Miller Trusts: Qualifying for Medicaid Benefits
Miller trusts are designed to fulfill a single purpose: making an individual eligible for Medicaid benefits. If you make too much monthly income to qualify for Medicaid, a Miller Trust might be the answer.
Miller Trust Basics
There are many different types of trusts, each with a specific goal and purpose. Miller Trusts are also known as Medicaid Qualified Income Trusts, supplemental needs trust, Qualified Income Trusts or QITs. These terms all refer to the same legal instrument, which is a type of irrevocable living trust.
Minimum Income Thresholds
To qualify for Medicaid, a nursing home resident must meet a specific income threshold. The Florida Department of Children and Families establishes this threshold, which changes slightly from year to year to account for inflation and increases in the cost of living. For April 2014, you can’t make more than $2,163 per month if you want to qualify for Medicaid benefits. If you earn more than this threshold, you will not qualify for Medicaid. This is where a Miller Trust comes in.
Establishing a Miller Trust
Miller Trusts are complicated documents that must be properly and carefully prepared to be effective. The first step in establishing a Miller Trust is to draft the trust document itself. You must also establish a non-interest bearing bank account, which will distribute a portion of your income to the nursing home and another portion that is applied toward your personal needs. If you are married, your trustee can also distribute funds to your spouse if his or her income dips below a specific threshold – an important benefit for Medicaid recipients who still have a healthy spouse living at home. When you pass away, any money left over is distributed to the state as reimbursement for the long-term care you received under the Medicaid program.
Who Can Create a Miller Trust?
If the Medicaid applicant is mentally competent to sign legal documents, he or she can set up the trust. Miller Trusts can also be established by a healthy spouse or the agent of a durable power of attorney, assuming the power of attorney gives the agent the authority to create trusts. In the absence of a person qualified to create the trust, the probate court can authorize an individual to create one on the nursing home resident’s behalf.
The Importance of Knowledgeable Legal Counsel
If you or a loved one needs Medicaid benefits but have excess income, you must create a Miller Trust to qualify. Because the rules governing these types of trusts are strict, it is important to work with a knowledgeable estate planning and probate attorney to ensure you satisfy Medicaid guidelines. Contact my office today at (772) 220-9699 to discuss your Medicaid needs.