PM 13-01-05-a: Allowable Medical Expenses

WAG 13-01-05-a

Medical expenses are not allowed if:

• reimbursable by insurance or a third party, or
• paid by a vendor payment, or
• paid by a non Food Assistance household member unless the amount paid is counted as income.

Allowable Medical Expenses

Regardless of intent to pay, allowable medical expenses include, but are not limited to, bills received or expected to be received for the following services:

• Medical and dental care.
• Psychotherapy and rehabilitation services provided by a state licensed practitioner or other qualified health professional.
• The cost for acupuncture, massage therapy, or herbs prescribed for therapeutic purposes, if a state licensed practitioner or other qualified health professional prescribes or approves as an alternative therapy or medicine. The cost for the practitioner and the therapy or medicine may be allowed as a medical expense, if it cannot be otherwise purchased with Food Assistance benefits and is not prescribed as a part of a special diet.
• Hospitalization or outpatient treatment.
• Nursing care or nursing home care including bills received by the household for a person who was a household member immediately before entering the hospital or nursing home.
• Prescribed drugs, including insulin and other over the counter medications when approved by a physician or other qualified health professional.
• Postage for mail order prescription drugs is an allowable medical expense.
• Cost of medical supplies, sickroom equipment, including rental, or other prescribed equipment.
• Adaptive equipment in vehicles and homes as well as monthly telephone fees for amplifiers and warning signals for elderly or disabled individuals (PM 05-06-01) and the costs of telecommunications devices for the elderly or disabled.
• Health and hospitalization insurance policy premiums.

  NOTE: Do not allow for the costs of:

  • health and accident policies such as those payable in a lump sum for death or dismemberment, or
  • income maintenance policies such as those that make mortgage or loan payments while the beneficiary is disabled, or
  • health insurance premiums paid by the Health Insurance Premium Payment (HIPP) Program.
• Insurance premiums for policies intended to cover cancer treatments.
• Insurance premiums for ambulance insurance policies.
• Payments made on a conventional loan when the loan is used to pay a one-time only medical expense, but loan expenses such as interest are not allowed as part of the deduction. If a mortgage is obtained for the purpose of financing a large medical expense, the mortgage payment should be allowed as a shelter cost and is not allowed as a medical expense.
• Medicare premiums, Supplementary Medical Insurance Benefits (SMIB), and/or the Hospital Insurance Benefits (HIB), regardless of whether the qualifying member pays the premium directly or has it deducted from their Social Security check. Do not allow costs for Medicare SMIB and/or HIB premiums, if the person is enrolled in the Department of Healthcare and Family Service (HFS) SMIB/HIB buy-in agreement, or in the QMB or SLIB program. 
• Pay-in Spenddown payments. Pay-in Spenddown payments are centrally entered by the system see (PM 13-01-05-f and WAG 13-01-05-f).
• Dentures, hearing aids, and prosthetics.
• Cost of securing and maintaining an animal specially trained to serve the needs of a disabled person. When determining the cost, include the cost of food, veterinary bills, and other maintenance costs.
• Contact lens or eyeglasses prescribed by an optometrist or a physician trained in eye disease.
• Physician's charges to complete medical or insurance reports.
• Reasonable cost of transportation and/or lodging to obtain needed medical treatment or services. If the household's automobile is used for medical transportation, the allowable rate is $.24 per mile. Transportation and lodging costs must be verified.
• Costs of maintaining an attendant, homemaker, home health aide, housekeeper, or childcare provider, when needed due to age, infirmity, or illness of a household member. In order to allow the costs, the provider cannot be a Food Assistance household member.

  If a Food Assistance household incurs attendant care costs for an incapacitated person of any age that could qualify as either a medical care deduction or as a dependent care deduction, allow the household the option to choose how the costs will be deducted. The household may choose to deduct the entire attendant care cost as a dependent care deduction or as a medical expense deduction but not both. Discuss with the customer and determine the option that would be most beneficial for them. Incapacitation is:

• In addition to other costs, if the household provides the attendant with a majority of their meals, allow an amount equal to the maximum benefit amount for a one-person Food Assistance household as a medical expense.
• Group home services, such as Community Integrated Living Arrangement (CILA) services, for persons living in group homes. See PM 06-11-02-b for an explanation of CILAs. CILA services are allowable medical expenses, even when the customer resides in their own home. Accept the group home's statement of what portion of the customer's income the group home keeps for shelter expenses, also allow the telephone standard as a utility expense if the household pays for their own private telephone. CILA customers keep a portion of their income as a Personal Needs Allowance (PNA). NOTE: The PNA is not a medical expense. See PM 05-08-09 for information on the current amount of the PNA. Effective January 1, 2026, the PNA will increase annually at the same rate as the Social Security cost-of-living adjustment. After the shelter expenses, PNA, and medical expenses the customer pays out of pocket are accounted for, the remainder of the income is retained by the group home as a medical expense. See WAG 13-01-05.  NOTE: Before deducting additional out of pocket medical expenses from the CILA customer's income, these must be verified.
• Supportive Living Facility (SLF) services. If the resident receives medical assistance, the amount of the medical expense is the SLF credit amount. See WAG 05-11-05.
• Hemp derived CBD (cannabidiol) Oil may be allowed as a medical deduction only if verification is provided that specifically indicates:
  1. a State licensed practitioner or qualifying health professional has approved or prescribed the product; and
  2. certifies that the product contains a delta-9 tetrahydrocannabinol (THC) concentration in an amount that does not exceed 3% on a dry weight basis.
     • When requesting verification from a customer claiming CBD oil as a medical expense, make sure the customer understands what needs to be provided as proof of their usage. Specifically state what is needed on the 267 VCL. If the customer's verification does not specifically include #1 and #2 above, do not allow a medical deduction. There is no exception to this requirement.

NOTE: See PM 13-01-05-e for Medical Expenses not allowed.