Qualified Income Trusts (Miller Trusts) for Over-Income Ohio Medicaid Applicants

Since transitioning from a traditional medical spend-down system to an SSI Criteria (1634) state, Ohio enforces a strict monthly 'income cap' for seniors applying for Nursing Facility Medicaid or Home and Community-Based Services (HCBS) waivers like PASSPORT and MyCare Ohio. If an applicant in Columbus, Cleveland, Cincinnati, Dayton, or Toledo receives gross monthly income that exceeds Ohio's Special Income Level (SIL)-set at 300% of the Supplemental Security Income Federal Benefit Rate-by even a single dollar, the county agency will deny long-term care coverage outright.

This creates a cruel financial gap: a retired Ohio worker earning $3,300 per month is considered 'too rich' for Medicaid under Ohio Rev. Code § 5163.03, yet cannot possibly afford a $10,500 monthly skilled nursing facility bill. To bridge this gap legally, federal law under 42 U.S.C. § 1396p(d)(4)(B)-originating from the landmark federal decision Miller v. Ibarra, 746 F. Supp. 19 (D. Colo. 1990)-and Ohio Admin. Code § 5160:1-6-03.2 allow over-income applicants to establish a Qualified Income Trust (QIT), widely known as a Miller Trust.

Social Security vs. Union Pension Income Limits in Ohio

Across Ohio's manufacturing and public-service hubs, thousands of retirees receive a combination of monthly Social Security benefits plus a union pension (such as UAW, Steelworkers, or Teamsters) or an Ohio public pension (OPERS, STRS, or SERS). Together, these checks routinely push an applicant over the $2,901 to $2,982 monthly Special Income Level (adjusted annually each January for federal cost-of-living increases).

The most common mistake Ohio families make is looking at net bank deposits rather than gross income. Under Ohio Admin. Code § 5160:1-6-03.2, county caseworkers calculate eligibility using the gross dollar amount of your Social Security and pension benefits before deductions for Medicare Part B premiums, federal or state income tax withholdings, or retiree health insurance:

• Gross Income Calculation Rule: If your net Social Security deposit is $1,800 after a $185 Medicare Part B deduction, and your net union pension deposit is $1,050 after $150 in tax withholding, your net deposits total $2,850-appearing below the limit. However, Ohio counts your gross monthly income of $3,185, triggering an automatic denial without a Miller Trust.
• Partial vs. Whole Source Deposits in Ohio: Unlike states that require an entire pension check to be direct-deposited into the trust, Ohio Admin. Code § 5160:1-6-03.2(B) permits an applicant to transfer either an entire income source or only the exact excess dollar amount needed to reduce countable monthly income below the Special Income Level.
• Strict Ban on Asset Deposits: A QIT can hold only monthly income (Social Security, pensions, annuities, or VA aid). Depositing savings account funds, CD proceeds, or proceeds from selling a car into a QIT invalidates the trust account.

Naming the State of Ohio as Remainder Beneficiary

In Pack v. Osborn, 117 Ohio St. 3d 14 (OH Supreme Court 2008), the Ohio Supreme Court emphasized that trust instruments used by Medicaid applicants are strictly scrutinized against statutory eligibility standards. Under Ohio Admin. Code § 5160:1-6-03.2(B) and 42 U.S.C. § 1396p(d)(4)(B)(ii), a Qualified Income Trust is legally invalid unless it contains an explicit irrevocable payback provision.

Specifically, the trust document must be irrevocable and must name the Ohio Department of Medicaid, Columbus as the primary remainder beneficiary. Upon the death of the Medicaid recipient, any cash remaining inside the QIT bank account must be paid directly to the State of Ohio up to the total amount of Medicaid benefits paid on the individual's behalf.

Because of this mandatory payback clause, experienced Ohio trustees never allow excess cash to sit idle inside a Miller Trust account. By properly disbursing the deposited funds each month toward approved expenses and the nursing home's patient liability bill, the QIT account balance stays near zero, leaving virtually nothing in the trust for state payback at death.

Approved Expenses the Trust Can Pay Under Ohio Law

Once monthly income is deposited into the QIT checking account, the Trustee cannot spend the money freely on gifts, family bills, or general household upkeep. Under Ohio Admin. Code § 5160:1-6-03.2(D) and the post-eligibility treatment of income rules in Ohio Admin. Code § 5160:1-6-07, all income placed into the QIT must be distributed no later than the end of the following calendar month strictly in accordance with Ohio's approved priority list:

• Personal Needs Allowance (PNA): Up to $75 per month for a nursing facility resident to spend on personal items such as haircuts, clothing, or phone service (or the special waiver maintenance allowance for PASSPORT home care recipients).
• Community Spouse Monthly Income Allowance (MIA): If the applicant is married to a spouse living at home, QIT funds can be transferred to the community spouse to bring their monthly income up to Ohio's spousal impoverishment allowance standard.
• Health Insurance Premiums & Non-Covered Medical Care: Monthly premiums for Medicare Part B, Medicare Part D, Medigap supplemental policies, and incurred medical or remedial expenses not covered by Medicaid.
• Monthly Patient Liability (Share of Cost): The remaining balance of the monthly income is paid directly to the Ohio skilled nursing facility as the resident's mandatory share of cost.
• Bank Fees & Trustee Administrative Costs: Under Ohio Admin. Code § 5160:1-6-03.2(D)(5), the trustee may pay up to $15 per month from the QIT account to cover bank service charges or administrative fees.

Step-by-Step Bank Account Setup for QITs in Ohio

Setting up and funding a Miller Trust properly is mandatory before your county agency-whether the Franklin County Department of Job and Family Services, Columbus, the Cuyahoga County Department of Job and Family Services, Cleveland, the Hamilton County Department of Job and Family Services, Cincinnati, the Montgomery County Department of Job and Family Services, Dayton, or the Lucas County Department of Job and Family Services, Toledo-can approve long-term care benefits.

Step 1: Audit Gross Monthly Income and Complete Resource Worksheets

Gather your Social Security benefit verification letter and gross pension statements for OPERS, STRS, or union retirement accounts. If married, complete Form ODM 04076, Ohio, Department of Medicaid, Resource Assessment Worksheet alongside your income calculation to determine the exact dollar amount by which the applicant's gross monthly income exceeds the Special Income Level.

Step 2: Execute the Irrevocable QIT Document

Prepare and sign the trust agreement using an approved Qualified Income Trust template distributed by the Ohio Department of Medicaid. The document must be signed by the applicant (or their agent holding express trust-creation authority under a Financial Power of Attorney, or a court-appointed Guardian) as Grantor, and by a trusted adult child or spouse as Trustee.

Step 3: Open a Dedicated QIT Checking Account at an Ohio Bank

Take the signed, notarized QIT document to a local bank in Columbus, Cleveland, or your hometown to open a separate checking account titled in the name of the trust (for example, 'The John Doe Qualified Income Trust'). Because a Miller Trust is a grantor trust for federal tax purposes, the bank will use the Medicaid applicant's own Social Security Number as the Tax Identification Number (TIN)-do not apply for a separate IRS EIN unless the bank's compliance department specifically insists on one.

Step 4: Fund the Account Before Month-End and File Proof with County JFS

In Ohio, a QIT is only effective starting in the first calendar month in which the trust is both executed and funded with an actual income deposit. Deposit at least the excess monthly income into the QIT checking account before the last business day of the month for which Medicaid coverage is needed, establish recurring monthly automated transfers, and submit the signed QIT, the Form ODM 10193, Ohio, Department of Medicaid, Qualified Income Trust Verification, and Form JFS 07200, Ohio, Department of Job and Family Services, Application for Cash, Food, or Medical Assistance.

How Much Does it Cost in Ohio?

Establishing and maintaining a Miller Trust in Ohio is highly cost-effective compared to paying privately for nursing facility care:

• State QIT Template: $0 when utilizing standard forms provided by the Ohio Department of Medicaid.
• Initial Bank Opening Deposit: Most Ohio banks require $25 to $100 from the applicant's monthly income (or the exact first month's excess income transfer) to open the QIT checking account.
• Monthly Bank Maintenance Cap: Under Ohio Admin. Code § 5160:1-6-03.2(D)(5), up to $15 per month can be deducted from the QIT account to pay bank fees.
• Ohio Elder Law Attorney Fees: Retaining an Ohio Medicaid attorney to verify power-of-attorney trust authority, prepare the QIT instrument, calculate spousal allowances, and guide the bank setup typically costs $500 to $1,500. You can connect with a local Ohio Medicaid lawyer through our directory.

How Long Does the Process Take?

Because a Miller Trust cannot cure over-income status retroactively for months prior to its funding, speed is essential:

• Drafting & Bank Account Setup: Executing the QIT document and opening the dedicated checking account at an Ohio bank takes 1 to 3 business days.
• Monthly Funding Deadline: The initial income deposit must clear before the end of the calendar month in which you want Ohio Medicaid eligibility to begin. Missing the end of the month by even one day can cost the family $9,500+ in uncovered nursing home bills for that month.
• County JFS Review & Approval: Once filed with Form JFS 07200, Ohio, Department of Job and Family Services, Application for Cash, Food, or Medical Assistance, the county JFS office has 45 calendar days to process the application. If a caseworker miscalculates QIT distributions, you have 90 days to request a hearing via Form JFS 04065, Ohio, Department of Job and Family Services, Prior Notice of Right to a State Hearing.

Frequently Asked Questions (FAQ)