5160-13      SPECIAL INCOME PROVISIONS

5160-13 A. Garnishments and Recoupments

Garnishments are funds withheld from an income source due to an outstanding debt a person is legally obligated to pay.  Garnishments are always made by direction of a court order.  The amount withheld for the garnishment is counted when determining the gross income from any source.

Recoupments are funds withheld from a benefit program, voluntarily or involuntarily, to repay a prior overpayment from that benefit program.  The amount withheld for a recoupment is not counted when determining the gross income from any benefit source.

The amount and reason for withholding of funds from any source must be verified in order to determine if the funds were withheld due to a garnishment or a recoupment.

5160-13 B. Income from Outside The Household

Any person not held legally or financially responsible for any applicant family members is not a member of the household.  The income of such persons is disregarded even if they use all or part of their money to purchase items for members of the Family Medicaid household.  However, any direct cash contribution to anyone in the household is counted as income.

5160-13 C. Income Received for Non-Household Members

Money received by a household for a person who is not part of the household is counted as unearned income if the household keeps the money and uses it to meet their needs.  Money received for a non-household member is not counted if the money is forwarded to the person it is intended for, or if it is otherwise used to meet the needs of the intended recipient.

5160-13 D. Qualifying Income Trust

A Qualifying Income Trust ( QIT Qualifying Income Trust ), also called a “Miller Trust”, allows the beneficiary to control the amount of income that is used to determine Medicaid eligibility.  Income that flows directly into the trust is not considered for the purpose of determining Medicaid eligibility.   Income generated by the trust that remains in the trust is not income to the beneficiary.

Payments made from the trust to the beneficiary or to someone acting on behalf of the beneficiary is counted as income.  Generally, vendor payments are exempt to the extent they are not made for food, clothing or shelter.  For more information, see Aged, Disabled and Long Term Care Medicaid Manual Section 526.