Theresa M. Varnet, Esq. FLETCHER TILTON PC 370 Main Street, 12 th Floor Worcester, MA SPAIN, SPAIN & VARNET PC 33 N. Dearborn Street, Suite 2220 Chicago, IL Academy of Special Needs Planners Conference March 27 - March 29, 2014 UPDATE ON SSI POMS CHANGES AND FORMATION OF NEW ADVOCACY COMMITTEE

POMS SI – SI Trusts Established after 1/1/2000 Applicable to trusts “established with the assets of the individual” after 1/1/2000; “Exceptions” contained in SI must be met; Basic special needs trusts requirements :  Assets of the beneficiary;  Under age 65 years;  Meets federal definition of disability;  Trust established by parent, grandparent, guardian or a Court for the sole benefit of the beneficiary; and  Contains payback requirement to Medicaid.

POMS SI – SI Trusts Established after 1/1/2000 General rules for pooled trusts:  Established and maintained by a nonprofit association;  Separate accounts are maintained for each beneficiary, but assets are pooled for investing and management purposes;  Accounts are established solely for the benefit of the disabled individuals;  The account in the trust is established through the actions of the individual, a parent, grandparent, legal guardian, or a court;  The trust provides payback to Medicaid.

POMS SI – SI Trusts Established after 1/1/2000 Early termination issue; Requirement of seed money; Clarification on the use of credit cards and gift certificates; Purchase of exempt assets by the trust; Judicial actions required to establish an exempt trust; Court authorization to guardian for transfer of assets to trust created by guardian.

Advocacy Efforts and Results SSA seeks input from a broad spectrum of advocates including members of the Arc, ASNP, the Consortium of Citizens with Disabilities, NAELA, SNA, and representatives of pooled income SNTs; Identification of issues to be discussed:  Travel expenses;  3 rd party reimbursement;  Family members as care providers;  Payment of legal obligations of beneficiary from SNTs;  Sole benefit standard;  Reasonable time to amend trusts when rules change;  Consistency of adjudication and policy interpretation across regions;  Education of SSA field staff.

Advocacy Efforts and Results Positive results:  Trustees may now reimburse 3 rd parties for payments made to purchase goods and services for the beneficiary without the reimbursement being counted as income to the beneficiary;  Trustees can now pay family members who act as care providers so long as treated as employee of trust or independent contractor and need for such services are documented.

Advocacy Efforts and Results POMS SI F.2.b, changed on May 16, 2013 to read:  “Consider the following disbursements or distributions to be for the sole benefit of the trust beneficiary:  Payments to a third party that result in the receipt of goods or services by the trust beneficiary;  Payment of third party travel expenses which are necessary in order for the trust beneficiary to obtain medical treatment;  Payment of third party travel expenses to visit a trust beneficiary who resides in an institution, nursing home, or other long-term care facility (e.g., group homes and assisted living facilities) or other supported living arrangement in which a non-family member or entity is being paid to provide or oversee the individual’s living arrangement. The travel must be for the purpose of ensuring the safety and/or medical well-being of the individual.”

Advocacy Efforts and Results New 90 day window enacted allowing for amendment of trusts which were previously found to be exempt from resource counting in order to comply with new third party travel expense provisions; Reasonable compensation to non-family member Trustees do not violate sole benefit rule; Compensation to family member Trustees will receive review on an individual basis.

Moving Forward Senior SSA officials and advocates will continue to meet; SSA staff training – in March 2014; Trust review to be handled by “trust experts”.

Implications for Practitioners Include powers to amend trusts to quickly respond to changes in policy interpretations; Shorten “laundry list” of examples of what trust can/can’t pay for; Advise all clients that the law in this area changes and provide no guarantee that trust will work if the law does change; Advise all clients that they should regularly have their trusts reviewed; Non-professional Trustees should meet at least annually with special needs attorney to review trust administration and any changes in the law.

Smaller Committee to Work on Issues Concerning Establishment of d4A SNTs by court Payment of legal obligations Expanding allowed travel