PM 15-08-14
When a person has both countable income and excess resources, countable income is to be applied first to meet a spenddown, then excess resources are applied. Refigure the amount of remaining excess resources available to apply to the cost of care for each month following the first month that a spenddown exists because of excess resources.
Each month as excess resources are applied after countable income to NH or SLF charges, the remaining excess resource amount to be used for the following month(s) is reduced.
To figure the monthly reduction in the excess resource balance for the current month, start with amounts in Step 2.C. and Section K. of the HFS 2500 for the previous month. Subtract countable income paid to the facility from the NH or SLF charges at the private pay rate to get the amount of the monthly resource reduction. Enter this amount on HFS 2500 for the current month. Deduct this amount from excess nonexempt resources to figure excess resources available to apply to the cost of NH or SLF care for the current month.
Example 1: Mr. S has been a resident of a nursing home since March. He applies for medical benefits in June. All eligibility requirements are met effective June. He does not want backdated medical eligibility.
Monthly countable income is $900. Excess resources are $2,000 over the resources limit. The private pay rate is $2,800. The HFS rate is $2,500. Mr. S is approved effective June as a long term care spenddown case.
Effective June, the long term care spenddown is $2,900. This amount is the sum of the monthly countable income ($900) plus the excess resources ($2,000). The $2,900 NH charge is applied to the spenddown. Mr. S presents $250 in additional medical costs. Spenddown is met for June.
Effective July, change the case to NH credit because the $2,000 in excess resources was considered towards the June spenddown which was met. This applies whether or not the excess resource is actually reduced. The HFS rate is $2,500. The NH credit amount for July and thereafter is the $900 monthly countable income.
Example 2: In this example countable income is applied first to NH charges, then excess resources are applied. The monthly countable income is $500. Mrs. J has excess resources of $2,500. The private pay rate is $1,500. The case is approved effective June as a long term care spenddown case.
For June, the long term care spenddown is $3,000. This is the sum of the monthly countable income ($500) plus the excess resources ($2,500). The $1,500 NH charge is applied to the $3,000 spenddown. First the $500 income is applied, then $1,000 of the $2,500 excess resources. As a result, $1,500 of excess resources remain available to apply to spenddown in July. No additional medical bills or receipts are presented. Spenddown for June is not met.
For July, countable income is $500. There is $1,500 in remaining excess resources from June. The July spenddown is $2,000. The July NH charge at the private rate is $1,500. First the customer's July countable income of $500, then $1,000 of the remaining $1,500 excess resources are applied to July charges. No additional medical costs are presented. Spenddown for July is not met. Excess resources of $500 remain to be considered for August.
For August, countable income is $500. Excess resources of $500 remain from July to be considered. Nursing home charges at the private rate are $1,400 and are $1,200 at the HFS rate. The customer's resources are now below NH charges at the HFS rate. Effective August, change the case from spenddown to a NH credit case because monthly countable income ($500) plus excess resources ($500) are less than the cost of long term care at the private pay rate ($1,400).
For September, the HFS rate is $1,200. The NH credit amount is the monthly countable income of $500 because the remaining excess resource balance was applied to the NH credit for August. There is no remaining excess balance to apply.
