1. (a) A service provider is required to use the HHSC fee schedule and instructions to calculate a person's fee.

2. (b) Factors that affect a person's fee are:

   1. (1) household size;
   2. (2) annual gross income; and
   3. (3) allowable deductions.

3. (c) Household size equals:

   1. (1) any person living inside or outside of the home who is eligible to be claimed as a dependent of a person on the person's federal income tax return; or
   2. (2) if a person is under 18 years of age, any other person living inside or outside of the home who is eligible to be claimed as a dependent of the person's parent or guardian on the parent or guardian's federal income tax return.

4. (d) A person's annual gross income:

   1. (1) equals the total annual gross income received by the household; and
   2. (2) includes all income classified as taxable income by the Internal Revenue Service before federally allowable deductions are applied.

5. (e) A person's allowable deductions are limited to expenses in the following categories:

   1. (1) attendant care;
   2. (2) rent or home mortgage payments;
   3. (3) court-ordered child support payments made by the person for financially dependent children who were not included in the calculation of household size; and

   4. (4) medical or dental expenses for treatment primarily intended to alleviate or prevent a physical or mental illness or manage a disability, with the expenses limited to the cost of:

      1. (A) diagnosis, cure, alleviation, treatment, or prevention of disease;
      2. (B) treatment of any affected body part or function;
      3. (C) medical services legally delivered by physicians, surgeons, dentists, and other medical practitioners;
      4. (D) medications, medical supplies, and diagnostic devices;
      5. (E) medical and dental health care insurance premiums;
      6. (F) transportation to receive medical or dental care; and
      7. (G) medical or dental debt that the family is paying on an established payment plan.
6. (f) A service provider calculates the allowable deductions using the actual amounts a person paid during the previous 12-month period.
7. (g) A person provides the most recent tax return available as proof of annual gross income and allowable deductions. If a person has no tax return, the person provides bank statements, medical records, receipts, proof of benefits awards, or other documentation to demonstrate annual gross income and allowable deductions.
8. (h) If a person does not provide documentation supporting the household's allowable deductions, the service provider determines the person's fee based on the person's documented annual gross income with no allowable deductions.
9. (i) A person's fee is equal to the amount on the HHSC fee schedule according to the household's annual adjusted income, that is, the annual gross income minus the allowable deductions.
10. (j) A service provider uses the most current fee schedule and instructions published by HHSC to determine a person's fee.
11. (k) The procedures, fee schedule, and instructions used to calculate a person's fee is available from HHSC between 8:00 a.m. and 5:00 p.m. on business days.

Source Note:The provisions of this §357.403 adopted to be effective August 31, 2016, 41 TexReg 6066; transferred effective March 15, 2021, as published in the Texas Register February 26, 2021, 46 TexReg 1387; amended to be effective June 3, 2025, 50 TexReg 3248.