Dear Martin:
Your friend is correct – you should report the winnings to the county, in order to avoid having to re-apply for Medical Assistance (MA) and avoid being assessed an “overpayment” in benefits. MA is a government benefit based on need, meaning there are income and asset guidelines that you need to be under in order to qualify and receive those benefits. Problems can happen when you go over the asset limit.
Because you are receiving MA, you need to report the winnings to the county right away. The asset limit for a single person on MA is $3,000. Your $6,000 winnings put you over the MA asset limit and will make you ineligible for MA until you spend it down again. When you inform the county, your MA case will be scheduled to close on a near future date. Because your winnings are relatively small, you should be able to spend your assets back down to $3,000 before the closing date so you won’t have to re-apply for MA. You will pay for your own healthcare costs during this time, which will help spend it down. If you don’t spend it down by the closing date, you will have to re-apply for MA.
Be careful to spend the excess assets on approved things, such as: your healthcare expenses, any taxes resulting from the winnings, your living expenses, your bills, your debts, and anything for yourself that you may need or want. Keep records of what you use the excess money for so that you can prove to the county that you did not make gifts to others. Don’t make gifts to family, friends, or even charities because you will need to get back on MA soon and you do not have enough money to support your costs on your own, you will need to be eligible for MA as soon as you spend the excess money down. If you make a gift, the gift will make you ineligible for a period of time, based on the value of the gift.
Keep asset limits in mind for other benefits as well, such as Supplemental Security Income (SSI). A single person getting SSI can only have $2,000 in countable assets.
By reporting excess assets right away, you will avoid an overpayment of benefits. An overpayment is when you kept getting benefits when you shouldn’t have, because you are ineligible, in this case for being over asset.
Of course, if you think the county made a mistake, you can appeal any action by the county. If you appeal within 10 days of a termination, your benefits may continue pending the outcome of the appeal – but if you lose, your overpayment will be larger. Otherwise, you have 30 days to appeal. In some circumstances, you have 90 days to appeal if you had good cause to miss the 30 day deadline. You would then have a right to a hearing with a Department of Human Services judge. For more information about appeals, go to the www.lawhelpmn.org website.
