Nursing home Medicaid is a program of the Federal government that is administered by the state of Georgia to provide nursing home care. For an applicant to receive nursing home Medicaid, they must have a medical need for care and also meet asset and income requirements. Currently, the income level for a nonmarried applicant needing nursing home care is $2,199 a month. Any applicant with income over this level will not qualify. This puts those with incomes above the $2,199 level but below the $6,000-8,000 a month needed to pay for nursing home care. There is a solution to this problem, and it is a qualified income trust.
A qualified income trust is a creation of Georgia Medicaid regulation. A trust in general is an agreement between two parties. A qualified income trust is an agreement between the grantor, the person providing the funds, and the trustee, the person or corporation tasked with management of the funds. If the qualified income trust is managed properly, it reduces the income of the Medicaid applicant, and enables them to qualify for nursing home Medicaid. The form of the trust is found in the Medicaid regulations, so it is easy to draft, but care must be taken in operation of the trust to ensure Medicaid eligibility,
A qualified income trust must maintain a checking account that neither earns interest or has any bank fees. The Medicaid applicant must deposit any excess income they have over the income limit. The excess income deposited is then disbursed to the nursing home. Many applicants get frustrated with the process, as the qualified income trust seems like an unnecessary step in the process, but it is required by Medicaid law.
Many applicants for nursing home Medicaid ask whether a qualified income trust can reduce their assets to get them under the asset limit for Medicaid. The answer is no; a qualified income trust only can address excess income. There are other techniques that can be used to reduce assets and gain qualification for nursing home Medicaid. As this is a complex area, it is recommended that applicant seek the advice of an experienced elder law attorney.