Florida Medicare Savings Program Countable Income and Income Disregards

The published income limits for Florida's Medicare Savings Programs tell only half the story. DCF does not compare raw Social Security payments against the threshold and call it a day. They run the numbers through a series of disregards that reduce countable income — and those disregards are often the difference between qualifying and being told no.

How DCF Calculates Countable Income

Florida follows SSI-related income methodology under F.A.C. Rule 65A-1.713. The calculation works in a strict sequence:

Start with gross unearned income. This includes the full Social Security payment before Part B premiums or tax withholding are deducted, plus private pensions, VA pension benefits, annuity payments, and any other regular unearned income.

Apply the $20 general income disregard. Every household gets a flat $20 per month subtracted from total unearned income. This is the single most common reason people who think they are slightly over the limit actually qualify. A Social Security check of $1,370 becomes $1,350 after this disregard — right at the QMB ceiling for a single person.

Calculate earned income separately. If the applicant works, DCF disregards the first $65 of gross monthly earnings, then disregards half of the remaining amount. A part-time job paying $400 per month produces countable earned income of just $167.50.

Add countable unearned plus countable earned. The total is what DCF compares to the program limits:

Impairment-Related Work Expenses. After the earned income disregard is applied, documented out-of-pocket expenses required for employment (specialized transportation, assistive equipment, medical supplies needed for work) are also deducted from earned income for disabled beneficiaries who work.

The COLA Disregard

Every January, Social Security applies a Cost-of-Living Adjustment that raises the monthly payment. The federal poverty guidelines that set MSP limits are not updated until April. During the January–March gap, a COLA increase could push someone over the income limit.

Federal law protects against this. The COLA amount is disregarded for MSP income calculations until the new poverty guidelines take effect, typically on April 1. This means a January raise does not cause a loss of MSP coverage during those months.

What Does Not Count as Income

Several income sources are excluded entirely:

• In-kind support from family — an adult child paying a parent's rent, utilities, or groceries directly is not counted. Only direct cash payments from a child to a parent count as unearned income
• SNAP/food stamp benefits
• One-time payments should be reported to DCF; even if a payment is not counted as income, it may count as a resource under applicable rules
• Tax refunds
• Energy assistance payments (LIHEAP)

Resource Limits and What's Exempt

Countable resources cannot exceed $9,950 for an individual or $14,910 for a couple across all three MSP tiers. But the exemption list is generous:

Exempt (does not count):

• Primary home — excluded regardless of value, with no home equity cap for MSP purposes (Florida's $752,000 Medicaid long-term care equity limit does not apply to Medicare Savings Programs)
• One automobile — excluded regardless of value
• Household furnishings and personal effects
• Up to $2,500 per person in designated burial funds held in a separately identifiable account
• Burial plots for the applicant, spouse, and immediate family
• Irrevocable pre-paid burial contracts — excluded without dollar cap
• Term life insurance policies (no cash value)
• Whole life insurance policies with a combined face value of $1,500 or less per person

Counted:

• Checking and savings account balances
• Certificates of deposit
• Stocks, bonds, mutual funds, brokerage holdings
• Non-home real estate equity
• Cash surrender value of whole life insurance if total face value exceeds $1,500
• IRAs and 401(k)s unless placed into mandatory periodic payout status (at that point, the principal is excluded and only the monthly distribution counts as income)

Joint accounts. A bank account held jointly with an adult child is presumed to belong entirely to the applicant. The burden is on the family to prove the child deposited their own funds — financial tracing records showing the child's independent deposits can rebut the presumption.

Running the Numbers Before You Apply

Before filing the application, calculate countable income and resources using the actual methodology DCF will use:

1. Add all gross unearned monthly income (Social Security gross, pensions, VA, annuities)
2. Subtract $20
3. Add any countable earned income (gross wages minus $65, then divide remaining by 2)
4. Compare the total to the program limits above
5. Total all countable resources (bank balances, investments, countable insurance values)
6. Compare to $9,950 single or $14,910 couple

If the numbers are close to a threshold, do not self-disqualify. Apply and let DCF make the determination — they may identify additional disregards or exemptions that tip the balance.

The Florida Medicare Savings Programs & Extra Help Guide includes a step-by-step income calculation worksheet and an asset classification checklist that walks through every line item DCF evaluates, so nothing is missed and nothing is overcounted.

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