A Pooled Income Trust allows a medicaid recipient to capture their income to pay their bills and qualify under the strict Medicaid income guidelines. This allows people to use their income to stay in their home and receive services. With some exceptions, the regulations state that a person receiving home care services through Medicaid can have $845 per month in income. Any monthly income over that amount is considered excess income and must be “spent down.” Excess income can be spent on monthly medical expenses, be given to the Medicaid provider, or placed into a pooled income trust.
To get maximum use of monthly income, the recipient will utilize the pooled income trust. This is an account that is administered by a charity that has been certified by New York State. The pooled income trust is a type of supplemental needs trust which means that the money can only be used for mom’s benefit and it can be used to pay any expenses that are not otherwise covered by her government benefits. There is an administrative fee that is paid to the trust, each trust has its own fee structure. Some trusts have an annual fee while others have monthly fees.
In addition to the $845 per month that a medicaid recipient can keep in a regular bank account, he or she can also keep the amount of any out of pocket health care premiums.
For example, if your mom pays for a Medicare supplement she can keep that amount in her name to cover that bill. The money that is put into the pooled income trust can be used to pay her other expenses including food, clothing, rent, mortgage payments, utilities, newspaper subscriptions, etc. This allows your mom to stay in her home, receive the care that she needs, and still have the use of her monthly income to pay her other living expenses.
Any part of the deposited income that is not used by the medicaid recipient each month will accumulate in the account. That money will stay in the trust until the recipient’s death, at which point it will be contributed to the charity that runs the trust. While the trust can make monthly payments towards a prepaid funeral contract, it cannot pay any expenses incurred after death which includes funeral expenses that were not prepaid. The trust can only pay expenses incurred and submitted to the trust administrator before the medicaid recipient’s date of death.
Being able to retain income to pay monthly living expenses is an important part of any plan that involves remaining in the home and receiving necessary care to remain there. Learn more about Medicaid law here.