A: Federal rules allow states to provide home and community based services waivers to individuals who would be eligible for services in an institution. States that cover be beneficiaries in nursing homes using the special income level can enroll individuals whose income is less than 300% of the federal SSI payment standard, $1,728 a month in 2005. In a nursing home, beneficiaries retain a personal needs allowance to incidental expenses. In the community, beneficiaries need to retain enough income to maintain their community residence and other expenses (rent, utilities, food, clothing and other costs).
The post-eligibility treatment of income rules (42 CFR Chapter IV §435.726 and §435.735) require that states set a maintenance allowance to cover their maintenance needs in the community. The maintenance allowance permits beneficiaries living in the community to keep enough money to pay their rent, utilities, food, clothing, and other costs.
Post-eligibility treatment of income rules for §1915(c) waivers allow states to use reasonable standards to establish the maintenance allowance. States typically set one maintenance allowance for all beneficiaries, regardless of their living arrangement and costs.
However, the allowance could vary based on the beneficiary’s circumstances. For example, a beneficiary living alone may need to retain more income than a beneficiary living with another or other family member. A person living in an assisted living facility may have a higher or lower need than a person living alone in a single family home.
The state Medicaid manual states that the maintenance amount:
“must be based on a reasonable assessment of the individual's needs, but may otherwise be set at any level you choose. You may establish a different amount for each individual, or for groups of individuals, if you believe that different amounts are justified by the needs of the individuals or groups. However, a maximum amount which will not be exceeded for any individual or group must be established.”
States may allow additional amounts to meet the needs of spouses of waiver participants. The amount must be based on need but cannot exceed the income standard used by SSI for an individual living in his/her own home; the highest income standard for aged, blind and disabled beneficiaries for the state’s optional state supplement to the SSI payment; or the income standard for the medically needy program.
A third maintenance allowance can be set for individuals with a family at home. The allowance is based on reasonable need and adjusted for the size of the family. The amount cannot exceed the TANF eligibility standard or the medically needy standard for families of the same size.
Community Living Exchange Fact Sheet: Maintenance Allowance by Robert Molllica, October 2005.
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