The IRS website explains how to deal with Notice 2014-7 wages.   Basically you just exclude them as a negative on Line 21.

https://www.irs.gov/individuals/certain-medicaid-waiver-payments-may-be-excludable-from-income

If EIC is involved you may have to make a few other adjustments on the EIC worksheet so that the program doesn't use the excluded wages for EIC purposes.