Georgia Medicaid Patient Liability and Cost-of-Care: A Complete Guide to Post-Eligibility Treatment of Income and Personal Needs Allowance

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By Brevy Care Team · Last verified May 12, 2026

When a Medicaid beneficiary in Georgia is receiving institutional long-term care or Home and Community-Based Services waiver services, federal Medicaid law under Section 1902(o) of the Social Security Act and 42 CFR 435.725 and 42 CFR 435.726 requires the beneficiary to contribute available income toward the cost of care, after specified deductions. This contribution is called patient liability, cost-of-care contribution, share-of-cost, applied income, or post-eligibility treatment of income (PETI). The framework includes a personal needs allowance ($70 per month in Georgia), spousal impoverishment income allocation under Section 1924 of the Social Security Act for community spouses (with monthly maintenance needs allowance up to $3,853.50 per month for 2024), dependent allowances, home maintenance deduction (up to 6 months when return home is expected), and incurred medical expense deduction for medical costs not covered by Medicaid. This guide translates the federal patient liability framework for Georgia families and explains exactly how PETI is calculated, what each deduction covers, how the framework interacts with Section 1924 spousal protections, and how families can manage the financial reality of long-term care Medicaid. :::

::: callout Key takeaways

1. Federal Medicaid law at Section 1902(o) of the Social Security Act and 42 CFR 435.725 requires institutional Medicaid beneficiaries (nursing facility, ICF/IID, IMD) to contribute available monthly income toward the cost of care, after specified deductions — a framework known as post-eligibility treatment of income (PETI) or patient liability.
2. Georgia's personal needs allowance is $70 per month for nursing facility residents — above the $30 federal minimum under Section 1902(q) but lower than most states.
3. Section 1924 spousal impoverishment provisions protect a community spouse's income through the monthly maintenance needs allowance (MMMNA), with a 2024 floor of $2,465 per month and ceiling of $3,853.50 per month.
4. Three key deductions reduce patient liability: the incurred medical expense (IME) deduction for Medicare premiums, Medigap, dental, and other uncovered costs; the home maintenance deduction for up to six months when return home is expected; and the dependent allowance for qualifying family members.
5. After all deductions, the remaining income is the patient liability the beneficiary contributes to the facility. Medicaid pays the gap between patient liability and the total cost of care. :::

Why patient liability matters for Georgia families

For families navigating long-term care Medicaid in Georgia, the patient liability framework determines the actual financial impact of Medicaid on the household. When a family member enters a nursing facility or receives HCBS waiver services through Medicaid, the family often expects that Medicaid "pays for everything." The reality is more nuanced. Medicaid pays for the cost of care, but the beneficiary contributes their available monthly income (after specified deductions) toward that cost of care. The deductions determine how much income the beneficiary keeps for personal needs, how much goes to a community spouse, how much can be retained for home maintenance, and how much offsets medical expenses not covered by Medicaid.

Understanding patient liability matters because it answers several practical questions. How much income does my parent keep for personal expenses each month? How much income does my parent contribute to the nursing facility each month? If my parent is married, how does Medicaid protect my non-institutionalized parent's income? Can my parent's home be maintained while they are in a nursing facility? What medical expenses can be deducted from patient liability?

This guide explains the federal post-eligibility framework, how each deduction works, how Georgia implements the framework, and how families can navigate the practical realities of patient liability for Georgia Medicaid LTSS beneficiaries.

The federal statutory framework

Section 1902(o) of the Social Security Act

Section 1902(o) of the Social Security Act requires that Medicaid beneficiaries receiving institutional services contribute their available income to their cost of care. The contribution is determined by the post-eligibility treatment of income framework, which specifies allowable deductions and how the remaining income is applied.

The framework reflects a fundamental design choice in Medicaid LTSS: the beneficiary contributes their income (with protective deductions), and Medicaid covers the gap between that contribution and the total cost of care. This is distinct from acute care Medicaid where the beneficiary generally does not contribute income to the cost of services.

Section 1902(q) personal needs allowance minimum

Section 1902(q) of the Social Security Act establishes a federal minimum personal needs allowance of $30 per month for nursing facility residents. The PNA is the amount of monthly income the beneficiary retains for personal use, exempt from being applied to cost of care.

States may set a PNA higher than $30 but cannot go below this federal minimum. There is no federal maximum. State PNAs vary significantly, with some states at $30 to $50, others at $75 to $100, and a few at $150 to $200 or higher. Georgia's PNA is $70 per month, above the federal minimum but below many states.

Section 1924 spousal impoverishment provisions

Section 1924 of the Social Security Act, added by the Medicare Catastrophic Coverage Act of 1988 and retained when most of MCCA was repealed in 1989, provides specific protections for the community spouse when one spouse is institutionalized. The provisions include:

Section 1924(d) income allocation: The community spouse is entitled to receive sufficient income to meet a monthly maintenance needs allowance. Income is allocated from the institutionalized spouse to the community spouse through the post-eligibility framework.

Section 1924(d)(1) MMMNA floor and ceiling: The minimum monthly maintenance needs allowance is set as 150 percent of the federal poverty level for a household of two, updated annually. For 2024, the floor is $2,465 per month. The ceiling is $3,853.50 per month for 2024. The actual MMMNA can be set anywhere between floor and ceiling based on the community spouse's documented housing and utility costs.

Section 1924(d)(3) family allowance: Additional allowance for dependents living with the community spouse, calculated based on dependent's income.

Section 1924(e) hearings: Right to fair hearing to challenge MMMNA determinations or to seek an increased MMMNA based on exceptional circumstances.

Section 1924 also addresses resource (asset) protection through the community spouse resource allowance, which is distinct from but related to the income MMMNA. Resource protection is discussed in the spousal impoverishment context but is conceptually separate from the patient liability income calculation.

The federal regulatory framework

42 CFR 435.725 institutional post-eligibility treatment of income

This regulation establishes the institutional PETI framework. The order of deductions from monthly income:

1. Personal needs allowance under 42 CFR 435.725(c)(1)
2. Spouse allowance under 42 CFR 435.725(c)(2) and Section 1924
3. Dependent allowance under 42 CFR 435.725(c)(2)
4. Home maintenance deduction under 42 CFR 435.725(c)(3)
5. Incurred medical expense deduction under 42 CFR 435.725(c)(4)

After all applicable deductions, the remaining income is the patient liability or applied income that the beneficiary contributes to the facility.

42 CFR 435.726 HCBS waiver post-eligibility

A similar post-eligibility framework applies to Section 1915(c) HCBS waiver beneficiaries, with adaptations for community living. Key differences:

• Maintenance needs allowance for the beneficiary (rather than just PNA) reflects the need to maintain housing in the community
• Spouse allowance follows the same Section 1924 framework
• IME deduction applies similarly
• States have flexibility in setting maintenance needs allowance for HCBS

For many HCBS waiver beneficiaries with modest income, the maintenance needs allowance and other deductions result in zero or minimal patient liability, reflecting that they continue to live in the community and must support themselves.

42 CFR 435.733 and 435.832 income allocation

These regulations operationalize Section 1924 income allocation between the community spouse and the institutionalized spouse, providing the technical rules for calculating MMMNA and applying it through the post-eligibility framework.

Personal needs allowance in detail

Purpose of the PNA

The personal needs allowance is the amount of monthly income the beneficiary retains for personal expenses not covered by Medicaid. Medicaid pays for medical care, nursing facility room and board, and other LTSS services. But residents have additional personal needs that Medicaid does not cover, and the PNA is meant to cover these.

Eligible personal expenses include:

• Clothing (replacements, seasonal items)
• Personal hygiene items beyond basic facility-provided
• Reading materials, books, magazines
• Entertainment (subscriptions, movies)
• Snacks beyond facility meals
• Cosmetic services (haircuts, manicures)
• Telephone and cable TV (if not provided by facility)
• Personal religious items
• Gifts for family members
• Limited personal transportation
• Special diet items beyond facility provision

Georgia's $70 PNA in practice

Georgia's $70 per month personal needs allowance is above the federal $30 minimum but is widely viewed as inadequate for meaningful personal expenses. Practical observations:

• $70 per month is approximately $2.30 per day
• A single haircut at a basic salon can consume 25 percent of monthly PNA
• Telephone bills, cable TV, and personal hygiene items not provided by the facility can quickly exhaust PNA
• New clothing purchases require multi-month savings of PNA
• Family birthday and holiday gifts may not be affordable from PNA alone

Many states have higher PNAs. Some states are at $100 to $150 per month, with a few at $200 or higher. Advocacy organizations have pushed for Georgia to increase its PNA to better reflect actual personal needs, but the amount has not been substantially changed in years.

Personal funds management requirements

When facilities manage residents' personal funds (a common arrangement), federal regulations at 42 CFR 483.10 and 42 CFR 483.16 establish strict requirements:

• Facility must maintain personal funds separately from facility operating funds
• Personal funds in amounts over $50 must be held in interest-bearing accounts
• Resident receives quarterly statements
• Facility cannot use resident funds without authorization
• Resident has access to funds during regular business hours
• Resident can choose alternative arrangement (family member, conservator)

Facilities that fail to comply with personal funds requirements face federal certification and enforcement consequences.

Spousal impoverishment income allocation in detail

The Section 1924 framework

When one spouse is institutionalized in a nursing facility (or receives HCBS waiver services for nursing facility level of care) and the other spouse remains in the community, Section 1924 provides protections to ensure that the community spouse is not impoverished by the institutionalized spouse's Medicaid coverage. The framework includes both resource (asset) protections through the community spouse resource allowance (discussed in a separate guide) and income protections through the monthly maintenance needs allowance.

Monthly maintenance needs allowance (MMMNA)

The MMMNA is the amount of monthly income the community spouse is entitled to retain. For 2024:

• MMMNA floor: $2,465 per month (150 percent of federal poverty level for household of two)
• MMMNA ceiling: $3,853.50 per month
• Adjustment between floor and ceiling: Based on community spouse's documented housing and utility costs that exceed a standard

Excess shelter calculation

The MMMNA can be increased above the floor (up to the ceiling) when the community spouse's housing costs are substantial. The mechanism:

1. Standard shelter allowance: 30 percent of MMMNA floor = $739.50 per month for 2024
2. Calculate community spouse's documented shelter costs: mortgage or rent, property tax, homeowner's insurance, utilities (electric, gas, water, basic phone), condominium fees, mobile home lot rent
3. Excess shelter = actual shelter costs minus standard shelter allowance
4. MMMNA = floor plus excess shelter, up to the ceiling

Income allocation calculation

After MMMNA is determined, allocation from the institutionalized spouse to the community spouse:

1. Determine community spouse's gross income (from all sources)
2. If community spouse income equals or exceeds MMMNA: no allocation needed; community spouse uses own income
3. If community spouse income is less than MMMNA: allocate from institutionalized spouse's income up to the amount needed to bring community spouse's income to MMMNA

The allocated income is treated as the community spouse's income for PETI purposes, meaning it is not patient liability. The institutionalized spouse's remaining income (after PNA, IME, and other deductions) is the patient liability.

Family allowance for dependents with community spouse

Section 1924(d)(3) provides additional allowance for dependents living with the community spouse:

• $766 per month per dependent (for 2024), minus the dependent's own income
• Dependents include children under 21, disabled children of any age, siblings under 21, parents, and other qualifying dependents
• The allowance is in addition to MMMNA

Hearings on MMMNA

Under Section 1924(e), the community spouse has the right to a fair hearing on MMMNA determinations. The community spouse may seek:

• Initial MMMNA determination
• Increased MMMNA based on documented exceptional circumstances
• Increased MMMNA based on court orders for spousal support

Fair hearings provide an avenue to address unusual circumstances where the standard MMMNA calculation does not adequately protect the community spouse.

Dependent allowance for the institutionalized beneficiary

When dependent allowance applies

42 CFR 435.725(c)(2) provides for a dependent allowance when the institutionalized beneficiary has dependents but no community spouse. This applies in situations where:

• Beneficiary is unmarried (single, widowed, divorced)
• Beneficiary has dependent children, parents, or other qualifying dependents
• Dependents are not living with a community spouse

Amount of allowance

The amount of dependent allowance is set by state plan, generally based on state maintenance standards similar to those used in TANF or related programs. In Georgia, the dependent allowance follows ABD eligibility manual standards.

The dependent allowance is reduced by the dependent's own income.

Interaction with community spouse family allowance

When the beneficiary has both a community spouse AND dependents living with the community spouse, the family allowance under Section 1924(d)(3) applies (not the dependent allowance under 42 CFR 435.725(c)(2)). The family allowance is calculated for each dependent and is in addition to the community spouse's MMMNA.

Home maintenance deduction

When the deduction applies

42 CFR 435.725(c)(3) allows a home maintenance deduction when:

• The beneficiary has a physician's statement that they may return home within 6 months from the date of institutionalization
• The beneficiary maintains intent to return home
• The home would be the beneficiary's principal residence upon return

Amount and duration

The amount of the deduction is set by state and covers reasonable home maintenance costs:

• Mortgage payments (principal and interest)
• Property tax (apportioned monthly if paid annually)
• Homeowner's insurance (apportioned monthly)
• Utilities at minimum level to maintain home (electricity, gas, water)
• Reasonable yard maintenance
• Other reasonable costs to preserve the home

The deduction is limited to up to 6 months from institutionalization. After 6 months, the deduction ends regardless of whether the beneficiary has returned home. If the beneficiary has not returned home, full income (after other deductions) becomes patient liability.

Home as exempt resource

The home maintenance deduction is distinct from the home as an exempt resource for Medicaid eligibility purposes. Under Medicaid resource rules, the home is generally exempt when:

• Beneficiary intends to return home, OR
• A spouse or dependent lives in the home

The home may continue to be exempt for eligibility purposes even after the 6-month home maintenance deduction period ends, as long as intent to return home or other exemption criteria are met. However, the income deduction for maintenance only applies during the first 6 months.

Incurred medical expense (IME) deduction

Purpose of the IME deduction

42 CFR 435.725(c)(4) allows deduction of medical or remedial expenses not covered by Medicaid. The purpose is to ensure beneficiaries are not impoverished by medical costs that fall outside Medicaid coverage but are nevertheless necessary.

Eligible IMEs

Eligible IMEs include:

Insurance premiums:

• Medicare Part B premium ($174.70 standard for 2024, higher with IRMAA)
• Medicare Part D premium
• Medicare Supplement (Medigap) premium
• Other health insurance premiums

Services not covered by Medicaid:

• Dental services beyond Medicaid coverage
• Vision services beyond Medicaid coverage
• Hearing aids and supplies
• Eyeglasses beyond Medicaid coverage
• Specialty medications not on Medicaid PDL (after exceptions exhausted)
• Over-the-counter medications prescribed by physician
• Medical transportation not covered by NEMT
• Other medically necessary services not in Medicaid coverage

Out-of-pocket costs:

• Copays and deductibles
• Coinsurance amounts

Note on Medicare premiums: If the beneficiary is enrolled in a Medicare Savings Program (QMB, SLMB, or QI), Medicare premiums may be paid by Medicaid rather than by the beneficiary. In that case, the beneficiary does not have an IME for those premiums (because they are not paying them).

Documentation

To receive IME deduction, the beneficiary or representative must document the expenses:

• Receipts for paid medical expenses
• Bills for current or ongoing medical expenses
• Premium statements
• Pharmacy receipts
• Physician orders for prescribed OTC medications

DCH or DFCS reviews documentation and applies the deduction in PETI calculations. Beneficiaries should submit IME documentation promptly to receive the deduction.

Application to patient liability

The IME deduction reduces patient liability dollar-for-dollar. If patient liability before IME would be $1,500 per month and the beneficiary has $250 per month in eligible IMEs, patient liability is reduced to $1,250 per month.

HCBS waiver post-eligibility framework

Differences from institutional PETI

42 CFR 435.726 applies the post-eligibility framework to HCBS waiver beneficiaries with adaptations:

Maintenance needs allowance: Instead of (or in addition to) the standard PNA, HCBS waivers use a maintenance needs allowance that reflects the beneficiary's continued community living. The maintenance needs allowance is generally higher than the $70 institutional PNA because the beneficiary must maintain housing in the community.

Spouse allowance: Section 1924 spousal impoverishment applies to HCBS waivers (for nursing facility level of care). MMMNA and family allowance follow the same framework as institutional.

IME deduction: Applies similarly.

Home maintenance deduction: Generally not applicable (the beneficiary lives in the community, so housing costs are addressed through maintenance needs allowance).

Georgia HCBS waivers

Georgia operates several Section 1915(c) HCBS waivers:

• Community Care Services Program (CCSP) for elderly and disabled adults
• Service Options Using Resources in Community Environments (SOURCE)
• Independent Care Waiver Program (ICWP) for adults with severe physical disabilities
• New Options Waiver (NOW) for individuals with intellectual and developmental disabilities
• Comprehensive Supports Waiver (COMP) for individuals with intellectual and developmental disabilities with higher support needs

Each waiver applies the HCBS PETI framework under 42 CFR 435.726. For many HCBS beneficiaries with modest income, the maintenance needs allowance plus spousal allocation plus IME deduction results in zero or minimal patient liability.

Step-by-step patient liability calculation

For a beneficiary in a nursing facility, the calculation flow:

1. Determine monthly gross income from all sources (Social Security, pension, annuities, interest, dividends, rental income, etc.)

2. Apply personal needs allowance ($70 per month in Georgia for nursing facility)

3. Apply spouse allowance (if applicable):

   • Calculate MMMNA based on community spouse housing/utility costs
   • Allocate from institutionalized spouse's income up to MMMNA minus community spouse's income
   • Add family allowance for dependents living with community spouse

4. Apply dependent allowance (if applicable, no community spouse):

   • Calculate based on state standard minus dependent's income

5. Apply home maintenance deduction (if applicable):

   • Verify physician's statement of expected return home within 6 months
   • Verify beneficiary's intent to return home
   • Calculate reasonable home maintenance costs (within state limits)
   • Apply for up to 6 months from institutionalization

6. Apply incurred medical expense deduction:

   • Sum documented Medicare premiums, Medigap premiums, other insurance premiums
   • Add documented out-of-pocket medical expenses not covered by Medicaid
   • Apply as deduction

7. Calculate patient liability: Gross income minus all applicable deductions equals patient liability that goes to the facility

8. Verify remaining for beneficiary: After PNA, the beneficiary should retain the PNA amount for personal use

Worked examples

Example 1: Eleanor age 82 Atlanta nursing facility no spouse

Eleanor is an 82-year-old who entered a nursing facility 8 months ago after a fall and complications. She has no community spouse (widowed for many years). She has no dependents. Her monthly income:

• Social Security retirement: $1,820 per month
• Small pension: $400 per month
• Total monthly income: $2,220

She sold her home before applying for Medicaid (no longer has intent to return home). Her medical expenses not covered by Medicaid:

• Medicare Part B premium: $174.70 per month
• Medigap Plan G premium: $150 per month
• Dental copays (estimated monthly average): $20 per month
• Total IME: $344.70 per month

PETI calculation:

Eleanor pays $1,805.30 per month to the nursing facility. The facility bills Medicaid for the difference between the full cost of care (approximately $8,000 per month) and Eleanor's patient liability. Eleanor keeps $70 per month for personal needs.

Note: Eleanor should consider applying for QMB (Qualified Medicare Beneficiary) status, which would have Medicaid pay her Medicare Part B premium. This would reduce her direct out-of-pocket cost for the premium but would also reduce her IME deduction by the same amount, resulting in no net change to patient liability.

Example 2: Walter and Margaret age 78 community spouse MMMNA

Walter (78) entered a nursing facility 4 months ago after a severe stroke. Margaret (76) remains in the community in their home of 35 years. Their monthly income:

• Walter's Social Security: $2,400 per month
• Walter's pension: $300 per month
• Walter's total: $2,700 per month
• Margaret's Social Security: $1,100 per month

Margaret's documented housing and utility costs:

• Mortgage (principal and interest, mostly principal paydown): $850 per month
• Property tax (apportioned monthly): $200 per month
• Homeowner's insurance: $75 per month
• Utilities (electric, gas, water, basic phone): $250 per month
• Total shelter costs: $1,375 per month

MMMNA calculation:

• MMMNA floor: $2,465 per month
• Standard shelter allowance (30% of floor): $739.50 per month
• Excess shelter: $1,375 - $739.50 = $635.50
• MMMNA before ceiling check: $2,465 + $635.50 = $3,100.50
• Ceiling: $3,853.50
• Final MMMNA: $3,100.50 (below ceiling)

Income allocation:

• Margaret's income: $1,100 per month
• MMMNA: $3,100.50
• Allocation from Walter: $3,100.50 - $1,100 = $2,000.50

Walter's PETI calculation:

Walter pays $454.80 per month to the nursing facility. Margaret receives $2,000.50 per month from Walter's income, plus her own $1,100, for total household income of $3,100.50 per month, allowing her to maintain household expenses and shelter.

Example 3: George age 76 nursing facility with dependent adult daughter

George is a 76-year-old in a nursing facility. He is unmarried (divorced 20 years ago). His daughter Lisa (35) has cerebral palsy and lives with him in his home. Lisa is disabled and receives $943 per month in SSI.

George's monthly income: $2,500 (Social Security plus small pension).

Dependent allowance:

• Standard dependent allowance for one dependent: $766 (using family allowance standard as reference)
• Less Lisa's income (SSI): $943
• Result: $0 (Lisa's SSI exceeds the standard, so no dependent allowance applies under this specific formula)

George's home maintenance:

• George has a physician's statement that he may return home within 5 months
• George maintains intent to return home
• He has been in the facility for 2 months
• Home maintenance costs (documented): $300 per month (modest mortgage, taxes, insurance, utilities)
• Within the 6-month window

George's IME: Medicare Part B ($174.70) plus prescription copays ($25) = $199.70 per month

PETI calculation:

George contributes $1,930.30 per month to the facility. Note: The home maintenance deduction supports maintaining the home Lisa lives in. After 4 more months (6 months total), the home maintenance deduction will end. At that point, George should either return home or family will need to assess longer-term arrangements for Lisa and the home.

Lisa's situation: Although the dependent allowance formula in this case yielded zero, Lisa's living arrangement may have other implications under SSI rules. SSI considerations are addressed under SSI's own framework rather than the PETI dependent allowance. The family should consult with a benefits counselor about Lisa's situation specifically.

Example 4: Doris age 70 HCBS waiver community spouse

Doris (70) receives services through Georgia's CCSP Section 1915(c) HCBS waiver, which requires nursing facility level of care. She and her husband Robert (72) live together in their home. Their monthly income:

• Doris's Social Security: $1,400 per month
• Doris's pension: $200 per month
• Doris's total: $1,600 per month
• Robert's Social Security: $1,800 per month

HCBS PETI under 42 CFR 435.726 applies. Spousal impoverishment Section 1924 applies because Doris receives nursing facility level of care services.

Robert's shelter costs (documented): $1,400 per month (modest mortgage, taxes, insurance, utilities for two-person household)

MMMNA calculation:

• Floor: $2,465
• Standard shelter: $739.50
• Excess shelter: $1,400 - $739.50 = $660.50
• MMMNA: $2,465 + $660.50 = $3,125.50 (below ceiling)

Income allocation:

• Robert's income: $1,800
• MMMNA: $3,125.50
• Allocation from Doris: $3,125.50 - $1,800 = $1,325.50

Doris's PETI calculation:

For HCBS waivers, the maintenance needs allowance for Doris's continued community living, combined with the spousal allocation and IME deductions, often results in zero patient liability. The exact calculation depends on the specific maintenance needs allowance Georgia applies to CCSP and the precise IME documentation.

In many HCBS cases, the beneficiary's available income (after maintenance needs allowance, spousal allocation, and IME) is fully accounted for in supporting the community household, leaving little or nothing as patient liability to the waiver provider.

Example 5: Henry age 80 home maintenance deduction

Henry (80) entered a nursing facility 2 months ago after a stroke. His physician's statement indicates he may return home with rehabilitation within 4 to 5 months. Henry has been a widower for many years and lives alone in his home of 40 years. His income is $1,900 per month (Social Security plus small annuity).

Home maintenance costs (documented):

• Mortgage (largely paid off, small remaining): $200 per month
• Property tax (apportioned monthly): $150 per month
• Homeowner's insurance: $80 per month
• Utilities (minimum to maintain home): $100 per month
• Lawn care service: $80 per month
• Total: $610 per month

Georgia DCH home maintenance deduction allows reasonable costs up to a cap, for up to 6 months from institutionalization. Henry has 4 months remaining within the window.

Henry's IME: Medicare Part B ($174.70) per month.

PETI calculation:

For the remaining 4 months until the 6-month limit, Henry's patient liability is $1,045.30 per month. After 6 months, if Henry has not returned home, the home maintenance deduction ends. His patient liability would increase to $1,655.30 per month ($1,900 - $70 - $174.70).

If Henry's rehabilitation does not progress as hoped and he cannot return home, the family may need to make decisions about the home, including whether to sell it (with consideration of estate recovery implications), continue maintaining it from other resources, or allow it to be unmaintained.

Example 6: Frances age 85 IME deduction high prescription costs

Frances (85) has been in a nursing facility for 18 months. She has no community spouse (widowed). Her monthly income is $1,400 (Social Security only).

Frances takes several medications including a specialty drug for a rare condition that is not on the Medicaid preferred drug list. After exhausting formulary exceptions and step therapy, Medicaid does not cover this medication for her. Her medical expenses not covered by Medicaid:

• Specialty medication (out-of-pocket): $400 per month
• Medicare Part B premium: $174.70 per month
• Medicare Part D premium: $35 per month
• Medigap Plan F (grandfathered coverage): $180 per month
• Hearing aid batteries and care: $25 per month
• Dental visit copays: $40 per month
• Total IME: $854.70 per month

PETI calculation:

The substantial IME deduction dramatically reduces Frances's patient liability. This is the protective function of the IME deduction: it ensures beneficiaries are not impoverished by medical costs that fall outside Medicaid coverage.

Frances should also consider applying for QMB status. If approved, Medicaid would pay her Medicare Part B premium directly rather than her paying it out-of-pocket. This would reduce her direct out-of-pocket cost for the premium but would also reduce her IME deduction by the same amount (since she would no longer be paying the premium). The net effect on patient liability would be approximately the same, but routed differently. The benefit would be elimination of cost-sharing for Medicare-covered services.

Common misconceptions

Medicaid pays the whole nursing home bill

False. Medicaid pays the nursing facility minus the beneficiary's patient liability. The beneficiary contributes their available monthly income (after specified deductions) toward the cost of care. The combination of beneficiary contribution and Medicaid payment covers the full cost of care.

The community spouse only gets what the institutionalized spouse "gives" them

False. Section 1924 provides a legal entitlement, not an informal allowance. The community spouse has a legal right to the MMMNA based on documented housing and utility costs. Income is allocated through the state Medicaid agency's calculation, with appeal rights if the calculation is incorrect or inadequate.

$70 per month is enough for personal needs

Widely disputed. Most advocacy organizations view $70 per month as inadequate for meaningful personal expenses including clothing, personal hygiene beyond basic facility provision, communication (telephone, postage), entertainment, and small holiday gifts for family members. Many states have higher PNAs, and advocacy organizations have pushed Georgia to increase the amount.

Patient liability is the same as estate recovery

False. Patient liability is the beneficiary's monthly contribution to cost of care from income while the beneficiary is alive and receiving Medicaid LTSS. Estate recovery is post-death recovery from the beneficiary's estate (typically real property remaining at death). The two are related concepts in Medicaid LTSS but are distinct processes.

If the beneficiary has no income, there is no patient liability

True. A beneficiary with no income would have no patient liability after PNA and other deductions. For example, an SSI-only beneficiary in a nursing facility has SSI income (around $943 for 2024), but the SSI federal benefit rate combined with PNA and any IME typically results in zero patient liability, and the beneficiary retains the full SSI amount.

Home maintenance deduction protects the home indefinitely

False. The home maintenance deduction is limited to 6 months when return home is expected. After 6 months, the deduction ends. The home may still be exempt for eligibility purposes (depending on intent to return home or other exemption criteria), but the income deduction for maintenance stops.

IME deductions are automatic

False. IME deductions require documentation. The beneficiary or representative must submit receipts, bills, premium statements, and other documentation to receive the deduction. DCH or DFCS reviews documentation and applies the deduction. Failure to document means failure to receive the deduction.

Patient liability never changes

False. Patient liability is recalculated when income changes (cost-of-living adjustments to Social Security, pension changes), when IME changes (new medical expenses, premium increases), when spouse circumstances change (death, divorce, income change of community spouse), when home maintenance status changes, and at annual eligibility redeterminations.

Practical guidance for Georgia families

Documenting income carefully

For accurate patient liability calculation, all sources of income must be documented:

• Social Security benefit letter
• Pension statements
• Annuity statements
• Bank statements showing interest income
• Rental property income documentation
• Other income sources

DCH and DFCS verify income through Federal Data Services Hub and other electronic sources, but documentation should be maintained for any income not captured electronically.

Documenting IMEs thoroughly

To maximize IME deductions, documentation should include:

• Medicare premium statements (Part B, Part D)
• Medicare Supplement (Medigap) premium statements
• Pharmacy receipts (for medications paid out-of-pocket)
• Dental and vision service bills
• Hearing aid bills and supplies receipts
• Physician orders for prescribed over-the-counter medications
• Other medical expense receipts

Submit IME documentation to DFCS or DCH promptly and retain copies for your records.

Managing the home maintenance deduction

If the beneficiary may return home within 6 months:

• Obtain physician's statement of expected return
• Document home maintenance costs carefully
• Track the 6-month period from date of institutionalization
• Reassess at 4 to 5 months whether return home is realistic
• Plan for what happens at month 6 if return home is unlikely

Reviewing PETI calculations

Beneficiaries and representatives should review PETI calculations carefully:

• Verify all income is correctly identified
• Verify PNA is being applied
• Verify spousal allocation (if applicable) reflects current MMMNA and community spouse income
• Verify dependent allowance (if applicable)
• Verify home maintenance deduction (if applicable)
• Verify all IMEs are deducted

If errors are identified, request correction through DCH or DFCS. If correction is not made, file an appeal.

Appeals on patient liability determinations

If patient liability is incorrectly calculated:

• Request reconsideration from the eligibility worker
• If not resolved, file a state fair hearing request (within 30 days of notice of action)
• Hearings are conducted by DCH Office of Appeals
• Beneficiary may be represented by family member, attorney, or other representative
• Decisions can be appealed further through state administrative process and ultimately to state court

Georgia Legal Services Program and Atlanta Legal Aid Society provide free legal assistance to qualifying low-income beneficiaries for Medicaid appeals.

Working with the long-term care ombudsman

The Georgia Long-Term Care Ombudsman Program at 1-866-552-4464 provides advocacy and assistance for nursing facility residents, including issues related to:

• Patient liability disputes
• Personal funds management
• Facility responsiveness on personal funds requests
• Resident rights related to financial matters
• Coordination with family members on financial issues

Final notes

For Georgia families with a loved one receiving Medicaid long-term services and supports, understanding the patient liability framework is essential to managing the actual financial impact of LTSS Medicaid. The post-eligibility treatment of income framework under Section 1902(o) of the Social Security Act and 42 CFR 435.725 and 42 CFR 435.726 determines how much of a beneficiary's monthly income goes to the facility or HCBS provider and how much is retained for personal needs and protected purposes.

Georgia's $70 per month personal needs allowance is above the federal minimum of $30 but lower than many states, and many advocacy organizations consider it inadequate for meaningful personal expenses. Section 1924 spousal impoverishment provisions provide substantial income protection to community spouses through the monthly maintenance needs allowance, with floor of $2,465 and ceiling of $3,853.50 for 2024 adjustable based on documented housing and utility costs. The home maintenance deduction for up to 6 months when return home is expected, the dependent allowance for qualifying dependents, and the incurred medical expense deduction for medical costs not covered by Medicaid all reduce patient liability.

Understanding the framework helps Georgia families anticipate the financial reality of LTSS Medicaid, document deductions carefully to maximize protections, advocate for accurate calculations, and pursue appeals when calculations are incorrect.

Brevy at brevy.com is your digital ally helping you navigate Georgia Medicaid patient liability, the post-eligibility treatment of income framework, personal needs allowance, spousal impoverishment income allocation, and the incurred medical expense deduction. This information is not legal-financial advice and is not a substitute for individualized counsel. For your specific situation, contact DCH at 1-866-211-0950, the Georgia Long-Term Care Ombudsman at 1-866-552-4464, Georgia Legal Services Program at 404-377-0701, or consult with a qualified elder law attorney.

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What is patient liability?

Patient liability is the amount of monthly income a Medicaid beneficiary contributes to their cost of care while receiving institutional long-term care (nursing facility, ICF/IID, IMD) or Section 1915(c) HCBS waiver services. It is also called post-eligibility treatment of income (PETI), cost-of-care contribution, share-of-cost, or applied income. The federal framework is at Section 1902(o) of the Social Security Act and 42 CFR 435.725 (institutional) and 42 CFR 435.726 (HCBS).

What is the personal needs allowance in Georgia?

Georgia's personal needs allowance is $70 per month for nursing facility residents. This is above the federal minimum of $30 under Section 1902(q) of the Social Security Act but lower than many states. The PNA is the amount of monthly income the beneficiary retains for personal expenses not covered by Medicaid.

What is the monthly maintenance needs allowance (MMMNA)?

The MMMNA is the amount of monthly income the community spouse of an institutionalized Medicaid beneficiary is entitled to retain under Section 1924 of the Social Security Act. For 2024, the floor is $2,465 per month (150 percent of FPL for household of two) and the ceiling is $3,853.50 per month. The actual MMMNA is set between floor and ceiling based on the community spouse's documented housing and utility costs.

How is the spouse allowance calculated?

The spouse allowance is calculated by determining the MMMNA, then allocating from the institutionalized spouse's income up to the amount needed to bring the community spouse's income to the MMMNA. For example, if MMMNA is $3,000 and the community spouse has $1,200 in income, $1,800 is allocated from the institutionalized spouse. The allocated income is treated as the community spouse's, not as patient liability.

What is the family allowance?

Under Section 1924(d)(3), an additional allowance is provided for dependents living with the community spouse. The allowance is $766 per month per dependent (for 2024), reduced by the dependent's own income. Dependents include children under 21, disabled children of any age, parents, siblings under 21, and other qualifying dependents.

What is the home maintenance deduction?

Under 42 CFR 435.725(c)(3), an institutionalized beneficiary may receive a home maintenance deduction when a physician's statement indicates expected return home within 6 months and the beneficiary maintains intent to return home. The deduction covers reasonable home maintenance costs (mortgage, property tax, insurance, utilities, basic upkeep) for up to 6 months from institutionalization.

What is the incurred medical expense (IME) deduction?

Under 42 CFR 435.725(c)(4), beneficiaries may deduct medical or remedial expenses not covered by Medicaid. Eligible IMEs include Medicare premiums, Medigap premiums, other health insurance premiums, dental services beyond Medicaid coverage, vision services beyond Medicaid coverage, hearing aids, prescribed over-the-counter medications, and other medically necessary expenses. Documentation is required.

How is HCBS waiver patient liability different?

Under 42 CFR 435.726, HCBS waiver beneficiaries receive a maintenance needs allowance that reflects continued community living, rather than just the institutional PNA. The maintenance needs allowance is generally higher than the institutional PNA to allow the beneficiary to maintain housing in the community. Spouse allowance and IME deductions apply similarly. Many HCBS beneficiaries have zero or minimal patient liability.

Does Medicaid pay the entire nursing home bill?

No. Medicaid pays the cost of care minus the beneficiary's patient liability. The beneficiary contributes their available monthly income (after PNA, spouse allowance, dependent allowance, home maintenance deduction, and IME deduction) toward the cost of care. The combination of beneficiary contribution and Medicaid payment covers the full cost.

What can I spend my personal needs allowance on?

PNA can be spent on personal items not covered by Medicaid: clothing, personal hygiene items beyond basic facility provision, reading materials, telephone and cable TV, haircuts and personal grooming services, snacks beyond facility meals, religious items, family gifts, limited personal transportation, and other personal expenses. Many advocates consider Georgia's $70 PNA inadequate for these needs.

How does the facility manage my personal funds?

Under 42 CFR 483.10 and 42 CFR 483.16, facilities must maintain residents' personal funds separately from facility operating funds, keep balances over $50 in interest-bearing accounts, provide quarterly statements, prohibit unauthorized use, allow access during regular business hours, and respect resident choice in arrangements.

Can I challenge my patient liability calculation?

Yes. If you believe your patient liability is incorrectly calculated, request reconsideration from the eligibility worker. If not resolved, file a state fair hearing request within 30 days of the notice. Hearings are conducted by DCH Office of Appeals. You may be represented by family member, attorney, or other representative. Georgia Legal Services Program provides free legal assistance to qualifying low-income beneficiaries.

Is patient liability the same as estate recovery?

No. Patient liability is the monthly contribution from income while the beneficiary is alive and receiving Medicaid LTSS. Estate recovery is post-death recovery from the beneficiary's estate (typically real property) for amounts Medicaid paid for LTSS or other services. They are related concepts but distinct processes.

What happens when home maintenance deduction ends?

The home maintenance deduction is limited to 6 months from institutionalization when return home is expected. After 6 months, the deduction ends regardless of whether the beneficiary has returned home. If not returned, patient liability increases by the amount of the lost deduction. The home may still be an exempt resource for eligibility purposes (depending on intent to return and other factors), but the income deduction stops.

How does Section 1924 spousal impoverishment work?

Section 1924 of the Social Security Act provides resource (asset) protection through the community spouse resource allowance and income protection through the MMMNA. The provisions ensure the community spouse is not impoverished by the institutionalized spouse's Medicaid coverage. Both protections apply to nursing facility care and HCBS waivers requiring nursing facility level of care.

Can I increase my MMMNA?

Yes, through documentation of housing and utility costs and through fair hearings. The MMMNA can be increased above the floor up to the ceiling based on documented shelter costs exceeding the standard. Beyond the ceiling, exceptional circumstances may justify a hearing under Section 1924(e). Court orders for spousal support may also support increased MMMNA.

When does patient liability change?

Patient liability is recalculated when income changes (Social Security cost-of-living adjustments, pension changes), IME changes (new medical expenses, premium increases), spouse circumstances change (death, divorce, community spouse income change), home maintenance status changes, or at annual eligibility redeterminations.

What if I have no income?

A beneficiary with no income has no patient liability after PNA and other deductions. SSI-only beneficiaries typically have zero patient liability and retain their full SSI federal benefit rate for personal needs.

How do I document IMEs?

Maintain receipts and bills for: Medicare premium statements (Part B, Part D), Medicare Supplement (Medigap) premium statements, pharmacy receipts for out-of-pocket medications, dental and vision service bills, hearing aid bills, physician orders for prescribed OTC medications, and other medical expense receipts. Submit documentation to DFCS or DCH promptly.

Where can I get help with patient liability questions?

Contact DCH Medicaid Member Services at 1-866-211-0950, DCH Aged Blind Disabled Eligibility Unit through DCH Member Services, DFCS Customer Service at 1-877-423-4746, Georgia Gateway at gateway.ga.gov, Georgia Long-Term Care Ombudsman at 1-866-552-4464, DCH Office of Appeals through DCH Member Services, Georgia Legal Services Program at 404-377-0701, Atlanta Legal Aid Society, AARP Georgia at 1-866-295-7283, 211 Georgia, State Bar of Georgia Elder Law Section, NAELA, Georgia Council on Aging, Georgia Adult Protective Services, or CMS Region IV. :::

::: cta Need help understanding Georgia Medicaid patient liability, the post-eligibility framework, or your specific calculation? These resources can help.

• DCH Medicaid Member Services: 1-866-211-0950
• DCH Aged Blind Disabled Eligibility Unit (contact through DCH Member Services)
• DFCS Customer Service: 1-877-423-4746
• Georgia Gateway: gateway.ga.gov
• Georgia Long-Term Care Ombudsman: 1-866-552-4464
• DCH Office of Appeals (contact through DCH Member Services)
• Georgia Legal Services Program: 404-377-0701
• Atlanta Legal Aid Society (contact through Georgia Legal Services Program)
• AARP Georgia: 1-866-295-7283
• 211 Georgia: dial 211
• State Bar of Georgia Elder Law Section
• NAELA National Academy of Elder Law Attorneys
• Georgia Council on Aging
• Georgia Adult Protective Services
• CMS Region IV (Atlanta): federal Medicaid oversight

Find personalized help understanding Georgia Medicaid patient liability at brevy.com. :::