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Issue Alert - 13-06-09

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Jun 17, 2013

Program Area:

Medicaid (MA)

Issue Summary:

Cost of Living Adjustments to Social Security benefits (RSDI) will not be counted in determining Medicaid eligibility during the first three months of the calendar year

Persons Affected:

Medicaid applicants and recipients who have Social Security or live with some who does

For More Information:

Center for Civil Justice 320 S. Washington, 2nd Floor Saginaw, MI 48607 (989) 755-3120, (800)724-7441 Fax: (989) 755-3558 E-mail: Michigan Poverty Law Program 611 Church Street, Suite 4A Ann Arbor, MI 48104-3000 (734) 998-6100 (734) 998-9125 Fax


Social Security benefits (also known as RSDI or Retirement, Survivors, and Disability Insurance) are adjusted (usually increased) beginning in January of each year to reflect changes in the cost of living.  These COLAs (cost of living adjustments) occur before the federal poverty guidelines are adjusted for the calendar year.  People whose Medicaid eligibility depends on having income below a certain percentage of the federal poverty guideline could become at least temporarily ineligible for Medicaid because their COLA began sooner than the adjustment to the federal poverty guidelines. 

For many years, federal law and state policy has required that the COLAs be disregarded during the first few months of the year for the Medicare Savings Programs (QMB, ALMB, SLMB) and the ADCare Medicaid eligibility category, to address this problem.  

What's Happening?

Michigan has changed its policy, effective July 1, 2013, to ensure the Social Security COLA will not make people ineligible for Medicaid during the first three months of the calendar year.  The COLA will not be counted in January, February, and March, which gives the state time to implement the new poverty guidelines before counting the COLA.  (The poverty guidelines usually are published in the Federal Register in January or February.)

This will be particularly helpful to people seeking Freedom 

What Should Advocates Do?

Be aware of the change and monitor changes in Medicaid eligibility for the clients you work with to be sure the policy change is implemented correctly in 2014.

What Should Clients Do?

1.   Be aware of the change and make sure your eligibility is not improperly terminated in 2014.

2.   Get legal advice immediately if you think DHS has not disregarded your COLA and it has caused you to lose Medicaid or Medicare Savings Program eligibility during the first three months of the calendar year.

Finding Help

Most legal aid and legal services offices handle these types of cases, and they do not charge a fee. You can locate various sources of legal and related services, including the free legal aid office that serves your county, at You can also look in the yellow pages under "attorneys" or call the toll-free lawyer referral number, (800) 968-0738.