What Can a Medical Assistance Income Trust Pay For in Iowa?

Income goes into an Iowa Medical Assistance Income Trust each month, and the trustee may pay it out only for the purposes Iowa HHS allows. Paying for anything else can put eligibility at risk. Here is the list, with the Iowa HHS source for each item.

What Iowa HHS's rules allow

• Trust expenses

  A reasonable amount for the trust's necessary expenses, up to $10 a month without court approval; not counted as the beneficiary's income.

  Source: Iowa Code 633C.3(1)(a); Iowa HHS Employees' Manual, Title 8, Chapter I

• Personal needs allowance

  $55 a month for a medical facility resident, plus additional amounts in the month of entry or discharge as appropriate.

  Source: Iowa HHS Employees' Manual, Title 8, Chapter I; General Letter 8-I-89

• Waiver or PACE maintenance allowance

  300% of the current SSI income limit for a waiver member or PACE enrollee.

  Source: Iowa HHS Employees' Manual, Title 8, Chapter I

• Community spouse

  An amount diverted to the community spouse to raise the spouse's income to the minimum monthly maintenance needs allowance.

  Source: Iowa HHS Employees' Manual, Title 8, Chapter I

• Dependents at home

  A deduction for minor or dependent children, dependent parents, or dependent siblings of either spouse living at home.

  Source: Iowa HHS Employees' Manual, Title 8, Chapter I

• Unmet medical needs

  Medicare and other health insurance premiums (including dental and vision), deductibles and coinsurance, and necessary medical or remedial care not covered by Medicaid.

  Source: Iowa HHS Employees' Manual, Title 8, Chapter I

• The remainder to the provider

  Remaining income, up to the Medicaid rate, paid directly to the medical facility, waiver provider or PACE provider each month; not counted as the beneficiary's income.

  Source: Iowa Code 633C.3(1)(c)

• Anything left after that

  At the trustee's discretion or as the trust directs: paid to providers of other Medicaid-covered care, paid to the state as reimbursement, or kept in the trust.

  Source: Iowa Code 633C.3(1)(d)

The order payments are made in

Iowa Code 633C.3(1) sets the priority: trust expenses up to $10, then the federal post-eligibility deductions, then the remainder to the facility or waiver provider up to the Medicaid rate, then the optional uses for anything left. The caseworker sets the dollar amounts for each payee.

Trustee and bank fees

Up to $10 a month for the trust's necessary expenses, without court approval (Iowa Code 633C.3(1)(a)). Iowa HHS's manual calls this the trust administration fee and says it isn't counted as income.

What the trust can't be used for

If total income is at or above 125% of the statewide average private-pay charge, a different rule applies: after the $10, everything goes to the beneficiary each month and is counted as income or a resource for eligibility (Iowa Code 633C.3(2)). Funeral and burial costs can't be paid from the trust until all medical assistance has been reimbursed to the state (Iowa HHS Comm. 666).

Timing, and money left over

Payments to the provider are made monthly (Iowa Code 633C.3(1)(c)). Iowa HHS's manual says remaining income is kept in the trust until the beneficiary's death; its revenue-collections manual adds that these trusts often, and should, reach a zero balance each month, and that high balances may be reviewed.

Keeping the monthly record

The trustee is the one who has to show that the trust paid only these items. A month-by-month record of every deposit and every payment, checked against the bank statement, is what makes that easy to show when Iowa HHS asks.