.04 Determination of the Ability of a Responsible Relative to Pay.

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

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.