Title: Par
Author: Tina M. Freidt
Last saved by: Mark Molesworth
Company: NDDHS

Bismarck, North Dakota	MANUAL LETTER #2900	February 1, 2004

Par.1.  Material Transmitted and Purpose --Transmitted with this Manual Letter are changes to Service Chapter 510, "Medicaid Eligibility Factors."  This manual letter supercedes IM 4896, Submitting Trusts for Review, IM 4912, New Income and Asset Exclusion, IM 4920, Spousal Impoverishment Change, IM 4922, Family Coverage Group Income Disregard, IM 4932, Institutions for Mental Diseases, IM 4939, Spousal Impoverishment Level Changes, and IM 4940, Average Cost of Nursing Facility Care.

05-10-25.  Improper Payments and Suspected Recipient Fraud:

Added a new second paragraph for clarification.

The amount of a recipient error is determined as follows:

1.	For ineligible cases resulting from excess assets, the amount of the overpayment is the lesser of:

a.	The amount of Medicaid payments paid in error on behalf of the Medicaid unit; or

b.	The difference between the actual amount of excess assets and the Medicaid asset limit.

2.	For overpayments resulting from errors related to incorrect recipient liability, the amount of the overpayment is the lesser of:

a.	The amount of Medicaid payments paid in error on behalf of the Medicaid unit; or

b.	The difference between the correct amount of recipient liability and the amount of the recipient liability met by the Medicaid unit.

3.	For overpayments resulting from any other error, the amount of the overpayment is the amount of Medicaid payments paid in error on behalf of the Medicaid unit.

Added a new fourth paragraph for clarification.

Any repayment of an overpayment received at the county agency must be submitted to the Fiscal Administration unit using SFN 828, “Credit Form” (Appendix K).

05-12-05.  Cooperation - Third Party Liability:

Added language to subsection 6 to clarify when an applicant will be ineligible for Medicaid due to failure to cooperate.

6.	When an applicant initially applies for Medicaid, it can usually be assumed that there will be cooperation.  If the recipient then fails to cooperate, without “good cause,” eligibility for that recipient is terminated.  For applications in which a recipient clearly states that he or she will not cooperate, and there is no “good cause,” that recipient is ineligible for Medicaid.  Once the individual begins cooperating, eligibility can be restored or established.  Eligibility can begin retroactively if the individual cooperates for the period to be covered.  If an individual who failed to cooperate, and eligibility was terminated, later reapplies for assistance the individual will remain ineligible until the individual begins to cooperate.  

05-25-15.  Duty to Establish Eligibility:

Changed to clarify that the responsibility to provide information applies to recipients as well as applicants.

It is the responsibility of the applicant or recipient to provide information sufficient to establish the eligibility of each individual for whom assistance is requested, including, but not limited to, the furnishing of a social security number, and the establishing age, identity, residence, citizenship, blindness, disability, and financial eligibility in each of the months in which Medicaid benefits are requested.

05-30-05.  Covered Groups:

Subdivision f of subsection 1 was changed to remove the reference to the reduction in the earned income disregard as there no longer is a reduction. This change incorporates IM 4922.

f.	Families who were eligible under the Family Coverage group in at least three of the six months immediately preceding the month in which the family became ineligible because of the caretaker relative’s hours or earnings from employment.

Subdivision g of subsection 3 was changed to clarify that individuals under age 21 who are in the state hospital must be certified in order to qualify for Medicaid.

g.	Individuals under age twenty-one who have been certified as needing the service, or age sixty-five and over in the state hospital who qualify on the basis of financial eligibility.

05-35-05.  Medicaid Unit:

Subdivision d was added to subsection 2 to identify another instance when a child may be included in the Medicaid unit without being eligible for Medicaid.  This change incorporates IM 4932.

d.	The child is receiving services in the state hospital, the Prairie at St. John’s center, the Stadter Psychiatric Center, or any other institution for mental disease (IMD), and has not obtained certification of need for services in that facility.  

05-35-10.  Deprivation:

Subsection 5 was changed for clarification.

5.	The primary wage earner is the caretaker with the greater current earnings UNLESS the family or agency establishes that the other caretaker had the greater total earnings in the twenty-four month period ending immediately before the month the family became eligible for the Family Coverage group. Total earnings from a period of less than twenty-four months is used when the earnings for the full twenty-four month period are not available. A primary wage earner, once established, remains the primary wage earner as long as the family remains eligible for the Family Coverage group.

05-35-15.  Caretaker Relatives:

A new subsection 3 was added to clarify that a child cannot make two caretakers from different Medicaid units eligible for the same time period.  The remaining subsections were renumbered.

3.	A child may not be considered to be living with more than
one caretaker relative in more than one Medicaid unit for the same time period.

05-35-90.	Application for Other Benefits:

Language was added to subsection 2 to show that pregnant women or newborns that are within their 60 free days of Medicaid coverage, and recipients of Transitional or Extended Medicaid Benefits, are not required to apply for other benefits.  It would make no difference in whether they would be eligible for Medicaid.

2.	Good cause under this section exists if receipt of the annuity, pension, retirement, or disability benefit would result in a loss of health insurance coverage; the recipient is a pregnant woman or a newborn who is within the 60 days of free Medicaid; or the recipient is eligible for Transitional or Extended Medicaid Benefits. Good cause must be documented in the case file.

05-35-100.	Blindness and Disability:

Language was changed in subsection 3 to clarify that only final SSA and SSI determinations of blindness and disability are binding.  Presumptive determinations are not followed.

3.	SSA and SSI final determinations of blindness and disability are binding (42 CFR 435.541) and serve as evidence of the presence or absence of statutory blindness or of disability.  Presumptive determinations of blindness and disability are not final determinations for Medicaid purposes. Eligibility for Medicaid cannot be determined until a final determination is made.  If a final determination will not be made by the Social Security Administration within 90 days after the date of application for Medicaid, the State Review Team will make a determination.

05-35-100.	Sixty Days Free Medicaid for Pregnant Women and Newborns:

Language was added to the last paragraph of subsection 1 to clarify that women who are eligible for Medicaid under a category other than as a pregnant woman, and aliens covered through emergency services, are not entitled to the 60 Days of free Medicaid.

This provision is not available to women who are eligible for Medicaid under any other Medicaid category other than the pregnant women category, or to women who are aliens covered by Medicaid for emergency services.

05-45-35.  Income Disregards and Deductions for the Family Coverage Group:

Language was changed in subsection 2 to identify the change in the earned income deduction to $120 plus 33 1/3% as identified in IM 4922.  

2.	The following disregards and deductions are allowed from earned income:

a.	An employment expense allowance equal to $120 of earned income is deducted from the gross earned income of each employed member of the Medicaid unit;

b.	For each employed member of the unit, a disregard equal to 33 and 1/3% of the balance of earned income (after deducting the employment expense allowance) is disregarded.

05-50-05.   Transitional Medicaid Benefits:

References to the reduction in the earned income disregard were removed from subsections 1 and 2.  Language was also added to subsection 1(b)(iii) to clarify the requirement that the caretaker remain employed when there is more than one caretaker relative. 

	(iii)	The caretaker relative remains employed or shows good cause for not being employed (In families with two caretaker relatives, as long as one of the caretaker relatives remain employed, the provision is met.  If both caretaker relatives stop working, the good cause provision applies to the last one that was employed); and

05-55-05.   Foster Care:

Language regarding the tribe not being a public agency was removed from subsection 2, and a new subsection 5 was added to clarify that to be considered foster care, the child must be considered a foster care child in the state foster care system.  

For Medicaid purposes, a child is not considered to be in foster care unless all of the following requirements are met:

1.	There is a current foster care court order;
2.	A public agency has care, custody, and control of the child;
3.	There is a service plan (permanency plan) in place for the child; 
4.	The child is residing in an approved licensed foster care home or facility; and
5.	The child is a foster care child in the state foster care system through the state's Children and Family Services unit.  (Tribal 638 Foster Care children are not in the state foster care system.)

05-60-25.  Assets Which are Excluded for the Medicare Savings Programs:

The first paragraph of subsection 2(a) was changed to clarify that the cash surrender value of life insurance that is not excluded under the $1500 test may be designated as a burial fund.

The SSI burial provision provides for:

a.	Burial funds of up to one thousand five hundred dollars each, plus earnings on excluded burial funds held for the individual and the individual's spouse are excluded from the date of application. Burial funds may consist of revocable burial accounts, revocable burial trusts, other revocable burial arrangements including the value of installment sales contracts for burial spaces, cash, financial accounts such as savings or checking accounts; or other financial instruments with definite cash value, such as stocks, bonds, the cash surrender value of life insurance not excluded under subsection 3a below, or certificates of deposit. The fund must be unencumbered and available for conversion to cash on very short notice.  The fund may not be commingled with nonburial-related assets and must be identified as a burial fund by title of account or by the applicant or recipient’s statement.

05-65-10.   Definitions for Spousal Impoverishment:

Language was added to subsection 2 to clarify who can be considered a family member.

2.	"Family member" means only minor or dependent children, dependent parents, or dependent siblings of the institutionalized, HCBS or community spouse who are residing with the community spouse.  For purposes of applying this definition, a family member is dependent only if that family member is, and may properly be, claimed as a dependent on the federal income tax return filed by the institutionalized, HCBS, or community spouse.  

A new definition, subsection 5, was added to define the first continuous period.

5.	"First continuous period" means the first period in which an institutionalized spouse requires care in, and enters a medical institution, a nursing facility, or a swing bed, or when a HCBS spouse begins receiving HCBS, and the institutionalized or HCBS spouse is expected to continue to receive that level of care for at least 30 consecutive days.

05-65-15.   Institutionalized Spouse or Home and Community Based Services (HCBS) Spouse Asset Limit:

Subsection 3 was changed to provide clarification and examples were added.

3.	After eligibility has been established, the institutionalized or HCBS spouse must reduce his or her countable assets (solely or jointly owned) to be within the medically needy asset limit ($3,000) not later than the next regularly scheduled redetermination.
If the assets are not reduced to the asset limit by the next regularly scheduled redetermination, the individual's case must be closed. Verification of the reduction in assets must be provided.
When an eligible institutionalized or HCBS spouse exceeds the asset limit due to an increase in the value of, a change in the exclusion of, or the receipt of assets, a new period, until the next regularly scheduled redetermination, may be allowed in order to transfer the excess assets to the community spouse. The amount of assets to which this new period applies is an amount equal to the difference between the current community spouse's asset allowance and the value of assets owned by the community spouse at the time eligibility was established, less the value of assets transferred to the community spouse. 

Example:  The community spouse has an asset allowance of $70,000.  At the time eligibility was established, the community spouse owned $30,000 and the institutionalized spouse transferred $25,000 to the community spouse by the first redetermination.  If the institutionalized spouse received new assets in excess of the $3,000 asset limit, the institutionalized spouse is allowed until the next regularly scheduled redetermination to transfer up to $15,000 to the community spouse ($70,000 less $30,000 owned by community spouse less $25,000 previously transferred to community spouse equals $15,000 that can still be transferred).
This new period is not allowed and additional transfers of countable assets are not allowed if: 
a.	The community spouse had assets equal to the community spouse asset allowance at the time the institutionalized or HCBS spouse became eligible; or
b.	The community spouse has since received assets from the institutionalized or HCBS spouse up to the community spouse asset allowance.

The following examples illustrate:
Example 1:  The community spouse had an asset allowance of $90,000.  At the time of eligibility, the community spouse owned all $90,000 in countable assets.  No additional assets may be transferred to the community spouse.

Example 2:  The community spouse had an asset allowance of $80,000. At the time of eligibility, the community spouse owned $50,000 in countable assets.  The institutionalized spouse has since transferred an additional $30,000 to the community spouse.  The community spouse has received assets up to the community spouse asset allowance so no additional assets may be transferred to the community spouse.  

05-65-20.   Community Spouse Asset Allowance:

This entire section was re-written to distinguish the difference between the spousal share and the community spouse asset allowance, to incorporate IM 4920, IM 4939, and to add examples.

1.	The community spouse asset allowance is computed as of the first continuous period of institutionalization of the institutionalized spouse, or as of the beginning of the first continuous period of receipt of HCBS by a HCBS spouse.
2.	The community spouse asset allowance is determined by first establishing a spousal share.  The spousal share is an amount equal to one half of the total value of all countable assets owned (individually or jointly) by the institutionalized, HCBS, or community spouse.

Example:
If the couple's countable assets are: | The community spouse share is:
$25,000 | $12,500
$90,000 | $45,000
$200,000 | $100,000

From the spousal share, the community spouse asset allowance is established, and is an amount that is equal to the community spouse share, but not less than $18,552, and not more than $92,760, effective January 2004 ($18,132 and $90,660 effective July 2003).

Example:
If the spousal share is: | The community spouse asset allowance is:
$12,500 | $18,552 (at least the minimum)
$45,000 | $45,000
$100,000 | $92,760 (one-half is more than the maximum allowed, so the community spouse gets the maximum)

The community spouse asset allowance may be adjusted by any additional amount transferred under a court order or established through a fair hearing.  Adjustments in the minimum and maximum allowed for a community spouse may also adjust the community spouse asset allowance.

3.	After the institutionalized or HCBS spouse has been determined eligible, the community spouse is no longer subjected to the community spouse asset allowance.

05-65-25.   Assets Which are Excluded for Spousal Impoverishment:

The first paragraph of subsection 2(a) was changed to clarify that the cash surrender value of life insurance that is not excluded under the $1500 test may be designated as a burial fund.

a.	Burial funds of up to one thousand five hundred dollars each, plus earnings on excluded burial funds held for the individual and the individual's spouse are excluded from the date of application. Burial funds may consist of revocable burial accounts, revocable burial trusts, other revocable burial accounts, arrangements including the value of installment sales contracts for burial spaces, cash, financial accounts such as savings or checking accounts, or other financial instruments with definite cash value, such as stocks, bonds, the cash surrender value of life insurance not excluded under subsection 3a below, or certificates of deposit. The fund must be unencumbered and available for conversion to cash on very short notice. The fund may not be commingled with nonburial-related assets and must be identified as a burial fund by title of account or by the applicant or recipient's statement.

05-65-45.  Asset Assessment Requirement:

Three new paragraphs were added to provide clarification and to incorporate IM 4920.

The asset assessment establishes the spousal share, the community spouse asset allowance, and the amount of assets that must be spent down before Medicaid eligibility can begin.

If an asset assessment is not completed at the time of the first continuous period of stay by the institutionalized or HCBS spouse, the couple may later provide verification of the assets they had at that time.  Only consider those countable assets that the couple can verify as owning at that time to establish the community spouse asset allowance.

Distribution of the asset assessment form requires that one copy be sent to each spouse, one copy be sent to the Economic Assistance division, and one copy is retained at the county.  Economic Assistance can be contacted for a copy of the asset assessment if the institutionalized, or HCBS, spouse applies in the future and the county in which the application is filed does not have a copy.

05-70-20.  Forms of Asset Ownership:

Subsections 1 and 5 were changed to clarify ownership of liquid assets and that an individual’s name on the signature card of some other person’s liquid asset does not make the individual the owner of the account.   

1.	Ownership of real or personal property or accounts can take various forms. The first basic consideration is the distinction between real and personal property. Real property relates to land and those things, such as houses, barns, and office buildings, which are more or less permanently attached to it. Personal property describes all other things which are subject to individual rights. Personal property includes liquid assets, but liquid assets are distinguished from other personal property because liquid assets have a market at a price that may not ordinarily be negotiated between buyer and seller.  Liquid assets include cash, accounts, publicly traded stocks, bonds, and other securities, and commodities for which there is an established market.
	
5.	When an applicant or recipient is a trustee, guardian or conservator, or has a power of attorney responsibility, the applicant or recipient may have legal access or ownership to real or personal property (liquid or nonliquid) that is intended for the benefit of someone else. Likewise, an applicant or recipient may be named on a bank signature card and have the right to sign checks or withdrawal slips on that account without being a joint owner of the account. In these situations, the trustee, guardian or conservator, the power of attorney, or the individual on the bank signature card is not considered to be the owner of the property for Medicaid eligibility purposes.

05-70-30.   Excluded Assets:

Subsection 15 was changed to add payments to children of women Vietnam veterans who are born with certain birth defects as a disregarded asset.  This incorporates IM 4912.

15.	Allowances paid to children of Vietnam veterans who are born with spina bifida, or to children of women Vietnam veterans who are born with certain covered birth defects. This asset must be identifiable and not commingled with other assets.

05-70-50.   Trusts:

Language was added to subsection 3 to identify information that needs to be submitted with the trust when it is sent in for review.  This incorporates IM 4896.

3.  Trusts may, or may not, make income or assets available to an applicant or recipient. Also, when an applicant or recipient creates a trust, assets put into the trust may be a disqualifying transfer. A thorough review of each trust is necessary to determine its effect, if any, on eligibility. Send trusts to the Legal Advisory Unit for review. When trusts are submitted for review, include all appropriate information so the trust may be reviewed in a timely manner.  When requesting a review of a trust document:
a.	Send the complete trust agreement (signed, dated, and notarized) and all pages and attachments; 
b.	Provide verification of the value of each asset owned by the trust when each asset was transferred to the trust; and who transferred the assets to the trust;
c.	Identify who is applying for which benefits (e.g. Medicaid nursing care, Medicaid no-nursing care, etc.); and
d.	Provide any other documents or information you think may be relevant (like schedules, powers of attorney, financial statements, etc.)

05-70-60.   Valuation of Assets:

Language was added to the first paragraph to address situations in which the valuation of an asset from a source offered by an applicant or recipient is greatly different from generally available or published sources.

It is not always possible to determine the value of assets with absolute certainty, but it is necessary to determine a value in order to determine eligibility. The valuation must be based on reasonably reliable information. It is the responsibility of the applicant or recipient, or the persons acting on behalf of the applicant or recipient, to furnish reasonably reliable information. However, because an applicant or recipient may not be knowledgeable of asset values, and particularly because that person may have a strong interest in the establishment of a particular value, whether or not that value is accurate, some verification of value must be obtained. If a valuation from a source offered by an applicant or recipient is greatly different from generally available or published sources, the applicant or recipient must provide a convincing explanation for the differences particularly if the applicant or recipient may be able to influence the person providing the valuation. If reasonably reliable information concerning the value of assets is not made available, eligibility may not be determined.

Subsection 4(c)(ii) was rewritten to provide clarification in situations where an individual has an ownership interest in a life estate, but that individual has a condition that is likely to shorten life expectancy.  

ii.	The life estate and remainder interest tables are based on the anticipated lifetimes of individuals of a given age according to statistical tables of probability.  If the life tenant suffers from a condition likely to cause death at an unusually early age, the value of the life estate decreases and the value of the remainder interest increases.  An individual who requires long-term care, who suffers from a condition that is anticipated to require long-term care within twelve months, or who has been diagnosed with a disease or condition likely to reduce the individual's life expectancy is presumed to suffer from a condition likely to cause death at an unusually early age, and may not rely upon statistical tables of probability applicable to the general population to establish the value of a life estate or remainder interest.  If an individual is presumed to suffer from a condition likely to cause death at an unusually early age, an applicant or recipient whose eligibility depends upon establishing the value of a life estate or remainder interest must provide a reliable medical statement that estimates the remaining duration of life in years.  The estimated remaining duration of life may be used, in conjunction with a life expectancy table, to determine the comparable age for application of the life estate and remainder interest table.

05-80-05.   Definitions (Disqualifying Transfers):

A new subsection 3 was added to define nursing care services.  The remaining subsections were renumbered.

3.	"Nursing care services" means nursing care provided in a medical institution, a nursing facility, a swing bed, the state hospital, or a home and community based services setting.

A third paragraph was added to subsection 5 to further explain the relationship between confidential relationships and fair market value.

The confidential relationship issue is closely tied to fair market value.  When dealing with personal or real property, the fair market value of the property is an estimate of the property's value.  "True" fair market value is established when such property sells for the highest amount possible.  When selling such property to someone who has a confidential relationship with the seller, the property may not be sold for the highest amount possible, and therefore, the "true" fair market value is not established.  The value of the property, for Medicaid purposes, is still an estimate.  When selling such property to someone who does not have a confidential relationship with the seller, the property is more likely to be sold for the highest amount possible, which will establish "true" fair market value, and which may be more less than the estimated fair market value.

The average cost of nursing facility care for 2004 was added to the existing chart.  The rates are $4185 per month, and $137.59 per day.  This addition supersedes IM 4940.

05-80-15.   Penalty Periods:

An example was added to subsection 1 to demonstrate how the monthly and daily period of ineligibility is calculated.

The following example demonstrates how the monthly and daily period of ineligibility is calculated:

Example:  On December 10, 2002, Mr. Brown made a disqualifying transfer of $70,000.  He applied for Medicaid on July 18, 2003.  The average cost of nursing facility care at the time of application is $3945 per month and $129.71 per day.  $70,000 divided by $3945 is 17.74 months.  Seventeen months at $3945 per month is $67,065, leaving $2935 to which the daily rate is applied. $2935 divided by $129.71 is 22.63 days.  Mr. Brown's penalty period is 17 months and 23 days (partial days are rounded up).

05-80-25.   Exceptions to Disqualifying Transfer Provision:

Language was added to subsection 3(a) to limit the amount of assets that can be transferred to a community spouse without penalty.  This is new policy that incorporates policy in the Medicaid administrative rules.

a.	To the individual's spouse or to another for the sole benefit of the individual's spouse, except that transfer to a community spouse may not exceed the limits identified in section 05-65-15, Institutionalized Spouse or HCBS Spouse Asset Limit;

A new subsection 3 (b) was added to clarify that an individual’s spouse can transfer assets to another, such as to a trustee, for the sole benefit of the spouse.  The remaining subdivisions were re-lettered.

b.	From the individual's spouse to another for the sole benefit of the individual's spouse;

Language was added to subsection 4(d) to clarify that transferred assets that are returned will only end the penalty period if the returned assets do not cause the community spouse to have excess assets above the community spouse asset allowance.  This is new policy that incorporates policy in the Medicaid administrative rules.

d.	All income or assets transferred for less than market value have been returned to the individual.  If all of the income or assets are returned at the time of application, and no periods of eligibility have been established after the date of the original transfer, process the application as if the original transfer never occurred. If all of the income and assets are returned after Medicaid eligibility has already been established (for a period after the date of the original transfer), the period of ineligibility ends as of the date the income or assets are returned, but only if the returned assets do not cause the community spouse to have total countable assets in excess of the community spouse countable asset allowance allowed at the time the institutionalized or HCBS spouse became eligible. In establishing whether all of the income or assets have been returned, the income or assets transferred, or their equivalent value, must be returned.

05-80-35.   Transfers to Relatives for Services Received:

This section was re-written to provide further clarification and new policy, that incorporates policy in the Medicaid administrative rules, on when transfers to relatives for services provided are not disqualifying.  

Where any income or asset is transferred to a relative for services or assistance furnished by the relative, the services or assistance furnished may not be treated as consideration for the transferred income or asset unless:

1.	The transfer is made pursuant to a valid written contract entered into prior to rendering the services; 
2.	The contract was executed by the individual or the individual's fiduciary who is not a provider of services or assistance under the contract;
3.	Compensation is consistent with rates paid in the open market for the services actually provided; and 
4.	The party’s course of dealing included paying compensation upon rendering services or assistance, or within 30 days thereafter.

05-85-15.  Unearned Income:

A new subsection 6(m) was added to identify stipends as a type of unearned income.  The remaining subdivisions were re-lettered.

m.	Stipends received to attend an educational facility or training (other than those stipends specifically excluded for victims of domestic violence in 05-85-30, subsection 30);

Subsection 6(o) (previously 6(n))was re-written to provide clarification on IIM accounts.  The $2000 disregard is a disregard of income that applies to individuals who are not in LTC so was moved to section 05-85-30, Disregarded Income.  This subsection now addresses countable monies deposited in IIM accounts and appropriate verification necessary.

o.	Payments, not otherwise disregarded in section 05-85-30 (relates to income from leases and trust or restricted land for non-LTC and Medicare Savings Programs), that are deposited in Individual Indian Monies (IIM) accounts by the Bureau of Indian Affairs. 
Payments received in either the past twelve months or in the most recent full calendar year may be used to estimate the current IIM payments. If the applicant or recipient demonstrates, by furnishing lease documents or reports, that the deposit amount will be substantially different, current payments may be determined by totaling all payments likely to be made in the twelve-month period beginning with the month in which the lease arrangement changed.
Because the first $2000 per year of income received from leasing of privately owned or restricted Indian lands is disregarded as income for individuals who are not residing in LTC facilities, client statement is acceptable verification of the amount in the IIM account unless one of the following applies:
i.	The balance of the account is more than $2000;
ii.	The client statement information is questionable;
iii.	The deposits include countable income such as inheritances, bonuses, or any other income that is not derived from leases, and trust or restricted lands; or
iv.	The individual resides in a LTC facility.

When additional verification is necessary’ the following three options are available:
i.	A request for verification, using SFN 413, Individual Indian Monies Account.  The form must be notarized before it will be accepted by the Bureau of Indian Affairs (BIA), and is valid for one year.
ii.	Individuals with IIM accounts receive quarterly statements.  A copy of the statement can be requested from the individual.
iii.	The individual may obtain a statement of the individual’s account directly from the Office of Trust Funds Management through the BIA by requesting the information in person or by making a telephone request.  The individual will need to know the account number and provide at least two forms of identification.
IIM account ledgers have columns for:

i.	Debit, which is amounts paid out of the account and which do not affect eligibility; 
ii.	Credit, which is amounts put into the account. This column is used to establish the amount of countable IIM for the year. Consider all deposits for the twelve-month period being looked at and subtract any per capita payments or judgment funds distributed by the Secretary of the Interior, subtract per capita payments distributed by the local tribe, and subtract other non-lease moneys deposited in the accounts. The remaining balance is the lease payments to which the $2,000 disregard is applied; and 
iii.	Balance, which is the amount still in the account. This amount is what is currently in the account and is considered an asset. (This balance may not be available to children under age 18 if they cannot access the account.) 

05-85-20.   Earned Income:

A new paragraph was added to the end of subsection 1 to address bonuses and similar payments.

Bonuses, profit sharing, and other similar payments are not considered lump sum earnings or wages received other than monthly, but an extra payment of earned income based on a productive period, and are considered income in the month received.

Subsection 3(m) was deleted.  This item identified SPED payments as a type of earned income.  While the payments are earned income, the listing caused confusion as most qualified service providers who receive SPED payments are considered self-employed.  Further discussion regarding qualified service providers as self-employed was added to subsection 4(a).

a.	Self-employed individuals whose business does not require the purchase of goods for resale. Examples of this type of business include persons who provide childcare services in their own home, or qualified service providers (who are not employees of a home health agency) who provide HCBS. Such income may be accounted for on a monthly basis, or the income tax return from the previous year may be used if it reflects a full year’s operation. When the tax return is used, one-twelfth of the annual gross income is monthly earnings. The first 25% of the gross monthly earnings shall be disregarded to offset the cost of producing the income and will cover such things as additional food, utilities, supplies, etc. The remaining 75% of gross monthly earnings is the figure to which the appropriate earned income disregards are applied to arrive at monthly net income.

05-85-30.   Disregarded Income:

Language was added to subsection 30 to clarify that training stipends from private charitable organizations for educational programs is disregarded as income.

30.	Training stipends provided to victims of domestic violence by private, charitable organizations, such as the Seeds of Hope Gift Shop or the Abused Adult Resource Center, for attending their educational programs;

Subsection 37 was changed to include payments to children of women Vietnam veterans who are born with certain birth defects as disregarded income.  This incorporates IM 4912.

37.	Allowances paid to children of Vietnam veterans who are born with spina bifida, or to children of women Vietnam veterans who are born with certain covered birth defects;

Subsection 40, relating to the $2000 disregard of IIM funds was added to this section, which only identifies disregards of income for individuals who are not in LTC.

40.	The first $2000 per year of lease payments deposited in IIM accounts.

05-100-55.   Medicaid Refund Letter:

This appendix was updated with the current refund letter.

05-100-65.   SFN 200, “Asset Assessment”:

This appendix was updated with the current asset assessment form.

Additional Changes:

The following sections, and some identified above, contain minor typographical or technical corrections, as well as minor wording changes to be consistent with Medicaid administrative rules.  The changes do not contain any new policy or other additions that need mention.

05-05   Definitions
05-10-20.   Assignment of Rights to Recover Medical Costs
05-10-33.   Certificate of Creditable Coverage
05-20-10.   Definitions (Cost-Effective Health Insurance Coverage)
05-20-15.   Applicant’s and Recipient’s Responsibility
05-25-05.   Applications and Redetermination
05-25-10.   Eligibility – Current and Retroactive Decision and Notice
05-25-25.   Decision and Notice
05-30-10.   Applicant’s Choice of Category
05-35-30.   Certification of Need for Children in an Institution for Mental Diseases
05-35-35.   Need
05-35-40.   Age and Identity
05-35-50.   American Indians Born in Canada
05-35-65.   Aliens Lawfully Admitted for Permanent Residence on or After August 22, 1996
05-35-70.   Emergency Services for Non-Citizens
05-35-80.   Social Security Numbers
05-35-85.   State Residence
05-35-95.   Inmates of Public Institutions	
05-35-105.   Incapacity of a Parent
05-40-20.   “Good Cause” – Child Support
05-45-10.   Individuals Covered Family Composition
05-45-30.   Income Considerations for the Family Coverage Group
05-50-10.   Extended Medicaid Benefits
05-55-20.   Subsidized Guardianship Project
05-55-25.   Subsidized Adoption
05-60-05.   General Information (Medicare Savings Programs)
05-60-30.   Income Considerations for the Medicare Savings Programs
05-60-35.   Income Levels for the Medicare Savings Programs 
05-65-30.   Income Considerations for Spousal Impoverishment
05-65-40.   Eligibility for Community Spouse
05-67-05.   General Information (Breast and Cervical Cancer)
05-70-10.   Asset Considerations 
05-70-15.   Asset Limits
05-70-30.   Excluded Assets
05-70-40.   Contractual Rights to Receive Money Payments 
05-75-05.   Ownership in a Business Entity
05-75-10.   Treatment of Conservation Reserve Program Property and Payments
05-80.   Disqualifying Transfer Provisions
05-80-10.   Disqualifying Transfer Provisions
05-80-20.   Hardship Provision
05-80-30.   Transfer of Income
05-80-40.   Presumption of Reason for Transfer
05-85-07.   Medical Payments
05-85-25.   Post Eligibility Treatment of Income
05-85-35.   Income Deductions
05-85-40.   Income Levels
05-85-45.   Determining the Appropriate Income Level in Special Circumstances
05-85-50.   Deeming of Income
05-85-60.   Offset of Recipient Liability
05-90-45.   Budgeting Procedures for SSI Recipients
95-95-10.   Healthy Steps
05-100-100.   Budgeting Workbook

 	Par. 2.  Effective Date – February 1, 2004

Par. 3.  Manual Maintenance – Please replace the entire service chapter 510-05 with the newly revised electronic version.

Carol K. Olson, Executive Director		Manual Letter #2900
North Dakota Department of Human Services	Page  of  Page