Fwd: [Health-announce] New application form
10/21/14
MassHealth and the Connector have posted the new paper application form to be used in applying for MassHealth, subsidized insurance through the Connector, CMSP and the Health Safety Net for people under age 65. It's the ACA-3 (Oct 2014).
. . .
Listed below are some tips from MLRI for completing the income section of the ACA-3.
If you are a Navigator or CAC, please let us know if your training on the new application form has alerted you to the issues we describe below!
In filling out the new application, there are a couple of things to watch out for when entering income information under the Modified Adjusted Gross Income (MAGI) methodology --
- Current job information. The form asks for your wages/tips (before taxes). In filling in an amount on this line, do not take out taxes but do take out any pre-tax deductions that will not appear on the person's W-2 and will not be included in their wage income when they file taxes. These may include pre-tax deductions for things like child care, transportation or retirement plans. Pay stubs may show Gross Pay, Pre-tax Deductions, Taxes & Take Home Pay (net of both pre-tax deductions and taxes). The wages included in MAGI and that should be entered on the application form are Gross Pay LESS Pre-Tax Deductions.
- Other income. Except for social security, tax-exempt interest, and certain foreign income (these are the "modifications" of AGI that makes it MAGI) only include income that will be included in adjusted gross income when the person files taxes for the year. The form warns you not to put in child support, VA payments or SSI, because these are not included in AGI.h It lists some examples of income that are included in MAGI but then asks for "other income." Only put in "other income" that will be included in Adjusted Gross Income. If the applicant has a new source of income or has never filed taxes and doesn't know if the income is taxable, try going to irs.gov and asking if the source of income is taxable income. If you report "other income" the computer is not programmed to recognize taxable/non-taxable income, it will count any income you include as "other income."
- Losses. Under the old gross income rules, MassHealth never counted losses as anything but zero income from that source. That's not how it works with MAGI. Income from self-employment and certain other sources can be profit OR LOSS. This is important for people who may have income from one source but a loss from another source. Reporting the loss will result in lower AGI. Again it is the federal tax rules that determine what counts as a loss in getting to Adjusted Gross Income.
- Income of tax dependents/ income of the children of non-filer parents who are not claimed as dependents. Under MAGI, the income of tax dependents (or the children of non-filing parents) does not count unless the dependent's income is high enough that the dependent will be required to file a return. Applicants don't need to figure out if their dependent has to file a return. The application form asks for income information for all applicants in the same way. The computer making eligibility decisions is programmed to apply the income threshold test under the tax rules to a dependent's income. It should not count the income of a dependent who is not required to file a return. For purposes of the tax threshold, only taxable social security counts. This means children whose only income is a social security dependent's benefit should not have that income counted in the income of the MAGI household that includes the child as a dependent (or the child of non-filing parents).
- Seasonal income. The ACA-3 asks if a person is seasonally employed. In the on-line application, if reported income is higher than the on-line data match, a drop down menu will ask in which months the person had seasonal income, but of course there is no drop down menu with the paper application form. To avoid a data mis-match when the paper application is later entered into the computer, try reporting seasonal income on a Yearly basis.
For more information on MAGI, visit the health section of masslegalservices.org. We've posted resources from MLRI, the National Health Law Program and the Center on Budget and from the federal Medicaid agency, CMS.