Chapter 02. Establishment and Payment of In-Patient Charges by Recipients of Services and Other Chargeable Persons for the Patient's Care
Regulation .01 Scope.LinkCopy Citation
It is the policy of the Maryland Department of Health to determine the ability of recipients of services, responsible relatives, and other chargeable persons to pay for in-patient or in-residence services to individuals in State-operated facilities. These regulations shall govern the assessment of these charges unless specific charges are established by statutory enactment.
Regulation .02 Definitions.LinkCopy Citation
A.
“Adjusted gross monthly income” means gross monthly income less allowable deductions as set forth in Regulation .04C(5), of this chapter.
B.
“Assets” means all accumulated personal wealth over which a person has the authority or power to liquidate his interest, including but not limited to cash savings, savings accounts, certificates of deposit, money market certificates, checking accounts, stocks, bonds, real property, personal property, mortgages, and mutual funds.
B-1.
“Chargeable person” means:
(1)
Any responsible relative; and
(2)
Except for a recipient of services, any other person who is legally responsible in an individual or representative capacity for the care of an individual.
C.
“Collectively” means pertaining to any combination of one or more responsible relatives.
D.
“College expenses” means tuition cost for undergraduate studies.
E.
“Department” means Maryland Department of Health.
F.
“Dependent” means any person who qualifies as a dependent under the dependency test of the Internal Revenue Service.
G.
“Gross monthly income” means total annual gross income divided by 12.
H.
“Income” means a recurrent money benefit from any source.
I.
“Individually” means pertaining to one sponsor.
J.
“In-patient” means a person admitted to a State-operated facility.
K.
“In-patient day.” The number of days of service received by a patient for in-patient services is always in units of full days; a day begins at midnight and ends 24 hours later. The midnight method is to be used for billing days of care of patients. A part of a day, including the day of admission, counts as a full day, however, the day of discharge, the day of death, or a day on which a patient begins a leave of absence is not counted as a day. If admission and discharge or admission and death occur the same day, the day is considered a day of admission and counts as one in-patient day.
L.
“Monthly rate” means the charge as developed under Regulation .04C(9)(a) of this chapter.
M.
“Patient” means in-patient.
N.
“Payroll taxes” means Social Security, federal, State, and local income taxes.
O.
“Rate” means monthly rate.
O-1.
“Recipient of services” means an individual who receives care, maintenance, treatment, and support in a facility or program that is operated or funded wholly or partly by the Department.
P.
“Responsible relative” means the:
(1)
Spouse of a recipient of services;
(2)
Parents of a recipient of services who is a minor; and
(3)
Children of a recipient of services.
Q.
“Secretary” means Secretary of Health.
R.
“Sponsor” means responsible relative.
S.
“State-operated facility” means those hospitals and centers as set forth in Health-General Article, §§7-305, 10-406, and 19-502, Annotated Code of Maryland.
T.
“Total lifetime hospitalization” means the sum total of all periods of inpatient hospitalization for a recipient of services in any State hospital or facility whether these periods are intermittent or continuous.
U.
“Treatment” means any process by which professional care or attention is given to a patient in a State-operated facility.
Regulation .03 Determination of the Ability of a Recipient of Services to Pay.LinkCopy Citation
A.
A recipient of services' primary liability-to-pay in-patient charges established in accordance with COMAR 10.02.01.04 shall be determined by conducting a financial investigation of the individual's income, assets, and expenses.
B.
Notwithstanding any other provision of law to the contrary, the Department or its designated financial agent may obtain and use financial information and, if and when necessary, a summary of medical and psychological diagnoses regarding a recipient of services. If the obtaining and use of this information is connected to the Department's billing and collection functions under Health-General Article, Title 16, Annotated Code of Maryland:
(1)
The Department shall obtain a release from the recipient of services or a chargeable person to secure information from a financial institution;
(2)
The Department shall request either copies of the recipient of services' most recently filed federal and state income tax returns or an affidavit that the recipient of services did not file tax returns for the previous tax year;
(3)
The failure of the recipient of services to provide the Department with the required documents of financial status, including the most recently filed federal and state income tax returns, may result in the Department charging and the recipient of services being liable for the full per-capita daily charge for services as set forth in COMAR 10.02.01.04; and
(4)
Except as provided in §C of this regulation, all information obtained by the Department or its designated agent shall be treated as confidential.
C.
If the financial information is connected to the treatment or care of a recipient of services, the Department or its designated financial agent may disclose the financial information to a designated clinical representative of a facility.
D.
The Department may set the amount of payments retroactively:
(1)
For a period of not more than 6 months from the date when the Department sets the amount of payments; and
(2)
After inquiry by the Department, for a greater period, if the recipient of services, the responsible relatives of the recipient, or any other person, agency, or organization having a summary of financial information or medical or psychological diagnoses about the recipient of services has failed or refused to give that information to the Department when the obtaining and use of this information is connected to the Department's billing and collection functions under this subtitle.
E.
The Department shall make a claim against all available income or assets, or both, of a recipient of services.
F.
Health insurance coverage and other third party reimbursements correctly paid, or to be paid, for services provided by the Department shall be considered available for billing purposes.
G.
For purposes of determining a recipient of services' financial capacity to contribute towards the cost of his or her care, the Department shall consider all of the recipient of services' assets and income to be available for billing purposes subject to certain billing reductions. In recognition of an individual's ongoing financial needs, the Department shall consider a reduction in a recipient of services' billing by permitting the income allowances, asset exemptions, and allowable expenses indicated below. A billing reduction may not be permitted unless and until the recipient of services submits appropriate written documentation demonstrating his or her entitlement to the billing reduction. Permitted billing reductions are as follows:
(1)
Exempted Assets. The following assets shall be excluded from the Department's ability to pay determinations:
(a)
A primary residence, occupied by spouse or dependents.
(b)
A primary residence unoccupied by a spouse or dependents. The assessed value of a recipient of services' primary residence may not be considered for the purpose of establishing charges incurred by the recipient of services during the first 6 months of the individual's hospitalization. An additional 6 months exemption may be allowed if the recipient of services provides written verification from the Department clinician who is primarily responsible for the individual's care which indicates that there is a reasonable clinical likelihood that the individual will be discharged from the facility not later than 12 months following his or her admission to the facility.
(c)
Household furnishings.
(d)
One motor vehicle plus other motor vehicles necessary for employment, education, medical care, or maintenance of family life.
(e)
Liquid assets including but not limited to cash, certificates of deposit, savings and checking accounts, stocks and bonds whose total value does not exceed $2,500.
(2)
Income allowances. The following sources of income shall be excluded from the Department's ability to pay determinations:
(a)
Therapeutic work activity income earned in a Department sponsored or approved program which may not exceed $100 per month;
(b)
If the recipient of services is not involved in a therapeutic work activity program, a monthly personal income allowance of $40.
(3)
Allowable Expenses. The following documented expenses shall be deducted from the countable gross income in determining a person's ability-to-pay:
(a)
Reasonable transportation expenses incurred by a recipient of services' relatives and designated visitors during the course of visits to a facility. Mileage allowances shall be calculated in accordance with the prevailing travel allowances permitted for State employees.
(b)
Health insurance premiums.
(c)
Life insurance premiums for policies which have a maximum face value which does not exceed $2,500.
(d)
Reasonable allowances shall be made for necessary and appropriate purchases of clothing and other personal items which may be used by the recipient of services while in a residence or during the course of a clinically sponsored activity. Clinicians responsible for the recipient of services care and treatment shall be consulted to determine the appropriateness of the requested item.
(e)
Reasonable income allowances reflecting the actual expenses incurred by a recipient of services in maintaining his or her primary residence or apartment provided that when the recipient of services:
(i)
Is unmarried and has no dependents, the income allowance shall be permitted only for that period of time that the residence is afforded exempt status pursuant to Regulation .03G(1)(b); and
(ii)
Income constitutes the primary source of financial support for a spouse or other individual claimed as dependents on that individual's federal income tax return, an additional monthly income allowance shall be permitted in an amount equal to the appropriate base monthly deduction as set forth in Regulation .04C(8).
H.
Monthly Rate. If a combined income is available, the monthly rate charged to the recipient of services and spouse will be computed according to Regulation .04, of this chapter.
Regulation .04 Determination of the Ability of a Responsible Relative to Pay.LinkCopy Citation
A.
Investigation of Financial Condition.
(1)
A responsible relative's ability to pay will be determined by an investigation of the financial condition of the person or persons to be held liable for payment for the in-patient treatment rendered at a State-operated facility. The assets, income, and cost of living of responsible relatives will be the subject of the investigation.
(2)
The Department shall request either copies of the responsible relative's most recently filed federal and state income tax returns or an affidavit that the responsible relative did not file tax returns for the previous tax year.
(3)
The failure of the responsible relative to provide the Department with the required documents of financial status, including the most recently filed federal and state income tax returns, may result in the Department charging and the responsible relative being liable for the full per-capita daily charge for services as set forth in COMAR 10.02.01.04.
B.
A maximum monthly charge for which responsible relatives may be held liable, within the scope of these regulations, will be developed by the Department in the following manner:
(1)
A charge will be developed by multiplying the daily charge set by the Secretary of the Department times 365 and dividing that product by 12.
(2)
A responsible relative's ability to pay will be measured against the maximum monthly charge.
(a)
Amounts assessed individually and collectively may not exceed the maximum monthly charge.
(b)
When a rate is prorated because the total ability to pay of all responsible relatives exceeds the total of the responsible relatives' liability, charges to each responsible relative will be prorated by applying each responsible relatives' ability to pay as a percentage of all responsible relatives' ability to pay.
C.
Procedure to be Followed for Computation of Monthly Rate.
(1)
The rate for which a person may be held liable will be determined from that person's adjusted gross monthly income as determined from the financial investigation required by §A, above.
(2)
The adjusted gross monthly income will be determined by deducting from the gross monthly income all payroll taxes as computed on tax deduction charts developed by the Department and all applicable special or unusual expenses as set forth in these regulations.
(3)
Self-employment tax paid will be considered in lieu of Social Security tax.
(4)
Payment into the Federal Retirement Fund will be considered in lieu of Social Security.
(5)
Special or unusual expenses which may be allowed are:
(a)
Reasonable child care expenses incurred by the working sponsor;
(b)
Child support or alimony payments if payments are made to a person who does not qualify as a dependent;
(c)
College expenses for dependents not to exceed the amount charged for tuition by the University of Maryland at College Park for undergraduate programs;
(d)
Union dues;
(e)
Mandatory contributions to retirement plans; and
(f)
Expenses for special work clothes or special work equipment.
(6)
Rental Income. One half of gross rental income will be considered as net rental income and will be included in gross monthly income. This may be modified if justifiable reasons are substantiated.
(7)
Medical Expenses.
(a)
Paid medical expenses in excess of those used in the cost of living tables in §C(8) may be allowed as an additional deduction.
(b)
Medical expenses which are covered by medical insurance will not be allowed.
(c)
Medical insurance premiums will be allowed as medical expenses.
(8)
Base Monthly Deduction.
(a)
The Department will develop a base monthly deduction, using the figures established by the Department of Commerce, for the average monthly consumption of a family of four of moderate means in an urban area. The Department will, using 1991 as the base year, adjust annually the base monthly deduction by the percentage by which benefits under Title II of the Social Security Act (42 U.S.C. 401 through 433) are increased by the federal government to reflect changes in the cost of living, as that percentage change is reported in the Federal Register in accordance with 42 U.S.C. 415(a)(1)(D).
(b)
The base monthly deduction shall be retained in the Office of the Division of Reimbursements and in the Financial Agents' Office located at the Department's in-patient facilities.
(9)
Monthly Rate.
(a)
The monthly rate will be determined by subtracting the base monthly deduction from the adjusted gross monthly income. The excess of the adjusted gross monthly income over the base monthly deduction will be the rate of charge for which the responsible relative will be held liable.
(b)
If the base monthly deduction is equal to or greater than the adjusted gross monthly income, the rate will be zero.
(c)
Rates will not be set if calculation of a rate results in an amount due of less than $5 per month.
(10)
Total Lifetime Hospitalization.
(a)
If a chargeable person has paid for 24 months total lifetime hospitalization of a recipient of services, the liability of that person for the recipient of services after that period may not exceed 15 percent of the charges for services set forth in this section.
(b)
The sum of any proceeds of applicable insurance, group health plan, or prepaid medical care that the insurer or plan pays because of liability for the payment of or repayment for the cost of care provided to the recipient of services does not count as payments paid by a chargeable person for the purpose of determining a recipient of services, total lifetime hospitalization.
Chapter annotations
Authority: Health-General Article, §§16-201—16-407, Annotated Code of Maryland
History: Effective date: September 1, 1976 (3:18 Md. R. 981)
History: Regulations .01—.03 amended effective May 5, 1986 (13:9 Md. R. 1028)
History: Regulation .02 amended effective June 27, 1988 (15:13 Md. R. 1553)
History: Regulation .02S amended effective June 28, 1999 (26:13 Md. R. 1019)
History: Regulation .03 amended effective June 27, 1988 (15:13 Md. R. 1553)
History: Regulation .03B amended effective October 15, 2001 (28:20 Md. R. 1782)
History: Regulation .03G amended effective June 28, 1999 (26:13 Md. R. 1019)
History: Regulation .04A amended effective October 15, 2001 (28:20 Md. R. 1782)
History: Regulation .04C amended as an emergency provision effective December 2, 1983 (10:26 Md. R. 2336); emergency status expired May 10, 1984 (Emergency provisions are temporary and not printed in COMAR)
History: Regulation .04C amended as an emergency provision effective June 6, 1984 (11:13 Md. R. 1169); adopted permanently effective October 8, 1984 (11:20 Md. R. 1742)
History: Regulation .04C amended effective June 3, 1985 (12:11 Md. R. 1048); March 23, 1987 (14:6 Md. R. 715); June 27, 1988 (15:13 Md. R. 1553); June 26, 1989 (16:12 Md. R. 1335); September 2, 1991 (18:17 Md. R. 1918); August 27, 2007 (34:17 Md. R. 1507)
History: Regulation .05 repealed effective May 5, 1986 (13:9 Md. R. 1028)
History: Annotation: COMAR 10.04.02.03 cited in State of Maryland Central Collection Unit v. Stewart, 292 Md. 255, 438 A.2d 1311 (1981)