Colorado Miller Trust / Qualified Income Trust (QIT)

COLORADO IRREVOCABLE INCOME TRUST AGREEMENT

(Miller Trust / Qualified Income Trust under 42 U.S.C. § 1396p(d)(4)(B))

TRUST IDENTIFICATION

ARTICLE I — ESTABLISHMENT OF TRUST

1.01 Name of Trust

This trust shall be known as The [____________________________] Irrevocable Income Trust (the "Trust"). The Trustee shall establish a dedicated bank account titled in the name of the Trust at a federally insured financial institution located in Colorado.

1.02 Settlor

The Settlor of this Trust is [____________________________] ("Settlor"), an applicant for or recipient of Colorado Medical Assistance long-term care benefits administered by the Colorado Department of Health Care Policy & Financing ("HCPF").

1.03 Purpose

This Trust is established under and intended to qualify as a "Qualified Income Trust" pursuant to 42 U.S.C. § 1396p(d)(4)(B), C.R.S. § 15-14-412.7, and 10 CCR 2505-10, § 8.100.7.E.6, for the sole purpose of enabling Settlor to qualify for and continue to receive long-term care Medical Assistance benefits (including nursing facility coverage, Home and Community-Based Services (HCBS) waiver services, and/or PACE) administered by HCPF. The Trust holds only income belonging to Settlor and is not intended to hold or shelter any resources or assets of Settlor.

1.04 Irrevocability

This Trust is IRREVOCABLE. Neither Settlor, nor any other person, shall have the power to revoke, amend, modify, alter, or terminate this Trust except as expressly permitted by 42 U.S.C. § 1396p(d)(4)(B), 10 CCR 2505-10, § 8.100.7.E.6, or order of a court of competent jurisdiction.

ARTICLE II — FUNDING AND CONTRIBUTIONS

2.01 Trust Corpus

The Trust shall be funded solely with income received by or on behalf of Settlor, including but not limited to:

☐ Social Security retirement, survivors, or disability benefits
☐ Railroad retirement annuities
☐ Private pensions or employer retirement payments
☐ Veterans benefits (excluding Aid & Attendance and Unusual Medical Expenses)
☐ Annuity payments
☐ Workers' compensation periodic payments
☐ Other periodic income: [____________________________]

2.02 No Resources or Assets

Settlor shall NOT contribute any pre-existing resources, savings, investments, real property, lump-sum distributions, gifts, inheritances, or other non-income assets to this Trust. Any deposit of a non-income asset is void and shall be returned to the source.

2.03 Full Redirection of Income Source

For each income source listed on Schedule A, the entire monthly payment from that source shall be deposited into the Trust bank account each month. Partial deposit of any single income source is not permitted.

2.04 Timing of Deposits

Each item of income shall be deposited into the Trust account no later than the last day of the calendar month in which it is received by or on behalf of Settlor. The Trustee shall maintain documentation evidencing timely deposit.

ARTICLE III — TRUSTEE

3.01 Initial Trustee

[____________________________] is appointed as Initial Trustee.

3.02 Successor Trustee

[____________________________] is appointed as Successor Trustee and shall serve upon the death, resignation, incapacity, or removal of the Initial Trustee.

3.03 Bond

No bond or other security shall be required of any Trustee unless ordered by a court of competent jurisdiction or required by HCPF.

3.04 Trustee Powers and Duties

The Trustee shall:

• (a) Establish and maintain a dedicated bank account in the name of the Trust, separate from any personal account of Settlor or Trustee.
• (b) Ensure timely deposit of all income identified on Schedule A.
• (c) Make distributions only as authorized in Article IV.
• (d) Maintain complete and accurate records of all deposits and disbursements and produce them upon request of HCPF, the county eligibility site, the Single Entry Point (SEP) agency, or a court.
• (e) Provide annual accountings to Settlor (or Settlor's authorized representative) and, upon request, to HCPF.
• (f) Notify HCPF and the county eligibility site of any change in income, Trustee, or banking institution within ten (10) days.

ARTICLE IV — DISTRIBUTIONS DURING SETTLOR'S LIFETIME

The Trustee shall, each calendar month, distribute the Trust corpus only in the following order and only as permitted by 10 CCR 2505-10, § 8.100:

4.01 Personal Needs Allowance

First, the personal needs allowance ("PNA") established by HCPF (currently set by 10 CCR 2505-10) for the Settlor's living arrangement (nursing facility, HCBS, or other).

4.02 Community Spouse Allowance

Second, if Settlor has a community spouse, the Minimum Monthly Maintenance Needs Allowance ("MMMNA") and any excess shelter allowance authorized under 42 U.S.C. § 1396r-5 and 10 CCR 2505-10, § 8.100.7.

4.03 Family Allowance

Third, any family member allowance authorized by HCPF.

4.04 Health Insurance Premiums

Fourth, Medicare premiums (Parts B and D), Medicare Supplement premiums, and any other health insurance premiums covering Settlor.

4.05 Non-Covered Medical Expenses

Fifth, medical expenses incurred by Settlor that are not subject to payment by Medicare, Medicaid, or any third party.

4.06 Patient Payment

Sixth, the Settlor's required "patient payment" to the nursing facility or HCBS provider as calculated by HCPF on Form AP-5615 or its successor.

4.07 Trust Administration Expenses

Seventh, reasonable trust administration expenses (bank fees, accounting), to the extent permitted by HCPF.

4.08 No Other Distributions

No distributions for any other purpose, person, or family member shall be made.

ARTICLE V — REMAINDER / STATE PAYBACK

5.01 State of Colorado as Remainder Beneficiary

Upon the death of Settlor, all funds remaining in the Trust shall be paid to the State of Colorado, Department of Health Care Policy & Financing (HCPF), up to the total amount of Medical Assistance benefits paid by Colorado (and any other state) on Settlor's behalf during Settlor's lifetime, in compliance with 42 U.S.C. § 1396p(d)(4)(B)(iii) and Colorado estate recovery rules at C.R.S. § 25.5-4-302 and 10 CCR 2505-10, § 8.061.

5.02 Multiple-State Reimbursement

If Settlor received Medicaid benefits from more than one state, the remaining Trust funds shall be distributed among the participating states pro rata based on each state's proportionate share of total benefits paid.

5.03 Notice to HCPF Estate Recovery

Within thirty (30) days of Settlor's death, the Trustee shall notify HCPF Estate Recovery in writing, provide a final accounting, and tender any payback due. Estate Recovery contact: HCPF Estate Recovery Unit, Denver, Colorado.

5.04 Residual Beneficiaries

Only after HCPF (and any other state Medicaid agency) is reimbursed in full may any residual funds be distributed to [____________________________] (residual beneficiary, if any).

ARTICLE VI — TAX AND ACCOUNTING

6.01 Grantor Trust

The Trust is intended to be a "grantor trust" under Internal Revenue Code §§ 671–679, with all items of income, deduction, and credit taxable to Settlor.

6.02 Taxpayer Identification Number

The Trustee may use Settlor's Social Security number as the Trust's taxpayer identification number to the extent permitted by the Internal Revenue Service.

ARTICLE VII — MISCELLANEOUS

7.01 Governing Law

This Trust shall be governed by the laws of the State of Colorado, including the Colorado Uniform Trust Code (C.R.S. § 15-5-101 et seq.) and C.R.S. § 15-14-412.7, except to the extent preempted or modified by federal Medicaid law.

7.02 Conformity with Federal and State Medicaid Law

This Trust shall at all times be construed to conform with 42 U.S.C. § 1396p(d)(4)(B), 10 CCR 2505-10, § 8.100, and any successor or amended provisions. Any provision of this Trust that conflicts with such law is void to the extent of the conflict, and the remainder of the Trust shall continue in full force.

7.03 Spendthrift

To the maximum extent permitted by law, the interest of Settlor and any other beneficiary in this Trust shall not be voluntarily or involuntarily assigned, alienated, or pledged.

7.04 Severability

If any provision of this Trust is held invalid, the remaining provisions shall continue in full force and effect.

SIGNATURES

SETTLOR:

By: _________________________________ Date: [__/__/____]
[____________________________], Settlor

By: _________________________________ Date: [__/__/____]
[____________________________], [Spouse / Agent under POA / Guardian / Conservator] on behalf of Settlor

INITIAL TRUSTEE:

By: _________________________________ Date: [__/__/____]
[____________________________], Initial Trustee

Trustee Mailing Address: [____________________________]
Trustee Email (if any): [____________________________]

NOTARIZATION (Recommended; not strictly required for validity under HCPF guidance, but strongly preferred)

STATE OF COLORADO
COUNTY OF [____________________________]

On this [____] day of [____________], 20[____], before me, the undersigned notary public, personally appeared [____________________________] (Settlor) and [____________________________] (Initial Trustee), who proved to me through satisfactory evidence of identification to be the persons whose names are signed on the preceding document, and who acknowledged to me that they signed it voluntarily for its stated purpose.

_________________________________
Notary Public, State of Colorado
My commission expires: [__/__/____]

Notary Seal:

SCHEDULE A — INCOME SOURCES TO BE DEPOSITED

Total Monthly Income to Trust: $[____________]

APPOINTMENT OF SUCCESSOR TRUSTEE (Required if Settlor is named Initial Trustee; otherwise optional)

I, [____________________________], Settlor, hereby appoint [____________________________] as Successor Trustee, to serve upon my death, resignation, incapacity, or removal as Initial Trustee.

Settlor signature: _________________________________ Date: [__/__/____]

Acknowledgment by Successor Trustee (optional but recommended):

_________________________________ Date: [__/__/____]
[____________________________], Successor Trustee

SOURCES AND REFERENCES

• 42 U.S.C. § 1396p(d)(4)(B) — Qualified Income Trust (Miller Trust) authority
• 42 U.S.C. § 1396p(b) — Medicaid estate recovery
• 42 U.S.C. § 1396r-5 — Spousal impoverishment / MMMNA
• C.R.S. § 15-14-412.7 — Colorado income trusts for Medicaid eligibility
• C.R.S. § 25.5-4-302 — Colorado Medicaid estate recovery
• C.R.S. § 25.5-6-101 et seq. — Colorado Medical Assistance Act (long-term care)
• 10 CCR 2505-10, § 8.100 — Medical Assistance Eligibility (HCPF)
• 10 CCR 2505-10, § 8.100.7.E.6 — Income trust / QIT requirements
• 10 CCR 2505-10, § 8.061 — Estate Recovery rules
• HCPF "Irrevocable Income Trust Agreement Form" — preferred form published by the Colorado Department of Health Care Policy & Financing
• Colorado Single Entry Point (SEP) agency network — long-term care eligibility intake