Three methods (specified by MedicalDeductionMethod) are available to impute the medical expense deduction. The first method (used through the 1999 baseline) imputes medical expenses by randomly selecting a percentage of units with an elderly or disabled member and assigning these units a medical expense from a simple, internally coded, look-up table. ProbabilityMedicalExpenses specifies the percentage of units with an elderly or disabled member that have medical expenses. MedicalIncomeBreakAdjustment adjusts the gross income levels used in the look-up table and MedicalExpenseAdjustment adjusts the amount of the medical expenses obtained from the look-up table. ProbabilityMedicalExpenses, MedicalIncomeBreakAdjustment, and MedicalExpenseAdjustment are set during each year’s alignment process in order to bring imputed medical expenses closer to real world targets. Once medical expenses have been imputed, then the amount of the deduction is calculated as indicated by MedicalExpenseOption.

The second method (used beginning with the 2000 baseline) is to randomly select units to have the medical expense deduction, and then assign each selected unit a medical expense deduction that represents the average for the unit's gross income level and characteristics (elderly or disabled). The probabilities of having the deduction and the average amount of the deduction vary by monthly gross income level: <$500, $500-<$600, $600-<$700, $700-<$800, $800-<$900, $900-<$1000, $1000-<$1200, $1200+. If the unit contains at least one elderly member, then the probability of having the deduction is obtained from ElderlyMedicalExpDeductPct, and the amount of the deduction is obtained from ElderlyMedicalExpDeductAmt. If the unit does not contain any elderly members but contains at least one disabled member, then these values are obtained from DisabledMedicalExpDeductPct and DisabledMedicalExpDeductAmt.

The third method (available beginning with version 36.0) allows the SNAP simulation to obtain the reported medical out-of-pocket expenses from a variable specified through MedicalExpenseAmount, which contains the monthly amount of medical out-of-pocket expenses for all persons.

For alternative simulations, MedicalDeductionMethod can be specified so as to read in the medical expense deduction amount simulated in the baseline, and use that amount. The purpose of this option is to give the user a way to prevent a unit's medical expenses from changing when its income changes. To simulate this option, UnitMedicalExpenseDeduc must be specified as an output variable in the baseline simulation, and listed as an input variable in the alternative simulation (under MedicalExpenseDeductionFromBase).