Authority: Social Security Act 1614(f); Regulations 20 CFR 416.1161a and 416.1204a (49 FR5740, February 15, 1984)

A. Background

In most States, supplemental security income (SSI) recipients are categorically eligible for Medicaid. Therefore, our implementation of the SSI deeming rules can affect eligibility for Medicaid. Those rules have resulted, in some circumstances, in the unnecessary institutionalization of some individuals with consequent higher costs to the State and Federal governments. This occurs when, for example, in order to retain SSI and Medicaid eligibility, some individuals remain institutionalized even though their medical needs could be met at lower costs if they were living at home.

The Secretary of Health and Human Services adopted two approaches to resolve the problem. An interim approach exercised the Secretary's discretion in particular cases not to apply the usual deeming rules where it would be inequitable to do so. The other, longer-term approach is to allow the States to take advantage of the flexibility under Medicaid (section 1915(c) of the Social Security Act (SSACT)) to create appropriate home and community-based programs to care for these individuals.

B. Interim Solution

It was expected to take time for States to develop and implement home and community-based programs. Therefore, the Secretary temporarily established a Board within the Department that determined whether it would be inequitable to apply the usual SSI deeming rules in particular cases. Cases for which the Board approved a waiver are called “special deeming cases.”

The term of the Intradepartmental Review Board expired on December 31, 1984. No new cases were accepted, but waiver determinations were made for cases pending with the Board on December 31, 1984.

The waiver procedure was an exercise of the Secretary's discretion under section 1614 of the SSACT. The SSACT only provides this discretion in parent-to-child and spouse-to-spouse deeming situations. Therefore, these instructions do not apply to sponsor-to-alien or essential person deeming cases.

A waiver of the usual deeming rules maintains SSI eligibility without unnecessary SSI program expenditures, because the Board decided to apply the deeming rules to the extent necessary to pay a minimal amount of SSI or federally administered State supplement. This generally results in payment of $1 in SSI or federally administered State supplement. However, as the retrospective monthly accounting (RMA) computation rules apply, there may be some months in which a higher payment is made. Also, the Board may have directed in its decision that a higher payment be made.

C. When Special Deeming Rules Apply — Policy Principles

1. The Department (through the Intradepartmental Review Board) considered not applying the usual deeming rules only upon application by a State Medicaid agency and on the condition that the agency showed:

   1. The individual met all the requirements for SSI eligibility except for excess deemed income and/or resources from a spouse or parent; and

   2. The waiver would result in savings to the Medicaid program; and

   3. The quality of medical care to be provided to the individual at home would be equal to the level of care provided in an institution.

2. The Board may have also required that additional facts be demonstrated, or that other criteria or standards be met, before it determined not to apply the usual deeming rules.

D. Intradepartmental Board Decisions on Waiver Requests

The Board reviewed each application to determine if the State agency showed that the criteria were met. Only the State Medicaid agency provided this information. In no case should a field office attempt to determine if these conditions applied in any given case.

The Office of the Secretary notified the Social Security Administration (SSA) and the State of the Board's decision. The State notified the individual or the person acting on his/her behalf. If the Board approved a waiver, the approval will remain in effect as long as the circumstances described or implied in the State's application and subsequent submissions remain unchanged. A copy of the Board's decision of approval and other related materials were sent to SSA by the Staff Coordinator for the Board. (See SI 01320.984 for instructions if changes occur.)