Special Needs Trusts and Medicare Cost-Savings Programs Eligibility

Estate Planning Practice Group

By Estate Planning Practice Group

The Qualified Medicare Beneficiary (QMB) program is a Medicare cost-savings program that helps low-income Medicare beneficiaries pay their monthly premiums, deductibles, copays, and coinsurance for Medicare Parts A (when applicable) and B. 

Medicare beneficiaries who qualify for the QMB program automatically qualify for the Medicare Part D Extra Help Program, which pays for 85% or more of the monthly premium, deductibles, and costs associated with the Medicare Part D Prescription Drug Program.

To be eligible for the QMB program, an individual must:

  1. Be enrolled in Medicare Part A (hospital insurance);
  2. Have monthly income less than 100% of the federal poverty level ($1,032 for single individuals or $1,392 for married couples); and
  3. Have assets and resources less than $7,560 (for single individuals) or $11,340 (for married couples).

Note: Medicare allows for a standard deduction of $20 from monthly income before income is compared to the federal poverty level.

Assets and resources that do count in determining eligibility for the QMB program include checking accounts, savings accounts, and investments such as stocks, bonds, and mutual funds.

Certain assets and resources, however, do not count in determining eligibility, including the Medicare beneficiary’s home, one car, a burial plot, burial expenses (up to $1,500), furniture, and other household and personal items.

Assets and resources held in a Special Needs or Supplemental Support Trust also do not count towards the QMB asset and resource maximum, provided they are held in the name of the Trust.

When properly drafted, payments made from a Special Needs or Supplemental Support Trust for the benefit of a disabled individual do not count as income to the individual in calculating monthly income. Supplemental Security Income (SSI) also does not count towards monthly income.

To apply for the QMB program, contact your local Medicaid office or visit https://mydss.mo.gov/medicare-cost-savings-programs to download a paper application.

Given the complex and evolving nature of Medicare laws, it is important to first consult with an attorney well-versed in Special Needs Trusts and Medicare regulations to ensure beneficiaries remain eligible for vital government benefits and achieve the day-to-day and long-term arrangements that are in the best interest of the Medicare recipient.

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