Miller Trust for Medicaid: Qualified Income Trust Guide

A Miller Trust (also called a Qualified Income Trust or QIT) is a special irrevocable trust that allows people with income above Medicaid limits to still qualify for nursing home coverage.

• **Named after**: The Miller v. Ibarra court case that established this planning tool
• **Purpose**: Holds "excess" income that would otherwise disqualify you from Medicaid
• **Required in**: Income cap states where income limits are strictly enforced
• **How it helps**: Income deposited into the trust is not counted for Medicaid eligibility
• **State beneficiary**: Upon death, remaining funds go to the state to reimburse Medicaid

Currently 23 states have income caps that may require a Miller Trust for Medicaid eligibility.

• **Alabama, Alaska, Arizona, Arkansas**: Income cap states
• **Colorado, Delaware, Florida, Georgia**: Income cap states
• **Idaho, Iowa, Kentucky, Louisiana**: Income cap states
• **Mississippi, Nevada, New Jersey, New Mexico**: Income cap states
• **Oklahoma, Oregon, South Carolina, South Dakota**: Income cap states
• **Tennessee, Texas, Wyoming**: Income cap states
• **2025 income cap**: Generally $2,901/month (300% of SSI federal benefit rate)

Understanding the mechanics helps you use a Miller Trust correctly.

• **Monthly deposits**: Social Security and pension income deposited into the trust
• **Allowable distributions**: Personal needs allowance (typically $30-$100/month)
• **Patient liability**: Remaining funds pay toward nursing home costs
• **Spousal allowance**: If married, income can be allocated to community spouse
• **Medicare premiums**: Trust can pay Medicare Part B and supplemental premiums
• **State reimbursement**: At death, remaining trust funds reimburse Medicaid

Proper setup is critical for your Miller Trust to be valid.

• **Work with attorney**: Elder law attorney familiar with your state's requirements
• **Irrevocable trust**: Must be irrevocable with specific required language
• **State as beneficiary**: State Medicaid agency must be named as remainder beneficiary
• **Separate bank account**: Open a dedicated checking account for the trust
• **Timing**: Can be created before or during Medicaid application
• **Cost**: Typically $500-$1,500 for attorney to draft the trust document

The trustee has important ongoing duties to manage the Miller Trust properly.

• **Who can serve**: Family member, friend, or professional (not the Medicaid applicant)
• **Monthly duties**: Deposit income, pay allowable expenses, calculate patient liability
• **Record keeping**: Maintain detailed records of all deposits and distributions
• **Nursing home payment**: Pay the nursing home the patient's share each month
• **Annual accounting**: Some states require annual trust accountings
• **Communication**: Work with nursing home and Medicaid caseworker as needed

While Miller Trusts address income for Medicaid eligibility, your retirement assets also need protection. Gold IRAs are generally protected from Medicaid spend-down in most states, providing another layer of security for your nest egg.