Income Disregard Program

The Income Disregard Program provides no share of cost MC to certain otherwise eligible pregnant women and infants under the age of one. To initially qualify under this program, net nonexempt family income must be over the Maintenance Need Level, but not in excess of 200% of the Federal Poverty Level (FPL).

Note: A pregnant woman or infant whose income is at or below 200% of the FPL is potentially eligible for the Property Waiver Provision of the Income Disregard Program.

The Income Disregard Program does not require a separate application.

Retroactive Benefits

Eligibility for the Income Disregard Program, including 365-day postpartum benefits, can be established retroactively.

Period of Eligibility

Pregnant Women

Eligibility can begin no earlier than the first day of the month for which pregnancy is verified. Eligibility continues through the 365-day postpartum period which begins on the last day of pregnancy, and ends on the last day of the month in which the 365th day occurs.

Women who are eligible for this program receive their postpartum MC benefits issued under the Income Disregard Program Aid Code instead of Aid Code 76.

Discontinue the Income Disregard Program at the end of the 365-day postpartum period.

Infants

Otherwise eligible infants can receive benefits under this program though the month that they turn age one.

Exception: An infant who is receiving inpatient medical services for a continuous period, which begins before and continues beyond the baby's first birthday, remains eligible under the Income Disregard program until the end of the continuous stay. Hospitalized infants remain eligible until they are actually discharged. Temporary home visits do not affect their eligibility. MEDS Renewal will automatically generate County Eligibility Worker Alerts (CEWA)'9525' within two (2) months of the end of the infant's qualifying period (11 months old). The month in which the infant reaches 1 year, CEWA '9526' will be generated by MEDS. The record will be terminated by MEDS at Renewal if no termination transaction is received from the county.

Scope of Benefits and Aid Codes

Pregnant Women

Pregnant women have dual MC eligibility which includes:

  • No-share-of-cost MC benefits for all of their pregnancy related services (including prenatal care, labor, delivery, services related to pregnancy complications, postpartum care, and family planning), and
  • A share of cost under the AFDC-MN/MI Program for their nonpregnancy care.

Aid codes for the Income Disregard Program are determined according to citizenship status:

Aid Code

Description

44

Citizen/lawful permanent resident, PRUCOL, or conditional resident (a non-citizen who is otherwise eligible for full scope benefits)

48

Undocumented status or temporary Visa.

Infants

Otherwise eligible infants will receive only one of the following aid codes:

Aid Code

Description

47

Citizen/lawful permanent resident alien, PRUCOL, or conditional resident.

69

Undocumented status or temporary Visa.

Income Determination, Budgeting

Follow these steps to determine eligibility for the Income Disregard Program:

Income Determination, Budgeting

  1. Determine eligibility for Federal Poverty Level programs under regular FPL or Sneede FPL if the MFBU includes a Sneede class member, and the case has both:
  • A share of cost, and
  • A pregnant woman and/or child under the age of one year.
  1. Include all family members in the MFBU (eligible and ineligible individuals) when determining the Maintenance Need and Poverty Level. (Do not count excluded individuals or PA recipients.)
  2. Allow only AFDC-MN/MI deductions when computing the net nonexempt family income for the income Disregard Program.

Note: Health insurance premiums are not an allowable deduction. Also, if the MFBU includes an ABD-MN individual, only AFDC-MN/MI deductions are allowed for the Income Disregard Program.

  1. Repeat these steps if income changes and/or new information is received which affects the SOC or an individual's eligibility.

Pregnant Minors, Parental Income Disregard

The parental income disregard provision applies when a parent/caretaker relative applies for MC on behalf of a pregnant minor living in the home. All of the parent(s) income is disregarded if the pregnant minor is not eligible for the 200% program using regular rules. This also includes pregnant minors, ages 18 - 21 who are being claimed as tax dependents by their parents, even though they do not live in their parents’ home.

Note: Sneede rules apply if the pregnant minor has income.

The disregard does not have to be applied if the pregnant minor is eligible under the regular Income Disregard Program. The parental income disregard is applied if the minor will have a SOC when her parent’s income is counted.

  • This provision includes pregnant minors, ages 18 - 21 who are being claimed as tax dependents by their parents, even though they do not live in their parents’ home.
  • Only the net non-exempt income of the pregnant minor, the unborn’s father, or the minor mother’s spouse is counted when determining eligibility.
  • If the pregnant minor’s parents apply for her and provide the necessary information about the minor but refuse to provide information about themselves, the eligibility determination can be made for the minor without it.
  • The Minor Consent Program is not changed by this provision. Pregnant minors may still choose to receive confidential pregnancy services under the Minor Consent Program.

Approvals & Denials

Use this chart to determine the appropriate Approval/Denial actions. These rules apply both to new applications and continuing cases.

If net non-exempt income of the MFBU is...

Then...

At or below Maintenance Need

Approve under the regular AFDC-MN/MI program.

Between Maintenance Need and 200% of FPL

Approve pregnant woman under the Income Disregard Program for her no SOC pregnancy services. She is also eligible for non-pregnancy care with a SOC.

Approve eligible infants under the Income Disregard Program.

Over 200% of FPL but under 266% of FPL, and pregnant individual is under 19 years of age

Deny the Income Disregard Program. Approve appropriate aid code under the Optional Targeted Low Income Children Program (OTLICP). Delete the denial NOA for the Income Disregard Program.

Approve eligible infants under the OTLICP.

Over 200% of FPL but under 266% of FPL, and pregnant individual is over 19 years of age

Deny the OTLICP. Approve AFDC-MN/MI with a share of cost. Explore MC Access Program (MCAP) eligibility.

Approve eligible infants under the OTLICP or MCAP.

Over 266% of FPL

Deny the OTLIC. Approve AFDC-MN/MI with a share of cost. Explore California Children’s Health Initiative Program (CCHIP) or MCAP.

Note: Delete the denial NOA for the OTLIC.

Continued Eligibility (CE)

Under Continued Eligibility rules, once a pregnant woman has been approved for MC, increases in income are not applied to the SOC determination for her pregnancy-related services, until the end of her 60-day postpartum period. Also, increases in the family's income are not counted in the newborn's SOC determination until the child reaches age one.

Property Waiver Program

Pregnant women and infants who choose and qualify for the Property Waiver Provision of the Income Disregard Program, remain eligible under the Property Waiver Program, even though their income later increases or decreases. Refer to Income Increases. 

Reminder: When a case has excess property or a SOC and the MFBU contains a Sneede class member,
Sneede rules must be applied.

MFBU Requirements

Pregnant Women

An Income Disregard Program eligible pregnant woman must always be included with the unborn as an eligible individual in two MFBUs: the Income Disregard Program MFBU (No SOC) and the MN/MI MFBU (SOC).

Infants

An infant receives no SOC MC benefits under the Income Disregard Program MFBU, either full-scope or restricted.

  • The infant is also included in the AFDC-MN/MI MFBU so the correct Maintenance Need level is allowed for other MC eligible family members.
  • When discontinuing an infant from the Income Disregard Program because he/she has turned age one, evaluate the child's eligibility for the 133% Program or OTLICP.

Notices of Action

A discontinuance NOA is required when:

  • The infant turns age one (unless the baby was hospitalized before age one and remains in the hospital). The EW will receive MEDS alert '9526'.
  • At the end of pregnancy.
    • Issue a NOA at the beginning of the 365-day postpartum period, as it informs the individual about their entitlement to postpartum care.
    • Set a Case Flag in CalSAWS to discontinue her at the end of the 365-day postpartum period. A second discontinuance notice is not required. [Refer to CATS CB 2023-03: How to add a Case Flag]

Discontinuance

When discontinuing the Income Disregard Program and benefits under another MC Program, a separate Income Disregard NOA is not required. Add the statement “Your benefits under the Income Disregard Program are also being discontinued”. For example, when the entire case is being discontinued due to loss of residency, only one discontinuance notice is required.

  • A woman who is eligible for the Income Disregard Program during the month pregnancy ends receives 365-day postpartum benefits under the same Aid Code, without regard to any changes except residency.
  • Many individuals will remain eligible under the Income Disregard Program even though their family income changes or they have excess resources.

Denials

CalSAWS generates a denial NOA when a pregnant woman and/or infant is not eligible due to income in excess of 200% of FPL, unless Continued Eligibility/Deemed Eligibility rules apply. Workers must delete this denial NOA and establish eligibility under, MN or MI with a share of cost for the pregnant individual, and OTLICP for the infant if other eligibility criteria are met.

Minor Consent

A pregnant minor may be eligible for no SOC MC under the Income Disregard Program using regular MFBU rules or by applying the Parental Income Disregard Provision. The individual may also choose to apply for the Minor Consent program. It is important to carefully evaluate the circumstances of the minor and their family to determine:

  • Is the minor in need of confidential services
  • Who has income in the family
  • Who needs MC and do they have linkage, and
  • Is the minor mother eligible for full-scope no SOC MC under another program.

A pregnant Minor Consent applicant is eligible under the Income Disregard Program when she would have a share of cost and her income is at or below 200% of the FPL. Aid Code 7N is a federally funded Aid Code for this service specific program which allows appropriate tracking. A pregnant minor consent applicant is eligible under Aid Code 7N as long as her income is at or below 200% of FPL.

  • Do not use Income Disregard Aid Code 44 for a pregnant minor.
  • A minor of any age who is requesting pregnancy-related services must be assigned Aid code 7N. Aid Code 7N covers pregnancy-related services only and always has no SOC.

Hospitalized Infants

Infants who are otherwise eligible and are receiving inpatient medical services for a continuous period, beginning before and continuing beyond their first birthday, will remain eligible for this program until the end of the continuous stay.

MEDS automatically terminates the baby's Income Disregard Program record at the end of the 13th month; therefore, to issue these special benefits the EW must complete an SCD 1296 requesting the MTO to reactivate the baby online, using the special “exception eligible” ESAC of “4” or “9”.

If the child is reactivated, an alert will be generated by MEDS every six months to remind the EW to check on the child's status. The EW must reactivate the child's MEDS record if still hospitalized.

Determine if the child might meet permanent disability criteria as ABD-MN.

Eligibility cannot be established for the Income Disregard Program for a child who is beyond age one when there has been a break in eligibility for any reason, even though there has been no change in the infant's inpatient status.

Related Topics

Optional Targeted Low-Income Children’s Program

Property Waiver Program