About These Materials
Families USA developed these materials under contract with
DC Health Link, the District of Columbia's Health Benefits
Exchange, for a training program for DC eligibility workers.
These workers determine eligibility for Medicaid and other
benefit programs (including SNAP and TANF). They will help
consumers apply for coverage and financial assistance, report
changes, renew coverage, and verify the information that is
needed to determine eligibility. These workers will not be
responsible for helping consumers select health plans.
These training materials are posted here as an example that
can be adapted for other training programs. They contain
information that is specific to the District of Columbia, which
would have to be changed if used in another state. Contact
Families USA at stateinfo@familiesusa.org for assistance with
adapting these materials.
Prepared by Families USA for use in the District of Columbia
ESA Policy
Training Day 3
Household Composition
Prepared by Families USA for use in the District of Columbia
Why are the rules changing?
• Some people who earn too much to qualify
for Medicaid can get new tax credits
through DC Health Link
• New rules make Medicaid and IRS tax rules
work together
• These changes are only for the MAGI
populations
• DC will start using new rules on October 1
Prepared by Families USA for use in the District of Columbia
How are the rules changing?
Old Rules
New Rules
Household based on who lives
together
Household based on who will be
on the same tax return
Everyone has the same
household
Household must be determined
for each person individually
One way of defining household
Two ways of defining household:
Tax household and fallback
Medicaid household
Prepared by Families USA for use in the District of Columbia
Two Ways to Define Household
1. Eligibility for premium tax credits determined
using tax household
• Based on who will be in the same tax household for
the year in which the family will be getting coverage
• Expected household and expected annual income
2. Eligibility for Medicaid determined using
Medicaid household
• Medicaid household rules are based on tax household,
but with some exceptions
• Current household and monthly income
Prepared by Families USA for use in the District of Columbia
What Applicants Need to Know
Applicants need to tell DC Health Link about:
• Everyone who will be on the same tax
return AND
• Everyone who they live with
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Example 1: Amber and Scott’s Family
Amber and Scott live together and are not
married. They have one child together, Janelle,
who lives with them. Amber and Scott must file
separate tax returns because they are not
married. Amber claims Janelle on her tax return.
When Amber fills out the DC Health Link
application, she should list:
• Amber
• Scott
• Janelle
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Tax Household
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Members of the Tax Household
• The taxpayer
• The taxpayer’s spouse if they are married and
filing jointly
• Anyone the taxpayer intends to claim as a
dependent
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Can the taxpayer claim this dependent?
• There are two types of dependents:
1. Qualifying child
2. Qualifying relative
• When determining if someone can claim a
dependent:
1. Check if the person is the taxpayer’s qualifying
child
2. Check if the person is the taxpayer’s qualifying
relative
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Qualifying Child
A qualifying child must be the taxpayer’s:
• Son, daughter, brother, sister, or a descendant of any
of them (includes step, foster, and half siblings)
Must be one of the following:
• Under age 19 at the end of the year OR
• Under age 24 and a full-time student OR
• Any age if permanently and totally disabled
Must be expected to:
• Live with the taxpayer for at least half the year
• Not provide more than half of his or her own financial
support
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Example 1: Leroy’s Family
Leroy is 28. He supports three people: his 35year-old brother who is disabled and lives with
Leroy, his 16-year-old nephew who lives with
him, and his 19-year-old niece who is in
college full-time in Ohio. He provides more
than half of the support for all three.
Prepared by Families USA for use in the District of Columbia
Who Leroy Can Claim
Leroy can claim the following dependents as
his qualifying children:
• His brother
• His nephew
• His niece
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Qualifying Relative
• A qualifying relative cannot be anyone’s qualifying child
• Must be either:
• Related to the taxpayer (taxpayer’s child or a
descendent of a child, taxpayer’s father, mother,
ancestor, sibling – includes step, in-laws, half
siblings) OR
• Expected to live with the taxpayer for the entire
year
• Must expect to have less than $3,700 in taxable income
for the year
• Taxpayer must expect to provide more than half of the
person’s total financial support for the year
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Example 2: Amber, Lynn, and Joan
Amber is 45 and works as a manager at a
department store making about $44,000 this
year. She expects to make about the same
amount next year. She supports her mother,
Lynn, who lives in Baltimore. Lynn has no
income other than what Amber sends her.
Amber’s 40-year-old friend Joan has also lived
with Amber for the last few years. Joan makes
about $2,000 per year babysitting, but she does
not have any other income.
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Who Amber Can Claim
Amber can claim the following dependents
as her qualifying relatives:
• Lynn
• Joan
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Example 3: Linda’s Family
Linda is a single mom with one child, Jordan,
who lives with her and who she claims on her
taxes. Linda also supports her elderly mother,
Renee, who lives in Baltimore and who she
claims on her taxes.
Who is in Linda’s tax household?
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Linda’s Tax Household
Linda’s tax household includes:
• Linda
• Jordan
• Renee
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Medicaid Household
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Three Ways to Determine
Medicaid Household
Method used depends on your tax filing
situation for the current year:
1. Tax filer who does not expect to be
claimed as a dependent
2. Someone who expects to be claimed on
someone else’s taxes
3. Someone who does not expect to file
taxes or be claimed on anyone else’s
taxes
Prepared by Families USA for use in the District of Columbia
Medicaid Household 1
Tax filer who does not expect to be claimed as a
dependent:
Medicaid household = tax household,
except that married couples who live
together are in the same Medicaid
household even if they file taxes
separately
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Medicaid Household 2
Someone who expects to be claimed on someone
else’s taxes:
Medicaid household = tax household of person
claiming them, with three exceptions
In these three cases, use non-filer rules (Medicaid
Household 3) to determine eligibility for the
person being claimed
Prepared by Families USA for use in the District of Columbia
Medicaid Household 2: Exception 1
Exception 1:
The person is being claimed on a tax return by
someone who is not the person’s spouse or parent
Example:
A grandmother claims her granddaughter.
The granddaughter’s household is determined
using Medicaid Household 3.
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Medicaid Household 2: Exception 2
Exception 2:
A child is under age 19 and the taxpayer who
is claiming the child is a non-custodial parent
Example:
A child claimed by her father who does not
live with her.
The child’s household is determined using
Medicaid Household 3.
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How do you determine who has custody?
Custodial parent is the parent who:
• Has physical custody based on a court
order or binding separation, divorce, or
custody agreement
• If there is no such agreement or shared
custody, custodial parent is the parent with
whom the child spends most nights
Prepared by Families USA for use in the District of Columbia
Medicaid Household 2: Exception 3
Exception 3:
A child is under age 19 and lives with both
parents who do not file taxes jointly.
Example:
A child lives with her unmarried parents.
The child’s household is determined using
Medicaid Household 3.
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Medicaid Household 3
Someone who does not expect to file taxes or be
claimed as a dependent:
For those who are age 19 and older, Medicaid household
includes the person and, if living with the person, his/her:
• Spouse
• Children under age 19
For those who are under age 19, Medicaid household
includes the person and, if living with the person, his/her:
• Parents
• Spouse
• Children under age 19
• Siblings under age 19
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Example: Lisa and Rhoda
Lisa’s 14-year-old niece Rhoda lives with her, and
Lisa claims Rhoda on her taxes every year. Lisa’s
income is $54,000 per year (about 350% of
poverty for a household of two).
The DC Health Link application tells Lisa that she
is eligible for premium tax credits, and Rhoda is
eligible for Medicaid.
Lisa calls your service center to find out why
Rhoda qualifies for Medicaid but she does not.
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Explaining Lisa and Rhoda’s Eligibility
• Lisa’s Medicaid household is Lisa and
Rhoda. With a household size of two and
an income of $54,000, her income is 350%
of poverty and she is eligible for premium
tax credits.
• Rhoda’s Medicaid household is just Rhoda
because the person claiming her (Lisa) is
not her parent or her spouse. Rhoda has a
Medicaid household size of one and no
income, so she qualifies for Medicaid.
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Special Rules for Pregnant Women
• Tax household remains the same
• Medicaid household size changes:
pregnant woman is counted as herself +
the number of children she expects to
deliver in her own household and in the
household of others
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Example: Crystal’s Family
Crystal and James are married and live
together with their five-year-old daughter,
Maria. Crystal and James file their taxes
together and claim Maria as a dependent.
Their income is about $45,000 per year, which
is about 230% of poverty.
Crystal and James get premium tax credits and
cost-sharing reductions, while Maria gets
Medicaid.
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Example: Crystal’s Family (cont’d)
Crystal finds out she is pregnant with twins and
reports this to DC Health Link. DC Health Link
responds by saying Crystal and James are now
eligible for Medicaid.
How would you explain why this happened?
Prepared by Families USA for use in the District of Columbia
Explaining Crystal’s Family’s Eligibility
Since Crystal told DC Health Link she is pregnant
and expects to deliver two children, DC Health Link
has reassessed the family’s eligibility.
With a household size of five, Crystal, James, and
Maria are now at 163% of poverty, so Crystal and
James now qualify for Medicaid too.
Prepared by Families USA for use in the District of Columbia
Things to Remember
• Applicants will need to provide information about
everyone who lives with them AND everyone who is
on the same tax return
• New household rules are only for MAGI populations,
but non-MAGI individuals are still included in the
households of MAGI people
• Household members who are incarcerated or
undocumented are included as long as they fit the
rules for determining household
• Each person has his or her household determined
separately
Prepared by Families USA for use in the District of Columbia
Review: Question #1
TRUE or FALSE:
Because the new rules for household
composition are based on IRS tax rules,
applicants need to include information about
only people who are on the same tax return
as they are.
Prepared by Families USA for use in the District of Columbia
Answer: Question #1
FALSE
Tax household will be used in most cases,
but there are some situations where we
need to know who lives with a person as
well. Applicants should always include those
in their tax household and people who live
with them on the application.
Prepared by Families USA for use in the District of Columbia
Review: Question #2
Amber and Scott live together and are not
married. They have one child together, Janelle,
who lives with them. Amber and Scott must file
separate tax returns because they are not
married. Amber claims Janelle on her tax return.
Who is in Janelle’s tax household when
determining eligibility for premium tax credits?
Prepared by Families USA for use in the District of Columbia
Answer: Question #2
ANSWER:
Amber and Janelle
Eligibility for premium tax credits is based on
tax household. Amber claims Janelle on her
taxes, so Janelle’s tax household is Amber
and Janelle.
Prepared by Families USA for use in the District of Columbia
Review: Question #3
Amber and Scott live together and are not
married. They have one child together, Janelle,
who lives with them. Amber and Scott must
file separate tax returns because they are not
married. Amber claims Janelle on her tax
return.
Who is in Janelle’s Medicaid household?
Prepared by Families USA for use in the District of Columbia
Answer: Question #3
ANSWER:
Amber, Scott, and Janelle
Janelle is claimed as a tax dependent, so we
use Medicaid Household 2. However, since she
lives with parents who do not file taxes jointly,
her Medicaid household is actually Medicaid
Household 3. She lives with both her parents,
so they are part of her Medicaid household.
Prepared by Families USA for use in the District of Columbia
Recap of Household Composition
• What you will do:
• Fill out application questions
• After application is finished, enter any
changes that occur
• What the system will do for you:
• Determine household composition for each
family member
• Give you the right questions to ask for each
family member
Prepared by Families USA for use in the District of Columbia
Income
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Review: What is MAGI?
• Stands for “Modified Adjusted Gross Income”
• New way of calculating income to determine
eligibility for:
• MAGI Medicaid
• Premium tax credits and cost-sharing
reductions
• Non-MAGI Medicaid will still use existing
income counting rules through the ACEDS
system
Prepared by Families USA for use in the District of Columbia
How the DC Health Link Application
Will Determine Income
• Income section of application will not be the
same for every applicant
• Some will need to estimate only next year’s
income
• Others will need to provide more detail on
different types of income
• Information about some income will be prepopulated
• Always be sure to check that this prepopulated information is correct
Prepared by Families USA for use in the District of Columbia
Whose income is included?
• Calculated separately for each person’s household
• Includes applicants and non-applicants
• DC Health Link application will automatically
subtract income from tax dependents who are not
required to file taxes
• For example, a college student whose parents claim
her as a tax dependent and who made less than
$5,950 in 2012 did not have to file her own taxes
• Step-parent income now included
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How is MAGI calculated?
Three steps:
1. Add up all types of income for each
household member
2. Subtract adjustments to income
3. If potentially Medicaid eligible, apply
special treatment to three types of income
DC Health Link application will do all of this
for you.
Prepared by Families USA for use in the District of Columbia
Step 1:
Add Up All Types of Income
DC Health Link Application asks about different
types of income, such as:
• Wages and tips from a job
• Earnings from self-employment
• Unemployment
• Rental income
• Social Security benefits
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Income from Self Employment
• Important to subtract business expenses
• Applicants can report expenses, such as:
• Rent or lease of business property
• Car and truck expenses
• Employee wages and benefits
• Advertising
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Less Common Forms of Income
that Are Included
DC Health Link application will ask about some
less familiar forms of income, such as:
• Capital gains or losses
• Investment income like interest and
dividends
• Rental or royalty income
• Farming or fishing income
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Common Forms of Income that
Are Not Included
Income does not include:
• SSI
• Child support
• Workers’ compensation
• Veterans’ benefits
• TANF and SNAP benefits
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Step 2:
Subtract Adjustments to Income
• Adjustments are certain expenses that you
can take out of taxable income
• Common adjustments:
• Alimony paid
• Student loan interest
• Contributions to an IRA
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Step 3:
If a Person Is Potentially Eligible for Medicaid…
DC Health Link application will ask additional
questions about three types of income for
those who might be eligible for Medicaid:
• Lump sum payments (e.g., back pay)
• Taxable educational awards
• Certain American Indian/Alaskan Native
income
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American Indian/Alaskan Native Income
• Income excluded:
• Per capita payments from a tribe from natural
resources, usage rights, leases, or royalties
• Payments from natural resources, farming, ranching,
fishing, leases, or royalties from designated Indian
trust land
• Money from selling things that have cultural
significance
• DC Health Link will give you the questions to ask
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Changes to Income Disregards
• Affordable Care Act ends current income
disregards and replaces with a single, 5%
disregard
• For example, no more Dependent Care
Deduction
• Parents and Caretaker Relatives now eligible
up to 221% of poverty (216% +5% disregard)
• Non-MAGI applicants still have income
disregards
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No Asset Questions in
DC Health Link Application
• Like today, eligibility for MAGI groups does
not depend on assets
• No asset questions in DC Health Link
application
• Asset tests still used for non-MAGI
populations
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Verifying Income
• DC Health Link application will make verifying
income much easier
• Some applicants will not need to provide proof
because DC Health Link has their information from:
• IRS tax data
• Work Number
• Department of Employment Services
• Quarterly wage data
• Other electronic data sources
• Others will still need to show proof, like paystubs
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Things to Remember
• Important to help applicants check and
update pre-populated information
• Income information is needed for both
applicants and non-applicants
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Review: Question #1
TRUE or FALSE:
Chris’s application includes two nonapplicants, Mandy and Will. Even though
Mandy and Will are not applying for
coverage, we still need to know about their
income.
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Answer: Question #1
TRUE
Income information is needed for applicants
and non-applicants.
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Review: Question #1
TRUE or FALSE:
The application only needs information
about applicants, not non-applicants.
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Answer: Question #1
False
Income information is needed for applicants
and non-applicants.
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Review: Question #2
TRUE or FALSE:
Child support is an important source of
income to include in the DC Health Link
application.
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Answer: Question #2
FALSE
Child support is not taxable income, so it is
not included in calculation of income under
the new rules.
Prepared by Families USA for use in the District of Columbia
Recap of Income
• What you will do:
• Fill out application questions
• After application is finished, enter any
changes that occur
• What the system will do for you:
• Determine what income is included
• Calculate household income separately for
each family member
Prepared by Families USA for use in the District of Columbia
Consumer Notices
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When are notices provided?
DC Health Link automatically sends a notice whenever:
• An action is taken that could affect eligibility
• Note dates for termination, changes and appeals
• Information is needed
• Different timeframes to provide documentation
for Medicaid and DC Health Link plans
• New information is received
• Notice will request confirmation
• Note Medicaid and DC Health Link timeframes to
respond if disagreement
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Combined Notices
• One combined notice for information about
coverage through DC Health Link and
Medicaid
• Makes it easier for families with mixed
eligibility
• Example: A parent is eligible to enroll in a
health plan though DC Health Link and
receive a premium tax credit, while the
children are eligible for Medicaid. They get
one notice.
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How will notices be sent?
•
Consumers can choose to receive:
• Paper notices (default, except for
applicants without fixed address)
• Electronic notices
•
•
Posted to “My Account”
Email alert sent
• Both paper and electronic notices
• Authorized representatives will receive all
notices as well
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Content of Notices
• Written in language that is easy to understand
• Available in other languages
• Notices will explain:
• The person’s eligibility for coverage, help with costs
• What the decision is based on
• Any action DC Health Link will take and when
• Any action the consumer needs to take and by when
• How to continue getting benefits and/or enroll in a
plan while waiting for a final eligibility determination
• Information on the right to appeal
• How to get assistance and access “My Account”
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Notice Example #1
A notice on eligibility might explain to an applicant:
You are ineligible for Medicaid. However, you are
eligible to enroll in a health plan and receive a
premium tax credit through DC Health Link, but
additional documentation is needed to verify
income. Here is a list of documentation you must
provide. You can select a DC Health Link plan and
receive benefits while we verify your eligibility.
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Notice Example #2
A renewal notice might explain to an enrollee:
You will be re-enrolled in your current DC
Health Link plan unless you select a new plan.
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Things to Remember
• DC Health Link automatically generates notices
whenever any new information is received or a
change is made to a consumer’s coverage
• Consumers should choose the method of
receiving notices that is best for them
• Make sure consumers understand the
importance of responding to notices
• Tell consumers how to get help with anything
they do not understand
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Appeals
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Building on the Current Appeals System
• DC Health Link appeals will follow the same
appeals process that is used for Medicaid now
• As in current process, starting an appeal will
trigger both:
1. Informal review by Office of Administrative
Review and Appeals (OARA)
2. Formal hearing through Office of
Administrative Hearings (OAH)
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Assistance with Appeals
• Service center staff will need to provide
assistance only with starting appeals
• If consumers need additional help, they should
contact the DC Health Link customer service call
center or the Office of Administrative Hearings
• Notices will include contact information for
sources of help with appeals (for example, legal
services programs)
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Options to Start an Appeal
• ESA or OAH worker helps consumer start an
appeal by entering it into DC Health Link
• Consumer starts an appeal using his or her DC
Health Link “My Account”
• Customer service call center helps consumer
start an appeal by entering it into DC Health Link
• Consumer mails an appeal form to ESA or OAH
• In-person assisters, agents, and brokers can also
help consumers start appeals through any of the
methods above
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Reasons to Appeal
Consumers should appeal if they disagree with
any decision made by DC Health Link or
Medicaid
• Determination of eligibility or ineligibility for
Medicaid, DC Health Link plans, or premium
tax credits
• Amount of premium tax credit
• Termination, suspension, or reduction of
benefits
• Delayed processing of an application or failure
to take timely action on new information
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Appeal Timeline
• Consumers must receive notice at least 10 days
before an action is taken
• Consumers have 90 days after getting a notice to
start an appeal
• For DC Health Link plans and premium tax credits,
current coverage will continue or be reinstated
retroactively when the appeal request is processed
• For Medicaid, coverage will continue if a person
requests an appeal before his or her coverage is
terminated
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Appealing a Denial of Services
If consumers want to appeal a health plan’s
denial of services or failure to pay a medical
bill, they should contact the Office of the
Health Care Ombudsman and Bill of Rights
for help.
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Things to Remember
• The role of ESA in the appeals process is to
help the consumer start an appeal
• Any time a consumer disagrees with a decision
or thinks a mistake has been made, they
should appeal
• DC Health Link appeals will use the same
process Medicaid uses now
• Provide referrals for additional help
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