On Aug. 1, 2016, the Ohio Department of Medicaid drastically changed eligibility rules for Medicaid benefits for people who are disabled and others who need long-term care.
My column in the September/ October 2016 issue of this magazine highlighted three significant changes in these new rules: How Medicaid deals with the applicant’s home, how Medicaid treats retirement funds that belong to an applicant’s spouse, and the applicability of a rule (new in Ohio) that bars Medicaid coverage for people who have too much income.
SO, WHAT DOES “TOO MUCH INCOME” MEAN?
As I wrote in the last issue, “too much income” sounds weird. But because Medicaid provides money for medical coverage for the poor, having “too much income” can make someone ineligible for help.
Those whose gross income is higher than $2,199 per month are ineligible for Medicaid coverage for long-term care. (That amount is adjusted from time to time to compensate for inflation.) That $2,199 is not enough to pay for long-term care for most people; it would cover a few hours of home care each week.
Because the amount of income that blocks eligibility is not enough to keep up with the costs of long-term care, a method has been created to make it so that only part of a Medicaid recipient’s income actually counts as income. As an aside, don’t look for logic here. This stuff is crazy. It’s what satisfies the rules, though. The only explanation I can offer for this “too much income” thing is that these are the rules.
To make some income not count as income for Medicaid purposes, recipients can run some of their income each month through a Qualified Income Trust, commonly referred to as a Miller Trust.
“Qualified Income” is not counted as income for Medicaid eligibility purposes, and the monthly money that goes through the Qualified Income Trust is “Qualified Income.” The result is someone can become (or remain) eligible for Medicaid help with long-term care costs by using a Miller Trust.
In addition, Ohio’s requirements for Qualified Income Trusts are more exacting than other states’ requirements. For example, because it’s an income trust, money can’t go into it until after the person’s monthly income has been received. In addition, the money that goes into the trust must be paid out of the trust in a specific order. The trust must first give money back to the person as part of his Personal Needs Allowance. The second monthly payment must go to the person’s spouse if an income share is necessary in accordance with Medicaid rules. The third payment must be for the person’s health care. Finally, the fourth payment must be for account fees and other costs (if any) for the Qualified Income Trust not to exceed $15 without special permission from Ohio Medicaid. The trust must be emptied each month.
The minute details of Ohio’s Qualified Income Trusts may cause some people occasionally to lose eligibility for a month. Only careful planning can help secure the correct countable income for Medicaid-covered expenses.