.03 Determination of the Ability of a Recipient of Services to Pay.

A. A recipient of services' primary liability-to-pay in-patient charges established in accordance with COMAR 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; 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.