TN 15 (08-09)

HI 03020.045 Determining the Value of In-Kind Support and Maintenance (ISM)

A. Definition of ISM

ISM is food or shelter or both provided to the individual and the individual’s living-with spouse that is paid for by someone else. Shelter expenses include room, rent, mortgage payments (including property insurance required by the mortgage lender), real property taxes, heating fuel, gas, electricity, water, sewerage, and garbage collection services. An individual can receive ISM when living alone, living with others, or residing in a facility or institution. ISM is countable as unearned income. An individual may receive ISM from inside or outside the household.

REMINDER: Receipt of occasional, small amounts of help for household expenses may be excludable as infrequent or irregular income.

NOTE: Under Public Law (P.L.) 110-275 (The Medicare Improvements for Patients and Providers Act (MIPPA) of 2008), ISM will not be counted as income for Medicare Part D Extra Help applications. The changes in counting ISM as income because of MIPPA are effective for: applications effectively filed on or after January 1, 2010; and initial determinations that do not become effective before January 1, 2010. An example of an initial determination that becomes effective on or after January 1, 2010 is a periodic or cyclical redetermination initiated in August 2009.

B. Policy for determining the value of ISM for Medicare Part D Extra Help

1. Current market value

The amount of ISM that we count as income is the current market value of the food or shelter provided to the individual (and his or her living-with spouse) that is paid for or provided by someone else. If the current market value of the ISM is greater than one-third of the applicable monthly SSI (Supplemental Security Income) Federal benefit rate (FBR), we count only one-third of the applicable monthly SSI FBR as income.

2. Maximum ISM rate for an individual

The maximum amount of income we count from ISM per month is limited to one-third of the monthly SSI FBR for an eligible individual that is in effect at the time we determine eligibility for Extra Help. To view the SSI FBR for a particular year, see SI 02001.020C.

3. Maximum ISM rate for a married couple

The maximum amount of income we count from ISM for an individual and living-with spouse per month is limited to one-third of the monthly SSI FBR, for an eligible couple at the time we are determining eligibility for Extra Help. This amount applies whether one member or both are filing for Extra help. To view the SSI FBR for a particular year, see SI 02001.020C.

4. ISM received by a child from parents

Food or shelter or both provided by parents to a child, as defined in SI 00501.010 is not ISM, when the parents and child are members of the same household. However, food or shelter or both provided to the child from any other sources inside and outside the household are countable as ISM and the value is calculated the same as for an adult individual.

5. ISM received during a medical confinement

Food or shelter or both received during a medical confinement is not ISM. A medical confinement exists when an individual receives inpatient medical services in a medical treatment facility. For a definition of medical services see SI 00815.050B.1.a. and for a definition of medical treatment see SI 00520.011.

6. ISM received by members of religious orders

This section applies only to members of religious orders who have taken a vow of poverty. Food or shelter or both that is not considered part of a member's wages is ISM. If the food or shelter or both is earned income, it cannot also be considered ISM.

Members of religious orders are required to turn over all money to the order, as fulfillment of the vow of poverty. Because of the vow of poverty, the order has an express obligation to provide food and shelter for the member. When the member lives in a convent, or any facility or living quarters provided by the order, the order provides food and shelter to the member.

Food or shelter or both provided to an individual is countable income (ISM) unless the individual pays for it with his or her own funds. Under the vow of poverty, the member turns over his or her money to the order in fulfillment of the vow and not as a payment for food or shelter or both. Food or shelter or both provided by the order is counted as ISM. (For additional information about income received by members of religious orders see SI 00810.700.)

C. Procedure for developing the value of ISM

For purposes of determining Extra Help eligibility do not use the ISM procedures for the SSI program.

NOTE: These procedures apply only to Medicare Part D Extra Help applications filed December 31, 2009, or earlier. The instructions in this section will be needed until all cases for 2009 and earlier have been processed. Public Law 110-275 MIPPA, changes the rules for counting ISM as income for Medicare Part D Extra Help applications. ISM will not be counted as income for: applications effectively filed on or after January 1, 2010; and initial determinations that do not become effective before January 1, 2010. An example of an initial determination that becomes effective on or after January 1, 2010 is a periodic or cyclical redetermination initiated in August 2009.

1. Development of ISM

Follow these instructions for developing and documenting ISM:

  • Ask the individual for the value of ISM received from any source (inside or outside the household);

NOTE: For ISM purposes, “household” means the same as in the SSI program. It is not necessarily the same as the family size used to determine the Federal Poverty Level (FPL). For example, if the individual lives with someone who is not a relative, the non-relative would be considered part of the household for purposes of determining ISM but would not be considered part of the family when determining the appropriate FPL rate (For the definition of “family size” for Extra Help purposes, see HI 03020.055.)

  • Accept without further development the individual’s allegation of the value of ISM he or she receives;

  • If the individual alleges receipt of ISM, but is unable to provide an estimated amount during the interview, ask the individual to contact the provider or a knowledgeable source to get an estimate;

  • Documents provided by the individual may be used to help figure out the current market value (CMV), but do not routinely request documents and do not copy the documents for the file. Record the documentation in the Medicare Application Processing System (MAPS) per HI 03035.006D.;

  • If the individual (or couple) alleges receipt of food or shelter or both in a month that is worth more than one-third of the applicable SSI FBR, count only one-third of the applicable FBR as ISM per month;

  • If the individual (or couple) alleges receipt of food or shelter or both less than one-third of the applicable FBR, count the alleged current market value as ISM;

  • Input the alleged monthly CMV to the system because the subsidy determination system is programmed to cap the ISM amount at the maximum countable level (See MAPS coding examples 4 and 5 in
    HI 03020.045D.);

  • Accept without further development the individual’s allegation that a roommate’s contribution is for the roommate’s own household expenses, because a contribution by a roommate toward his or her own share of the household expenses does not count as ISM for the individual;

  • If the individual alleges free rent, or a payment for rent, food, or utilities from outside the household, divide the alleged value of the ISM by the number of household members to determine the individual’s share of the ISM. Count the individual’s share of the ISM as unearned income. For a married couple, each member of the couple receives an individual’s share of the household ISM. Count the share of the ISM that each member receives as unearned income, whether one or both members of the couple are filing.

2. Excluding small amounts of in-kind and cash help

Question 11 on the Medicare Part D application (SSA-1020) contains the statement, “Do not include small amounts of money given occasionally or unexpectedly.” This statement was added to the application so that Extra Help applicants completing the self-help SSA-1020 would not report insignificant amounts of ISM, e.g., a bag of groceries, a restaurant meal, etc.

NOTE: Although there is no special exclusion in the Medicare Part D prescription drug Extra Help program for small amounts of ISM, small amounts of help may be excludable by applying the SSI infrequent or irregular income exclusion per SI 00810.410

a. Extra Help applicant alleges receipt of in-kind help for food or shelter

If the Extra Help applicant alleges receiving in-kind help for food or shelter or both, follow these steps:

  • In-kind help is countable as ISM;

  • Consider whether the help can be excluded under the infrequent or irregular income exclusion (SI 00810.410).

  • It is not necessary to document the file if the help is excluded as infrequent or irregular income.

  • If the in-kind help is not excludable, input the monthly amount of ISM the applicant receives.

  • For guidance on inputting ISM that is not received monthly, see the example in HI 03020.045D.4.

b. Extra Help applicant alleges receipt of cash help

If the applicant alleges receiving cash help for food or shelter or both, follow these steps:

  • Cash help is not ISM, but it may be cash income;

  • A cash contribution from outside the household is countable as cash income unless it can be excluded as infrequent or irregular income;

  • A cash contribution from inside the household is not counted as ISM or cash income if it is a roommate’s contribution towards the roommate’s portion of the household expenses. Accept without further development the applicant’s allegation that a roommate’s contribution is for the roommate’s portion of the household expenses;

  • If the cash is not excludable, it should be input as “other income” in Question 9 of the SSA-1020.

Refer to SI 00810.410, “Infrequent or Irregular Income Exclusion” for development and documentation guidelines. To view the Medicare Part D application (SSA-1020), see HI 03010.038G.

3. Computing the value of ISM

We always accept the individual’s allegation of the value of ISM. However, if an individual alleges getting ISM but cannot provide any estimate of the dollar value, compute the value of ISM as follows:

  • Calculate the total household expenses for food or shelter or both. Include expenses paid by members of the household and expenses paid by sources outside the household (A list of shelter expenses is in HI 03020.045A.);

  • Divide the total expenses by the number of members of the household to determine the individual’s share of the expenses;

  • If the individual pays less than his or her share of the expenses, the difference between the share of the expenses and the individual’s payment is the CMV of the ISM received by the individual;

  • For a married couple, combine their individual shares of the household expenses and combine their contributions.

D. Examples of ISM determinations

1. Example 1 – ISM received by an individual adult applicant

Mr. Smith files an Extra Help application and alleges that his adult children pay all of his rent and utilities. His rent is $450 per month and he estimates that his utilities cost about $200 per month. The current market value of the ISM is $650. Since the CMV is higher than one-third of the SSI FBR, cap the countable ISM at one-third of the FBR. The claim representative (CR) inputs the actual value of the ISM ($650) in MAPS. The system will cap the countable amount at one-third of the FBR.

2. Example 2 – ISM received by a married couple

Mr. and Mrs. Jones file an Extra Help application and allege that they get free rent from their son. They allege that the free rent is worth $200 per month. The CR accepts their allegation as the current market value. Because the current market value is less than one-third of the SSI couple FBR, the CR determines that the countable ISM is $200 per month. The CR inputs the actual value of the ISM ($200) in MAPS.

3. Example 3 – ISM received by a child applicant

A 15 year old Extra Help applicant, who meets the SSI definition of a child, lives with her parents, and her aunt. The child receives her food from her parents and her aunt. The child’s grandfather, who is not a member of the household, pays the rent for the household. The food provided by the child’s parents is not ISM. The food provided by the child’s aunt and the shelter provided by the child’s grandfather is countable as ISM.

4. Example 4 - ISM received in part of the year: actual value of ISM counted

Mr. Wilson files an Extra Help application in December 2007 and he turns 65 in January 2008. He alleges that his brother will pay his heating bill from November 2007 through March 2008. The ISM received in 2007 does not count because January 2008 is Mr. Wilson’s first month of potential eligibility. Mr. Wilson alleges that the heating bill will average about $160 per month for the 3 months (January, February, and March 2008). The claims representative determines that Mr. Wilson will get a total of $480 worth of countable ISM during 2008 (3 months x $160 = $480). The CR divides the $480 by 12 months and determines that Mr. Wilson will receive an average of $40 per month of ISM during 2008. The CR inputs $40 per month as the amount of ISM received. Based on the input of $40, MAPS will determine correctly that Mr. Wilson will receive $480 of ISM in 2008.

5. Example 5 – ISM received in part of the year: one-third of the FBR counted

Mr. and Mrs. Hollenbrook file an Extra Help application in January 2008 and allege that a relative will pay their heating bill, rent, and food from January through March 2008. The couple alleges that the heating bill will average about $250 per month, the rent is $600 per month, and the groceries will average $400 per month for the 3 months (January, February, and March 2008). The claims representative determines that Mr. and Mrs. Hollenbrook will receive a total of $3750 worth of ISM during 2008 (3 months x $1250 = $3750). However, ISM is capped at one-third of the FBR per month ($318.66 per month in 2008 for a married couple). Therefore, the Hollenbrook’s will receive $955.98 ($318.66 x 3 months) of countable ISM in 2008. The CR divides the $955.98 by 12 months and determines that Mr. and Mrs. Hollenbrook will receive an average of $79.66 per month of ISM during 2008. The CR inputs $79.66 per month as the amount of ISM received. Based on the input of $79.66, MAPS will determine that Mr. Wilson will receive $955.98 of ISM in 2008.

E. References

SI 00501.010 - Determining Child Status for Supplemental Security Income (SSI) Purposes

SI 00810.410 - Excluding Infrequent or Irregular Income

SI 00835.020 - Definitions of SSI ISM terminology


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0603020045
HI 03020.045 - Determining the Value of In-Kind Support and Maintenance (ISM) - 07/13/2016
Batch run: 07/13/2016
Rev:07/13/2016