44. Medical expense deductions
- Who can deduct medical expenses?
- What medical expenses can be deducted?
- Medical expense deductions and quarterly reporting
Who can deduct a medical expenses?
Households with at least one “elderly” or “disabled” person can deduct non-reimbursed medical costs over $35 a month. [7 U.S.C. § 2014(e)(5); 7 C.F.R. § 273.9(d)(3); MPP §§ 63-502.33, 63-1101.25.] In order to get this medical expense deduction, the household member with disability must be receiving certain disability benefits such as Supplemental Security Income (SSI) benefits, Social Security disability benefits, government agency retirement disability benefits, or other interim disability benefits pending the SSI approval. [7 C.F.R. § 271.2; MPP §63-102(e).]
What medical expenses can be deducted?
- costs of medical and dental care
- hospitalization or nursing care (including hospitalization or nursing care of an individual who was a household member immediately prior to entering a hospital or nursing home)
- prescription medication (when prescribed)
- over-the-counter medication (including insulin and vitamins but not nutritional supplements) when prescribed by a licensed qualified health professional
- health and hospitalization insurance policies (excluding the costs of health and accident or income maintenance policies)
- Medicare premiums
- dentures, hearing aids, and prosthetics
- costs for obtaining/maintaining seeing eye dogs
- reasonable transportation and lodging expenses needed to obtain medical treatment
- special telephone equipment for a person with disabilities
- prescription eyeglasses and contact lenses
- care for a child with disability
- attendant services performed by someone outside of the household (even if that person is a relative)
- rehabilitation services
What you can’t deduct is the cost of prescription medicine that illegal under federal law (i.e. medical marijuana). USDA July 10, 2012 memorandum.
Only medical expenses that the household paid out-of-pocket can be deducted. Expenses that are covered by Medi-Cal or other public or private medical insurance cannot be deducted. [MPP § 63-503.254(a)(2)(QR).]
A household with a hospital bill can deduct the entire amount that is not reimbursable by any public or private insurance coverage. [MPP § 63-503.251(c).]
If the household receives a medical bill, other than for hospital expenses, the deduction will be determined in the following ways:
- if the elderly or disabled household member is insured by Medicare, Blue Cross/Blue Shield, or other private insurance company, the household can deduct 20% of the total bill;
- if the elderly or disabled household member is covered by Medi-Cal [Medicaid], the household can deduct the member’s share of cost or the doctor’s bill, whichever is less;
- if the elderly or disabled household member is uninsured, the household can deduct the total amount of the uninsured medical expenses that can be verified.
[MPP § 63-503.251(b).]
If the household has not yet paid, has not received a bill and cannot reasonably anticipate the expense amount, the food stamp office will not allow the deductions. [7 C.F.R. § 273.10(d)(1)(i); MPP § 63-503.254.] For example, a recipient who has applied for Medi-Cal [Medicaid} could not claim any medical deductions while waiting for Medi-Cal approval since Medi-Cal could cover the expenses retroactively. The food stamp office should allow the non-reimbursable amount to be deducted in a later month when the recipient can provide proof of non-reimbursement. [See 44 Fed.Reg. 47 FR 11878-01 (recap of the discussion) (Sept. 25, 1979) (preamble to final medical deduction regulation) and .
Medical expense deductions and quarterly reporting
The food stamp office should have a simple method for households with elderly or disabled members to prove medical expenses that the household pays every month. [7 U.S.C. § 2014(e)(5)(B)(i); 60 FR 17628, (1995), preamble to final rule. ] The households should not need to give the food stamp office verification on their actual medical expenses every month. [Id.] If the household claims a medical expense, and cannot verify it within the time required, the household shall not be denied or terminated, but will not get the deduction until the verification is submitted. 7 C.F.R. § 273.12(5)(iii)(d)
Quarterly reporting households that have regular medical expenses can anticipate medical expenses for each month during the quarter and use the average monthly expense in computing benefits. [MPP § 63-509(a)(3)(A).]
A household that reports a one-time medical expense above $35 during its certification period can choose to have a one-time only deduction or have the expense averaged over the remaining months of its certification period. [MPP § 63-503.252(a).] Averaging of the expense will begin in the month in which the household reports and verifies the medical expense or the month in which the household incurs the expense, whichever is later. [Id, MPP § 63-509(d)(1).]