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VA Note - Medically Needy Spenddown

Eligibility for Medicaid in the Medically Needy covered group, may require that you "spenddown" income over the medically needy income limit for your geographic area and family size. For details about how the spenddown is calculated, see Medically Needy Income Levels.

WorkWORLD calculates your medical expenses based on your estimates of the medical expenses that you would have with and without Medicaid:

· If your estimated medical expenses without Medicaid are less than your spenddown, then WorkWORLD uses those estimated medical expenses as the amount shown in the Numerical Results (SSI/DI).

· If your estimated medical expenses without Medicaid are greater than your spenddown, then WorkWORLD calculates the number of months in each 6-month period that you would be spending down and the number of months that you would be covered by Medicaid. It multiplies both by your estimated expenses with and without Medicaid for the 6 months and adds the results together. WorkWORLD then averages the results to give you an estimated monthly expense over that 6-month period.

NOTE: If you receive Medicare Part B coverage and are eligible for Medically Needy Medicaid, the Numerical Results will show your Medicare Part B premium as $0.00 even though you must pay the premium during your spenddown. Since your estimated expenses without Medicaid should include the Part B Premium amount, your average monthly medical expenses as shown in Numerical Results should correctly include those premium payments. If you did not include the payments in your estimate, go back and revise your estimate to include the Part B premium amount.

EXAMPLES:

1. Estimated Expenses Too Low:

Your spenddown for the 6-month period is $2000 and you estimate that your average medical expenses without Medicaid would be $200 per month. Then WorkWORLD multiplies $200 times 6, yielding $1800. Since you would not have enough medical expenses to spend down the $2000, WorkWORLD posts $200 in the Numerical Results as your average Medical Expenses.

2. Estimated Expenses High:

Again, your spenddown for the 6-month period is $2000. This time you estimate that your average medical expenses without Medicaid would be $500 per month. WorkWORLD calculates that in 4 months you would spend down to the $2000 level, and then get Medicaid coverage for the next 2 months. Let's say that you estimate that your out-of-pocket medical expenses with Medicaid would be $20, then WorkWORLD would calculate your average medical expenses as follows:

· $500 X 4 = $2000 spenddown

· $20 X 2 = $40 expenses while covered by Medicaid

· $2000 + $40 = $2040 total medical expenses for 6 months

· $2040 / 6 months = $340 average monthly medical expenses

WorkWORLD™ Help/Information System
Topic Title: VA Note - Medically Needy Spenddown
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