Qualified Income Trust for Medicaid

If your income is too high to qualify for Medicaid long-term care in Florida, you are not out of options. A Miller Trust — formally known as a Qualified Income Trust (QIT) — is a specific type of irrevocable trust that allows individuals whose income exceeds Florida’s Medicaid cap to become eligible for nursing home care, assisted living, or home and community-based services.

Florida is an “income cap” state. That means if your gross monthly income exceeds a specific threshold — even by one dollar — you are disqualified from Medicaid long-term care benefits unless you establish a properly drafted Miller Trust. Understanding how these trusts work, what they must contain, and how they interact with spousal protections and estate recovery is essential for anyone navigating the Medicaid application process.

This page explains everything you need to know about Miller Trusts in Florida, including the legal requirements, required trust provisions, how income flows through the trust, protections for your spouse, and what happens to the trust after death.

What Is a Miller Trust?

A Miller Trust is a special irrevocable trust authorized by federal law under 42 U.S.C. § 1396p(d)(4)(B). The trust takes its name from the landmark case Miller v. Ibarra and was formally codified by Congress through the Omnibus Budget Reconciliation Act of 1993 (OBRA ’93).

The purpose of a Miller Trust is straightforward: it allows a Medicaid applicant whose income exceeds the state’s income cap to deposit that excess income into the trust, removing it from the eligibility calculation. Once the income is deposited into the QIT, it is no longer counted as available income for Medicaid purposes, and the applicant can qualify for benefits.

A Miller Trust is not an asset protection trust. It does not shelter savings, real estate, or investments. It holds only income — Social Security payments, pensions, annuity distributions, VA benefits, and other recurring income sources. The trust must be irrevocable, and upon the beneficiary’s death, the State of Florida must be repaid for all Medicaid benefits provided before any remaining funds can pass to other beneficiaries.

Florida’s Medicaid Income Cap: When a Miller Trust Is Required

Florida’s Medicaid income eligibility threshold for long-term care is set at 300% of the Supplemental Security Income (SSI) Federal Benefit Rate. This cap is established by Florida Administrative Code Rule 65A-1.713 and applies to both Institutional Care Program (ICP) benefits (nursing home care) and Home and Community-Based Services (HCBS) waiver programs.

For 2024–2025, the monthly income cap is approximately $2,829 per month for individuals. This amount is adjusted annually based on changes to the SSI Federal Benefit Rate.

If your gross monthly income from all sources — including Social Security, pensions, VA benefits, annuity payments, and any other recurring income — exceeds this cap, you cannot qualify for Medicaid long-term care in Florida without a Miller Trust. There is no spend-down option for income the way there is for assets. The only path to eligibility is routing excess income through a properly established QIT.

Exception for Working Disabled Individuals

Florida provides a higher income threshold for individuals enrolled in the HCBS Working People with Disabilities (WPwD) waiver who are employed and age 21 or older. For this population, the income cap increases to 550% of the Federal Benefit Rate — $4,367 per month for an individual or $8,734 for an eligible couple — under Florida Administrative Code Rule 65A-1.716.

Federal and State Legal Framework

Miller Trusts exist at the intersection of federal Medicaid law and Florida’s implementing regulations:

Federal Authorization

42 U.S.C. § 1396p(d)(4)(B) authorizes states to disregard income placed in a qualifying trust when determining Medicaid eligibility, provided the trust meets specific requirements. This statute creates an exception to the general rule that trust assets are counted as available resources. The exception is available only in “income cap” states — states that do not extend Medicaid to individuals with income above the cap under § 1396a(a)(10)(C).

Florida’s Implementing Regulations

Florida has implemented the federal requirements through Florida Administrative Code Chapter 65A-1. The key regulatory provisions include:

Required Miller Trust Provisions in Florida

A Miller Trust must satisfy every mandatory requirement under both federal and state law. If any required provision is missing or improperly drafted, the trust will be disqualified and Medicaid benefits will be denied. Florida’s requirements, drawn from Rule 65A-1.701(57) and 42 U.S.C. § 1396p(d)(4)(B), include the following:

Irrevocability

The trust must be irrevocable. Once established, the grantor cannot modify, amend, or revoke the trust. This prevents manipulation of trust terms to circumvent Medicaid eligibility rules after benefits are approved.

Income-Only Funding

The trust corpus must consist exclusively of the individual’s income: “pension, Social Security and other income.” The trust cannot hold assets such as savings, real estate, or investments. Any attempt to fund the trust with non-income assets will disqualify the trust and render the individual ineligible for Medicaid.

Sole Beneficiary Requirement

The trust must be established for the sole benefit of the Medicaid applicant. The individual must be the only person who can benefit from trust disbursements during their lifetime.

Medicaid Payback Provision

This is the most critical provision. The trust must contain explicit language providing that upon the beneficiary’s death, the State of Florida will receive all amounts remaining in the trust up to an amount equal to the total medical assistance paid on the individual’s behalf under the state’s Title XIX plan.

Florida courts enforce this provision strictly. In Agency for Health Care Administration v. Spence, 394 So.3d 1207 (Fla. 3d DCA 2024), the Third District Court of Appeal reversed a probate court order that would have allowed distribution of trust assets without first satisfying the state’s reimbursement claim. The court held that the payback provision was “clear and unequivocal” and that AHCA must be fully repaid before any remaining assets can be distributed to other beneficiaries.

Proper Establishment Authority

Under 42 U.S.C. § 1396p(d)(2)(A), a Miller Trust must be established by one of four authorized parties: (1) the individual; (2) the individual’s spouse; (3) a person with legal authority to act on behalf of the individual (such as a guardian or agent under a durable power of attorney); or (4) a person acting at the direction or upon the request of the individual or spouse.

In Maddox v. Florida Department of Children and Families, 291 So.3d 1014 (Fla. 1st DCA 2020), the First District Court of Appeal clarified that a QIT cannot be invalidated based solely on deficiencies in a power of attorney when the trust document contains alternative statutory language establishing it was created at the individual’s direction and request under subsection (iv). However, the court remanded the case for a determination of whether the applicant had the mental capacity to authorize trust creation — highlighting that capacity issues remain a potential vulnerability even when the trust document itself is properly drafted.

How to Fund a Miller Trust Each Month

Establishing the trust is only the first step. A Miller Trust must be properly funded every month to maintain Medicaid eligibility. The Florida Supreme Court has recognized the critical importance of proper monthly funding through its approval of the Florida Bar’s advisory opinion in The Florida Bar re Advisory Opinion — Medicaid Planning Activities by Nonlawyers, 183 So.3d 276 (Fla. 2015).

As documented in that opinion, the income trust checking account must be funded each month with the income that exceeds the Medicaid cap. If a Miller Trust is not properly funded in any given month, the Medicaid applicant will not be eligible for benefits that month. The advisory opinion documented cases where improper funding resulted in denied benefits, including one instance where a client faced a $7,000 nursing home bill due to incorrect funding advice from a nonlawyer.

Which Income Must Be Deposited

All income that causes the individual to exceed the Medicaid income cap must flow through the QIT. Under Rule 65A-1.701(57), this includes Social Security benefits, pension payments, VA benefits, annuity distributions, and any other recurring income. The regulations do not distinguish between income types — if it is income and the individual’s total exceeds the cap, it must be deposited into the QIT.

Verification Requirements

Florida Administrative Code Rule 65A-1.713(3)(b) requires that income placed into a QIT must be verified at the source. Bank statements or records are acceptable verification of deposits. The trustee must also provide quarterly statements to the Department of Children and Families identifying all deposits and disbursements for each month during the eligibility period, as required by Rule 65A-1.702(13)(d).

Permissible Disbursements from a Miller Trust

Once income is deposited into the Miller Trust, it can only be disbursed in a specific priority order established by Florida Administrative Code Rule 65A-1.7141. This is not discretionary — the trustee must follow the prescribed sequence:

The trustee must follow this exact priority order. Any disbursement that does not fall within these categories, or that is made out of order, could jeopardize the individual’s Medicaid eligibility.

Miller Trusts and Community Spouse Protections

When one spouse requires long-term care and the other remains at home, federal and state law provide spousal impoverishment protections designed to prevent the community spouse from being left destitute. These protections interact directly with Miller Trust disbursements.

Monthly Maintenance Needs Allowance (MMNA)

The community spouse is entitled to a Monthly Maintenance Needs Allowance, calculated using the formula under § 1924 of the Social Security Act as implemented by Rule 65A-1.7141(1)(e) and Rule 65A-1.716. This allowance is paid from the institutionalized spouse’s income (through the QIT) as the second disbursement priority, after the personal needs allowance.

If the community spouse’s own income is below the MMNA floor, the difference is made up from the institutionalized spouse’s income flowing through the Miller Trust. An excess shelter allowance may increase the MMNA above the standard amount if the community spouse’s housing costs exceed certain thresholds.

Important Limitation for HCBS Waiver Recipients

Spousal impoverishment protections are not applied to individuals receiving services under most HCBS waiver programs, with limited exceptions for the Familial Dysautonomia and Model (Katie Beckett) waivers under Rule 65A-1.712(4). This is a critical planning consideration: a married couple where the Medicaid applicant is receiving home-based services rather than nursing home care may not have access to the same spousal income protections.

Miller Trusts for Nursing Home Care vs. Home and Community-Based Services

Florida applies the same income cap and QIT requirements to both Institutional Care Program (nursing home) and HCBS waiver programs. Under Rule 65A-1.713(1)(d) and (e), gross income cannot exceed 300% of the SSI Federal Benefit Rate for either program, and both reference the same QIT eligibility criteria in Rule 65A-1.702(15).

The key difference lies in spousal protections. As noted above, most HCBS waiver recipients do not receive spousal impoverishment protections, which affects how income is allocated through the Miller Trust. Families exploring home-based care alternatives should work with an attorney who understands these distinctions before assuming that a QIT established for HCBS purposes will work the same way as one established for nursing home care.

What Happens to a Miller Trust After Death: Estate Recovery in Florida

When the Miller Trust beneficiary dies, the trust does not simply pass to the family. Florida’s Medicaid Estate Recovery Act, codified in § 409.9101, Florida Statutes, requires the Agency for Health Care Administration (AHCA) to seek reimbursement for all Medicaid benefits paid on the individual’s behalf.

The payback provision in the Miller Trust requires that AHCA receive all amounts remaining in the trust, up to the total medical assistance paid, before any distributions to surviving family members. AHCA files claims against the estate as provided under the Florida Probate Code (§§ 733.702 and 733.710), and these claims take priority as Class 3 claims under § 733.707(1)(c).

The Spence decision (2024) confirmed that Florida courts will strictly enforce these payback obligations. The Third District reversed a probate court order that had attempted to distribute trust assets to beneficiaries without first satisfying AHCA’s reimbursement claim. The message is clear: the state will be repaid first, and any attempt to circumvent the payback provision will be reversed on appeal.

Consequences of an Improperly Drafted Miller Trust

The stakes of getting a Miller Trust wrong are high. An improperly drafted QIT results in immediate disqualification from Medicaid benefits until the defects are corrected. Common drafting errors that lead to trust disqualification include:

Missing or inadequate Medicaid payback language. If the trust does not contain the required provision naming the State of Florida as the remainder beneficiary, the trust is disqualified regardless of whether all other requirements are met.

Improper establishment authority. If the trust was not established by one of the four authorized parties under 42 U.S.C. § 1396p(d)(2)(A), or if the person who established the trust lacked capacity, the trust may be invalidated. The Maddox case demonstrated that a single drafting deficiency can result in months of denied benefits.

Including non-income assets. Depositing savings, investment proceeds, or other assets into the QIT disqualifies the trust. Only income may be deposited.

Failure to maintain irrevocability. Any provision that allows the grantor to modify or revoke the trust will disqualify it.

Failure to fund the trust monthly. Even a properly drafted trust will not protect eligibility if income is not deposited each month. As the Florida Supreme Court recognized, improper funding has resulted in denied benefits and thousands of dollars in unexpected nursing home costs.

Why You Need an Attorney to Establish a Miller Trust in Florida

The Florida Supreme Court has made clear that preparing a Qualified Income Trust constitutes the practice of law. In The Florida Bar re Advisory Opinion — Medicaid Planning Activities by Nonlawyers, 183 So.3d 276 (Fla. 2015), the Court approved the Standing Committee’s determination that it is the unlicensed practice of law for a nonlawyer to determine the need for, prepare, and execute a QIT — including gathering the information necessary to complete the trust.

The advisory opinion documented specific cases where nonlawyer preparation of Miller Trusts resulted in significant harm to clients, including denied Medicaid benefits, months of uncovered nursing home costs, and trusts that had to be completely redrafted at additional expense. The Court recognized that the legal complexity involved — coordinating federal and state requirements, ensuring proper establishment authority, drafting compliant payback language, and advising on funding mechanics — requires the judgment and expertise of a licensed attorney.

This is not a form you can download online and fill in yourself. A single missing provision or improper clause can result in months of denied benefits and tens of thousands of dollars in out-of-pocket nursing home costs.

Protect Your Medicaid Eligibility with a Properly Drafted Miller Trust

If you or a loved one needs long-term care and your income exceeds Florida’s Medicaid cap, a Miller Trust may be the only path to eligibility. The trust must be drafted correctly the first time — there is no room for error when Medicaid benefits and nursing home costs are on the line.

Zoecklein Law PA helps families throughout the entire state of Florida establish compliant Miller Trusts, navigate the Medicaid application process, and protect the community spouse’s income.

Contact us today for a consultation.