Cash Payments for Medical and Social Services

Definitions

Medical Service

Services which are directed toward diagnostic, preventative, therapeutic, or palliative treatment of a medical condition and are performed, directed or supervised by a State licensed health professional.

Social Service

A service (other than medical) intended to assist a handicapped or socially disadvantaged person to function in society at a level comparable to a person without such handicap or disadvantage.

Exempt

Cash payments for a medical or social service paid by governmental medical or social services programs are exempt for one calendar month following the month of receipt. (e.g., California Children's Services, programs under Lanterman Development Disabilities Services Act of 1976, Vocational Rehabilitation programs, etc.)

Note: Payment from a governmental program which is disbursed by a nongovernmental agency is considered to be a payment from a governmental program.

Cash from a nongovernmental medical or social services organization is exempt for one calendar month following the month of receipt when:

It is to pay for a medical/social service already received by the individual and approved by the organization; OR
The payment is restricted for the future purchase of a medical/social service.
Examples of nongovernmental medical or social service organizations include the American Red Cross, Easter Seals, Shriners, private medical and liability insurance, etc.

Nonexempt

The following is nonexempt:

Cash from an agency or insurance policy which pays a flat rate benefit to the recipient without regard to the actual expenses. (i.e., per diem employment, hospitalization or disability insurance, cancer policies.)
Incentive payments
Payments for sheltered workshop or work activities center
Cash payments received as reimbursements for medical/social services which the recipient has already paid.
- If the payment is retained in the following month, determine if it results in excess property.
- If there is excess property, determine if it is a payment for a specific medical or social service or a reimbursement.
- Any amounts of the payment which are not specifically for a medical/social services (i.e., a Workers Compensation payment which includes regular monthly income and funds to pay for a medical exam and transportation).

Verification

The following rules apply:

Verify the source of the payment.
If the fundamental services of the agency or program are not clear, obtain a statement to verify that the purpose is to provide medical or social service assistance.
Verify the purpose of the payment, and that the provider requires follow up to verify that the funds were spent for the stated purpose.
If unclear, verify which portion of the cash payment is specifically for a medical/social service.