While we have seen trustees go out for dinner on the Miller Trust dime, a nice, juicy steak is probably never going to be a DHS-approved expenditure. We’ve previously discussed some of the income rules regarding a Miller Trust. Here we are going to discuss problems we have seen regarding expenditures.

This is the third and final article in our series discussing Miller Trusts and how to avoid mistakes resulting in DENIED Medicaid long-term care applications.

What can be paid out of a Miller Trust account? The law here is very specific, but again, we see a host of problems.

Here are 4 authorized types of expenditures from a Miller Trust:

Authorized Use #1: The Trustee may pay a $40 personal needs allowance to the institutionalized person every month out of trust. The Trustee may write a check directly to the institutionalized person or have this set up on direct draft. Sometimes, nursing homes will establish a resident account which will hold the funds from a resident’s monthly PNA.

Authorized Use #2: The Trustee may pay the cost of the resident’s insurance coverage month out of trust. This could be for a Medicare supplement, health insurance or Medicare Part D coverage.

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Authorized Use #3: The Trustee may pay an amount to bring the community spouse’s (spouse at home) income up to an amount known as the Minimum Monthly Maintenance Needs Allowance (MMMNA), which has been set at $1,966.25 per month for 2015. As an example, say the husband is in the nursing home and has a monthly income of $2,200; the wife is at home with a monthly income of $820 from her Social Security check. She would be entitled to receive funds from the husband’s income every month to bring her income up to the MMMNA authorized amount.

Authorized Use #4: The balance of the patient’s income, less administrative fees, must be paid toward the patient’s monthly cost of care.
The primary factor for all of the above “Authorized Uses” is to first get case worker approval. Don’t assume that an expenditure is O.K.
For example, expenditures for necessary medical expenses of a resident can sometimes be authorized to spend down a build-up in funds held by a Miller Trust (such as when the resident goes to the hospital and has subsequent rehab days paid by Medicare).

The information provided on this blog is intended as general information only for a broad audience. It is not intended as legal advice and should not be acted upon as such. If any reader has questions or concerns about any matter mentioned herein, he/she should contact an Elder Law Attorney or other appropriate professional. If any reader has questions or suggestions about a future topic area that he/she would like to see discussed, please contact the author at doug@arkelderlaw.com.