Preserving Public Benefits through Special Needs Trusts
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Transcript of Preserving Public Benefits through Special Needs Trusts
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September 23, 2011MOPRA Conference
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MSNT backgroundSpecial Needs TrustsProtecting BenefitsOpening and using a SNTMSNT ServicesQuestions & Discussion
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Financial planning and estate tool Trust account for an individual with a disability
Administered by trustee/co-trustees Protects eligibility for SSI, Medicaid & other public benefits
Trust funds can be used for supplemental needs, NOT basic support needs
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First Party or Self-Settled◦ Typical sources of funds
Back payment from Social Security Inheritance Personal Injury Settlement
◦ Medicaid payback required
Third Party◦ Family donors◦ Typically revocable until donor’s death◦ Does not require Medicaid payback
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Trust language protects benefits◦ Used only to supplement benefits◦ No distributions that negatively affect benefits
Trust “exception” allowed by Medicaid and SSI regulations
Missouri Statute exempts resource for DMH services
Funds Can Be Used for Wide Range of Living and Health Needs
No Upper Limit on Amount in Trust
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Exception for Counting Trust Resources for Persons with Disabilities
◦ Federal Medicaid Regulations Title 42 US Code Section 1396p(d)(4)(A) Title 42 US Code Section 1396p(d)(4)(C)
◦ SSI Section 1917(d)(4)(A) of the Social Security Act Section 1917(d)(4)(C) of the Social Security Act www.ssa.gov
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Trust Established with Beneficiary’s Resources (SI 01120.203)◦ MSNT qualifies as Pooled Trust Exception [(d)(4)(C)]
No age restriction Must be established and administered by a non-profit
organization Must be for the sole benefit of individual with a disability May be established by the disabled individual, a parent,
grandparent, legal guardian, or a court State pay-back clause required
◦ If revocable, further criteria apply
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All Necessary Documents Available at http://midwestspecialneedstrust.org/trustDocs/default.htm
◦ Master Trust Agreement◦ Beneficiary Background Information Form◦ Waiver of Right to Revoke (for third party only)◦ Enrollment Fee on Sliding Scale up to $500◦ Minimum Trust Deposit of $500◦ Add additional funds at any time
MSNT advises attorney consultation but does not require it
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Attorneys Specializing in Special Needs & Estate Planning◦ National Association of Elder Law Attorneys
http://www.naela.org/public/ and click on pink box at right that says Find a Special Needs or Elder Law Attorney
◦ Special Needs Alliance, LLC http://www.specialneedsalliance.com/locate-an-
attorney
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Distribution request form signed by co-trustee with appropriate documentation
MSNT reviews each request ◦ Must conform decision-making to fiduciary duties◦ Must assure will not have negative effect on
benefits Processed daily
◦ Authorize bank to prepare check available on next business day
― Checks are sent by MSNT to vendor or to co-trustee―$5 check fee
Periodic distributions can be arranged with appropriate justification
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Medical and dental care not covered by Medicaid or health insurance
Private rehabilitative training Durable medical & rehabilitation equipment Supplementary education Entertainment
◦ Concerts◦ Periodic vacations and outings
Transportation of beneficiary or family & friends to visit beneficiary
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Pre-paid burial expenses Expenditures to foster interests, talents,
hobbies Personal property, goods and services
◦ Furnishings, telephone/cable, etc. Personal caregiver or respite
◦ In-home support◦ To accompany beneficiary or provide
transportation Attorney fees to create trust or other legal
matters
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MSNT will not accept or hold a home in trust Large purchases require board approval
◦ Takes time◦ Scrutiny◦ Example: Car
Documentation and Security agreement Check from MSNT to vendor
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Fee Type Amount
Enrollment Fee $500
Annual Asset Value Fee(includes bank admin fees)
2.04% for AV ≤$9,999 plus 1.54% for AV ≥ $10,000
Check Processing Fee $5 per check
Annual Trustee Fee (only when MSNT is sole trustee)
$350
Extraordinary Services Fee $50 per hour, plus mileage, if applicable
Account Closure Fee $100
Charitable Trust Provision at death of life beneficiary
None if trust never used 25% of remainder balance if distributions were
made
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Provide consultation on use of trust funds Staff and board knowledgeable about SSI,
Medicaid and services to PWD Smaller amount accepted to open a trust Reasonable administrative fees Investments managed at no additional
charge Minimizes co-trustee burden
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Created by Missouri Statute in 1989 as Missouri Family Trust with 2011updates to authorizing statutes
Values-driven board appointed by Governor
Not for profit 501 c 3 Administer trusts for >900 individuals with
disabilities in Missouri & surrounding states
Average trust at opening is about $30,000
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Missourians with disabilities with no trust may apply
Grants up to $1000◦ Urgent care◦ Board review
Limitations◦ One award per year◦ Cannot be for medical or dental already completed◦ Must provide a treatment plan with estimated costs from
the intended provider◦ Award must be used within 90 days◦ Payment made directly to the vendor, not the recipient
Application online or by request◦ Contact information on next slide◦ Sponsor or self submission◦ Timelines for submission
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Midwest Special Needs Trust1500 Vandiver Drive, Suite 100Columbia, MO 65202
Phone: 573-882-3388Fax: 573-303-5866Email:
[email protected] Web: www.midwestspecialneedstrust.org
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