1. Affordable Care Act Part II - Medicaid Expansion and MAGI Budgeting New York Legal Assistance Group Evelyn Frank Legal Resources Program Valerie Bogart, Director & Rebecca Wallach, Staff Attorney/Skadden Fellow (212) 613-7310 eflrp@nylag.org http://nylag.org http://nyhealthaccess.org October 2013

2. Medicaid Expansion New York is one of the States that has opted to expand Medicaid coverage to a new eligibility population that includes single adults, up to 138% of the federal poverty level (FPL). New York already covered single or married adults without children under age 21 -- up to 100% FPL. This was under Family Health Plus. ACA switches them to Medicaid and expands income to 138% FPL. New York also covered parents living with children under 21 up to 150% FPL, under Family Health Plus. Family Health Plus is being eliminated 12/31/14, but many formerly on FHP will now be covered by Medicaid with eligibility expanded to 138% FPL. For those between 138 – 150%, NYS will subsidize the Premium on the Exchange so that they will have no premium. They will have the federal cost-sharing subsidy. 2

3. Five Eligibility Criteria for Medicaid – Which are Changing under ACA? 1. Residency – No change. Resident = intend to remain in New York “permanently or indefinitely.” 2. Immigration Status - NO CHANGE. PRUCOL immigrants still eligible. Undocumented immigrants still eligible only for emergency Medicaid, pre-natal care services, and Child Health Plus for children under 19* As of January 2014, undocumented immigrants can apply for emergency Medicaid through the Exchange 3. Category – Big change – MAGI vs. NON-MAGI 4. Income – NO Changes for people who have Medicare – seniors, disabled Big changes for almost everyone else - MAGI 5. Resources – NO resource limit for MAGI categories, but resources still count for non-MAGI. *See http://www.empirejustice.org/issue-areas/immigrant-rights/access-to-public-benefits/access-to- medicaid/immigrant-eligibility.html 3

4. New Category: What is MAGI? MAGI is “Modified Adjusted Gross Income.” It is a federal income tax concept. People in the “MAGI” category will have eligibility determined counting income using federal income tax rules. For families with children, as well as singles and childless couples this will change how income used to be calculated. Some lose Medicaid eligibility because some income will now be counted that wasn’t. But others will gain eligibility. NOT everyone will use the new MAGI budgeting. Learn which categories are “NON-MAGI.” 4

5. New Medicaid Eligibility Categories MAGI = Modified Adjusted Gross Income from income tax return Pregnant Women Children under 19 Parents/Caretaker Relatives* Childless Adults ages 19 to 64, including disabled if not on Medicare Family Planning Benefit program MAGI Aged 65+, Disabled, Blind “DAB” Spend-down See next slide for other non-MAGI groups Non- MAGI * Live with their own child, grandchild or another relative or step-relative, under age 18 or under 19 if a full-time student 5

6. NON-MAGI Categories – #1 - Disabled, Aged 65+ and Blind = DAB SSI recipients – still get Medicaid through SSI, using SSI rules for income & resources Certified disabled, age 65+ and blind still use old income and resource limits and budgeting rules, including Spend-down and pooled trusts Still have Transfer of Asset penalties for Nursing Home care Medicaid Buy-In for Working People with Disabilities under age 65 (MBI-WPD) Medicare Savings Programs Disabled Adult Children receive SSD on retired or deceased parent’s earnings, based on becoming disabled before age 22 Medicaid continuation of Pickle, Widow/Widower’s benefits 6

7. Non-MAGI Categories - #2 Spend-down – (also known as “Medically Needy”) Children under 21 and Parents/caretaker relatives may still “spend down” to the old Medicaid limits, using the old rules, if they do not qualify for Medicaid using MAGI budgeting, and if they prefer to use Medicaid to using Premium and Cost-sharing subsidies for a plan on the Exchange Disabled, aged, blind may also still use “spend-down” & pooled trusts COBRA continuation - Medicaid pays COBRA premium Cancer Treatment programs for breast, cervical, colorectal and prostate cancer – only if not eligible using MAGI Residents in adult homes, OMH residences Old Medicaid income and asset rules are used for these Non- MAGI categories. Aged, disabled still have $14,400 asset limit. Transfers of assets still have a penalty for nursing home care. 7

8. More about MAGI vs. non-MAGI Recipients in the MAGI group will be eligible for 12 continuous months of coverage, regardless of changes in income. Recipients in the MAGI group are eligible for “benchmark benefits” – Includes everything now covered under Medicaid except institutional long term care (nursing home care). Can apply for Medicaid on Exchange (online or with Navigator) but if apply between now and end of 2013, coverage won’t start until January 1, 2014 Can still apply now at local Medicaid office for coverage now under old rules. Non-MAGI Categories – CANNOT apply on the Exchange Can only apply at local Medicaid offices 8

9. People with NO Income Test! Child currently in foster care and some formerly in foster care Child under 21 who was in foster care on his/her 18 th birthday Person under 26 who was in foster care on his/her 18 th birthday and had Medicaid at the time. Special needs child placed for adoption or who has been adopted and receives a medical subsidy, Child for whom Kinship guardianship assistance payments are made 9

10. Some People have a Choice – May choose MAGI or non-MAGI If certified disabled < age 65 --may choose MAGI or non-MAGI, but only if they are not yet receiving Medicare (< age 65). Once receive Medicare, may not use MAGI UNLESS they live with and care for a child/other relative under age 18 (19 if student). Parent/caretaker relatives who are disabled or over 65 may choose MAGI or Non-MAGI, even if they receive Medicare. Disabled children may choose MAGI or NON-MAGI, unless they are in a waiver program (eg. Katie Beckett program). 10

11. For those with choice – how to choose? PRO’s of MAGI – Higher income limit - 138% FPL vs. 87% FPL = $1321/mo vs. $820/month Alice receives $1200/mo. SS Disability and is not yet on Medicare. Her income under 138% FPL. With MAGI will have Medicaid with no spend-down Workers comp, VA benefits, child support not counted No asset test! CON’s FOR MAGI - If disabled person is working, better income disregards and higher income limits for Medicaid Medicaid-Buy-In for People with Disabilities – income limit 250% FPL 50% of gross earned income “disregarded” – better than 5% MAGI deduction No coverage of nursing home care Can’t use MAGI if you have Medicare, unless you live with your child/relative <18 CHOICES - If income > 138% FPL – Choose between: Medicaid spend-down or Exchange with premium subsidies – but no long-term care on Exchange 11

12. DETERMINING COUNTABLE INCOME How much income is allowed? Which income? Whose income? What is “household size?” 12

13. Counting Income for MAGI – Building Blocks Find Income level that applies based on category (pregnant, child, etc.) FIND total Household Income = sum of MAGI income for all “household members”– this is NOT everyone actually living in the home! Determine who is in Medicaid household – household size INDIVIDUAL DETERMINATION - Members of a family may have different household sizes and different income levels. 13

14. How Much Income is Counted? Changes from Old Rules Old Rule = Many disregard rules. 1. For families and children, $90/mo. was deducted from gross earned income 2. Child care deduction was $175/child/mo. Or $200 if child < 2 New Rule = Only 1 disregard: 5% of your Modified Adjusted Gross Income. 133% FPL becomes 138% with disregard. Child care – though cost is no longer deducted from income, if your employer provides and you use a Flexible Spending Arrangement (FSA) for dependent care expenses, income deposited into the account is not included in wages or MAGI. Same for health expenses and retirement contributions made to an FSA or retirement plan pre-tax. These deductions not available for self-employed. 14

15. How much Income? While most people under age 65 will have a MAGI income limit of 138% FPL, there are some special categories. CategoryFederal Poverty Level Limit – MAGI income Pregnant women223% FPL Infants under age 1223% FPL Children age 1 – 18154% FPL 19 and 20-year olds living with parents155% FPL Family Planning Benefit program223% FPL < 26 who were in foster care when age 18NO INCOME LIMIT! All other MAGI people – under age 65138% FPL 15

16. Courtesy of Empire Justice Center Income & Benefit Levels for MAGI Groups 16

17. How much income: Why these odd FPL limits? Why are there odd FPL limits, such as 223% FPL for pregnant women and 154% for kids age 1-18? The ACA says people who used to be eligible for Medicaid should not lose eligibility. Pregnant women used to be eligible up to 200% FPL. But in MAGI budgeting, they are losing some of the old income deductions – for child care, the $90/month earned income disregard, etc. CMS approved these odd FPL levels as the equivalent of the old deductions. By allowing a pregnant women 223% FPL instead of 200% FPL, even with losing the old income deductions, she should not lose eligibility. 17

18. Which income? Modified AGI Gross income = Wages, taxable interest and dividends, Unemployment, pensions, IRA distributions, alimony, and income from self-employment. 18

19. Common Income counted toward Medicaid MAGI Type of IncomeForm 1040 Line NOTE Wages, salary, tips (earned income) Line 7!!! Does not include retirement or cafeteria plan deductions – flexible spending account – for health care or child care. See note re child care. Interest & dividendsLines 8-9Tax exempt interest is counted State income tax refundsLine 10 Alimony receivedLine 11 Profit or Loss from Self- Employment Line 12Only net income after expenses – use Schedule C Rental incomeLine 17Net income after expenses Unemployment Compensation Line19 Social Security BenefitLine 20aALL SS income is counted, even part not taxable 19

20. Self-Employment Income Self employment income is income after expenses claimed on schedule C. 20

21. Income NOT Counted toward MAGI Type of incomeExplanation Child SupportNot counted as income by the family that receives the support. THIS IS A CHANGE FROM PAST RULES. Person paying the support may not take any deduction for paying support. Veteran’s benefitsUnlike past Medicaid rules, VA benefits don’t count as income – both disability and pension benefits. (But note that this is only for MAGI budgeting. Aged 65+ must still count VA benefits). Military retirement pay IS counted. Certain scholarship income IRS rules count some scholarships & grants as income, but if used for educational purposes, not living expenses, Medicaid will continue to exclude them. American Indian income Some types counted as income by IRS, but not by Medicaid Gift or inheritanceNot counted. Taxed to the donor of the gift, or to the Estate, not to the recipient or beneficiary. Workers CompNot Counted 21

22. Lump sums, Gifts & Inheritances MEDICAID RULE -- The lump sum is treated as income in the month received, and then is a resource in subsequent months. Since resources are not counted in MAGI budgeting, the lump sum in effect does not hurt eligibility. EXAMPLE – Lottery winning, lawsuit settlement Gifts and inheritances are NOT counted as income under MAGI. NOTE that MAGI budgeting for the Premium Tax Credit and Coinsurance subsidy is different. Those are based on annual income, so a lump sum that would be taxable is counted as income (e.g. lottery). Not all lump sums are taxable – such as gifts and inheritances. 22

23. Which Income – Past, Current or Future? MAGI Medicaid will use anticipated income for the upcoming year. People applying now must “attest” to estimated 2014 income. Data-matching will be used to compare the estimated income. If the applicant’s estimate and the data from the IRS and other sources are very different, you will be given a chance to verify the reason (for example, that you lost your job or are retiring). When data obtained is “reasonably compatible” with an applicant’s attestation, the State agencies are prohibited from requiring additional documentation. 23

24. Adjustments from Gross Income Adjustments = Deductions Alimony paid, certain moving expenses, student loan interest, and self-employed health insurance contributions, self-employment tax, IRA deduction. If you contribute to a flex spending plan, that income is deducted. 24

25. Whose income is counted? Generally count income of everyone in the Medicaid tax “household” -- but there are exceptions. Exception - Children claimed as dependents by parents – If child has enough income to require that the child file a tax return, then child’s income is counted in the household. If child is not required to file a tax return, then child’s income is not counted in the household even if she chooses to file a tax return, in order to get a tax refund. A single dependent < age 65 must file a return if any of the following apply. Unearned income was more than $950. Earned income was more than $5,950. Gross income was more than the larger of $950 OR earned income (up to $5,650) plus $300 25

26. Alexis is a single mother with 2 children Susan age 5 and John age 3. Alexis is employed, earning $24,000 a year. She also receives $4,000 per year in child support and pays $3,000 per year for child care. Current Medicaid Rules Family size: 3 Income: Wage $24,000 Child support $4,000 Total Income: $28,000 or $2,333/mo Monthly Deduction: $ 90 earned income deduction $ 100 child support disregard $ 250 child care expenses (max $175/child) $440/mo = $5,280 / year Medicaid income: $22,720/yr or $1,893/mo. FHP income: $28,000 Children -- Medicaid Eligible (limit 133% FPL) Mom -- eligible for Family Health Plus MAGI Rules Family size: 3 Total Countable Income: $24,000 Child Support not counted as income No deduction for child care UNLESS she uses employer’s Flexible Spending Arrangement (FSA). If she does, amount contributed to FSA does not count as income. All Three are Medicaid eligible –income limits - Alexis – 138% FPL = $26,951 for 3 Susan and John = 154% FPL - $30,076 for 3 Eligibility Example 26

27. Example #2 with working teenager Same family – Alexis is a single mother but with 2 children Debbie age 18 and in school and John age 3. Alexis is employed, earning $24,000 a year. She also receives $4,000 per year in child support and pays $3,000 per year for child care. Debbie earns $4,000. Mom claims both kids as dependents. MAGI Family size for all: 3 Total Countable Income: $24,000 – Debbie’s income not counted because it is less than $5,950 – so she is not required to file a tax return. Even if Debbie does file a tax return to get refund, her income doesn’t count. Child Support not counted as income No deduction for child care UNLESS she uses employer’s Flexible Spending Arrangement (FSA). All Three are Medicaid eligible –income limits - Alexis – 138% FPL = $26,951 for 3 Debbie and John = 154% FPL - $30,076 for 3 27

28. Household Size for MAGI Based on EXPECTED tax filing status for year seeking Medicaid (2014) Factors: 1. Does the individual expect to file taxes? See next slide. 2. Does the individual expect to be claimed as a dependent? 3. Is the individual a US citizen, or lawfully present? 4. Is anyone married, including same-sex couples? 5. Is anyone under age 19? a) Need ages of all kids (age at end of tax year). b) Is anyone age 18 – 24 a full time student? 6. Who lives in the household at least half the year, or year-round? 7. Is anyone pregnant? How many babies are expected? Pregnant women counted as self + number of expected children 28

29. Why does household size matter? Household Size 100% 133%138% 150%154%223%250%400% Most < 65 FHP limit– premium subsidy if losing FHP Child < 18, age 19-20 living with parents Pregnant women, Infants < age 1 Cost- sharing Reduction Ends Premium tax subsidy ends 1$11,490$15,282 15,856 $17,235 17,69535,35928,725 $45,960 215,510 20,628 21,404 23,265 23,88547,73038,775 62,040 319,530 25,975 26,951 29,295 30,07660,10248,825 78,120 423,550 31,322 32,499 35,325 36,26772,47358,875 94,200 527,570 36,668 38,047 41,355 42,45884,844 68,925 110,280 631,590 42,015 43,594 47,385 48,64997,21578,975 126,360 For each additional person, add $4,020 $5,347$6,030$16,080 Federal Poverty Levels 2013- Annual income 29

30. Household size for MAGI con’d. Medicaid uses tax rules for who is expected to file a tax return, and who is claimed as dependents Medicaid has some special rules for people who don’t file tax returns, because many low-income people don’t file tax returns. Three general categories of people for household size rules: 1. Those who are expected to file taxes and are not claimed as a dependent by someone else; 2. Those who are claimed as a dependent; and 3. Non-filers who do not file taxes AND are not claimed as a dependent by someone else. Pregnant women – always count woman + number of expected children when including her in household Spouses – Spouses who live together are counted in each other’s household, regardless of whether they expect to file jointly. 30

31. Family size Rule 1 – TAX FILERS 1. ► TAX FILERS - Those who are expected to file taxes and are not claimed as a dependent by someone else; 2. Those who are claimed as a dependent; and 3. Non-filers who do not file taxes AND are not claimed as a dependent by someone else 31

32. Family size rule 1: Tax Filers Rule for people who file taxes who do not expect to be claimed as a dependent by another taxpayer. RULE: Household = Tax filer and all persons whom taxpayer expects to claim as a tax dependent Spouse rule - Spouses who live together are counted in each other’s household, regardless of whether they expect to file jointly. Example– Joe and Mary are married and live with 2 kids under age 19, Aaron and Andrew, as well as Joe’s Uncle Matt, who does not file taxes. Joe files a tax return, claiming the 2 children and Uncle Matt as dependents. Joe’s household is FIVE – he and his wife under spouse rule, and 3 dependents. If Mary is pregnant with twins, household is SEVEN. 32

33. BASIC CONCEPTS FOR HOUSEHOLD SIZE To figure out household size, need to know: (1) WHO IS expected to file taxes? (2) WHAT IS test for who can IS expected to be claimed as a dependent? 33

34. Tax filing requirements – MAGI categories Filing Status:At the end of the year you were: File Return if your gross income was at least: SingleUnder 65$ 9,750 ($ 812/mo) 65 or older$11,200 Married filing Jointly Both spouses < 65$19,500($1,625/mo) 1 spouse >65$20,650 ($1,720/mo) Married filing separatelyAny Age$ 3,800 Head of household Under 65$12,500 ($1,040/mo) 65 or older$13,950 Qualifying widow(er) with dependent child Under 65$15,700 65 or older$16,850 34

35. Is the tax filer expected to be claimed as a “Dependent?” WHO ARE TAX DEPENDENTS? There are 2 types of dependents: Dependent children – a/k/a/ “qualifying child” Dependent relatives –a/k/a “qualifying relative” For BOTH types – You can’t claim a dependent if someone can claim YOU as a dependent. Dependent must be US citizen, resident alien, US national, or resident of Canada or Mexico One may be claimed as a dependent but still file her own tax return. Example: Pam, age 18, has a part time job. She can be claimed by her parents as a dependent if her income doesn’t provide her with more than one-half of her support. But Pam may want to file her own tax return for a refund. She is still in her family’s MAGI household. 35

36. Test to be a dependent or qualifying child RELATION – your own child, stepchild, foster child, grandchild, OR your younger sibling, OR your niece/nephew AGE – at the end of the tax year, was: under 19 or under 24 if in school, or any age if disabled. If not disabled, must be younger than you or your spouse. LIVED WITH YOU more than half the year special rules in divorce/ split custody SUPPORT – child did not provide more than half of his/her own support for the year. Child not filing a Joint Return for the year (unless just for a refund). US citizen, resident alien, US national, or a resident of Canada/Mexico WARNING: Tax rules are complicated. There are many exceptions to these rules! 36

37. Test to be a dependent or qualifying relative Can’t be your dependent “child” or a dependent child of another taxpayer (can use this if your child is age 24 or over) Relationship – must EITHER: Live with you year-round as a member of your household OR be your or your spouse’s parent, grandparent, child, grandchild, niece/nephew, aunt/uncle.. Includes step-relatives and in-laws. (Does not include cousins). Support – You must provide more than half of the person’s support in a calendar year. Total support includes amounts spent to provide food, lodging, clothing, education, medical and dental care, recreation, transportation, and similar necessities (NOT taxes, life insurance premiums) Person’s gross income < $3,900 for year (some exceptions) US citizen, US national, resident alien, resident of Canada or Mexico 37

38. Family size Rule 2 – DEPENDENTS 1. TAX FILERS - Those who are expected to file taxes and are not claimed as a dependent by someone else; 2. ► Those who are claimed as a dependent 3. Non-filers who do not file taxes AND are not claimed as a dependent by someone else 38

39. Family Size Rule 2: Tax Dependents Dependents usually use the same household size as the tax filer claiming the dependent. In the preceding example, wife Mary and the two children are a household of FIVE, using the same household as Joe. If Mary is pregnant with twins, two children’s household size would be SEVEN – same as for Joe and Mary. THREE exceptions to this Rule: 1. Multi-Generation Households – A grandparent or other person (like Uncle Matt) lives with Tax Filer who claims the grandparent/other person as a dependent. 2. Unmarried parents of minor children, who all live together 3. Split custody families – child claimed as dependent by non-custodial parent 39

40. Rule 2 EXCEPTION 1 – Multi-Generation Household. If the grandparent, uncle, or other relative or friend living with a taxpayer is: claimed as a dependent by the taxpayer but is not a child or spouse of the taxpayer The dependent’s household is just HIM/HER, and if they are living with him, his spouse and minor children < 19 or student < 21 EXAMPLE Uncle Matt living with Joe and Mary and their kids. Even though Joe claims him as a dependent, and he is counted in Joe’s Medicaid household, MATT’s household is just him. If they are living with him, it would also include his Spouse, and his Children < 19. This rule helps low-income families with multi- generations living together. 40

41. Rule 2/ Exception 2 - Child living with both parents but claimed as dependent by one parent 1. Child under 19 (or student < 21), who expects to be claimed as dependent by ONE parent though lives with BOTH parents, where parents don’t expect to file a Joint tax return – This rule generally applies to unmarried parents of a child who live together but, because they are not married, do not file a joint tax return. The rule ensures that income of those legally responsible for the child is counted. 2. RULE: Household is the CHILD and each of the following, if living with the child: Child’s parents, Child’s spouse, if any, Child’s children or siblings, if <19 or students < 21, and parents of any of child’s siblings 41

42. Rule 2/ Exception 3 – Child claimed as a dependent by non-custodial parent Child under 19 (or student < 21), who expects to be claimed as a dependent by NON-custodial parent. RULE: Household consists of the CHILD PLUS: Child’s parent and siblings who live with the child, Child’s spouse, if living with the child, and Child’s children, if living with the child and under age 19. EXAMPLE: Mike & Carol are divorced. Their only child, Marcia, age 19 and in college, lives with Carol, spending every other weekend with Mike. Mike claims Marcia as a dependent. Marcia’s Medicaid household is TWO - Marcia and Carol Mike’s Medicaid household is TWO (Rule 1) – him and Marcia. Carol’s Medicaid household is ONE - if she files taxes and is not claimed as a dependent by someone. (RULE 1) If Carol doesn’t expect to file taxes or be claimed as a dependent, then she falls under RULE 3 –next slide. 42

43. Family size Rule 3 1. TAX FILERS - Those who are expected to file taxes and are not claimed as a dependent by someone else; 2. Those who are claimed as a dependent 3. ► Non-filers who do not file taxes AND are not claimed as a dependent by someone else Same rule applies to Exceptions under Rule 2 43

44. Family Size Rule 3: Non-Filers, Those Not Claimed as Dependents, and Some Dependents Rule 3 applies to people who: Do not expect to file a tax return (non-filers), and Do not expect to be claimed as a dependent, OR are claimed as a dependent but are either: Not the spouse or child of the taxpayer (i.e. Uncle Matt) Are under 19 (or student < 21), expect to be claimed as dependent by ONE parent though live with BOTH parents, where parents don’t expect to file a joint tax return, or Are under 19 (or student < 21), expect to be claimed as dependent by NON-custodial parent. Carol, in previous example, would be in this rule if she doesn’t expect to file a tax return or be claimed as a dependent. 44

45. Family Size Rule 3: Non-Tax Filers who do not expect to be claimed as dependent For everyone on previous slide -- RULE - Household Size = Individual, and, if living with the individual, the following: Spouse, Individual’s Children < 19 (or student <21), If the individual is <19 (or student < 21), the individual’s parents and siblings if they are also < 19 (or student < 21). Uncle Matt Example: Uncle Matt is his own Medicaid household, even though he is claimed as a dependent by nephew Joe. If Matt’s son, Tom, age 10 was also living with them, Matt’s household would be TWO – he and his son Tom, even if Joe counted Tom as a dependent. Carol Example: If Carol does not expect to file taxes or be claimed as a dependent, her household size would be 2 – she and daughter Marcia. 45

46. Household Case Example # 1 – Intact multi-generation family, pregnant wife James (the taxpayer) and Alexis (James’s wife) live together with two children, John and Susan, both under 18, as well as James’s Aunt Patricia, age 62, who receives Social Security but does not file taxes. Alexis is pregnant and is expecting one child. James claims all of them as dependents. What is James’Medicaid household size? James’ household size is six. His household includes James plus his four dependents + unborn child. What is the household size of the dependents? Alexis – Spouse rule always counts her in James’ household. So she is SIX. 2 children - Since they are dependents and children of James, the taxpayer, their household size is the same as James = SIX. Aunt Patricia - household of ONE because she is not James’ or Alexis’ child or spouse, and she has no parents, spouse or siblings living in the same household. 46

47. Household Case Example #2 -- Separated, children claimed by non-custodial parent James and Alexis are separated. Alexis lives with their children, John and Susan. Alexis also lives with her new baby, Mary. James claims John and Susan as a dependent on his taxes. Alexis files taxes and claims Mary as her dependent. What is household size of: Wife ALEXIS? TWO -- Alexis and her tax dependent, daughter Mary (Rule 1) Even though John and Susan live with her, they don’t count as they are not her dependents. Husband James? THREE -James and his two dependents, John and Susan. (Rule 1) John & Susan – FOUR - John, Susan, Alexis and Mary (Rule 2, Exception 3). Children claimed as dependents by their non-custodial parent. Their household includes them, the parent who they live with and any siblings they live with Baby Mary? TWO – Mary and Alexis (Rule 2)(As Alexis’ dependent, she uses same household size as Alexis since she lives with her) 47

48. Example #3 – Married with children who file taxes Ann & Bob are married and live together. They file a joint tax return. They have 2 children who they claim as dependents. Didi, age 20, has a summer job, earning $3000 for college. Corey is 15 and doesn’t work. Didi will file her own tax return to obtain a refund of taxes withheld. Since her parents claim her as a dependent, she may not claim a personal exemption on her taxes. ANN & BOB: Both household of FOUR (Rule 1) Corey: Household of FOUR (Rule 2) Did: Household of FOUR (Rule 2 – same number as her parents who claim her as a dependent. Doesn’t matter that she files own tax return). As explained later, Didi’s income doesn’t count toward Ann & Bob’s household income for Medicaid 48

49. What if Over-Income for Medicaid? 1. Children under 19 – Can get Child Health Plus – up to 400% FPL. Also uses MAGI budgeting. 2. Parents/ Caretaker relatives of children < 18 (students <19) CHOICE – Medicaid with a spend-down, using OLD budgeting rules or Buy Insurance on Exchange and get Subsidies: Premium Tax Credit – up to 400% FPL and Cost-Sharing Assistance – up to 250% FPL Those with incomes 138% - 150% FPL are losing Family Health Plus. State will subsidize premium even more than the federal Premium Tax Credit. 3. Singles/Childless Couples and people age 20-21 not living with parents - No Medicaid option, can only buy Insurance on Exchange with premium & cost-sharing subsidies. 49

50. MAGI for Premium Tax Credits & Coinsurance Rules mostly the same as MAGI for Medicaid but some differences. The 5% FPL income disregard does not apply to Premium tax credits or cost sharing, only to Medicaid. Rule for determining number of people in the household is different for Medicaid than for Premium tax credits/cost- sharing. Both rules are based on income tax rules but there are some differences. For complete explanation and worksheets, see National Health Law Program, Advocates Guide to MAGI. http://www.healthlaw.org/images/stories/2013_10_18_AGMAGI.pdf http://www.healthlaw.org/images/stories/2013_10_18_AGMAGI.pdf 50

51. Medicaid Applications October 1, 2013 – new MAGI Medicaid applicants can apply through the NY State of Health via: Online or by Mail Navigators, Certified Application Counselors or Brokers Applications filed on the Exchange before 12/31/13 will be a 2-step process: 1. Receive an eligibility determination, and must 2. Return in December to pick a plan for coverage to start 1/1/14. Advocate tip: People who want Medicaid coverage to start before Jan. 1, 2014 OR who are seeking Medicaid for retroactive coverage (3 months before application) should continue to apply at your local Medicaid office until January 1, 2014 - Will receive regular Medicaid card for bills incurred after the eligibility determination and before plan coverage starts. If you apply at the Exchange, you’ll just be referred to the Medicaid office. 51

52. Timeline October 1, 2013 – MAGI population can apply for Medicaid through the New York State of Health & receive eligibility determinations using new MAGI rules, and shop for a plan, but coverage through Medicaid Managed Care plans will not begin until January 2014. People wanting Medicaid to start in 2013 should apply at the Medicaid office. December 31, 2013 – No new FHP applications will be taken. January 1, 2014 – Coverage begins for PHI and QHPs. April 1, 2014 – New MAGI budgeting applies upon renewal for all MA recipients. If renewal scheduled between Jan. 1 – Mar. 31, 2014 and client LOSES eligibility under the new rules, Medicaid will continue until 3/31/2014 or next regularly scheduled renewal. 52

53. Pop Quiz Bob and Brenda are married. They have two children, Arthur age 2 and Hank age 19. Bob claims Brenda, Arthur and Hank as his dependents. Bob and Brenda’s income is 155% of FPL for a household of four. Arthur works and earns $5,000 per year and isn’t required to file taxes. Brenda’s mother, Beatrice also lives with them. Beatrice is 75 years old. She received $500 per month Social Security Retirement and Medicare. Beatrice does not file taxes. Household size? Bob, Brenda, Arthur and Hank = Household of four Beatrice = Household of one Benefit? Bob and Brenda are eligible for FHP wrap. Arthur is eligible for CHIP. Hank is eligible for full Medicaid. Beatrice gets full Medicaid. Category? Bob and Brenda are MAGI as parents. Arthur is MAGI as a child under 18. Hank is MAGI as a 19 year old living with his parents. Beatrice is non-MAGI. 53

54. Credits – Thanks to these organizations for their materials used in this presentation. National Health Law Program, Advocate Guide to MAGI, October 2013, posted at http://www.healthlaw.org/images/stories/2013_10_18_AGMAGI.pdf. http://www.healthlaw.org/images/stories/2013_10_18_AGMAGI.pdf Empire Justice Center, Health Coverage Crosswalk: Eligibility by Immigration Status http://www.wnylc.com/health/entry/188/ http://www.wnylc.com/health/entry/188/ Empire Justice Center – Many other resources at http://www.wnylc.com/health/40/ and http://www.empirejustice.org/issue-areas/health/http://www.wnylc.com/health/40/ http://www.empirejustice.org/issue-areas/health/ Legal Aid Society – including http://www.wnylc.com/health/entry/194/http://www.wnylc.com/health/entry/194/ Kaiser Family Foundation - http://kff.org/aca-consumer-resources/ - FAQs, graphics, tutorials, etc.http://kff.org/aca-consumer-resources/ KEY STATE REFERENCES – STATE POLICY – NYS DOH 13ADM-03 - Medicaid Eligibility Changes under the Affordable Care Act (ACA) of 2010 –download at http://www.health.ny.gov/health_care/medicaid/publications/pub2013adm.htm NYS DOH 13ADM-03 - Medicaid Eligibility Changes under the Affordable Care Act (ACA) of 2010http://www.health.ny.gov/health_care/medicaid/publications/pub2013adm.htm New York State Official Website on Exchange --- http://healthbenefitexchange.ny.gov/http://healthbenefitexchange.ny.gov/ 54