441—86.2 (514I) Eligibility factors. The decision with respect to eligibility shall be based primarily on information furnished by the applicant, the enrollee, or a person acting on behalf of the applicant or enrollee. A child must meet the following eligibility factors to participate in the HAWK-I program.
	 86.2(1) Age. The child shall be under 19 years of age. Eligibility for the program ends the first day of the month following the month of the child’s nineteenth birthday.
	 86.2(2) Income. Countable income shall not exceed 200 percent of the federal poverty level for a family of the same size when determining initial and ongoing eligibility for the program.
	  a.   	 Countable income. When determining initial and ongoing eligibility for the HAWK-I program, all earned and unearned income, unless specifically exempted, shall be countable.
	 (1) 	 Earned income. The earned income of all parents, spouses, and children under the age of 19 who are not students who are living together shall be countable. Income shall be countable earned income when an individual produces it as a result of the performance of services. Earned income is income in the form of a salary, wages, tips, bonuses, and commissions earned as an employee, or net profit from self-employment.
	  1. 	 Earned income from employment. Earned income from employment means total gross income.
	  2. 	 Earned income from self-employment. Earned income from self-employment means the net profit determined by comparing gross income with the allowable costs of producing the income. The allowable costs of producing self-employment income shall be determined by the costs allowed for income tax purposes. Additionally, the cost of depreciation of capital assets identified for income tax purposes shall be allowed as a cost of doing business for self-employed persons. Losses from a self-employment enterprise may not be used to offset income from any other source. A person is considered self-employed when any of the following conditions exist. The person:
	  ● 	 Is not required to report to the office regularly except for specific purposes such as sales training meetings, administrative meetings, or evaluation sessions; or
	  ● 	 Establishes the person’s own working hours, territory, and methods of work; or
	  ● 	 Files quarterly reports of earnings, withholding payments, and FICA payments to the Internal Revenue Service.
3. Earned income deduction. Each person in the household whose nonexempt income, earned as an employee or from self-employment, is considered in determining HAWK-I eligibility is entitled to a 20 percent earned income deduction. The deduction is intended to include work-related expenses other than child care. These expenses may include taxes, transportation, meals, uniforms and other work-related expenses.
	 (2) 	 Unearned income. The unearned income of all parents, spouses, and children under the age of 19 who are living together in accordance with subrule 86.2(3) shall be counted. Unearned income is any income in cash that is not gained by labor or service. The available unearned income shall be the amount remaining after the withholding of taxes (Federal Insurance Contribution Act, state and federal income taxes). Examples of unearned income include, but are not limited to:
	  1. 	 Social security benefits. Social security income is the amount of the entitlement before withholding of a Medicare premium.
	  2. 	 Child support and alimony payments received for a member of the family.
	  3. 	 Unemployment compensation.
	  4. 	 Veterans benefits.
	 (3) 	 Recurring lump sum income. Earned and unearned lump sum income that is received on a regular basis shall be counted and prorated over the time it is intended to cover. These payments may include, but are not limited to:
	  1. 	 Annual bonuses.
	  2. 	 Lottery winnings that are paid out annually.
	  b.   	 Exempt income. The following shall not be counted toward the income limit when establishing eligibility for the HAWK-I program.
	 (1) 	 Nonrecurring lump sum income. Nonrecurring lump sum income is income that is not expected to be received more than once. These payments may include, but are not limited to:
	  1. 	 An inheritance.
	  2. 	 A one-time bonus.
	  3. 	 Lump sum lottery winnings.
	  4. 	 Other one-time payments.
	 (2) 	 Food reserves from home-produced garden products, orchards, domestic animals, and the like, when used by the household for its own consumption.
	 (3) 	 The value of the coupon allotment in the Food Stamp Program.
	 (4) 	 The value of the United States Department of Agriculture donated foods (surplus commodities).
	 (5) 	 The value of supplemental food assistance received under the Child Nutrition Act and the special food service program for children under the National School Lunch Act.
	 (6) 	 Any benefits received under Title III-C, Nutrition Program for the Elderly, of the Older Americans Act.
	 (7) 	 Benefits paid to eligible households under the Low Income Home Energy Assistance Act of 1981.
	 (8) 	 Any payment received under Title II of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 and the Federal-Aid Highway Act of 1968.
	 (9) 	 Interest and dividend income.
	 (10) 	 Any judgment funds that have been or will be distributed per capita or held in trust for members of any Indian tribe.
	 (11) 	 Payments to volunteers participating in the Volunteers in Service to America (VISTA) program.
	 (12) 	 Payments for supporting services or reimbursement of out-of-pocket expenses received by volunteers in any of the programs established under Titles II and III of the Domestic Volunteer Services Act.
	 (13) 	 Tax-exempt portions of payments made pursuant to the Alaskan Native Claims Settlement Act.
	 (14) 	 Experimental housing allowance program payments.
	 (15) 	 The income of a Supplemental Security Income (SSI) recipient.
	 (16) 	 Income of an ineligible child if the family chooses not to include the child in the eligibility determination in accordance with the provisions of paragraph 86.2(3)“c.”
	 (17) 	 Income in kind.
	 (18) 	 Family support subsidy program payments.
	 (19) 	 All earned and unearned educational funds of an undergraduate or graduate student or a person in training. However, any additional amount of educational funds received for the person’s dependents that are in the eligible group shall be considered as nonexempt income.
	 (20) 	 Bona fide loans.
	 (21) 	 Payments made from the Agent Orange Settlement Fund or any other fund established pursuant to the settlement in the In re Agent Orange product liability litigation, M.D.L. No.	381 (E.D.N.Y.).
	 (22) 	 Payment for major disaster and emergency assistance provided under the Disaster Relief Act of 1974 as amended by Public Law 100-707, the Disaster Relief and Emergency Assistance Amendments of 1988.
	 (23) 	 Payments made to certain United States citizens of Japanese ancestry and resident Japanese aliens under Section 105 of Public Law 100-383, and payments made to certain eligible Aleuts under Section 206 of Public Law 100-383 entitled Wartime Relocation of Civilians.
	 (24) 	 Payments received from the Radiation Exposure Compensation Act.
	 (25) 	 Reimbursements from a third party or from an employer for job-related expenses.
	 (26) 	 Payments received for providing foster care when the family is operating a licensed foster home.
	 (27) 	 Any payments received as a result of an urban renewal or low-cost housing project from any governmental agency.
	 (28) 	 Retroactive corrective payments.
	 (29) 	 The training allowance issued by the division of vocational rehabilitation, department of education.
	 (30) 	 Payments from the PROMISE JOBS program.
	 (31) 	 The training allowance issued by the department for the blind.
	 (32) 	 Payments from passengers in a car pool.
	 (33) 	 Compensation in lieu of wages received by a child under the Job Training Partnership Act of 1982.
	 (34) 	 Any amount for training expenses included in a payment issued under the Job Training Partnership Act of 1982.
	 (35) 	 Earnings of a child under the age of 19 who is a full-time student as defined at 441—75.54(1)“b”(1) and (2).
	 (36) 	 Incentive payments received from participation in the adolescent pregnancy prevention programs.
	 (37) 	 Payments received from the comprehensive child development program, funded by the Administration for Children, Youth, and Families, provided the payments are considered complementary assistance by federal regulations.
	 (38) 	 Incentive allowance payments received from the work force investment project, provided the payments are considered complementary assistance by federal regulation.
	 (39) 	 Honorarium income and all moneys paid to an eligible family in connection with the welfare reform longitudinal study.
	 (40) 	 Family investment program (FIP) benefits.
	 (41) 	 Moneys received through pilot self-sufficiency grants or diversion programs.
	 (42) 	 Income that has ended as of the date of application.
	 (43) 	 Any income restricted by law or regulation that is paid to a representative payee living outside the home, other than to a parent who is the applicant or recipient, unless the income is actually made available to the applicant or recipient by the representative payee.
	 (44) 	 A federal or state earned income tax credit, regardless of whether the payment is received with the regular paycheck or as a lump sum with the federal or state income tax refund.
	 (45) 	 All earnings received by temporary workers from the U.S. Bureau of the Census.
	  c.   	 Verification of income. Income shall be verified using the best information available. For example, earnings from the 30 days before the date of application may be used to verify earned income if it is representative of the income expected in future months.
	 (1) 	 Pay stubs, tip records, tax records and employers’ statements are acceptable forms of verification of earned income.
	 (2) 	 Unearned income shall be verified through data matches when possible, award letters, warrant copies, or other acceptable means of verification.
	 (3) 	 Self-employment income shall be verified using business records or income tax returns from the previous year if they are representative of anticipated earnings.
	 (4) 	 When a child who has been determined ineligible for Medicaid is referred to the HAWK-I program, the third-party administrator shall use the income amount used by the Medicaid program unless rules in this chapter require the income to be treated differently.
	  d.   	 Changes in income. Once initial eligibility is established, changes in income during the 12-month enrollment period shall not affect the child’s eligibility to participate in the HAWK-I program. However, if income has decreased, the family may request a review of their income to establish whether they are required to continue paying a premium in accordance with rule 441—86.8(514I).
	 86.2(3) Family size. For purposes of establishing initial and ongoing eligibility under the HAWK-I program, the family size shall consist of all persons living together who are children under the age of 19 or who are parents of those children as defined below.
Exception:  Persons who are receiving Supplemental Security Income (SSI) under Title XVI of the Social Security Act or who are voluntarily excluded in accordance with the provisions of paragraph “c” below are not considered in determining family size.
	  a.   	 Children. A child under the age of 19 and any siblings under the age of 19 of whole or half blood or adoptive shall be considered together unless the child is emancipated due to marriage, in which case, the emancipated child is not included in the family size unless the marriage has been annulled. Emancipated children, their spouses, and children who live with parents or siblings of the emancipated child shall be considered as a separate family when establishing eligibility for the HAWK-I program.
	  b.   	 Parents. Any parent living with the child under the age of 19 shall be included in the family size. This includes the biological parent, stepparent, or adoptive parent of the child and is not dependent upon whether the parents are married to each other. In situations where the parents do not live together but share joint physical custody of the children, the family size shall be based on the household in which the child spends the majority of time. If both parents share physical custody equally, either parent may apply on behalf of the child and the family size shall be based on the household of the applying parent.
	  c.   	 Persons who may be excluded when determining family size. If including a child in the family size causes siblings to be ineligible, the family may choose not to count the child in the family size. However, this rule shall not apply when the child is receiving Supplemental Security Income (SSI) benefits because SSI recipients are not counted in determining family size for the purposes of HAWK-I eligibility.
	  d.   	 Temporary absence from the home. The following policies shall be applied to any person who would be counted in the family size in accordance with paragraphs “a” and “b” who is temporarily absent from the home.
	 (1) 	 When a person is absent from the home to secure education or training (e.g., the person is attending college), the person shall be included when establishing the size of the family at home and, if otherwise eligible, shall be covered under the program.
	 (2) 	 When a person is absent from the home to secure medical care, the person shall be included when establishing the size of the family at home and, if otherwise eligible, shall be covered under the program when the reason for the absence is expected to last less than 12 months.
	 (3) 	 When a person is absent from the home because the person is an inmate in a nonmedical public institution (e.g., a penal institution) in accordance with the provisions of subrule 86.2(9), the person shall be included when establishing the size of the family at home if the absence is expected to be less than three months. However, when the person is a child under the age of 19, coverage under the program shall not be provided pursuant to subrule 86.2(10) until the child returns to the home.
	 (4) 	 When a child is absent from the home because the child is in foster care, the child shall not be included when establishing the size of the family at home.
	 (5) 	 When a child is absent from the home for a vacation or a visit to an absent parent, for example, the child shall be included in establishing the size of the family at home and, if otherwise eligible, shall be covered under the program if the absence is expected to be less than three months.
	 86.2(4) Uninsured status. The child must be uninsured.
	  a.   	 A child who is currently enrolled in an individual or group health plan is not eligible to participate in the HAWK-I program. However, a child who is enrolled in a plan shall not be considered insured for purposes of the HAWK-I program if:
	 (1) 	 The plan provides coverage only for a specific disease or service (such as a vision, dental, or cancer policy), or
	 (2) 	 The child does not have reasonable geographic access to care under that plan. “Reasonable geographic access” means that the plan or an option available under the plan does not have service area limitations or, if the plan has service area limitations, the child lives within 30 miles or 30 minutes of a network primary care provider.
	  b.   	 Rescinded IAB 7/9/03, effective 7/1/03.
	  c.   	 American Indian and Alaska Native. American Indian and Alaska Native children are eligible for the HAWK-I program on the same basis as other children in the state, regardless of whether or not they may be eligible for or served by Indian Health Services-funded care.
	 86.2(5) Ineligibility for Medicaid. The child shall not be receiving Medicaid or eligible to receive Medicaid if application were made except when the child would be required to meet a spenddown under the medically needy program in accordance with the provisions of 441—subrule 75.1(35).
	  a.   	 A child who would be eligible for Medicaid except for the parent’s failure or refusal to cooperate in establishing initial or ongoing eligibility shall not be eligible for coverage under the HAWK-I program.
	  b.   	 Children who are excluded from the Medicaid household due to the income or resources of the child may participate in the HAWK-I program if otherwise eligible.
	 86.2(6) Iowa residency. The child shall be a resident of the state of Iowa. A resident of Iowa is a person:
	  a.   	 Who is living in Iowa voluntarily with the intention of making that person’s home in Iowa and not for a temporary purpose; or
	  b.   	 Who, at the time of application, is not receiving assistance from another state and entered Iowa with a job commitment or to seek employment or who is living with parents or guardians who entered Iowa with a job commitment or to seek employment.
	 86.2(7) Citizenship and alien status. The child shall be a citizen or lawfully admitted alien. The criteria established under 8 U.S.C. Section 1612(a)(2)(A) and the Balanced Budget Act of 1997, subsection 5302, shall be followed when determining whether a lawfully admitted alien child is eligible to participate in the HAWK-I program. The citizenship or alien status of the parents or other responsible person shall not be considered when determining the eligibility of the child to participate in the program.
	 86.2(8) Dependents of state of Iowa employees. The child shall not be eligible for the HAWK-I program if the child is eligible for health insurance coverage as a dependent of a state of Iowa employee unless the state contributes only a nominal amount toward the cost of dependent coverage. “Nominal amount” shall mean $10 or less per month.
	 86.2(9) Inmates of nonmedical public institutions. The child shall not be an inmate of a nonmedical public institution as defined at 42 CFR Section 435.1009 as amended November 10, l994.
	 86.2(10) Inmates of institutions for mental disease. At the time of application or annual review of eligibility, the child shall not be an inmate of an institution for mental disease as defined at 42 CFR Section 435.1009 as amended November 10, l994.
	 86.2(11) Preexisting medical conditions. The child shall not be denied eligibility based on the presence of a preexisting medical condition.
	 86.2(12) Furnishing a social security number. Rescinded IAB 10/20/99, effective 12/1/99.