Question

"Our HOME participating jurisdiction has implemented HOTMA for its HOME rental program. We know that HOTMA expanded to persons with any disability (not just developmental disabilities) the exclusion of income for payments from Medicaid and other sources to keep people in their homes. However, what if a person is receiving payments to keep their mother in her home, when she is not living with the family receiving the payments in the HOME unit?"  

Answer

Summary: This exclusion only applies when the benefits are paid to allow a person to live in the affordable housing unit, not when they live elsewhere. Both the caregiver and the person with the disability must reside in the affordable unit.  

The HUD regulation at 24 CFR § 5.609(b)(19) says that we must exclude "payments made by or authorized by a State Medicaid agency (including through a managed care entity) or other State or Federal agency to a family to enable a family member who has a disability to reside in the family's assisted unit. Authorized payments may include payments to a member of the assisted family through the State Medicaid agency (including through a managed care entity) or other State or Federal agency for caregiving services the family member provides to enable a family member who has a disability to reside in the family's assisted unit." Notice that the exception twice mentions that the exclusion applies if the payents allow a family member to stay in the "family's assisted unit." Further clarifying this, HUD HOTMA Notice H 2023-10 G.11 provides more details. It says, "a family member with a disability qualifies for this income exclusion. Amounts received may be intended for items such as services, equipment, and compensation provided to a family member. The payments are excluded from income as long as the amounts are provided to enable a family member with a disability to remain in the family’s assisted
unit. Both the person providing the care and the person who has the disability must be family members (not household members) and must live in the same assisted household. The exclusion does not apply to income earned by the family for other caregiving
services provided to individuals outside of the assisted household." [bolded emphasis ours]