You have agreed to serve as the Trustee of a Qualified Income Trust, or Miller Trust. This post will help guide you through the administration process and your duties as Trustee. A Trustee is a person or entity who takes delivery of and manages money or other property for the benefit of another person or entity in accordance with the administrative and dispositive provisions detailed in the Trust Agreement.
The Trust Agreement is the written document that details and describes the trust arrangement, designates the name of the trust, and provides the Trustee with instructions that must be followed during the administration of the trust. A Trustee acts in a fiduciary capacity on behalf of the beneficiaries.
A fiduciary has a special duty to protect the trust assets and income for the beneficiaries of the trust. That duty is a strict duty, similar to the duty of a conservator or guardian. A beneficiary is the person who is entitled to receive benefits from a trust. In a Miller Trust, the grantor (or person who creates the Trust) is the beneficiary. The State of Indiana is the secondary beneficiary.
Indiana uses an “income cap” for certain Medicaid programs. The income cap limits the availability of Medicaid assistance to adults with monthly incomes below a Special Income Level (SIL). The SIL standard is 300% of the maximum monthly benefit payable under the Supplemental Security Income program. The SIL standard generally increases each year in January. The SIL standard for 2019 is $2,313 per month.
An individual who receives monthly income above the SIL will generally not qualify for Medicaid to pay for long term care health services because the income is too high. However, Indiana law currently permits income above the SIL to be transferred to a Miller Trust and not interfere with Medicaid. A Miller Trust bank account must be opened when the Miller Trust is established.
The Miller Trust terminates when one of the following things happen:
The Medicaid recipient dies
The Settlor no longer requires Medicaid assistance
Family and Social Services Adminsitration (FSSA) provides express written authorization and approval to terminate the Trust
See our articles "The Basics of a Miller Trust" and "How to Set Up a Miller Trust" for more information.