to a spouse or to dependents for an SSI-related individual who is married or who has dependent children. Rules for allocating income are described in WAC 388-475-0900;
(c) For an SSI-related individual who is married and lives in the same home as his or her spouse who receives home and community based waiver services under chapter 388-515 WAC, an income deduction equal to the medically needy income level (MNIL) minus the nonapplying spouse's income; and
(d) A child or pregnant woman who is applying for MN coverage is eligible for income deductions allowed under TANF/SFA rules and not under the rules for CN programs based on the federal poverty level. See WAC 388-450-0210(4) for exceptions to the TANF/SFA rules which apply to medical programs and not to the cash assistance program.
A person whose MN countable income exceeds the MNIL
may become eligible for MN medical coverage when they have or
expect to have medical expenses. Those medical expenses or
obligations may be used to offset any portion of their income
which is over the MNIL)) The MNIL for individuals who qualify
for MN coverage under subsection (1) of this section is based
on rules in chapter 388-513 and 388-515 WAC.
That portion of a person's MN countable income
which is over the department's MNIL standard is called "excess
income.")) The MNIL for all other individuals is described in
WAC 388-478-0070. If an individual has countable income which
is at or below the MNIL, he or she is certified as eligible
for up to twelve months of MN medical coverage.
When a person has or will have "excess income" they
are not eligible for MN coverage until they have medical
expenses which are equal in amount to that excess income. This is the process of meeting "spenddown)) If an individual
has countable income which is over the MNIL, the countable
income that exceeds the department's MNIL standards is called
(9) When individuals have "excess income" they are not eligible for MN coverage until they provide evidence to the department of medical expenses incurred by themselves, their spouse or family members who live in the home for whom they are financially responsible. See WAC 388-519-0110(8). An expense has been incurred when:
(a) The individual has received the medical treatment or medical supplies, is financially liable for the medical expense but has not yet paid the bill; or
(b) The individual has paid for the expense within the current or retroactive base period described in WAC 388-519-0110.
(10) Incurred medical expenses or obligations may be used to offset any portion of countable income that is over the MNIL. This is the process of meeting "spenddown."
(11) The department calculates the amount of an individual's spenddown by multiplying the monthly excess income amount by the number of months in the certification period as described in WAC 388-519-0110. The qualifying medical expenses must be greater than or equal to the total calculated spenddown amount.
(12) An ((
person)) individual who is considered for MN
coverage under this chapter may not spenddown excess resources
to become eligible for the MN program. Under this chapter (( a
person is)) individuals are ineligible for MN coverage if
their resources exceed the program standard in WAC 388-478-0070. (( A person)) An individual who is considered
for MN coverage under (( chapter 388-513)) WAC 388-513-1395,
388-505-0250 or 388-505-0255 is allowed to spenddown excess
(10) No extensions of coverage or automatic
redetermination process applies to MN coverage. A client must
submit an application for each eligibility period under the MN
(13) There is no automatic redetermination process for MN coverage. An individual must submit an application for each eligibility period under the MN program.
(14) An individual who requests a timely administrative hearing under WAC 388-458-0040 is not eligible for continued benefits beyond the end of the original certification date under the medically needy program.
[Statutory Authority: RCW 74.04.050, 74.04.055, 74.04.057 and 74.08.090. 98-16-044, § 388-519-0100, filed 7/31/98, effective 9/1/98. Formerly WAC 388-503-0320, 388-518-1840, 388-519-1930 and 388-522-2230.]4022.4
(2) A ((
person's)) base period begins on the first day of
the month (( of application)), in which an individual applies
for medical assistance, subject to the exceptions in
subsection (4) of this section.
(3) An individual may request a separate base period
may be made for a retroactive period. The retroactive base
period is made up of the)) to cover the time period up to
three calendar months immediately prior to the month of
application. This is called a retroactive base period.
(4) A base period may vary from the terms in subsections (1), (2), or (3) of this section if:
(a) A three month base period would overlap a previous eligibility period; or
A client is not or will not be resource eligible
for the)) The individual has countable resources that are over
the applicable standard for any part of the required base
(c) The client is not or will not be able to meet the TANF-related or SSI-related requirement for the required base period; or
(d) The ((
client)) individual is (( or will be)) eligible
for categorically needy (CN) coverage for part of the required
base period; or
(e) The client was not otherwise eligible for MN coverage for each of the months of the retroactive base period.
The amount of a person's ")) An individual's
spenddown(( ")) liability is calculated by the department. The
MN countable income from each month of the base period is
compared to the medically needy income level (MNIL). (( The
excess income from each of the)) Income which is over the MNIL
(based on the individual's household size) in each month(( s))
in the base period is added together to determine the total
(( "))spenddown(( " for the base period)) amount. The MNIL
standard is found at
http://www.dshs.wa.gov/pdf/esa/manual/standards_C_MedAsstChart.pdf and is updated annually in January.
(6) If household income varies and ((
a person's)) an
individual's MN countable income falls below the MNIL for one
or more months, the difference is used to offset the excess
income in other months of the base period. If this results in
a spenddown amount of zero dollars and cents, see WAC
(( 388-519-0100(5))) 388-519-0100(7).
Once a person's spenddown amount is known, their
qualifying medical expenses are subtracted from that spenddown
amount to determine the date of eligibility. The following
medical expenses are used to meet spenddown:
(a) First, Medicare and other health insurance deductibles, coinsurance charges, enrollment fees, or copayments;
(b) Second, medical expenses which would not be covered by the MN program;
(c) Third, hospital expenses paid by the person during the base period;
(d) Fourth, hospital expenses, regardless of age, owed by the applying person;
(e) Fifth, other medical expenses, potentially payable by the MN program, which have been paid by the applying person during the base period; and
(f) Sixth, other medical expenses, potentially payable by the MN program which are owed by the applying person)) If an individual's income decreases, the department approves CN coverage for each month in the base period when the individual's countable income and resources are equal to or below the applicable CN standards. Children under the age of nineteen and pregnant women who become CN eligible in any month of the base period remain continuously eligible for CN coverage for the remainder of the certification even if there is a subsequent increase in income.
If a person meets the spenddown obligation at the
time of application, they are eligible for MN medical coverage
for the remainder of the base period. The beginning date of
eligibility would be determined as described in WAC 388-416-0020)) Once an individual's spenddown amount has been
determined, qualifying medical expenses are deducted. To be
considered a qualifying medical expense, the expense must:
(a) Be an expense for which the individual is financially liable;
(b) Not have been used to meet another spenddown;
(c) Not be the confirmed responsibility of a third party. The department allows the entire expense if the third party has not confirmed its coverage of the expense within:
(i) Forty-five days of the date of service; or
(ii) Thirty days after the base period ends.
(d) Be an incurred expense for the individual:
(i) The individual's spouse;
(ii) A family member, residing in the home of the individual, for whom the individual is financially responsible; or
(iii) A relative, residing in the home of the individual, who is financially responsible for the individual.
(e) Meet one of the following conditions:
(i) Be an unpaid liability at the beginning of the base period;
(ii) Be for medical services either paid or unpaid and incurred during the base period;
(iii) Be for medical services incurred and paid during the three month retroactive base period if eligibility for medical assistance was not established in that base period. Paid expenses that meet this requirement may be applied towards the current base period; or
(iv) Be for medical services incurred during a previous base period and either unpaid or paid for, if it was necessary for the individual to make a payment due to delays in the certification for that base period.
If a person's spenddown amount is not met at the
time of application, they are not eligible until they present
evidence of additional expenses which meets the spenddown
amount)) An exception to the provisions in subsection (8) of
this section exists for qualifying medical expenses that have
been paid on behalf of the individual by a publicly
administered program during the current or the retroactive
base period. The department uses the qualifying medical
expenses to meet the spenddown liability. To qualify for this
exception the program must:
(a) Not be federally funded or make the payments from federally matched funds;
(b) Not pay the expenses prior to the first day of the retroactive base period; and
(c) Provide proof of the expenses paid on behalf of the individual.
To be counted toward spenddown, medical expenses
must)) Once the department has determined that the expenses
meet the definition of a qualified expense as defined in
subsection (8) or (9) of this section, the expenses are
subtracted from the spenddown liability to determine the date
the individual is eligible for medical coverage to begin.
Qualifying medical expenses are deducted in the following
Not have been used to meet a previous spenddown))
First, medicare and other health insurance deductibles,
coinsurance charges, enrollment fees, copayments and premiums
that are the individual's responsibility under medicare Part
A, Part B, Part C and Part D. (Health insurance premiums are
income deductions under WAC 388-519-0100(5)); (( and))
Not be the confirmed responsibility of a third
party. The entire expense will be counted unless the third
party confirms its coverage within:
(i) Forty-five days of the date of the service; or
(ii) Thirty days after the base period ends; and
(c) Meet one of the following conditions:
(i) Be an unpaid liability at the beginning of the base period and be for services for:
(A) The applying person; or
(B) A family member legally or blood-related and living in the same household as the applying person.
(ii) Be for medical services either paid or unpaid and incurred during the base period; or
(iii) Be for medical services paid and incurred during a previous base period if that client payment was made necessary due to delays in the certification for that base period)) Second, medical expenses incurred and paid by the individual during the three month retroactive base period if eligibility for medical assistance was not established in that base period;
(c) Third, current payments on, or unpaid balance of, medical expenses incurred prior to the current base period which have not been used to establish eligibility for medical coverage in any other base period. The department sets no limit on the age of an unpaid expense; however, the expense must still be a current liability and be unpaid at the beginning of the base period;
(d) Fourth, other medical expenses that would not be covered by the department's medical programs, minus any third party payments which apply to the charges. The items or services allowed as a medical expense must have been provided or prescribed by a licensed health care provider;
(e) Fifth, other medical expenses which have been incurred by the individual during the base period that are potentially payable by the MN program (minus any confirmed third party payments that apply to the charges), even if payment is denied for these services because they exceed the department limits on amount, duration or scope of care. Scope of care is described in WAC 388-501-0060 and 388-501-0065; and
(f) Sixth, other medical expenses that have been incurred by the individual during the base period that are potentially payable by the MN program (minus any confirmed third party payments that apply to the charges) and that are within the department limits on amount, duration or scope of care.
An exception to the provisions in subsection (10)
of this section exists. Medical expenses the person owes are
applied to spenddown even if they were paid by or are subject
to payment by a publicly administered program during the base
period. To qualify, the program cannot be federally funded or
make the payments of a person's medical expenses from
federally matched funds. The expenses do not qualify if they
were paid by the program before the first day of the base
period)) If an individual submits verification of qualifying
medical expenses with his or her application that meets or
exceeds the spenddown liability, he or she is eligible for MN
medical coverage for the remainder of the base period unless
their circumstances change. See WAC 388-418-0005 to determine
which changes must be reported to the department. The
beginning of eligibility is determined as described in WAC 388-416-0020.
The following medical expenses which the person
owes are applied to spenddown. Each dollar of an expense or
obligation may count once against a spenddown cycle that leads
to eligibility for MN coverage:
(a) Charges for services which would have been covered by the department's medical programs as described in WAC 388-501-0060 and 388-501-0065, less any confirmed third party payments which apply to the charges; and
(b) Charges for some items or services not typically covered by the department's medical programs, less any third party payments which apply to the charges. The allowable items or services must have been provided or prescribed by a licensed health care provider; and
(c) Medical insurance and Medicare copayments or coinsurance (premiums are income deductions under WAC 388-519-0100(4)); and
(d) Medical insurance deductibles including those Medicare deductibles for a first hospitalization in sixty days)) If an individual cannot meet the spenddown amount at the time the application is submitted, the individual is not eligible until he or she provides proof of additional qualifying expenses that meet the spenddown liability.
(13) Each dollar of a qualifying medical expense((
(( be used more than once if)) count once against a spenddown
period that leads to eligibility for MN coverage. However,
medical expenses may be used more than once under the
(a) The ((
person)) individual did not meet (( their)) his
or her total spenddown (( amount)) liability and (( did not))
become eligible in (( that)) a previous base period and the
bill remains unpaid; (( and)) or
(b) The medical expense was ((
applied to that
unsuccessful spenddown and remains an unpaid)) a bill incurred
and paid within three months of the current application and
the department could not establish eligibility for medical
assistance for the individual in the retroactive base period.
To be considered toward spenddown, written proof
of)) The individual must provide the proof of qualifying
medical expenses (( for services rendered to the client must be
presented)) to the department. The deadline for
(( presenting)) providing medical expense information is thirty
days after the base period ends unless there is a good
(( cause)) reason for delay (( can be documented)).
The medical expenses applied to the spenddown
amount are the client's financial obligation and are not
reimbursed by the department (see WAC 388-502-0100).
(16))) Once ((
a person)) an individual meets (( their))
the spenddown (( and they are issued a medical identification
card for MN coverage)) requirement and the certification begin
date has been established, newly identified expenses cannot be
considered toward that spenddown unless there is a good reason
for the delay in submitting the expense or there was a
department error in determining the correct begin date. (( Once the application is approved and coverage begins the
beginning date of the certification period cannot be changed
due to a clients failure to identify or list medical
(16) Good reasons for delay in providing medical expense information to the department include, but are not limited to:
(a) The individual did not receive a timely bill from his or her medical provider or insurance company;
(b) The individual has medical issues that prevents him or her from submitting proof in a timely manner; or
(c) The individual meets the criteria for needing a supplemental accommodation under chapter 388-472 WAC.
(17) The department is not responsible to pay for any expense or portion of an expense that has been assigned to an individual's spenddown liability. If an expense is potentially payable under the MN program, and only a portion of the medical expense has been assigned to meet spenddown, the medical provider may not bill the individual for more than the amount which was assigned to the remaining spenddown liability. See WAC 388-502-0160 Billing a client.
(18) The department determines whether any payment is due to the medical provider on medical expenses that have been partially assigned to meet a spenddown liability, according to WAC 388-502-0100.
(19) If the medical expense assigned to spenddown was incurred outside of a period of MN eligibility, or if the expense is not the type that is covered by the department's medical assistance programs, the department is not responsible for any portion of the bill.
[Statutory Authority: RCW 74.04.050, 74.08.090, 74.09.530, and 74.09.700. 06-24-036, § 388-519-0110, filed 11/30/06, effective 1/1/07. Statutory Authority: RCW 71.05.560, 74.04.050, 74.04.057, 74.08.090, 74.09.500, 74.09.530. 06-13-042, § 388-519-0110, filed 6/15/06, effective 7/16/06. Statutory Authority: RCW 74.04.050, 74.04.055, 74.04.057, and 74.08.090. 05-08-093, § 388-519-0110, filed 4/1/05, effective 5/2/05; 98-16-044, § 388-519-0110, filed 7/31/98, effective 9/1/98. Formerly WAC 388-518-1830, 388-518-1840, 388-519-1905, 388-519-1910, 388-519-1930 and 388-522-2230.]