affordable care act income/resources
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Affordable Care ActIncome/Resources
Session 3
Presented by Tokie Moriel & John Tvedt
1DHS/DFO/IMTA/2013-07-15
Objective
• Present a high level overview of changes affecting types of income and resources under ACA
DHS/DFO/IMTA/2013-07-15 2
MAGI in Medicaid and CHIPMyth or Reality
• Myth
– MAGI is a number on a tax return which DHS can get and know what someone’s income is for purposes of Medicaid or CHIP
• Reality
– MAGI is a methodology which identifies whose income is counted in determining somebody else’s eligibility and what kind of income is counted
DHS/DFO/IMTA/2013-07-15 3
Myth or Reality
• Myth
– Financial eligibility rules are affected for EVERYONE
• Reality
– MAGI will be used to determine the financial eligibility for:
• Iowa Health and Wellness Plan• Children• Pregnant women• Parents and caretaker relatives
DHS/DFO/IMTA/2013-07-15 4
Myth or Reality
• Myth
– Coverage through the Marketplace
• Reality
– Coverage through the Marketplace
DHS/DFO/IMTA/2013-07-15 5
MAGI-Based MethodologiesTypes of Income
• Today
– All income/money received, unless excluded, minus any deductions, disregards or diversions
• MAGI-based income
– Tax rules apply with exceptions
– No income disregards, except 5%
DHS/DFO/IMTA/2013-07-15 6
MAGI-Based MethodologiesWhose Income Is Counted
• Today
– Consider all income of the members in the eligible group unless the income is exempted, disregarded, deducted or diverted
• MAGI-based income
– Income of adults, parents and spouses always counted (stepparents will be treated like parents)
– Income of children in parents’ household counted if required to file a tax return
DHS/DFO/IMTA/2013-07-15 7
MAGI-Based MethodologiesHousehold Composition & Size
• Today
– Based on legal responsibility; parents and children living together, but prohibited deeming rules apply
• MAGI-based households
– Medicaid and tax households the same for most families
– Certain exceptions apply
– Rules for non-filers mirror rules for filers
DHS/DFO/IMTA/2013-07-15 8
MAGI-Based Methodologies
• Household Composition and Size
• Key changes for Medicaid:
– Stepparents and stepchildren
– Children/siblings with income
– Children ages 21+ claimed as tax dependent
DHS/DFO/IMTA/2013-07-15 9
MAGI-Based Methodologies
• Exceptions to adoption of tax household
– Individuals other than biological, adopted or step children claimed as tax dependent
– Children claimed by non-custodial parent
– Married couples and children of parents not filing jointly
– Pregnant women
DHS/DFO/IMTA/2013-07-15 10
Budget Periods (Point-In-Time)
• Today
– Current monthly income
• Budget period under MAGI
– New applicants/enrollees –current monthly income
– State flexibility to account for predictable fluctuations in income
DHS/DFO/IMTA/2013-07-15 11
Income Standard Conversion
• Today
– Net income standard after deductions, diversions and disregards
• Under MAGI
– States to convert current net income standards to new equivalent “gross income” standards such that individuals do not lose coverage
DHS/DFO/IMTA/2013-07-15 12
MAGI Screen
• First step: Eligibility based on MAGI
– Everyone is first evaluated for eligibility based on MAGI-based income
– Determination based on other factors for those not eligible based on MAGI
• Same process regardless of application door
DHS/DFO/IMTA/2013-07-15 13
Income Exempted under ACA
– Child support income
– Depreciation of business expenses, including capital losses
– Scholarships, fellowship grants and awards used for education purposes
– Worker’s compensation
– Veteran’s benefits
– American Indian and Alaska Native (AI/AN) income derived from distributions, payments, ownership interests, and real property usage rights
– Non-recurring lump sum
DHS/DFO/IMTA/2013-07-15 14
Asset Test for MAGI Households
• There is no asset test for MAGI households
• There are no changes to the asset limits for non-MAGI households
DHS/DFO/IMTA/2013-07-15 15
Conclusion
• Additional ACA webinars
• Session review – Income Maintenance Workers ONLY
DHS/DFO/IMTA/2013-07-15 16
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