Current through September 24, 2024
A. The Long Term
Care Income Trust Agreement will be discussed and provided to the long term
care client subject to an Income Trust.
LONG-TERM CARE INCOME TRUST
THE _______________ INCOME TRUST
WHEREAS, __________________________, hereinafter referred to
as the Settlor, now has a monthly income that exceeds the current Medicaid
income limits, and;
WHEREAS, the total monthly income received by Settlor is not
sufficient to pay for expenses associated with long-term care services and
related services, and;
WHEREAS, Settlor's other assets have been exhausted by
Settlor's long-term care expenses, and;
WHEREAS, the principal purpose of this Trust is to receive
all income payments due Settlor in excess of the Settlor's cost of care,
including Social Security benefits, retirement benefits, interest, dividends,
or other income. The Settlor's cost of care will be determined by the daily
rate that Medicaid pays the nursing facility in which the Settlor resides. If
the rate for the facility is less than the Settlor's income, the excess income
will be used to fund the income trust. If the rate for the facility is more
than the Settlor's income, the Settlor's total income, less authorized
deductions, will be paid to the nursing facility. Any income in excess of the
Settlor's cost of care will be retained as part of the Trust.
WITNESSETH:
This _________________________ Income Trust Agreement is
entered into between _____________________, "Settlor", and ______________, "Trustee", who agree as follows:
(A)
The Trustee shall place all income in excess of the Settlor's cost of care into
the Trust, and the Trustee shall hold such income under the following terms and
conditions:
(1) Trustee shall retain the
income in excess of the Settler's cost of care in the Income Trust
Account.
(2) At the time of each
review of the Settlor's Medicaid eligibility (at least annually) while this
trust is in existence, if the Settlor's income exceeds the cost of care, the
Division of Medicaid will notify the Trustee of the amount that should be
accumulated in the trust. The Trustee will then be requested to make payment of
this amount to the Division of Medicaid up to the total amount expended by the
Division of Medicaid on behalf of the Settlor that has not previously been
repaid to Medicaid. Failure to make the requested payments may result in the
loss of Medicaid eligibility for the Settlor.
(3) This trust will terminate upon the death
of the Settlor; when the Settlor's Medicaid eligibility is terminated; when the
Settlor's income no longer exceeds the current Medicaid income limits; or when
the trust is otherwise terminated. At that time, any income amounts accumulated
in the trust shall be paid over to the Division of Medicaid, State of
Mississippi, up to the total amount expended by the Division of Medicaid on
behalf of the Settlor that has not previously been repaid to Medicaid
(B) When requested, the Trustee
shall furnish to the Division of Medicaid, State of Mississippi, an annual
accounting to show all receipts and disbursements of the trust during the prior
calendar year.
(C) The Trustee
shall maintain the trust funds on deposit in a federally insured banking
institution.
No Trustee shall receive a Trustee's fee for services
rendered to the trust, however, reasonable bank charges will be allowed. The
Trustee shall give written notice to the Division of Medicaid, State of
Mississippi when the Settlor dies or when the trust is otherwise
terminated.
(F) The
provisions of this Trust shall be interpreted under the laws of the State of
Mississippi.
The effective date of this trust shall be
__________________________________.
IN WITNESS WHEREOF, this ____________________________ Income
Trust Agreement has been executed on this the _____ day of __________, 20___.
___________________________________
Trustee
___________________________________
Settlor
STATE OF _________________
COUNTY OF _______________
Personally appeared before me, the undersigned authority in
and for said county and state, on the ______ day of ______, 20___, within my
jurisdiction, the within named ____________________, who acknowledged that
(he) (she) executed the above and foregoing instrument.
___________________________
(NOTARY PUBLIC)
MY COMMISSION EXPIRES:
STATE OF _________________
COUNTY OF _______________
Personally appeared before me, the undersigned authority in
and for said county and state, on the _____ day of __________, 20___, within
my jurisdiction, the within named ________________, who acknowledged that (he)
(she) (they) executed the above and foregoing instrument.
____________________________
(NOTARY PUBLIC)
MY COMMISSION EXPIRES:
TRUSTEE INFORMATION:
NAME: ____________________ SSN: ____________________
TELEPHONE NUMBER: ____________________
ADDRESS: ________________________________
________________________________
RELATIONSHIP TO SETTLOR: ____________________
(Rev 6/08)
B. The Long Term Care Income Trust Help Sheet
will be discussed and provided to the long term care subject to an Income
Trust.
INCOME TRUST HELP SHEET
Section 1917 (d) of the Social Security Act (42 U.S.C. §
1396 p (d) (4)) defines certain provisions that qualify as an exception
for the purpose of an individual qualifying for Medicaid benefits. One such
exception is an "Income Trust". This type of trust, established for the benefit
of an individual in a nursing facility, must meet the following
requirements.
1. The purpose of the
trust is to allow an individual with excess income who has exhausted all
available resources to become eligible for Medicaid. The trust may be used only
for income belonging to the individual. No resources (assets) may be used to
establish or augment the trust. Inclusion of resources voids the trust
exception.
2. Funds subject to the
trust are all income due the individual from all sources such as Social
Security, pension benefits, interest and any and all other types/sources of
income.
3. Income Trusts, once
accepted by Medicaid, cannot be modified without Medicaid's approval. Trusts
must specify that the trust will terminate at the individual's death, when
Medicaid eligibility is terminated, when the trust is no longer necessary or in
the event the trust is otherwise terminated. Trusts may need to be terminated
prior to an individual's death due to changes in the client's income or changes
in Medicaid policy regarding how certain income must be counted or in the event
the individual is discharged from the nursing facility.
4. If the income of the Settlor is less than
Settlor's cost of care at the nursing facility, all income of the Settlor, less
authorized deductions, must be paid directly to the nursing facility. In that
case no funds will be retained in the Trust. If the income of the Settlor
exceeds the cost of care at the nursing facility, the Trust must retain the
income in excess of the cost of care.
5. At the dissolution or termination of the
trust, the death of the Settlor, loss of the Settlor's Medicaid eligibility or
in the event that the Settlor's income no longer exceeds the current Medicaid
income limits, the trust agreement must provide that all amounts remaining in
the trust up to an amount equal to the total medical assistance paid by
Medicaid on behalf of the individual that has not previously been repaid will
be paid to the Division of Medicaid.
6. In addition the trust agreement must
provide that at the time of each review of the Settlor's Medicaid eligibility
(at least annually) while this trust is in existence, when notified by
Medicaid, the Trustee must pay to the Division of Medicaid the amount that
should be accumulated in the trust up to the amount expended by the Division of
Medicaid on behalf of the Settlor that has not previously been repaid. Failure
to make the requested payments may result in the loss of Medicaid eligibility
for the Settlor.
7. The trust
agreement must provide for an accounting to be sent to the Division of Medicaid
when requested to show all receipts and disbursements of the trust during the
prior calendar year when requested by Medicaid.
8. No fees are allowed to be paid to the
Trustee for their service. In the event funds are retained in the trust,
administrative fees are limited to $10 per month and are intended to cover any
bank charges required to maintain the trust account.
9. Any disbursements not approved by Medicaid
or provided for by the trust agreement will result in a loss of the trust
exemption.
10. The trust instrument
must specify an effective date. Unless the applicant is requesting retroactive
eligibility of up to 90 days (which will require that the applicant have the
funds necessary to fund the trust for that period) the effective date will be
the date of execution. If a retroactive date is being sought the effective date
will be determined through consultation with the Medicaid Regional Office. In
that case the Regional Office should be consulted to determine the effective
date prior to execution of the agreement.
11. Medicaid requires that the trust document
be filed in the records of the Chancery Clerk. An Income Trust is a very simple
trust that accomplishes the specific goal of receiving income and disbursing it
for the sole purpose of allowing an individual in a nursing facility with
income in excess of Medicaid income limits to qualify for Medicaid. It is not
intended to be a complex fiduciary trust. For more information, attorneys
drafting an Income Trust may contact the Division of Medicaid's Legal Unit at
(601) 359-6050.
C. The
Home and Community Based Services Waiver (HCBS) Income Trust Agreement will be
discussed and provided to the HCBS client subject to an Income Trust.
HOME AND COMMUNITY BASED SERVICES WAIVER (HCBS) INCOME
TRUST
THE _______________ INCOME TRUST
WHEREAS, __________________________, hereinafter referred to
as the Settlor, now has a monthly income that exceeds the current Medicaid
income limits, and;
WHEREAS, Settlor's other assets have been exhausted by the
expenses of the Settlor's care, and; WHEREAS, the principal purpose of this
Trust is to receive all income payments due Settlor, including Social Security
benefits, retirement benefits, interest, dividends, or other income, and to
allow the Trustee to expend for the benefit of the Settlor each month an amount
equal to no more than $1.00 less than the then current Medicaid limit, with any
excess income to be retained as a part of the Trust. WITNESSETH:
This _________________________ Income Trust Agreement is
entered into between _____________________, "Settlor", and ______________, "Trustee", who agree as follows:
(A)
The Trustee shall place all income due the Settlor into the Trust, and the
Trustee shall hold such income under the following terms and conditions:
(1) Trustee shall distribute to the Settlor,
or for Settlor's benefit, any amounts allowed by the Division of Medicaid, but
the total amount distributed each month shall not exceed an amount equal to
$1.00 less than the then current Medicaid income limit.
(2) At the time of each review of the
Settlor's Medicaid eligibility (at least annually) while this trust is in
existence, the Division of Medicaid will notify the Trustee of the amount that
should be accumulated in the trust. The Trustee will then be requested to make
payment of this amount to the Division of Medicaid up to the total amount
expended by the Division of Medicaid on behalf of the Settlor that has not
previously been repaid to Medicaid. Failure to make the requested payments may
result in the loss of Medicaid eligibility for the Settlor.
(3) This trust will terminate upon the death
of the Settlor; when the Settlor's Medicaid eligibility is terminated; when the
Settlor's income no longer exceeds the current Medicaid income limits; or when
the trust is otherwise terminated. At that time, any income amounts accumulated
but undistributed shall be paid over to the Division of Medicaid, State of
Mississippi, up to the total amount expended by the Division of Medicaid on
behalf of the Settlor that has not previously been repaid to
Medicaid.
(B) When
requested, the Trustee shall furnish to the Division of Medicaid, State of
Mississippi, an annual accounting to show all receipts and disbursements of the
trust during the prior calendar year.
(C) The Trustee shall maintain the trust
funds on deposit in a federally insured banking institution. No Trustee shall
receive a Trustee's fee for services rendered to the trust, however, reasonable
bank charges will be allowed. The Trustee shall give written notice to the
Division of Medicaid, State of Mississippi when the Settlor dies or when the
trust is otherwise terminated.
(F)
The provisions of this Trust shall be interpreted under the laws of the State
of Mississippi.
The effective date of this trust shall be
_______________________________.
IN WITNESS WHEREOF, this ____________________________ Income
Trust Agreement has been executed on this the _____ day of __________, 20___.
___________________________________
Trustee
___________________________________
Settlor
STATE OF _________________
COUNTY OF _______________
Personally appeared before me, the undersigned authority in
and for said county and state, on the ______ day of ______, 20___, within my
jurisdiction, the within named ____________________, who acknowledged that
(he) (she) executed the above and foregoing instrument.
___________________________
(NOTARY PUBLIC)
MY COMMISSION EXPIRES:
STATE OF _________________
COUNTY OF _______________
Personally appeared before me, the undersigned authority in
and for said county and state, on the _____ day of __________, 20___, within
my jurisdiction, the within named ________________, who acknowledged that (he)
(she) (they) executed the above and foregoing instrument.
____________________________
(NOTARY PUBLIC)
MY COMMISSION EXPIRES:
TRUSTEE INFORMATION:
NAME: ____________________ SSN: ____________________
TELEPHONE NUMBER: ____________________
ADDRESS: ________________________________
________________________________
RELATIONSHIP TO SETTLOR: ____________________
D. The Home and
Community Based Services Waiver (HCBS) Income Trust help Sheet will be
discussed and provided to the HCBS client subject to an Income Trust.
INCOME TRUST HELP SHEET
Section 1917 (d) of the Social Security Act (42 U.S.C. §
1396 p (d) (4)) defines certain provisions that qualify as an exception
for the purpose of an individual qualifying for Medicaid benefits. One such
exception is an "Income Trust". This type of trust, established for the benefit
of an individual participating in a Home and Community Based Services (HCBS)
waiver, must meet the following requirements.
1. the purpose of the trust is to allow an
individual with excess income who has exhausted all available resources to
become eligible for Medicaid. The trust must be composed only of income
belonging to the individual. No resources may be used to establish or augment
the trust. Inclusion of resources voids the trust exception.
2. The trust must be composed only of income
due the individual from all sources such as Social Security, pension benefits,
interest and any and all other types/sources of income. The individual's right
to receive income should not be transferred to the trust; instead, the
individual must first receive the income and then place it into the Income
Trust.
3. Income Trusts, once
qualified, cannot be modified without the approval of the Division of Medicaid.
Trusts must specify that the trust will terminate at the individual's death,
when Medicaid eligibility is terminated, when the trust is no longer necessary
or in the event the trust is otherwise terminated. Trusts may need to be
terminated prior to an individual's death due to changes in the client's income
or changes in Medicaid policy regarding how certain income must be counted or
in the event the individual is discharged from the nursing facility.
4. The Trust must distribute to the Settlor,
or for his/her benefit, an amount equal to not more than $1 less than the then
current Medicaid income limit as approved by Medicaid. The trust should not
specify the amount of the individual's income as this amount may change each
year and the amount to be released from the trust will change to an amount
equal to $1 less than the current Medicaid income limit.
5. At the dissolution or termination of the
trust, the death of the Settlor, loss of the Settlor's Medicaid eligibility or
in the event that the Settlor's income no longer exceeds the current Medicaid
income limits, the trust agreement must provide that all amounts remaining in
the trust up to an amount equal to the total medical assistance paid by
Medicaid on behalf of the individual that has not previously been repaid will
be paid to the Division of Medicaid.
6. In addition the trust agreement must
provide that at the time of each review of the Settlor's Medicaid eligibility
(at least annually) while this trust is in existence, when notified by
Medicaid, the Trustee must pay to the Division of Medicaid the amount that
should be accumulated in the trust up to the amount expended by the Division of
Medicaid on behalf of the Settlor that has not previously been repaid. Failure
to make the requested payments may result in the loss of Medicaid eligibility
for the Settlor.
7. The trust
agreement must provide for an accounting to be sent to the Division of Medicaid
when requested to show all receipts and disbursements of the trust during the
prior calendar year when requested by Medicaid.
8. No fees are allowed to be paid to the
Trustee for their service. Administrative fees are limited to $10 per month
intended to cover any bank charges required to maintain the trust
account.
9. Any disbursements not
approved by Medicaid or provided for by the trust agreement will result in a
loss of the trust exemption.
10.
The trust instrument must specify an effective date. Unless the applicant is
requesting retroactive eligibility of up to 90 days (which will require that
the applicant have the funds necessary to fund the trust for that period) the
effective date will be the date of execution. If a retroactive date is being
sought the effective date will be determined through consultation with the
Medicaid Regional Office. In that case the Regional Office should be consulted
to determine the effective date prior to execution of the agreement.
11. Medicaid requires that the trust document
be filed in the records of the Chancery Clerk.
An Income Trust is a very simple trust that accomplishes the
specific goal of receiving income and disbursing it for the sole purpose of
allowing an individual participating in a Home and Community Based Services
(HCBS) waiver with income in excess of Medicaid income limits to qualify for
Medicaid. It is not intended to be a complex fiduciary trust. For more
information, attorneys drafting an Income Trust may contact the Division of
Medicaid's Legal Unit at (601) 359-6050.
USC §1396p(d)(4);
Social Security Act §1917(d); Miss. Code Ann. § 43-13-121.1 (Rev.
2005).
