For those residing in nursing homes or are over age 65, the MassHealth eligibility rules have not been changed by the Affordable Care Act (the “ACA”). However, it has created major differences for individuals who are disabled and under 65.
For disabled individuals under 65, there is still no asset limit for purposes of determining MassHealth eligibility. Income eligibility, however, is now based on a calculation known as Modified Adjusted Gross Income or MAGI. Some of the benefits are as follows:
- There is a 5% income disregard, increasing the income threshold from 133 percent of the federal poverty level to 138 percent (currently $15,856 per year for an individual).
- Child support is no longer treated as countable income for the child or the custodial parent.
- Alimony payments are treated as countable income of a recipient applicant, but can be deducted from the countable income of the payee applicant.
- Gifts, bequests, and inheritances are not treated as income.
- Traditional IRA contributions that are deductible on your income tax return are deducted from income.
One disadvantage to the MAGI income calculation is that trust income that was previously not countable may be treated as countable if it is reported on your income tax return.
The overall intention of the ACA was to expand eligibility for MassHealth. We will see how this plays out over time.