Our Plan for Today

1. Medical Expense Deduction: Issues and Best Practices Ty JonesAASD ConferenceSeptember 23, 2013

2. Our Plan for Today Overview of Medical Expense Deduction Policy Advocates’ Perspective Lessons from South Dakota Q & A

3. Why Talk About this Deduction? • The excess medical deduction plays an important role in targeting food assistance to households with high out of pocket medical costs. • The excess medical expense deduction is one of the most underutilized of the SNAP income deductions.

4. Share of Elderly or Disabled Households Claiming Medical Expense Deduction

5. Wide Variation Across States in Share of Eligible Claiming the Deduction Source: USDA Household Characteristics Data, 2011

6. Why Aren’t More Households Claiming the Deduction? • State policies & procedures • Participant and advocate lack of awareness

7. Types of Medical Expenses that Qualify Allowed Expenses Disallowed Expenses Expenses incurred that include the cost of a special diet, Costs of health and accident policies, Medical expenses covered by vendor payments, and Medical expenses covered by reimbursements. • Medical and dental services, • Hospital bills, • Prescriptions, • Medical equipment, • Transportation to & from medical services/treatment • Attendant or home health aide • Medical insurance premiums or Medicare supplemental insurance policies

8. State Applications Can Help Households Claim the Deduction

9. Application Design Can Hinder the Deduction Use

10. Verification Policy Can Be a Barrier • Federal regulations require: • The amount of any medical expenses deductible shall be verified prior to initial certification. • Other factors such as the allowable services provided or the eligibility of the person incurring the cost, shall be verified, if questionable.

11. Paper Verification is Not the Only Way • Clients and advocates identify verification as a key barrier to eligible households claiming medical expenses. • States and workers often only accept paper documentation. • No specific document can be required. • Other forms of verification could work also, collateral contacts. • State agencies have a duty to assist with verification

12. Strategies to Ensure Eligible Households Claim Medical Expenses States are assessing the medical expense take-up rates and reviewing their policy and procedures. • Require verification only at initial certification. • Lift unnecessary restrictions on allowable medical expenses • Standard Medical Expense Deduction waiver • Outreach to senior and disabled individuals and advocacy groups

13. Standardized Medical Deduction Waiver • A waiver from USDA started in 2005 • Currently 14 State agencies are operating with these waivers • Designed to: • Test the impact of increasing access to SNAP by the elderly and disabled • Increase administrative efficiency • Reduce the risk of quality control errors.

14. Standard Medical Deduction Waiver in 14 States

15. What’s A Successful Standard Medical Deduction? • Increases use of medical expense deduction amongst eligible households, directing more food assistance to vulnerable seniors and people with disabilities. • Households with extreme medical expenses continue to claim actuals. • Offset to rest of SNAP population is minimum. • Increases administrative efficiency.

16. Caveat Emptor: Standard Medical Deduction Waivers Aren’t A Silver Bullet • Cost-Neutrality Determination • Offset Dilemma • Gathering Data • Constraints on Staff Time • Risks to households with high medical costs

17. What is Cost Neutrality?

18. Possible Downsides To Standard Medical Deduction

19. So What’s a State To Do? • Gather Data • How many claim the deduction now? • Assess Barriers • Set Clear Policy and Expectations • Verifications • Assess impacts on households with high medical costs • Review Training • Engage Advocates and Assisters