There are income limits associated with Medicaid home care. An individual who’s applying for Medicaid home care is only allowed to make a certain amount of income each month. This includes their social security, pension, IRA distribution and any other source of income they may have.
If they have income in excess of the allowable amount they must spend down the excess income every month. They can either spend it on their care and Medicaid will pick up the difference or they can create a pooled income trust which is a special needs trust that’s established and managed by charitable organizations.
Each month the excess income would go into this pool trust and the Medicaid recipient would still have access to it to pay for all of their monthly expenses.