What is a Miller Trust and How Does it Work?

A Miller Trust also referred to in Missouri as a Qualified Income Trust, can be used by Medicaid applicants who are over the Medicaid income limit for those programs with an income cap.  There are many different names used for a Miller Trust depending on the state in which an applicant resides or the state in which the applicant is applying for benefits. The titles for such trusts include d4B Trusts (named after the federal statute authorizing the trusts, i.e. 42 UCS 1396p(d)(4)(B)), Income Cap Trusts, Income Diversion Trusts, Irrevocable Income Trusts, Income Only Trusts, and Qualifying Income Trusts, or QIT’s for short. No matter the title, they’re all referring to what we will mostly call Miller Trusts in this article.

*This blog is for educational purposes only and should not be considered legal advice. The use of the Paths Law Firm website does not constitute a client-lawyer relationship.

Applicants are allowed to place income, not assets or resources, over the Medicaid income limit in this type of trust and the income is not counted towards the income component for Medicaid eligibility. In Missouri, the income cap Medicaid programs are waiver services, also known as Home and Community Based Services (HCBS), Program for All-Inclusive Care for the Elderly (PACE), and MO HealthNet for Children with Developmental Disabilities (MOCDD). 

Missouri is not an income cap state for long-term nursing home care (also known as skilled nursing care) Medicaid benefits. This means all available income must be paid towards care.  An applicant’s income will not limit long-term nursing home care benefits.  So, in Missouri, the use of a Miller Trust is not useful for long-term nursing home care Medicaid assistance.  

What is Medically Needy and Categorically Needy?

It is important to understand the terminology medically needy and categorically needy and the relevance they have for a Qualified Income Trust.

The phrase “medically needy”, also referred to as spend down, is when a state allows a recipient to spend income over of the Medicaid limits, on qualified expenses, to become eligible for long-term care nursing home benefits.  Once the applicant’s income is within the maximum income limit, they become eligible for benefits for the remaining time left in the current spend down period.

Whereas a state that is “categorically needy”, also referred to as income cap, does not allow Medicaid recipients to spend down income above Medicaid limits.  These states utilize Miller Trusts to allow applicants the opportunity to meet income limits to qualify for nursing home Medicaid benefits (but not Missouri).  For a Medicaid qualification of an income cap benefit, the Home and Community Based Services Medicaid Waiver is usually 300% of the Federal Benefit Rate.  For 2020, this equates to $2,349 per month.

qit guidelines

How Does a Miller Trust Work?

With a Miller Trust or QIT, the individual applying for Medicaid allocates any income over the Medicaid income limit into the Qualified Income Trust.  This lowering of counted income allows the applicant to qualify for the benefits through Medicaid.  The uses of the income diverted to the trust is discussed below.

The applicant, a power of attorney, or guardian is required to set up a bank account and have the trust documentation drawn up to establish the trust.  A Miller Trust or QIT is highly recommended to be drafted only by an experienced Elder Law Attorney.  There are many legal nuances that must be considered.  Once the trust is in place, a trustee must be chosen to manage the trust and follow the established guidelines for the trust.  The trustee can be anyone, except the applicant, also considered the beneficiary. 

The other hallmarks of a valid Miller Trust, as set forth in Missouri’s Medicaid caseworker’s manual, are the following:

  • The trust is irrevocable,
  •  Only the beneficiary’s income is paying to the trust,
  • The income must be paid to the trust in regular intervals,
  •  The State of Missouri is the beneficiary of any remaining trust funds after the death of the beneficiary, and
  •  Disbursements from the trust must be for the beneficiary, the beneficiary’s spouse, or a disabled child of the beneficiary who is residing with the beneficiary.
income trust

 

At least monthly, the portion of the recipient’s income must be deposited into the trust.  It is important to note if a recipient only has one source of income such as social security, the entire check does not need to be deposited into the trust.  Only the portion of income the participant needs in order to qualify for under the income limitations is the minimum that needs to be deposited.  The monies deposited into the Qualified Income Trust (QIT) by the Medicaid participant are exempt and not counted towards the income limit for Medicaid.

It is important to note, a QIT will not help an applicant over the Medicaid asset limit.  Assets are not eligible to be deposited into a QIT.  However, if an applicant is planning for future Medicaid needs, an asset protection trust can provide another avenue to protect assets and meet the asset limits set by Medicaid.   There are different transfer rules applicable to assets, again this depends on the particular program for which the applicant is applying.

Also, as may have been noted under the hallmarks listed above, a Qualified Income Trust does not shelter money for the participant or their family after the death of the trust’s beneficiary, the Medicaid participant.  When the Medicaid participant dies, the state will recover any expenses paid by Medicaid for the participant’s cost of care, up to what remains in the trust.  In fact, by the terms of the trust, the trustee must first make such payments to the state.  Once Medicaid has recouped their funds, any additional funds remaining in the trust will then be paid according to the terms of the trust by the trustee.  

miller trust

What Expenses Can a Miller Trust be Used for?

There are specific guidelines for how funds in a Qualifying Income Trust can be used.  The trustee is responsible for managing the trust and disbursing payments from the trust for qualified expenses.  If all income for a Medicaid recipient is deposited into a Miller Trust, the recipient is eligible to receive a personal needs allowance (PNA).  The amount of the PNA will vary based on the state the recipient lives.

If the recipient is married and the non-applicant or community spouse meets the spousal impoverishment income guidelines, the spouse may also qualify for a monthly allowance.  This allowance is paid out to help support the spouse.

Money in the QIT must be used each month for medical needs, including expenditures for physicians’ bills, medications, durable medical equipment, and the recipient’s share of costs for their in-home care not otherwise covered.  Most often, funds in the trust are used to supplement costs above what Medicaid pays, medical bills not covered by Medicaid, as well as Medicare premiums.   

qualified income trust

What Can Personal Needs Allowance Funds be Used For?

The primary purpose of the PNA is to provide recipients a personal fund to be used at their discretion for items or services not covered by Medicaid.  If the recipient is living in a nursing home, the nursing home cannot take PNA funds for items or services unless it is not covered by Medicaid or is more expensive than what is covered by the program.  The regulations of use for PNA’s is set by both the federal government and individual states to protect recipients from misappropriation of funds and abuse.  Some states require PNA funds periodically to determine misuse or abuse by guardians and long-term care facilities, however, Missouri does not have such a requirement.

What is the Maximum Amount of Money That Can Be Put into a Miller Trust?

While some states have restrictions on how much income may be put into a Miller Trust, other states do not have a cap.  In states that do not set a cap, there is a reasonable limit.  For a single individual, the reasonable limit is no more than the cost of a private pay nursing care facility in the state in which the individual resides.  For couples that are married, the amount considered reasonable is a maximum of the spousal allowance combined with the cost of private pay nursing facility care.

personal needs allowance

In Closing

Understanding Medicaid’s guidelines can be quite difficult, especially when it comes to the qualifications of income and asset limitations.  A Miller Trust can significantly help resolve financial issues for medical needs and daily living requirements for individuals needing in-home care.

At Paths Elder Law, we understand the importance of protecting your future and the future of your loved ones.  We have close to 30 years of experience helping individuals and married couples with Estate Planning, Asset Protection, Medicaid eligibility, and application process, VA Benefits, Probate, and Guardianship.  We have been extremely successful in helping our clients protect their futures and in mitigating issues related to Medicaid and setting up Miller Trusts. 

If you or your loved ones need assistance with a Miller Trust, qualifying for Medicaid or Medicaid planning, contact Paths Elder Law.  We are here to help you protect your future and assist you in getting the care you need. 

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Community Relations

Jeane M. Fracassa

Community Relations

Jeane M. Fracassa

Jeane Fracassa – a dedicated and accomplished professional who retired with an impressive 38-year service record from the Kansas City Missouri Police Department. Throughout her illustrious career, Jeane served as a Civian Supervisor in the Communications Unit, where she played a pivotal role in ensuring efficient and effective communication within the department.

Even in retirement, Jeane’s commitment to community service remains unwavering. Currently, she serves in various capacities within Community Relations at Paths Law Firm. Actively engaged in the Lee’s Summit and Overland Park communities, she proudly represents the law firm.

In all aspects of her life, Jeane Fracassa exemplifies the values of community, compassion, and family. Her commitment to making a difference and her love for exploration make her a remarkable individual, whose presence brightens the lives of those she encounters. Whether at work, with family, or during her travels, Jeane’s genuine care for others and her zest for life make her a truly remarkable and inspiring person.

Administrative Assistant

Laura E. Messer

Administrative Assistant

Laura E. Messer

Laura is the Law Firm’s marketing assistant, supporting all marketing tasks, including managing calendars, researching upcoming events, updating marketing software and spreadsheets, and partnering with organizations to maintain relationships that benefit Paths Law Firm’s clients.  Laura is also the law firm’s professional photographer as she provides the professional photographs for the headshots, organizations, events, and networking.

Laura has over 10 years of experience as a professional photographer.  She is also Adobe and Microsoft Certified.  She graduated from Columbia College, Columbia, Missouri with her Bachelor of Arts degree, Magna Cum Laude, in Behavioral Psychology (minors in Social Work and Criminal Justice), and her Photographic Craftsman degree from Professional Photographers of America. She is certified as a Qualified Mental Health Professional, Certified Gentle Teacher, Medicaid Billing Certified, Crisis Intervention Counselor, and a Missouri Notary.

Laura has been married more than 26 years and has a daughter and a son. She has four brothers, a niece, and a nephew. Her four spoiled pets that love her attention. A lot of Laura’s off time is spent taking photos and she is an internationally published photographer. Laura owns a studio on the historic Independence Square. 

Administrative Assistant

Holly D. Bramble

Administrative Assistant

Holly D. Bramble

Holly is our newest member of the administrative team. She is hardworking, has proven organizational skills and excellent communication skills. Holly has transitioned to the Estate Planning field from healthcare administration where she gained valuable knowledge that has contributed to her success here at Paths.

Holly enjoys spending time with loved ones, cheering for the Chiefs, and relaxing on the beach.

Administrative Assistant

Tressa L. Purdy

Administrative Assistant

Tressa L. Purdy

Tressa has the important role of being a client’s initial point of contact as the law firm’s receptionist for all locations.  She also welcomes, assists, and cares for clients at the Lee’s Summit office. Additionally, she provides support in an administrative capacity for the attorneys, staff, and clients.  When you meet Tressa, the first quality many note is her readiness to be of assistance.

 

Tressa is a graduate of Park Hill High School with extensive administrative experience and executive level management. Tressa brings a stability and comfort to the law firm experience having worked in a variety of industries and having lived in six different major metropolitan cities.

 

Tressa has a daughter, two sons, and one grandchild.  In her free time, she enjoys her family and friends, loves being outdoors, gardening, bike riding and bird watching. Indoor hobbies include scrapbooking, painting cookies, and cheering on Chiefs football. She is a Kansas City native but enjoys traveling but is always happy to be back in her hometown.  

Attorney

Kathleen E. Overton

Attorney

Kathleen E. Overton

Kathleen Overton is an attorney and owner at Paths Law Firm. She has more than 17 years of experience advocating for those with special needs and navigating the state and federal agencies formed to help the disabled and elderly. At Paths Law Firm, Kathleen’s practice focuses on helping the elderly qualify for nursing home Medicaid, creating estate plans to protect beneficiaries, as well as a lot of time planning and forming businesses. Kathleen also enjoys helping clients form non-profit organizations and obtain 501(c)(3) tax exempt status.

 

After attending law school at the University of Oklahoma, Kathleen began representing clients before the Social Security Administration. Eventually her practice switched to federal court appeals and Kathleen spent years representing clients before the Eastern and Western District of Missouri, the District of Kansas, and the Eighth Circuit Court of Appeals. Kathleen has since focused her practice on estate planning and elder law after watching clients struggle to find ways to financially care for loved ones with special needs or aging parents.

 

Kathleen lives in the Northland with her husband and four children. She spends her free time attending soccer matches and ballet performances with her children and starting endless home improvement projects with her husband. 

Medicaid paralegal

Tena K. Dooley

Medicaid Paralegal

Tena K. Dooley

Tena is a Medicaid Paralegal.  She is very meticulous and organized.  She works closely with the attorneys, clients, and State representatives. 

Tena has an associate in applied science and has over 20 years of office management experience. She has two daughters and one grandson.

Tena enjoys spending time with her family.  She enjoys everything outdoors and her hobbies include fishing and gardening.

PARALEGAL & ACCOUNTANT

Sydney R. Morris

PARALEGAL & ACCOUNTANT

Sydney R. Morris

Sydney is the law firm’s internal accountant and one of their experienced paralegals having been with Paths Law Firm since 2017. She is a primary point of contact for estate planning and business planning.

Sydney graduated with honors from the University of Missouri Kansas City in 2022 with her Bachelor of Science Degree in Accounting. She is a Bloch Launchpad, Phi Theta Kappa, and National Honor Society alumni.

In her free time, Sydney enjoys spending time with her husband, reading, baking and going on long walks. 

SENIOR ADMINISTRATIVE ASSISTANT

Christy L. Phillips

SENIOR ADMINISTRATIVE ASSISTANT

Christy L. Phillips

Christy has three years of experience in elder law working for seniors and their families. She is currently the Senior Administrative Assistant and organizes the day to day functions of the office and makes sure everything runs smoothly. When asked why she loved what she does, Christy said at Paths Law Firm, she gets the opportunity to help clients in more ways than one. Her favorite parts of the job are getting to know the clients and helping them get their questions answered. 

Christy’s experience in the finance industry has been extremely beneficial to her role as the Senior Administrative Assistant. Christy has a special place in her heart for the elderly and attributes this to the relationship she had with her grandparents. 

Christy was raised in Ogden, Utah and moved to Independence, MO, when she was ten years old. She has been with her high school sweetheart for 25 years and they have two beautiful children together. Her daughter works in the medical industry, and her son currently attends High School and plays Baseball. When Christy is not working, she enjoys crafting and spending time with her family and friends.

Christy’s experience in the finance industry has been extremely beneficial to her role as Benefits Coordinator. There have been many influences that went into her decision to select the field of Elder Law. Christy has a special place in her heart for the elderly and attributes this to her relationship with her grandparents.

When asked why she loves what she does, Christy said that at Paths Elder law, she gets the opportunity to help clients in more ways than one. Her favorite part of her job is getting clients approved for Medicaid or VA benefits as it is a huge relief for them and their loved ones.

Christy was raised in Ogden, Utah, and moved to Independence, MO, when she was ten years old. She has two children that keep her busy and fill her life with joy! Christy’s daughter cheers for Avila University, and her son plays competitive baseball for the Bucks and races BMX locally for the Motorcycle Closeout Team.

When Christy is not working, she enjoys crafting and making homemade gifts for her loved ones and raising her kids to be healthy, happy, and positive humans.

 

Practice Areas

  • Medicaid Benefits
  • VA Benefits

 

Professionalc Memberships and Affiliations

  • Missouri Notary

FINANCIAL MANAGER

René A. Fracassa

Rene A. Fracassa, Paths Law

FINANCIAL MANAGER

René A. Fracassa

René is the Financial Manager at Paths Law Firm overseeing all aspects of revenue, expenses, and financial planning. She is also responsible for general office management, including assisting in many of the administrative matters that periodically arise. 

 

René earned her Bachelor of Science in Hotel and Restaurant Management from Central Missouri State University in Warrensburg, Missouri and soon thereafter worked her way through management at The American Restaurant where she worked almost 17 years before relocating to the country of China.

 

René is the Financial Manager at Paths Law Firm overseeing all aspects of revenue, expenses, and financial planning. She is also responsible for general office management, including assisting in many of the administrative matters that periodically arise. 

 

René earned her Bachelor of Science in Hotel and Restaurant Management from Central Missouri State University in Warrensburg, Missouri and soon thereafter worked her way through management at The American Restaurant where she worked almost 17 years before relocating to the country of China.

 

René is the Financial Manager at Paths Law Firm overseeing all aspects of revenue, expenses, and financial planning. She is also responsible for general office management, including assisting in many of the administrative matters that periodically arise. 

 

René earned her Bachelor of Science in Hotel and Restaurant Management from Central Missouri State University in Warrensburg, Missouri and soon thereafter worked her way through management at The American Restaurant where she worked almost 17 years before relocating to the country of China.

 

René is the Financial Manager at Paths Law Firm overseeing all aspects of revenue, expenses, and financial planning. She is also responsible for general office management, including assisting in many of the administrative matters that periodically arise. 

 

René earned her Bachelor of Science in Hotel and Restaurant Management from Central Missouri State University in Warrensburg, Missouri and soon thereafter worked her way through management at The American Restaurant where she worked almost 17 years before relocating to the country of China.

 

In her spare time, René is currently quite active managing multiple generations of her family, including parents and grandkids.  René has had great impact on the lives of many women teaching discipling and teaching and abundance of Bible Studies. Her former career in management and event planning trained her well to juggle all the activity.

MARKETING MANAGER

Hilary R. Tichota

MARKETING MANAGER

Hilary R. Tichota

Hilary plays a vital role in managing the Marketing Department at Paths Law Firm.  She is excellent at bringing new ideas and sharing valuable resources with the law firm and our community. Hilary has been with the law firm since the beginning, working in nearly every role which is invaluable in her marketing endeavors as she brings a unique set of skills into the Marketing Department.

Hilary is nearly complete in her Bachelor’s of Arts Degree in Marketing at Park University.  She has earned the honor of being listed in National Honors Society, Phi Theta Kappa, and the Dean’s List. Hilary is always looking for new and innovative ways to share the law firm’s message.

While not working, Hilary spends her time with her family at their rural home. They tend to their chickens and honeybees and enjoy the solitude of country living.

SR. PARALEGAL & OPERATIONS MANAGER

Jennifer A. Bronson

SR. PARALEGAL & OPERATIONS MANAGER

Jennifer

Jennifer is the Sr. Paralegal and Operations Manager at Paths Law Firm.  She oversees the firm’s probate department as well developing, implementing, and managing all the firm’s administrative processes having been with the law firm almost from the beginning.  She enjoys client contact as well as behind-the-scenes operations.

 

Jennifer began her legal career in 1990 as a legal secretary.  She has worked in small and medium sized firms, as well as court operations.  She has her Paralegal Certificate from Boston University, Law Office Management Certificate from University of Central Missouri, and she is a Master Financial Coach. 

 

Jennifer has two daughters, twin sons, and twin grandsons.  She spends as much time as she can with them.  She enjoys reading, listening to podcasts, and tending her yard. 

ATTORNEY

Russell A. Fracassa (Rusty)

ATTORNEY

Russell A. Fracassa (Rusty)

When asked what he wants to do, his reply was “I just want to sit at the kitchen table and work directly with people.” Rusty enjoys working with clients providing experienced advocacy and supporting them through their unfamiliar and overwhelming situations. Due to all the challenges faced by seniors, it is essential to work with an experienced elder law attorney who has expertise in the law, issues, and concerns affecting seniors and their families.

Rusty brings more than 30 years legal experience and expertise working for seniors and their families as an elder law attorney in Kansas City and surrounding. Prior to law school, Rusty was an accountant and his first couple years practicing law was as a tax attorney. This provides invaluable experience in his current practice of law. Rusty’s focus is helping protect seniors’ assets from taxes and long-term care costs, benefit qualification, and navigating more complex family scenarios in their estate planning.

Rusty has personally experienced the loss every parent fears, caring for a spouse suffering with cancer and the treatment, and working with aging parents through all stages of their lives.  He intimately understands the challenges faced by individuals and their caretakers when capacity or health declines, how to prepare for it, and the legal matters while in the midst of it.  He may not be able to eliminate his client’s grief, but he strives to provide clients with peace of mind.

In 2010, Rusty’s faith and love led him and part of his family to China as Christian missionaries. He and his wife, went permanently, but ended up dedicating 3 years to that ministry. They returned to Missouri to help with grandchildren after a family tragedy and later began anew with Paths Elder Law. The goal is providing compassionate care through legal advocacy.

Rusty has multiple degrees and advanced study spanning his Bachelor’s of Arts in Business Administration – Accounting at Rockhurst College (now Rockhurst University), Masters of Arts in Accounting and in Intercultural Studies, as well as his Juris Doctorate from the University of Missouri at Kansas City School of Law.

When Rusty is not practicing law, he enjoys spending time with his family, grandchildren, and excessive eating at local restaurants.

Practice Areas

  • Wills and Trusts
  • Estate Planning
  • Asset Protection
  • Medicaid Benefits
  • VA Benefits
  • Probate
  • Guardianship and Conservatorships
  • Education

 

BSBA and Master’s in Accounting, Master’s in Inter-Cultural Studies, and Doctorate in Juris Prudence

  • Rockhurst University
  • Liberty University
  • University of Missouri – Kansas City


Admissions to Practice

  • Missouri


Professional Memberships and Affiliations

  • State Bar of Missouri
  • National Academy of Elder Law Attorneys (long-time Member)
  • Elder Counsel (Charter and Ongoing Member)
  • Missouri Association of Trial Attorneys (Past Member)
  • Kansas City Metropolitan Bar Association
  • Missouri State Bar Committees – Elder Law, Estate Planning, Probate