Board gives initial approval to extend post‑eligibility income ("petty") calculations to DD residential services; advocates warn of work disincentives

The Medical Services Board approved initial action on a rule to apply Colorado’s established post‑eligibility treatment of income (commonly called "patient pay" or "petty") to people on the developmental disabilities (DD) waivers who live in per‑diem residential settings.

Cassandra Keller of the department’s Office of Community Living told the board the proposal brings parity across Medicaid waiver programs: under the change, members in DD residential settings would keep a personal needs allowance and have allowable deductions (taxes, certain household expenses, approved trust contributions) before any contribution toward room and board is calculated. The department said members who are employed or receiving employment supports will be exempted so earnings are not disincentivized.

Advocates and family speakers urged caution. They said many DD waiver members live on fixed incomes and that administrative complexity could create inequities; some parents and advocates argued the rule risks taking income from the most vulnerable if implementation or exemptions are imperfect. Public commenters also urged the department to publish a clear worksheet and to provide intensive case‑manager training because each member’s calculation is individualized.

Why it matters: Extending pen calculations to DD residential care is expected to produce state budget savings while standardizing treatment of income across waiver programs. The department said federal approval is required; the Joint Budget Committee has already assumed some savings from parity measures.

What’s next: The board granted initial approval. The department said it will seek federal authority, train case management agencies, and monitor implementation outcomes to avoid unintentional barriers to community living and employment.

Sources: Department presentation and stakeholder comments at the board meeting; public testimony from family caregivers and advocates.