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Title 8: Medicaid Page 66 Iowa Department of Health and Human Services Employees’ Manual Chapter D: Resources Trusts Revised July 10, 2026 Medicaid Qualifying Trusts

4. Mr. O is living in a nursing facility. He applies for non-MAGI-related Medicaid on May 6, 1993. His gross social security and VA income is $965.30 monthly. He has $1,700 in savings and checking accounts as of April 30, 1993, at midnight. He also has a trust that he set up when he went into the nursing facility in May 1990. The trust was set up over 60 months ago, so divesting is not considered. According to the trust, money is available if he needs it, but he can have no more than one-third of the principal of the trust each year. The trustee verifies the principal as of the first of the year to be $99,000. Mr. O has used $1,000 of the trust this year. His resource from the trust is: $99,000 divided by 3 = $33,000 that can be withdrawn minus $1,000 used = $32,000 remainder. Therefore $32,000 plus his other resources of $1,700 is counted toward the resource limit. He is not eligible. 5. Ms. J, an SSI recipient in a residential care facility, has a Medicaid qualifying trust for educational benefits that she set up with inheritance funds. Each year she receives $2,500 for tuition, books, and living expenses. Since SSI policy provides that the income for living expenses counts for eligibility and is included as income for SSI, there is no more income to count from the Medicaid qualifying trust. Also since the only amount available from the trust is for education, the trust is not counted as a resource. Client Participation Legal reference: 441 IAC 75 (Rules in Process) Consider all income, including countable income from the Medicaid qualifying trust, as available when determining client participation in a medical institution, unless the income is expressly exempt income, as listed in 8-E.