UU Prizes and Winnings

Revised 12/18/2020

Policy

The policy for how prizes and winnings are counted is covered in the following sections:

• General rules for prizes and winnings;

• Prorating prizes and winnings over more than one month (MAGI programs only); and

• Undue hardship claims for prorated prizes and winnings (MAGI programs only).

 

1) General Rules for Prizes and Winnings

How prizes and winnings are treated depends on the following:

If the prize or winning is...	And the program is...	Then the treatment is...
Cash (i.e., currency, checks or money orders)	All programs	Counted as unearned income. NOTE     For MAGI programs, prizes and winnings of $80,000.00 or more must be prorated over more than one month; see section 2 below.
Non-cash items	ALTCS SSI-MAO MSP	Excluded.
	Adult Caretaker Relative Pregnant Woman Child KidsCare	Counted as unearned income. Prizes and winnings of $80,000.00 or more must be prorated over more than one month; see section 2 below. NOTE     The fair market value of the prize or winnings is the countable income amount.

 

2) Prorating Income for MAGI Programs

Use the chart below to determine when prizes or winnings must be prorated:

If the prize or winnings amount is...	Then the treatment is...
Less than $80,000.00	Counted as unearned income in the month received.
$80,000.00 to $89,999.99	Prorated over two months.
$90,000.00 to $99,999.99	Prorated over three months.
Over $99,999.99	Prorated over three months plus one additional month for each additional $10,000 over $90,000, up to a maximum of 120 months.

 

3) Undue Hardship Claims for Prorated Prizes and Winnings

A request for undue hardship will be considered when a loss of eligibility due to prorated prize income would deprive the customer of:

• Medical care to the point that the customer’s life or health would be endangered; or

• Food, clothing, shelter, or other necessities of life as shown by the fact that the customer’s income excluding the prorated prize income is less than or equal to 100% of the Federal Poverty Level (FPL). See MA615.2 for the 100% FPL income standard.

To qualify for an undue hardship, ALL of the following conditions must be met:

• The customer does not have the income or resources to pay for the medical care that he or she needs;

• The customer does not have any other means of obtaining the medical care that he or she needs, including other insurance, benefits, or third-party liability; and

• The customer is otherwise eligible for AHCCCS Medical Assistance when the prorated prize income is not counted.

NOTE     This is an exception to the general rule that resource information is not needed for MAGI programs.

Undue hardship decisions are made on a case-by-case basis.

See How to Refer an Undue Hardship Request for Prorated Prizes and Winnings for the information needed to complete an undue hardship request.

 

Definitions

Term	Definition
Prizes and winnings	Items of value provided as a result of a contest, sweepstake, lottery or gambling. The item may be provided in cash or as a non-cash item such as goods, property or services.

 

Proof

Income is first obtained through the Federal and State Data Services Hubs. If needed, other proof includes:

• Copy of the check stub;

• Prize or winnings award letter; or

• Collateral contact with the source providing the income.

 

Legal Authority

Program	Legal Authorities
ALTCS SSI-MAO Medicare Savings Program	42 USC 1382a(a)(2)(C) 20 CFR 416.1121(f)
Adult Caretaker Relative Pregnant Woman Child KidsCare	42 USC 1396a(e)(14)(K) 42 CFR 435.603 42 CFR 457.315