TN 20 (12-11)
HI 03035.020 Verification Process for Liquid Resources
A. Introduction to the verification process
Applications go to the verification process when the comparison of application data and agency data for resources falls within certain tolerances. Follow instructions in Verification and Documentation Process for Medicare Application Processing System (MAPS) HI 03035.006 and Verification and Documentation Instructions for Internal Revenue Service (IRS) Data within the Medicare Application Processing System (MAPS) HI 03035.007.
This section provides additional instructions specifically for verification of cash and financial accounts.
B. Policy for counting cash and financial institution accounts as resources
When determining Medicare Part D Extra Help eligibility, cash and financial accounts are countable resources. For more information on how financial institutions count accounts, see HI 03030.015.
C. Policy for resource tolerances for application and agency data comparison
We base the resource tolerances on the 2018 resource limits for Part D Extra Help eligibility, as follows:
$7,560 to $12,600 for an applicant;
$11,340 to $25,150 for a married couple
The sources of agency data used for financial accounts and savings bonds are:
1. Computing agency data for resources
Data provided by the IRS match does not include the amount of money an applicant has in his or her financial accounts. The IRS provides data about the interest income on IRS Form 1099-INT, or dividends and distributions on IRS Form 1099-DIV earned by the applicant’s financial accounts, but does not provide the account balance. Based on the interest reported for the account, the subsidy determination system computes an estimated account balance for the applicant’s financial accounts. The system uses this estimated account balance as the agency data for financial accounts.
2. Resource verification tolerances for single applicants
a. Verification required
The system sends the application to verification if:
the application data indicates resources of $7,560 or less and the agency data indicates resources over $7,560; or
the application data indicates resources between $7,560.01 and $12,600 and the agency data indicates resources over $12,600.
EXAMPLE: On his application, Mr. White alleges that he has $500 in cash, $3,500 in his bank accounts, and $6,000 in savings bonds. The application data for Mr. White indicates resources of $10,000. The agency data, derived from data provided by the IRS and BPD, indicates resources of $13,000. Because application data is under $12,600 and agency data is over $12,600, the system sends the application to verification.
b. Verification not required
The system does not send the application to verification if:
the application data and the agency data both indicate resources of $7,560 or less;
the application data and the agency data both indicate resources between $7,560.01 and $12,600; or
the application data indicates resources over $12,600, regardless of the amount of agency data.
EXAMPLE: On her application, Ms. Smith alleges $500 in cash, $8,000 in bank accounts, and $12,000 in a retirement account. The application data for Ms. Smith indicates resources of $20,500. The agency data, derived from data provided by the IRS, indicates resources of $9,500. Because the application data is over the $12,600 resource limit, the application does not go to verification. The system issues a pre-decisional notice to Ms. Smith informing her that she appears to be ineligible for Extra Help.
3. Resource verification tolerances for married couples
a. Verification required
The system sends the application to verification if:
the application data indicates resources of $11,340 or less and the agency data indicates resources over $11,340; or
the application data indicates resources between $11,340.01 and $25,150 and the agency data indicates resources over $25,150.
b. Verification not required
The system does not send the application to verification if:
the application data and the agency data both indicate resources of $11,340 or less;
the application data and the agency data both indicate resources between $11,340.01 and $25,150; or
the application data indicates resources over $25,150, regardless of the amount of agency data.
D. Procedure for the verification of liquid resources
1. Contact the applicant
If you make contact with someone other than the potentially eligible applicant, use caution to avoid improper disclosure.
Follow the general verification procedure for contacting the applicant including phone contacts and sending the Evidence or Information Request Notice in HI 03035.006.
NOTE: Under Public Law 110-275 (The Medicare Improvements for Patients and Providers Act of 2008), the cash surrender value of a life insurance policy is not countable as a resource for Medicare Part D Extra Help applications filed January 1, 2010, or later. Although the system does not select CSV as a verification issue, the claims representative might identify CSV as a development issue while processing another verification issue (e.g., the applicant reported resources incorrectly on the application). In that situation, count CSV as a resource for Extra Help applications filed December 31, 2009, or earlier. If the applicant files an Extra Help application January 1, 2010, or later, CSV is not countable as a resource and the system will not use it in the computation of countable resources.
2. Document the $250 economic recovery payment from the American Recovery and Reinvestment Act (ARRA) of 2009
Ask the applicant whether he or she received the $250 one-time economic recovery payment under the ARRA.
For purposes of this exclusion, assume that the applicant retained the $250 payment. It is not necessary to ask the applicant if he or she retained these funds.
Exclude the $250 payment from resource counting for the month the applicant received the payment and for the following nine months when determining Part D Extra Help eligibility.
Correct the resource amounts on the resource verification screen if the applicant incorrectly reported any of these funds as resources and document the verification on the MAPS Report of Contact screen (DWRC).
EXAMPLE: If the applicant receives the one-time payment in May 2009, it does not count as a resource in the month of receipt and is excluded as a resource for June 2009 through February 2010. Count retained funds as countable resources beginning March 2010.
NOTE: Most of the $250 payments were issued during May 2009. However, under the law distribution of these payments may continue through December 31, 2010. If an applicant received a $250 payment in December 2010, exclude it from resources through September 2011.
HI 03030.020, For information on the resource exclusion for the one-time $250 payment
HI 03020.050, For more information on the income exclusion for the one-time $250 payment
3. Verify the Making Work Pay Tax Credit from the American Recovery and Reinvestment Act of 2009
The Making Work Pay Tax Credit provides for a tax credit of up to $400 per year for the years 2009 and 2010 (up to $800 per year for filers of joint tax returns).
During verification, if the applicant’s resources exceed the lower or higher resource limits for Medicare Part D Extra Help and the applicant reported wages on the application, develop the resource exclusion for this tax credit.
This tax credit increases the take home pay of working applicants because the employer reduces the rate of income tax withholding deducted from the applicant’s paycheck.
Do not count the increase in take home pay due to this tax credit as a resource in the month received and exclude it from resources for the following two months.
It is not feasible to determine the actual amount an applicant receives each month from this tax credit. For purposes of determining the excludable resource amount for the Medicare Part D Extra Help, we assume that the applicant receives a $35 per month excludable tax credit for any month that he or she receives wages. Assume that the excludable tax credit is $70 per month for a married couple for any month that both members of the couple receive wages.
If the applicant has more than one employer, assume that the tax credit is $35 per employer. For example, if the applicant has two jobs and the spouse has one job, the excludable amount would be $105 per month (3 times $35).
For purposes of applying this resource exclusion, assume that we retain the tax credit when making the resource determination. Assume that the applicant receives a tax credit in every month, he or she alleges wages on the application, and there is no allegation of a stop work date.
Applicants who have very low wages may not receive their full tax credit through an increase in their take home pay.
Self-employed applicants also do not receive the tax credit in take home pay. These applicants can get the tax credit as part of their tax refund when they file their income tax return. If the applicant receives a tax credit in their tax refund, exclude it from resources for the month of receipt and the following two months. In these situations, ask the applicant the amount received from the tax credit and exclude that amount.
NOTE: If the applicant also received the $250 one-time economic recovery payment, we reduce the Making Work Pay Tax Credit by that amount. Thus, if the applicant is eligible for the full $400 tax credit in his or her tax refund, the $400 tax credit is $150 ($400 minus $250).
EXAMPLE: Tax credit received in take home pay
Mr. Johnson files for Medicare Part D Extra Help in June 2009. The application indicates that his spouse is working and there is no work stop date on the application. During verification, the claims representative (CR) determines that the Johnsons’ resources are over the lower resource limit and develops the resource exclusion for the Making Work Pay Tax Credit. The CR determines that $105 is excludable from resources ($35 per month for April, May, and June 2009) due to Mrs. Johnson’s wages. The CR does an input to correct the amount of the Johnsons’ resources and documents the verification contact and determination on the MAPS Report of Contact screen.
EXAMPLE: Tax credit received in tax refund
Ms. Wilson, receives Title II benefits, is self-employed, and files for Medicare Part D Extra Help in June 2010. During verification, the CR determines that Ms. Wilson’s resources are over the upper resource limit. Because she is self-employed, she received the Making Work Pay Tax credit in her tax refund. Because she also received the $250 economic recovery payment in 2009, there is a reduction in her Making Work Pay Tax Credit by $250. Based on her 2009 federal income tax return, she received a $150 Making Work Pay Tax Credit as part of her tax refund in April 2010. This $150 tax credit is not countable as a resource in April 2010, and excluded from resources for May and June 2010.
NOTE: We do not exclude the $25 weekly ARRA unemployment compensation increase from income or resources. This issue does not require additional documentation or development verification. For more information about the $25 unemployment compensation increase, see HI 03030.020.
4. Verify the Filipino Veterans Equity Compensation Fund payment
ARRA establishes the Filipino Veterans Equity Compensation Fund that provides a one-time payment for veterans who served in the Philippines armed forces during World War II. Only a small number of veterans receive this one-time payment, however, some veterans who file for Medicare Part D Extra Help may require verification.
The veterans who are citizens of the United States are eligible for a one-time payment of $15,000. The veterans who are non-citizens are eligible for a one-time payment of $9,000. A veteran’s surviving spouse may receive this payment, but only if the veteran filed for it prior to death.
Exclude this one-time payment from resources to determine Medicare Part D Extra Help eligibility whether received by the veteran or the surviving spouse.
ARRA does not have a time limit on the resource exclusion for this payment. Therefore, exclude these funds for as long as we retain them.
Accept the applicant’s allegation about the amount of excluded funds retained from this special payment and exclude that amount.
If the applicant is unable to provide an allegation about the amount of retained funds from the special payment, develop the excluded amount using the instructions for commingled funds in, SI 01130.700.
Correct the resource amount on the resource verification screen if the funds are incorrectly reported as a resource and document the verification on the MAPS Report of Contact screen (DWRC).
NOTE: Direct all public inquiries related to applying or obtaining eligibility requirements to the Department of Veterans Affairs Office at 1-800-827-1000 or to their website: www.va.gov , (Office locator listed).
HI 03030.020, For more information about resource exclusions for Medicare Part D Extra Help
HI 03020.050, For more information about income exclusions for Medicare Part D Extra Help
5. Verify payments from the Economic Stimulus package of 2008
When verifying resources for Extra Help applications filed May 1, 2008, through March 31, 2009, ask the applicant if he or she reported on the application any money received under the Economic Stimulus Act of 2008.
If yes, ask the applicant to provide the month he or she received the stimulus payment and determine if the funds are excludable. Do not count these funds as a resource for two months following the month of receipt when determining Medicare Part D Extra Help eligibility.
If the applicant incorrectly reports any of these funds as resources, the CR must correct the resource amounts on the resource verification screen accordingly. We always count conserved stimulus funds retained after March 2009 as resources because we assume that applicants received payments issued in December 2008 no later than January 2009.
For information about Extra Help income verification for stimulus payments, see HI 03035.010.
EXAMPLE: If the applicant receives a payment in May 2008, exclude the payment from resources for June 2008 and July 2008. In this example, the funds, if retained, are countable as a resource starting in August 2008.
6. Ask if the applicant agrees with agency data
a. Applicant agrees with agency data
Inform the applicant that we will use the agency data for the Extra Help determination, if he or she agrees with the agency data.
b. Applicant disagrees with agency data - discrepancy explained
Determine that the application data is correct for that resource type if the applicant provides a reasonable explanation for the discrepancy.
c. Applicant disagrees with agency data - discrepancy not explained
Ask the applicant to provide evidence to resolve the issue (e.g., a recent bank statement, stock certificates, a recent statement of stock accounts) if the applicant is unable to provide an explanation for the discrepancy, or if, in the CR's judgment, the financial account balances are not adequately explained.
If the applicant does not have recent account statements, and we require financial account evidence, request the applicant to contact the financial institution for evidence of the account balances. Follow SSI development procedures to verify the value of stocks (SI 01140.220), bonds (SI 01140.250), mutual funds (SI 01140.230), or pension funds (SI 01120.210).
7. Verify cash
Always accept the applicant’s allegation of the amount of cash.
8. Verify U.S. savings bonds
Accept the applicant’s allegation without further development, if the agency data indicates ownership of savings bonds and the applicant denies ownership. Process the application based on the applicant’s allegation.
Document when we receive saving bond data from the Bureau of Public Debt (BPD) and adjudicate the application using the applicant’s allegations on the MAPS Report of Contact screen.
Do not contact the Bureau of Public Debt or the Parkersburg, WV field office to verify ownership of U.S. savings bonds.
NOTE: In addition to traditional savings bonds, applicants may now make online purchases of electronic savings bonds, referred to as “book entry securities.” These book entry securities are countable resources for the owner of the account and you must include them in the BPD match. For further information on U.S. Savings Bonds, see SI 01140.240.
9. Verify information using the Medicare system query
The total dollar amount for agency data in the “Bank Accounts Balance” field and the “Stocks and Bonds Balance” field does not reflect the actual source of the agency data.
The Medicare System Query displays available fields from the Medicare database. This query contains information about the source of the agency data for those two fields.
Use the Medicare System Query for information about the data the agency uses, by clicking on the Query option on the verification screen.
10. Document the verification determination
For documentation requirements, see HI 03035.007. Use the MAPS verification screens to document:
Verified balance amounts: verified balance amounts for the “Bank Accounts Balance” field and the “Stocks and Bonds Balance” fields;
Contacts: the dates and types of contacts made;
Evidence: the types of evidence requested and reviewed; and
Determination: the CR’s determination of “resolved” or “failure to cooperate.”
NOTE: Do not photocopy the evidence for the file; record the evidence on the verification screens.
11. Input the resource determination
Use the “Resources” section of the verification screen to input the correct amounts for resources.
Select “None,” “Application,” “Agency,” or “New Amount” to indicate the correct amount of resources for the applicant.
When you resolve resource issues, go to the “Issue Resolution” section and select “Resolved” and “Submit to Subsidy Determination.”
If attempts to contact the applicant were not successful and the applicant does not respond to the Evidence Request Notice within the closeout period, select “Failure to Cooperate” and “Submit to Subsidy Determination.”