Lately we’ve been hearing a lot from people with questions about Qualified Income Trusts (QIT’s) – aka Miller Trusts.
We have a whole page on our website devoted to QIT’s, with lots of information. But all the same, I’m going to take this opportunity to give anyone who’s reading this some basic information about how QIT’s work.
In New Jersey, if you want Medicaid to pay for your long term care, you have to have income within the income limit. In 2018, that limit is $2,250. And what counts is your gross income – your income before deductions, such as Medicare premium or tax withholdings.
If your income is above that figure, you may need a Qualified Income Trust (QIT), aka Miller Trust, to get New Jersey Medicaid to pay for a nursing home, assisted living facility, home health aide or other long term care.
An NJ elder law / elder care attorney like FriedmanLaw can help you set up a QIT. Once it’s established, the QIT is managed by a trustee – usually a family member (especially spouse or child) of the person who needs long term care. The person who needs long term care is the beneficiary.
The trustee opens a bank account in the name of the QIT (i.e., owned by the QIT, not by the trustee or by the beneficiary). The beneficiary’s income is deposited into the QIT each month, and paid out according to QIT rules. The income must be paid out in a certain order, depending on the situation. An example of that order might be first for the beneficiary’s personal needs allowance, then to the beneficiary’s spouse for spousal maintenance, then for the beneficiary’s health insurance premium, then to the nursing home for the beneficiary’s cost share.
If the QIT is set up and administered correctly, then the income that gets paid into the QIT every month should not count towards that Medicaid income limit, and the beneficiary can get Medicaid despite high income (provided, of course, that the beneficiary meets Medicaid’s other requirements).
If you think you may need a QIT, it’s worth talking to an elder law attorney. You may not know whether or not you need one, Medicaid staff may not tell you, and you may set it up wrong if you try to do it yourself. In all these situations, if Medicaid is denied as a result, you could end up with a big nursing home bill and no way to pay it.
If you have more questions about a qualified income trust, call (908-704-1900) or email FriedmanLaw today.
