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MISSISSIPPI DIVISION OF MEDICAID LONG TERM CARE INCOME TRUST – HELP SHEET

Long Term Care Income Trust Help Sheet, Revised June 2020 Page 3

Completing the Income Trust: 9. The Division of Medicaid provides a model Long Term Care Income Trust agreement for individuals in need of an Income Trust. The only change to this legally binding document that is acceptable is to add a successor Trustee or Co-Trustee. Any changes must be approved by the Division of Medicaid prior to execution of the trust. Once approved and accepted by the Division of Medicaid, the document cannot be modified without prior approval by the Division of Medicaid.

10. The individual requesting eligibility under an Income Trust is referred to as the “Settlor” in the Income Trust document. The Trustee is the individual or entity (such as a bank) that manages the trust and has fiduciary responsibilities. The Settlor and Trustee cannot be the same person.

Income Trust Restrictions: 11. A Long Term Care Income Trust is used only for income belonging to the individual. No resources (assets) may be used to establish or augment the Income Trust as this will void the trust exception, resulting in the loss of Medicaid eligibility.

12. 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 are intended to cover any bank charges required to maintain an Income Trust bank account.

13. An Income Trust is not allowed on a temporary or intermittent basis except in instances when recurring excess monthly income that does not exceed the facility’s private pay rate as outlined in #14 below will be reduced at a future date. In such a situation, an Income Trust will be allowed until such time as the excess income is reduced and an Income Trust is no longer required to allow eligibility.

• Income received less often than monthly does not qualify as recurring excess monthly income that allows the use of an Income Trust.

• Irregular or infrequent income must be converted into a monthly income before allowing an Income Trust to be established.

14. If the individual has total income that exceeds the monthly private pay rate for the facility in which he/she resides, Medicaid eligibility will be denied. The Division of Medicaid will use the facility’s daily private pay rate in effect for a 31-day month for the period of time under consideration for Medicaid eligibility to make this determination. If income exceeds the 31-day private pay rate for any month(s) after Medicaid eligibility is approved, Medicaid will be terminated. If eligibility cannot be terminated due to advance notice requirements, but income can be counted for Medicaid Income purposes, the excess income will be payable to the Division of Medicaid upon receipt of notice from the agency.