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Part 6      COUNTABLE INCOME FOR MAGI

317:35-6-50.Countable sources of income

[Issued 07-01-13]

Unless an exception listed in OAC 317:35-6-51 applies, all income included in Modified Adjusted Gross Income in Section 36B of the Internal Revenue Code is included in the MAGI calculation for SoonerCare eligibility.

317:35-6-51.Exceptions to Internal Revenue Code rules

[Issued 05-14-2020]

(a) The following sources of income are excluded from household income for SoonerCare eligibility under Modified Adjusted Gross Income (MAGI), regardless of whether they are included in MAGI in Section 36B of the Internal Revenue Code:

(1) Scholarships, awards, or fellowship grants used for education purposes and not for living expenses; and

(2) The following types of American Indian / Alaska Native income:

(A) Distributions from any property held in trust, subject to Federal restrictions, located within the most recent boundaries of a prior Federal reservation, or otherwise under the supervision of the Secretary of the Interior;

(B) Distributions and payments from rents, leases, rights of way, royalties, usage rights, or natural resource extraction and harvest from:

(i) Rights of ownership or possession in any lands described in Paragraph (a)(2)(A) of this section; or

(ii) Federally protected rights regarding off-reservation hunting, fishing, gathering, or usage of natural resources;

(C) Distributions resulting from real property ownership interests related to natural resources and improvements:

(i) Located on or near a reservation or within the most recent boundaries of a prior Federal reservation; or

(ii) Resulting from the exercise of federally-protected rights relating to such real property ownership interests;

(D) Payments resulting from ownership interests in or usage rights to items that have unique religious, spiritual, traditional, or cultural significance or rights that support subsistence or a traditional lifestyle according to applicable Tribal Law or custom;

(E) Student financial assistance provided under the Bureau of Indian Affairs education programs; and

(F) Distributions from Alaska Native Corporations and Settlement Trusts.

(b) Amounts received as a lump sum are counted as income only in the month received (see also Oklahoma Administrative Code (OAC) 317:35-10-26), with the exception of certain lottery or gambling winnings as specified in OAC 317:35-6-55.  If a lump sum amount is received from an income source that is not counted in MAGI according to section 36B(d)(2)(B) of the Internal Revenue Code or the exceptions listed in this section, the amount is not counted.

317:35-6-52.Adjustments to income

[Issued 07-01-13]

Amounts subtracted from gross income to calculate MAGI for a household are defined in Section 36B of the Internal Revenue Code. No other deductions are applicable, except the subtraction of 5 percent from the percentage of FPL as provided in OAC 317:35-6-39.

317:35-6-53.Determination of current monthly income

[Issued 07-01-13]

(a) Use of current monthly income. Current monthly income is used in determinations of financial eligibility at application, when a member reports a change in circumstances, and at renewal. See 317:35-6-39 for potential exceptions.

(b) Calculation of monthly income. For computation of monthly income, see OAC 317:35-10-26(e).

(c) Anticipated income. Income which can reasonably be anticipated to be received is considered to be available for the month its receipt is anticipated.

(d) Expected changes in income. Reasonably predictable future increases or decreases in income, such as for contract or seasonal employees, are prorated over the year the income is expected to support the household. The predicted annual amount of the income is divided by 12 to reach the monthly amount.

(e) Lump sum income. Whether a particular lump sum is counted in household income depends first on whether the source of the lump sum is a countable source of income according to OAC 317:35-6-50 and OAC 317:35-6-51. See also OAC 317:35-10-26 for detailed rules regarding lump sum income.

317:35-6-54.Determination of current monthly amount of adjustments to income

[Issued 07-01-13]

(a) Expenses or losses that qualify as deductions for MAGI according to OAC 317:35-6-52 are totaled to reach an annual amount. The annual amount is then divided by 12 and subtracted from gross monthly income to calculate the household's current monthly MAGI.

(b) Whether a deduction is allowed when it has already been paid or when it has only been incurred is determined in accordance with Section 36B of the Internal Revenue Code.

317:35-6-55.Treatment of qualified lottery or qualified gambling winnings

[Issued 05-14-2020]
(a) Definitions.  The following words and terms, when used in this section, shall have the following meaning, unless the context clearly indicates otherwise:

(1) "Qualified lottery winnings" means winnings from a sweepstakes, lottery, or pool described in paragraph three (3) of Section 4402 of the Internal Revenue Code of 1986 or a lottery operated by a multistate or multijurisdictional lottery association paid out in a single payout and not in installments over a period of time.

(2) "Qualified gambling winnings" means monetary winnings from gambling, as defined by Section ( ' ) 1955(b)(4) of Title 18 of the United States Code (U.S.C.).

(3)  "Undue hardship" means circumstances resulting from a loss or denial of SoonerCare eligibility that would deprive an individual of medical care, such that the individual = s health or life would be endangered, or that would deprive the individual or his or her financially dependent family members of food, clothing, shelter, or other necessities of life.

(b) Income determinations. In accordance with 42 U.S.C. ' 1396a(e)(14)(K), qualified lottery and gambling winnings shall be considered as income in determining the financial eligibility of individuals whose eligibility is determined based on the application of Modified Adjusted Gross Income (MAGI), as follows:

(1) Winnings less than $80,000 are counted in the month received;

(2) Winnings greater than or equal to $80,000, but less than $90,000, are counted as income over two (2) months, with an equal amount counted in each month;

(3) Winnings greater than or equal to $90,000, but less than $100,000, are counted as income over three (3) months, with an equal amount counted in each month;

(4) Winnings greater than or equal to $100,000 are counted as income over three (3) months, with one (1) additional month for every increment of $10,000 in winnings received over $100,000, with an equal amount counted in each month; and

(5) The maximum period of time over which winnings may be counted is one hundred and twenty (120) months, which would apply to winnings greater than or equal to $1,260,000.

(c)  Treatment of household members.  Qualified lottery and gambling winnings shall be counted as household income for all household members in the month of receipt; however, the requirement to count qualified lottery and gambling winnings in household income over multiple months applies only to the individual receiving the winnings. 

(d) Undue hardship.  An individual who loses or is denied eligibility due to qualified lottery or gambling winnings may timely file a member appeal, in accordance with Oklahoma Administrative Code 317:2-1-2.  If, as part of that appeal, the individual proves by a preponderance of the evidence that loss or denial of eligibility would result in undue hardship, eligibility shall be restored or approved, provided all other conditions of eligibility have been met.

(e) Notice.  SoonerCare members or applicants who are determined financially ineligible due to the counting of lottery or gambling winnings  will receive a notice of the date on which the lottery or gambling winnings will no longer be counted for eligibility purposes.  The notice will also inform the member or applicant of the undue hardship exemption and of their opportunity to enroll in a Qualified Health Plan on the Federally Facilitated Exchange.

Disclaimer. The OHCA rules found on this Web site are unofficial. The official rules are published by the Oklahoma Secretary of State Office of Administrative Rules as Title 317 of the Oklahoma Administrative Code. To order an official copy of these rules, contact the Office of Administrative Rules at (405) 521-4911.