Adult Medicaid Manual MA-2261 1/3 REDUCTION

II. 1/3 REDUCTION

If the a/r does not meet criteria in I.A. above, evaluate 1/3 reduction at each application and redetermination.

A. Verification of Expenses

Applications and Redeterminations

Require that the a/r provide proof of expenses (bills, receipts, statements, etc.) If he fails to provide evidence that he is meeting his proportionate share of the household expenses, apply the 1/3 reduced income level.

B. Determining Proportionate Share

If the a/r is living in the home of another and there is no rental agreement nor ownership interest, determine if he pays his proportionate share of household expenses.

1. Total all monthly costs related to food, mortgage, or rental payments, real property taxes, heating fuel, gas, electricity, water, sewer, garbage removal.

a. Divide costs by the number of individuals in the household, including the a/r, to obtain the proportionate share (i.e. a/r lives with a couple who have two children. Divide costs by five).

b. Compare the proportionate share to the amount usually paid by the a/r.

c. Do not apply the 1/3 reduction in the income level if the amount paid by the a/r equals or exceeds his proportionate share.

d. Apply the 1/3 reduction in the income level if:

(1) The amount paid by the a/r is less than his proportionate share, or

(2) The a/r’s income is not enough to pay his proportionate share.

2. Document your decision on the DMA-5008/5007.

C. Income Levels

Refer to the Income Table in MA-2260,Financial Responsibility Regulations PLA, for the appropriate income levels for an individual or couple.