(1) An applicant may be eligible for covered services under the HMK coverage group if:

(a) the applicant is under 19 years of age;

(b) the applicant's social security number is provided. Benefits will not be denied or delayed to an otherwise eligible applicant pending issuance of his or her social security number;

(c) the family of which the applicant is a member has annual family income, without regard to other family resources, at or below 250% of the federal poverty level (FPL);

(d) the applicant is a Montana resident;

(e) the applicant is a U.S. citizen or qualified alien as defined under federal statute;

(f) the applicant is not incarcerated;

(g) the applicant is not an inpatient in an institution for mental disease on the date of initial application or the date of any redetermination of eligibility; and

(h) for three months prior to enrollment the applicant has not had creditable private health insurance coverage. This requirement is waived if the parent or guardian providing the insurance:

(i) dies;

(ii) is terminated or laid off;

(iii) can no longer work due to a disability;

(iv) has a lapse in insurance coverage due to new employment;

(v) had insurance coverage that ended because the stepparent, who provided the coverage, and the parent divorced;

(vi) had coverage through the Insure Montana Program;

(vii) had coverage through the Medicaid Health Insurance Premium Payment (HIPP) program;

(viii) paid more than 50% of the insurance premium;

(ix) has insurance coverage that is not accessible (e.g. coverage is through an HMO in another state);

(x) loses Tricare military health insurance; or

(xi) has an annual aggregate amount of health insurance premiums and cost sharing expenses imposed for coverage of the family of a child which exceeds 5% of the family's income.

(2) State of Montana and Montana University System employees' children may be eligible for the HMK coverage group under the following conditions: the family meets HMK income guidelines and the health insurance premiums and cost-sharing expenses exceed 5% of the family's income for the benefit year.

(3) An applicant who is eligible or potentially eligible for the HMK Plus coverage group as determined by the department is not eligible for the HMK coverage group.

(4) The department must verify an applicant's citizenship or qualified alien status.

(5) Family income must be verified to determine eligibility. The department will request documentation of income from the applicant and will access various electronic databases to verify income as needed.

(a) Family income may include one or more of the following:

(i) the income of both parents if the child resides with both parents;

(ii) the income of the parent with whom the child resides the majority of the year, including any child support received for the child, if the child resides with one parent in a single parent household:

(A) If the parent with whom the child resides the majority of the year has remarried, the stepparent's income is imputed to the parent with whom the child resides the majority of the year.

(B) The income of individuals under the age of 19 who live in the household but do not attend school is imputed to the parent with whom the child resides the majority of the year.

(b) Family income does not include:

(i) money received from assets drawn down such as withdrawals from a savings account, an annuity, or from the sale of a house or a car;

(ii) gifts, loans, one-time insurance payments, or lump sum compensation for an injury;

(iii) the first $2,000 of an enrolled tribal member's per capita payment;

(iv) the first $2,000 of an enrolled tribal member's tribal land income;

(v) the interest earned on (5)(b)(iii) and (iv);

(vi) earned income which is excluded and dependent care expenses which are deducted from income under the HMK Plus coverage group;

(vii) income excluded under federal Medicaid regulations;

(viii) foster care income for any children unless the only children in the family are in foster care; or

(ix) income of an individual with whom a child resides who has no legal obligation to support the child.

(c) Income information will be used by the department to project the family's income.

(d) The family's debts, medical expenses, or other financial circumstances will not be taken into consideration when determining family income.

(6) Applicants eligible to receive services from the Indian Health Services (IHS) program administered by the United States Department of Health and Human Services are eligible for the HMK coverage group if they meet the criteria specified in this subchapter.

(7) Applicants who are losing HMK Plus coverage or who were denied HMK Plus coverage for a reason other than the family withdrew their application or failed to comply with HMK Plus requirements are evaluated for HMK coverage group via an electronic report. The HMK coverage group eligibility will be determined and applicants will be enrolled in the HMK coverage group or placed on the HMK coverage group's waiting list.

(8) Applicants and their parents or guardians must comply with the procedures specified by the department as necessary to obtain or access benefits.

(9) The HMK coverage group benefits do not start until the applicant is enrolled even though the applicant may have been determined eligible for the HMK coverage group prior to the date of enrollment.

(10) The HMK coverage group eligibility is redetermined within one year after the initial eligibility period, and annually thereafter. Prior eligibility for HMK does not guarantee continued eligibility or enrollment.

(11) The HMK coverage group eligibility and benefits are not an entitlement. If funding is insufficient, the department may reduce enrollment numbers or reduce eligibility to a lower percentage of the federal poverty level to limit the number of individuals who are eligible to participate.

(12) A determination of the HMK coverage group eligibility will be completed within 45 calendar days after receipt of a complete application.