|
All Medicaid Programs |
|
Obsolete Policy |
General Budgeting Concepts
Budgeting is the process of determining a best estimate of income an individual or household will receive. Use prospective budgeting for MAGI-based coverage groups as well as non-MAGI-based coverage groups. Prospective budgeting means that we use current and historical information to project what income the individual or household will receive during the certification period.
Use the methods of anticipating, averaging or annualizing income to determine an appropriate prospective estimate. The method used to determine the best estimate is based on the type of income, the frequency of receipt, the individual’s earnings history and any anticipated changes in circumstances. Determine which method to use based upon the individual's history and current circumstances.
Consider the following factors to determine the best estimate of income.
What income is the client currently receiving or expecting to receive in the future months?
What are the client's historical patterns such as recurring income or regular seasonal income that will continue in the future?
Although budgeting will be similar for both MAGI-based and non-MAGI-based eligibility groups, the types of income we count and the deductions we allow for MAGI-based and non-MAGI-based coverage groups are different. These differences will likely cause the countable income to vary. The aged, blind and disabled Medicaid coverage groups also have differences. Section 435-2 covers how to calculate the best estimate for the different coverage groups.
For MAGI-based coverage groups, determine a best estimate of income to be received during the whole certification period to arrive at a monthly amount. Once the best estimate is determined for the certification period, it remains fixed unless the agency receives a report of a change in income. See section 815-5 for reported income changes.
For non-MAGI-based groups, we create a best estimate of income on a month by month basis. The best estimate could change in future months due to expected or reported changes.
These rules apply to the client's income, a spouse's income AND the income of any family members whose income must be counted based on the policy for the applicable coverage group to determine eligibility.
When budgeting self-employment income for MAGI and Non-MAGI-based groups, determine the expected net annual income, and prorate that over 12 months to determine a monthly amount. Some other types of income such as contract or commission income may also need to be annualized. See section 405-2 and 405-3 for more information on self-employment.
Budgeting for retroactive coverage months is discussed in sec. 445.