823-2 REASONABLE COMPATIBILITY
Reasonable compatibility refers to the standard used to address discrepancy between the client stated income and the income as reported by an electronic data source. Reasonable compatibility cannot be used without client statement of income.
The reasonable compatibility standard is only used when client stated income is below the income standard and data sources show above the standard.
To be considered reasonably compatible, income electronically reported by DOL must be within 10% of the client stated gross monthly income. The most recent quarter reported by DOL is divided by three to get the average monthly income amount.
Example:
Client stated monthly gross income is $1000. 10% of $1000 is $100.
Add $100 to $1000 = $1100.
Subtract $100 to $1000 = $900.
The 10% range determined by the client stated income is $900 - $1100.
If the DOL monthly average is between and including $900 - $1100, then there is reasonable compatibility.
If the DOL monthly average is below $900 or above $1100, there is not reasonable compatibility.
Note:
Retroactive Medicaid uses actual income. Please refer to section 827 when determining retroactive Medicaid.
1. Both the client stated income and the electronic data are at or below the income standard. Take client statement and authorize MAGI Medicaid. There is no need to check for reasonable compatibility.
Example:
Joe reports he receives earnings of $1000 per month. DOL reports he is receiving $990 per month. The income limit for Joe’s household is $1200 per month. The caseworker uses $1000 as income and determines Joe’s household eligible for MAGI Medicaid. Both amounts are below the income standard.
2. Both the client stated income and the electronic data are above the income standard. Take client statement and deny MAGI Medicaid and refer to FFM. There is no need to check for reasonable compatibility.
Example:
Sofia reports she receives earnings of $2000 per month. DOL shows she is receiving $2010 per month. The income limit for Sofia’s household is $1200 per month. The caseworker uses $2000 as the income amount, denies MAGI Medicaid, and refers Sofia’s household to the FFM.
3. Client stated income is above the income standard and the amount verified using electronic data is at or below the income standard. Accept client statement, deny MAGI Medicaid and refer to the FFM. There is no need to check for reasonable compatibility.
Example:
Gertrude reports she receives earnings of $1205 per month. DOL shows she is receiving $1199 per month. The income limit for Gertrude’s household is $1200 per month. The caseworker uses $1205 as the income amount, denies MAGI Medicaid and refers Gertrude’s household to the FFM.
4. Client statement amount is at or below the income standard and the amount verified using electronic data is above the income standard. Check for reasonable compatibility. If the data source is within 10% of the client stated income, approve MAGI Medicaid using the client stated income.
Example:
Lisa reports she receives earnings of $1200 per month. DOL shows she is receiving $1210 per month. The income limit for Lisa’s household is $1200 per month. The caseworker uses the client stated income of $1200 as the income and authorizes MAGI Medicaid.
5. Client states they have a new job; there is no electronic history. In this type of scenario, the caseworker must pursue further verification of income.
Example:
April just started her first job at McDonald's. She thinks she will be working 20 hours a week and get paid $10 per hour. DOL shows no history of work for her. The caseworker calls McDonald's and the manager confirms the following: April will work 20 hours per week at $10 per hour, and will be paid once a week. The caseworker uses $10 X 20 X 4.3 to come up with the monthly income of $860.
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