Vendor Adjustments to Allotments and Surpluses

Effective for allotments for July 2004 and later for community spouses, minor children and eligible dependents, the Minimum Maintenance Standard and the Shelter Standard are revised in accordance with the new poverty guidelines. In computing these allotments, use the following amounts:

Use the current standards for allotment and surplus computations completed prior to the mass adjustment. After the adjustment, compute allotments and surpluses for July 2004 and later using the new standards.

For mass-adjusted cases, State Office will compute the new allotment amounts and the resulting surplus amounts. State Office will do the complete adjustment: send adjustment notices to claimants, list the cases for the counties, and send the updated surplus amounts to the nursing facilities. Turnaround IM-5 forms will not be generated for this adjustment.

County office staff must complete adjustments on cases listed on report "Cases Needing Review for Adjustment".

State Office and county office responsibilities in handling this allotment adjustment:

1. Calculating new surplus amounts for cases with community spouses or with minors or eligible dependents:

   If the case contains a community spouse, minor or eligible dependent and has an "N" or a "Y" in Field 13X (Main. Std.), State Office will compute a proposed new allotment amount using the revised standards. We will then add the difference between the current and new allotment amounts to Field 33 (Expense) and compute the new surplus/deficit amount in Field 35 (Deficit/Surplus).

2. State Office actions as a result of the new surplus amounts:
   1. If the new surplus amount is a decrease in surplus, State Office will adjust the case. State Office will also send a notice to the claimant (see below for text of notice).

      State Office will include the case on a listing for each county, "Cases Adjusted," with reason "Surp. Dec." We will also print and mail a separate listing for each nursing facility.

   2. If either the current or the new amounts for Field 35 is 0.00 or a deficit, State Office will adjust the case and send a notice to the claimant.

      These cases will be included on the "Cases Adjusted" listing with reason "No Chg." We will print and mail a separate listing for each nursing facility.

   3. If the new surplus amount represents an increase, the case will not be adjusted. We do not anticipate increases in surplus amounts due to this adjustment. Any such cases will be noted on the listing, "Cases Needing Review for Adjustment," with reason "Surp. Inc."
3. County actions needed on listings:
   1. "Cases Adjusted."

      This listing includes cases in which the surplus decreases or does not change. It will be sorted by county and load. It is for information only and does not require action by the caseworker.

      If the new surplus amount was determined using $2267.00 as the Total Maintenance Standard, the "Cases Adjusted" listing will note that a "Y" has been entered in Field 13X with the caption "Max Std = $2319.00”.

      If the case was incorrectly coded "Y" in Field 13X, the case will be adjusted. Field 13X will be changed to "N". The caption will read "Max Std < 2319.00."

   2. "Cases Needing Review For Adjustment."

      None of the cases on this listing will have been adjusted by State Office. In all these situations, compute the new allotments and surpluses based on the standards contained in this memorandum. Notify the claimant and the facility or institution via the IM-62.

      1. Cases that have an "H" or "L" in Field 13X (Main. Std.).

         The reason "Review 13X" will appear on the listing.

         Review Field 13X for these cases:

         Use "H" only if a hearing decision set the allotment amount. At this time, no cases have been determined to need an "H" in Field 13X.

         Use "L" only if the institutionalized spouse chooses to make an allotment of less than the maximum allowable.

         Change Field 13X to "N" or "Y" for any case which does not meet either of these criteria. This will allow State Office to consider the case for automatic adjustment the next time the standards change.

      2. Cases in which the OASDI amount in Field 13J (OASDI Amt.) is greater than the amount in Field 13V (Income).

         The reason "OASDI > Income" will appear on the listing. Correct Field 13J or 13V as appropriate. Manually adjust the case.

      3. Cases in which the amount entered in Field 33 (Exp./Eil.) is less than the current maximum allotment amount.

         The reason "Max Allot > Exp" will appear on the listing. If the institutionalized spouse intends to make the maximum allotment available to the community spouse, but has insufficient income, add the full amount of the maximum allotment to the other allowable deductions and show the total in Field 33.

      4. Cases in which there is an increase in the surplus.

         The reason "Surp. Inc." will appear on the listing. If this occurs, recompute the allotment and surplus based on the new standards contained in this memorandum.

4. Notices

   Adjustment notices on computer actions will be computer-generated. There will be no computer-generated adverse action notices. Letters to nursing facilities will also be computer generated explaining the changes in the surplus amounts. The following are samples of the claimant notice and the notice to the nursing facility.

NOTICE TO CLAIMANT:

Dear (case name) (case ID) (date)

Beginning July 1, 2004, the amount of the allotment that may be given to your spouse and eligible dependents increases.

Because of this increase, the allotment you make to your spouse and eligible dependents will be $XXX.XX beginning July 1, 2004. Since all your available income is considered in determining your benefits (13 CSR 40-2.200), the amount you must pay the nursing home or institution will be $XXX.XX beginning July 1, 2004.

We determined the amount you must pay to the nursing home or institution by assuming that the entire allotment will be given to your spouse and eligible dependents. If you do not wish to give the full amount of the allotment stated above to your spouse or eligible dependents, contact your caseworker and an adjustment will be made.

If your income increases, you may give your spouse and eligible dependents up to $XXX.XX monthly.

If you believe this decision is not correct, you have the right to request a hearing within 90 days of the date of this letter.

If you wish to have a hearing, you may advise us by phone, in person or in writing. We will schedule a hearing for you and notify you of the time of the hearing. At the hearing, you may present your case or be represented by someone else including an attorney. You may bring and/or question witnesses.

NOTICE TO NURSING FACILITY OR INSTITUTION

To the Administrator:

Enclosed is a list of patients for whom you receive Nursing Facility (NF), Mentally Retarded (IMR) or Mental Hospital (MHC) payments from the Division of Family Services. Beginning July 1, 2004, the amount of the allotment the patient may make to his/her spouse and eligible dependents is increased. The increase in the allotment amount will change the amount of surplus paid to your facility or institution.

The attached listing shows the name and Medicaid number of each patient who is making an allotment and the old and new surplus amounts. The surplus amount shown is effective July 1, 2004, unless you receive a notice (IM-62) mailed from the county office after June 19, 2004, which indicates a different surplus amount. If you have an NF, IMR, or MHC patient in your facility or institution who is not on the listing but was approved for vendor care before June 19, 2004, and who is making an allotment, please contact that patient's caseworker to find the July 2004 surplus amount.

• Review this memorandum with all appropriate staff.
• Take necessary action on the listings mailed from State Office for these adjustments.
• Handle the allotment adjustments as outlined in this memorandum.
• Effective with July 2004 allotments, use $1562.00 as the Minimum Maintenance Standard. Effective with the July 2004 allotments, use $469.00 as the Shelter Standard.