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Ask Nancy…

Question: My mom gets $2,000 income that is made up of her social security, a small pension, and monthly distributions from her retirement account. Does she have too much income to qualify for home care services through the Medicaid program?
Answer: No, your mom can stay in her home, receive services, and use her income to help pay her other expenses. 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.” Your mom can either spend her excess income on monthly medical expenses, give the excess income to the Medicaid provider, or she can place it into a pooled income trust.
For your mom, the best option to make sure she gets maximum use of her income will likely be to use 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 your mom can keep in her regular bank account, 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 your mom each month will accumulate in the account. That money will stay in the trust until mom’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 for mom, it cannot pay any expenses incurred after her death which includes funeral expenses that were not prepaid. The trust can only pay expenses incurred and submitted to the trust administrator before mom’s date of death.
Being able to keep mom’s income to pay her monthly living expenses is an important part of any plan that involves her remaining in the home with the care she needs.

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