Adult Medicaid Manual MA-2250 INCOME

IV. BASE PERIOD

A. Definition of Base Period

The base period is a set time for verification of income when determining eligibility for the certification period. Certain incomes have different base periods. Refer to C. below.

B. Base Period for Applications and Redeterminations

1. Applications

a. Prospective

Unless there is a change, the base period for verifying income for the certification period is the calendar month prior to the month of application. Convert income to a monthly amount. Always convert annual sources of income to a monthly amount (e.g. salaried employee on contract, rental income paid annually, etc.).

b. Retroactive

Verify actual income for the month(s) of retroactive need except for certain incomes listed in C. below and annual sources of income referenced in IV. above. Refer to MA-2370, Retroactive Coverage, regarding retroactive eligibility.

REVISED 11/01/07-CHANGE NO. 22-07

(IV.B.)

2. Redeterminations

Unless there is a change, the base period for computing income for a subsequent certification period is the calendar month prior to the month of the redetermination interview. The base period can:

a. Never be earlier than the 4th month of the current certification period, and

b. Never go beyond the first month of the certification period for which you are determining eligibility.

C. Base Period for Certain Incomes

1. The following types of income have a different base period:

a. Self-Employment - Refer to VII.

b. Rental Income Received other than Monthly - Refer to VIII.

c. Child/Spousal Support/Contributions - Refer to VIII.

d. Child care worker supplements from the Child Care Wages Project - Refer to VII.

e. Farm Income-Refer to VII.

2. Retroactive Medicaid

Always use monthly income computed from the base period (not actual income) when determining eligibility for retroactive Medicaid for these sources of income. The base period for retroactive benefits is the same as for the prospective period.

D. Verifications for Income/Operational Expenses

1. Applications

On the DMA-5097/DMA5097S, Request for Information, always request verification of the income received in the base period. Also, ask for verification of operational expenses paid during the same period.

When processing applications, always follow procedures in MA-2303, Verification Requirements for Applications.

REVISED 11/01/07-CHANGE NO. 22-07

(IV.D.)

2. Redeterminations

On the review letter, always request verification of the income received in the base period. Also ask for verification of operational expenses paid during the same period, if applicable.

3. Client Statement as Verification of Income for Applications and Redeterminations.

Only accept the applicant’s statement as verification of income if:

a. The applicant or IMC cannot obtain the verification from any source, or the source refuses to provide verification or cannot be located, and

b. The statement is not questionable. Do not accept the statement if the applicant/recipient refuses or simply fails to provide the verification of income.

Example 1: The a/r provides a statement but has lost the previous month’s pay stubs. The IMC contacts the employer who refuses under any circumstances to provide verification. Accept the statement of income unless questionable.

Example 2: The a/r provides a statement of income but does not provide pay stubs with the application. The IMC requests proof of income. If the a/r does not return the pay stubs and does not indicate that they are unavailable, the IMC should not approve Medicaid. This is true even if the IMC contacts the employer and he refuses to verify income.

c. Document the reason why the applicant’s statement was accepted and that he has been instructed that for any subsequent applications or redeterminations he will be required to provide proof of his income.

E. Determination of Adjusted Gross Income

Upon receipt of the verified income and operational expenses:

1. Determine the average monthly gross income by adding together the total gross income received during the base period. Divide this by the number of months used in the base period. This is the average monthly gross income.

REVISED 11/01/07-CHANGE NO. 22-07

(IV.E.)

2. Determine the average monthly operational expenses by adding together the operational expenses paid during the base period. Divide this by the number of months used in the base period. This is the average monthly operational expenses.

3. Subtract the average monthly operational expense from the average monthly gross income to determine adjusted gross income. (Refer to IX. for computation). Use this amount to determine eligibility.

F. Conversions

1. Upon receipt of the verified base period income, total the income for each pay/benefit period. Divide by the number of pay periods. This is the average income.

2. Convert the average income to a gross monthly amount.

a. If received weekly, multiply by 4.3.

b. If received bi-weekly, multiply by 2.15.

c. If received semi-monthly, multiply by 2.

d. If received monthly, use the monthly gross.

e. If salaried, and contract renewed annually, divide annual income, etc., by 12.

EXAMPLE: Applicant receives income bi-weekly. On Sept. 7, he received $300 gross and on 9-21, he received $300 gross. $300 plus $300 = $600. Divide $600 by 2 (number of pay periods received and used). This equals $300 (average income). Convert the $300 by multiplying $300 by 2.15 = $645.00 (countable gross monthly income).

REVISED 11/01/07-CHANGE NO. 22-07