New Hampshire Medicare Savings Income Calculation: The $20 Disregard Explained
Gross Income Is Not Countable Income
The published QMB income limit for a single person in 2026 is $1,350 per month. That looks low — many seniors on Social Security receive more than that. But the number DHHS compares against the limit isn't your gross Social Security check. It's your countable income after disregards.
The most important disregard: DHHS subtracts $20 per household from total unearned income before comparing against the limit. This is the standard general income disregard established in the Adult Assistance Manual.
In practice, that means a single person with $1,370 in gross monthly Social Security has countable income of $1,350 — right at the QMB ceiling. Without understanding this disregard, that person might see "$1,370" on their benefit statement, compare it to the "$1,350 limit," and never apply.
What Counts as Income
DHHS evaluates all income from all sources in the household:
Unearned income (most common for seniors):
- Gross Social Security benefits — the amount before Medicare premiums or tax withholdings are deducted
- Pensions and civil service annuities
- VA disability payments
- Interest and dividends
- Net rental income
- Distributions from retirement accounts in periodic payment status
Earned income (less common but relevant for working beneficiaries):
- Gross wages, salaries, commissions
- Net self-employment earnings
The key word is gross. Social Security deducts Part B premiums before sending the check, but DHHS adds that deduction back when calculating income. If the monthly deposit is $1,100 and $202.90 was withheld for Part B, DHHS counts $1,302.90.
The Earned Income Calculation
Working beneficiaries get a more generous calculation. After applying the $20 general disregard (to unearned income first), DHHS also excludes:
- The first $65 of gross monthly earned income
- Half of the remaining earned income after the $65 exclusion
Example: A person earns $500 per month part-time and receives $900 in Social Security.
- Unearned income: $900 − $20 disregard = $880
- Earned income: $500 − $65 = $435 → $435 ÷ 2 = $217.50
- Total countable income: $880 + $217.50 = $1,097.50
That's well under the QMB limit, even though gross income totals $1,400.
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Spousal Income and Deeming
When a Medicare-eligible person lives with a spouse who isn't applying for an MSP, the couple's combined income and assets are tested against the couple limits — $1,824 for QMB, $2,184 for SLMB, $2,455 for SLMB135.
If spouses are legally separated or living in separate households indefinitely, deeming stops. The applicant is evaluated as a single individual against single thresholds. This distinction can change the outcome entirely — a couple with combined income of $2,000 would exceed the QMB couple limit, but if they're living separately, the applicant's individual $1,100 would qualify easily.
One-Time Payments and Lump Sums
A retroactive Social Security payment, insurance settlement, or inheritance can affect a bank balance above the $9,950 asset limit. DHHS counts a retroactive Social Security payment as unearned income in the month received, but excludes it from countable resources for nine calendar months following that month if the funds are kept in a separate account and not commingled.
Retroactive Social Security Fairness Act payments (from the 2025 WEP/GPO repeal) are one example. Report the deposit during the application and keep the funds separate to preserve the nine-month resource exclusion.
Why the Calculation Matters
The gap between "too much income" and "qualifies for QMB" is often $20 to $50. Getting the disregard right — and understanding that DHHS tests net countable income, not the number on a Social Security statement — is the difference between $2,434.80 a year in premium savings and nothing.
Our New Hampshire Medicare Savings Programs & Extra Help Guide includes an income calculation worksheet with three worked examples covering the most common scenarios, so you can run the numbers before applying.
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