Many families are surprised to learn that a parent can be denied long-term care Medicaid because their income is too high, even when that income doesn’t come close to covering the cost of a nursing home. A Qualified Income Trust, also called a Miller Trust or QIT, is the legal tool designed to solve this problem.
Why income can block Medicaid
Many states, including Florida, Alabama, and Louisiana, set a strict monthly income limit for nursing home and long-term care Medicaid. If a person’s income is over the limit, even by a small amount, the application can be denied. Social Security, pensions, annuities, and retirement distributions can all count. For a family already paying for care privately, a denial can be devastating.
What a Qualified Income Trust does
A Qualified Income Trust is a special type of trust that allows a person whose income exceeds the state’s limit to qualify for long-term care Medicaid. It does not make the person’s income disappear, and it is not a way to avoid paying toward care. It removes the income barrier so Medicaid can help with the rest of the cost.
Who may need one
You may need to consider a Qualified Income Trust if a parent or spouse:
- needs nursing home care or in-home long-term care services;
- has income from Social Security, a pension, or other sources that is over your state’s limit; and
- cannot afford to keep paying privately for care.
Specific legal requirements, and why they matter
Qualified Income Trusts have highly specific legal requirements, both when they are created and every month afterward. Mistakes in setting up or administering the trust can cost months of Medicaid coverage. Special considerations also apply to married couples and to families where the parent can no longer sign documents.
Our attorneys are experienced at drafting Qualified Income Trusts to the correct legal specifications, tailoring them to fit your family’s needs, and guiding trustees through what is required.
Part of the bigger picture
A QIT solves an income problem. Many families also need help with assets, through spend-down planning, personal caregiver agreements, or Medicaid asset protection trusts. We look at the whole picture.
Contact us today for a consultation
Jackson+Jackson helps families plan for long-term care. Call us to schedule a consultation at any of our offices in New Orleans, Birmingham, Mobile, or Pensacola.
This article provides general information only. It is not legal advice, and reading it does not create an attorney-client relationship. Every situation is different; please consult an attorney about yours.