What is the Miller Trust?
Miller Trusts or Qualified Income Trusts provide a way for certain Medicaid recipients or applicants who are over Medicaid’s income limit to become income-eligible for long-term care coverage through Medicaid. This is done by putting income over Medicaid’s limit into a trust so that it is no longer counted towards an income limit.
Miller Trusts may also be known as Qualifying Income Trusts, QITs, Income Diversion Trusts, Income Cap Trusts, Irrevocable Income Trusts, Income Trusts, D4b Trusts, and Income Only Trusts. Although the names are often state-specific, they all refer to the same type of trust.
Who Benefits From Miller Trusts?
To qualify for Institutional Medicaid, which assists in long-term care facility expenses, the applicant’s monthly gross income must be below $2,382. The income limit is determined by requiring that gross income be less than the Ohio Department of Medicaid’s Special Income Level, which is 300% of the Supplemental Security Income federal benefit rate.
The Miller Trust allows applicants who earn a monthly income above this level to deposit excess funds into the trust so that the total is not considered towards the monthly income amount. Depositing a total monthly income is not required; it is only enough to reduce the remainder below the income cap.
Income includes earned income, such as wages, and unearned income, like pension benefits, interest on savings, dividends on stock, and Social Security benefits.
Who Receives a Miller Trust Upon Death?
When the recipient of a Miller Trust dies, the state is named as the beneficiary. Funds remaining in the trust will be received as reimbursement for funds paid for the recipient’s care. The state will not receive funds greater than the amount paid.
How Much Money Can Be Placed Into Miller Trusts?
Some states restrict the amount that can be placed into a Miller Trust, with some variances by country. Most states, however, do not set limits. Ohio does not have a limit on the amount that may be placed into a Miller Trust.
While Ohio may not place a limit, there is a practical limit to how much should be placed within the trust. Single individuals should place no more than the cost of private pay for nursing home care into the trust. Married couples should limit themselves to the maximum Spousal Income Allowance plus the cost of privately paid nursing home care.
What Can Miller Trusts be Used For?
Funds placed in this trust can only be used for specific purposes, including medical expenses or bank and attorney fees associated with the trust. A small amount may also be used for the beneficiary’s personal or maintenance needs. The remainder of the funds are required to contribute toward the cost of care for the beneficiary.
Miller Trusts may also be used to help pay for assisted living and home- or community-based care services. These services include Ohio Home Care and the PASSPORT Medicaid waiver program, which connects seniors with services and support, allowing them to remain in their homes. Miller Trusts may also be used for intermediate care facilities used by adults with cognitive or intellectual disabilities.
Miller Trusts may be used for the following expenses:
- The beneficiary’s monthly needs allowance
- Monthly maintenance allowance for the spouse of the beneficiary
- Monthly maintenance allowance for dependents of the beneficiary
- Incurred medical expenses
- Patient fees after Medicaid
- Monthly banking or attorney fee for maintaining the trust
What are the Requirements for Having a Miller Trust?
A Miller Trust can only be funded by the beneficiary’s income. It cannot include other assets, such as revenue from the sale of a property or another person’s income or property. The trust is irrevocable, meaning that transfers into the trust cannot be reversed.
The document must also include that the state is the beneficiary upon the death of the recipient.
How Can a Miller Trust be Created?
The first step in creating a Miller Trust is creating a trust document. The State of Ohio has made a form available for easy use.
Second, a trust must be created with a bank, savings and loan association or credit union. Not all financial institutions allow this type of account. Some banks may allow an individual to serve as the trustee of the account, while others may require an independent trustee.
While only a portion of the monthly income must be deposited, it must be enough to reduce the remaining income below the Medicaid limit. A good practice is to deposit a bit extra into the trust to account for any unexpected income increases that may disqualify Medicaid coverage.
Fourth, a copy of the trust document, Ohio Department of Medicaid, Qualified Income Trust Verification Form, ODM10193, proof of the initial deposit, and the Medicaid application must be sent to the County Department of Job and Family Services.
Next, the beneficiary must arrange for monthly deposits into the trust to ensure that the monthly income will never exceed Medicaid income caps. While direct deposits are not required, they are encouraged to ensure retention of Medicaid eligibility.
Last, withdrawals from the deposits must be made each month prior to the end of the month and only for authorized expenses.
Do I Need an Attorney?
If you or a loved one needs assistance paying for long-term care, you need legal help from someone experienced and knowledgeable of the rules specific to your area. A Miller Trust that is incorrectly established will be of no use to you and may bring you more hardship. For help navigating this challenging time, call Lawrence Law Office at 614-363-1273 or fill out a contact form to schedule a consultation.
