For many of us, the rising cost of nursing home care and assisted living is worrying. These costs, which on average amount to $330 a day, risk draining all our life savings and leaving nothing on which to enjoy our final years or help care for our loved ones after we’ve passed. While Medicaid can help alleviate this financial pressure, it can be difficult to qualify for this assistance. Fortunately, the federal government has recently allowed the use of Qualified Income Trusts (QITs) to help plan for Medicaid assistance.
What is a QIT?
This is a legal trust into which individuals pay an income each month. This income will not be counted as part of the Medicaid assessment process. It is an irrevocable trust, so it cannot be modified after its creation and, in New Jersey, the State needs to be listed as the first beneficiary of the trust in the event of the death of whoever created the trust, giving them the right to claim on any remaining income.
It is an income exclusive trust, however, so you cannot place cash, proceeds from the sale of assets (such as your home) or assets themselves into a QIT. Income can include pensions as well as Social Security payments.
How does this affect Medicaid eligibility?
If your gross income exceeds $2,199 per month, you will qualify to have a QIT (keeping in mind that these figures are subject to change). This income, which can include a full income or a portion of your income, will no longer be used in eligibility calculations, making it easier to qualify. All other criteria will still be in place, however, such as citizenship, residency and level of care requirements.
Expert Medicaid planning, application and assistance in NJ
Frank R. Campisano is highly experienced and compassionate elder law attorney with considerable knowledge of Medicaid issues. In addition to planning ahead financially for Medicaid eligibility, he is also able to assist with applications, appeals and other Medicaid issues.
For a free consultation, please contact us today and speak to Frank R. Campisano at https://www.scclegal.com/