March 9, 2012 in General
As the baby boomer population ages, we find ourselves with an increase percentage of clients who have smaller awards and or are over the age of sixty-five so a traditional Individual Special Needs Trust cannot be used. Especially those who are seriously injured and require continued eligibility for Medi-Cal and Supplemental Security Income (SSI). As experts in protecting the injured you already use the following primary indicators to determine then your client will need a Special Needs Trust:
- Client qualifies or receives Medi-Cal and/or Supplemental Security Income (SSI)
- Client has a dependent that has or is qualified for Medi-Cal and/or SSI
- Client is permanently unable to work and meets Social Security Administration definition of disabled
So what do you do when settling a case for an individual over the age of sixty-four. As you know Federal law permits Special Needs Trust to hold assets of a person while preserving your clients needs-based public benefits as identified in 42 USC §1396p (d)(4)(A) & (d)(4)(C). There are two First-Party Special Needs Trusts options available to your client. An Individual Special Needs Trust or a Pooled Special Needs Trust. The diagram below will help you differentiate the two First-Party trusts available. This article will focus on how you can utilize the First-Party Pooled Special Needs Trusts to serve the baby boomer generation.
Pooled Trusts use a state approved master Special Needs Trust administered by a non-profit rather than an individual or a bank. Fortunately in California Medi-Cal allows the transfer of settlement funds into a Pooled Trust or (d)(4)(C) trust for individuals of any age.
Charities Pooled Trust (CPT) of California offers comprehensive prompt support to consumer attorneys. They use a one-page trust application that can be submitted online. Trust documents are provided within three business days. They do not have minimum funding requirement. CPT also has a probate compliant master trust so they can accept cases that are court supervised. In addition, CPT will hold Medicare Set-asides funds so they will remain uncountable to Medi-Cal & SSI. The MSA funds are still professionally administered by your MSA vendor
Now you have a way to process cases of any size for clients of any age while still protecting Medi-Cal & SSI eligibility.