Advocacy and Public Policy

Freedom to Work Medicaid

Freedom to Work Medicaid is a Medicaid category. Eligibility requirements are found in the DHS Bridges Eligibility Manual (BEM) under BEM 174.

Since passage of the Freedom to Work Medicaid for Individuals with Disabilities Act of 2003, eligible people with disabilities in Michigan have been able to work and increase their income beyond the previous limit, and keep Medicaid coverage. The purpose of Freedom to Work Medicaid is so people will not lose their Medicaid due to increased earnings or assets. This is a work incentive. Beneficiaries must be working in order to be eligible for it.

Some of the eligibility criteria for Freedom to Work Medicaid (FTW) are:

The individual must be disabled according to the disability standards of the Social Security Administration, except for employment, earnings and substantial gainful activity (SGA)
The individual is between the ages of 16 and 64
The individual’s unearned income (such as SSDI, stock dividends or trust fund income) is not more than the Federal poverty guideline ($903 per month for a single person in 2010)
Before working the individual was receiving or eligible for Medicaid (not including a Medicaid Deductible case)
The individual is employed

The applicant's spouse's income and assets will not be considered in determining the applicant's eligibility for FTW. Once an individual is determined eligible for this program by a Department of Human Services (DHS) Medicaid worker, he or she gets Medicaid coverage free until his or her countable earned income exceeds 250% of poverty for one person. Once earnings are more than that amount, a recipient may stay on Medicaid by paying a monthly premium to the state toward the cost of Medicaid coverage. This means the recipient may make up to approximately $54,000 annually in 2010 before he or she needs to pay premiums.

The monthly premium starts at $50 ($600 per year) and increases on an income-based sliding scale. The premium will be adjusted annually based on changes in income. There is no limit on earned income for people in the program.

Monthly premiums are sent to the Department of Community Health. Premiums not received by the due date each month will initiate a grace period during which the beneficiary is notified of case closure.

An individual in the program may also:

Save up to $75,000 (a house and vehicle don't count toward the $75,000)
Accumulate savings in retirement and individual retirement accounts without limits
Have breaks in employment up to 24 months due to medical necessity or involuntary layoff

For people receiving Supplemental Security Income (SSI), Freedom to Work is triggered either by earning more than the applicable Medicaid income limit ($29,036 in 2011) or by saving more than $2,000. This should happen automatically without the need to sign up.

Note: When an SSI recipient earns above a certain amount, their SSI check will stop. However, their SSI case will remain open and they will still have Medicaid under SSI until earnings exceed $29,036 annually. If income exceeds $29,036 annually the SSI case closes and the individual is moved into Freedom to Work Medicaid.

SSDI beneficiaries who are eligible for Medicaid (not including a Medicaid Deductible case) will move into Freedom to Work Medicaid when they start working.

In the past the move into FTW Medicaid has encountered some problems. Some FTW enrollees have mistakenly been cut off of Medicaid or put into a Medicaid deductible case. Because they now make too much money, their Department of Human Services (DHS) worker assumed they no longer have a disability despite the fact that there has been no change in their medical condition. This is NOT the intent of the law. The good news is that the process at DHS is improving and the MiJob Coalition, which helped write and obtain passage of the law, is working to completely remedy this error. If you have mistakenly been put on a Medicaid Deductible case when you should be enrolled in FTW, or if you have been receiving Medicaid coverage through FTW and have been cut off, contact Michigan Protection and Advocacy at (800)288-5923.

If you have questions about Freedom to Work Medicaid or you think you qualify for FTW Medicaid and have not been moved to that Medicaid category, speak with your local Community Work Incentive Coordinator (CWIC). A list of CWICs with phone numbers, by area, is located on this web site under Work Incentive Planning and Assistance.

Updated November, 2010

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