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Trusts, Nursing Home, Medicaid Trust, Taking Care of Others, Long Term Care Planning, Qualified Income Trust, irrevocable grantor trust, medicaid qualification, medicaid laws
Qualified Income Trust – now that is a mouthful. Trusts come in many flavors and I use this trust in Medicaid planning or nursing home Medicaid qualification in Jacksonville, Florida – this is part of the world known as elder law. A Qualified Income Trust is a specialized irrevocable grantor trust that Medicaid requires in some circumstances. A Qualified Income Trust is sometimes referred to as a QIT or a Miller Trust.
Under Medicaid rules, if a Nursing Home resident has a monthly gross income of over a certain amount, the Nursing Home resident’s income is excessive under Medicaid eligibility rules and the resident is not Medicaid eligible. To determine the Medicaid applicant’s income, the department of children and families adds up all the applicant’s income from social security, pensions, investments and other sources for the month. Basically, what is deposited in the applicant’s account each month?
Annually, the Florida Department of Children and Families sets the amount of monthly income an applicant can have. For example, for 2011 an applicant cannot make more than $2,022 a month and qualified for Medicaid. In reality, $2,022 is not enough to pay monthly nursing home costs. Therefore, a QIT is needed to cure this problem of having too much monthly income to qualify for nursing home Medicaid.
Do you need an attorney for this QIT that I speak of? First, the actually document needs to be drafted. Second, the trust needs to be administrated correctly.
A QIT is a trust, which has a grantor, trustee, and beneficiary. You can learning about the basics of Florida trusts from a youtube video of mine. The Medicaid laws acknowledge the existence and viability of qualified income trusts in Medicaid planning, but the laws require the trust be drafted in a certain way.
The second step of properly utilizing QITs in Medicaid planning requires someone to properly administrate the QIT. A new account must be set up at a bank. Monthly income must be directed correctly through the account to maintain Medicaid qualification. Some of the money goes to the nursing home, as essentially, a co-pay for care. A portion of the money goes to the applicant’s needs and allowed expenses. Upon the death of the applicant, the money remaining in the QIT account goes to the state of Florida.
In the end, the Florida Medicaid laws do not consider the money passing through the QIT and QIT account as belonging to the nursing home resident – the trust owns the money. As a result, the applicant qualifies for Medicaid to assist in the costs of providing nursing home care.
