1. SPECIAL NEEDS TRUSTS UPDATE
AND OTHER BENEFIT ISSUES

2. Post-resolution Topics
Government benefits
Subrogation
Structures
Allocation among claims
Probate approval
468b Settlement Funds

3. ADDRESS THESE ISSUES EARLY
Avoid overwhelming your clients at the time of settlement
The client needs time to consider the advantages and disadvantages of their options
Optimize position of clients for settlement
After an injury, clients need help with numerous issues, including health insurance, available benefits to help pay the bills and provide needed services
You need to know your client’s thoughts about importance of maintaining benefit eligibility versus retaining control over the funds
They need to understand the structured settlement as an option
You may be able to get benefits in place prior to settlement that maximizes the value of the settlement to the client

4. CASE EXAMPLE 32 year old quadriplegia from MVA
Married, 2 kids, wife is pregnant
Advice sought as soon as case filed
Case settled for $7 million
Without lead time, all would have to go into a special needs trust to maintain Medicaid eligibility
With lead time, we were able to get the client qualified for Medicaid quickly by setting up a special needs trust immediately and transferring existing assets into trust.
We got the client on the Medicaid waiver program, so any allocation to his wife for her loss of consortium claim did not affect his eligibility
We allocated a larger amount than we might otherwise have to the consortium claim, and the wife agreed to pace the funds in an irrevocable trust which provided that if she divorced or left the client, she would be entitled to a fixed sum with the remainder to stay in the trust for the benefit of client and the children.

5. PROTECT YOURSELF! Ensure that the client is advised about
Protecting his benefit eligibility
Ability to structure the settlement
Document in your file and have the client sign acknowledgement

6. WHAT BENEFITS ARE THE CLIENT (AND FAMILY MEMBERS) RECEIVING?
SSI/SSD/SS
Medicaid/Medicare/Private insurance/BCMH
TANF/Food stamps
HUD subsidized housing
VERIFY!

7. IMPORTANCE OF VERIFYING BENEFITS
For preservation of benefits
For subrogation issues
Remember that an individual who is eligible for and receiving Social Security Disability Insurance (SSDI) will be Medicare-eligible within 24 months and Medicare may have a claim for reimbursement if the case has not settled prior to that date.

8. PRESERVATION OF BENEFITS

9. BENEFITS NOT BASED ON FINANCIAL NEED
Social Security Disability Income (SSDI, CDB, DAC)
Medicare
Social Security (retirement)
These are not need-based benefits
Receipt of a settlement will not affect these benefits
There is information in the handout which addresses eligibility for SSDI, CDB and DAC
SSDI is available 5 months after the person is disabled.
Children disabled prior to age 22 get DAC or CDB benefits when a parent retires, dies or becomes disabled
Medicare kicks in 24 months after SSDI begins. This is why COBRA benefits have an extension period for persons who are disabled – ensure that your client files the necessary notices to get this extension if they want/need the COBRA benefits until Medicare is available
Shorter waiting period end stage renal disease, one month for Amyotropic Lateral Sclerosis (Lou Gehrig’s disease)

10. NEED-BASED BENEFITS Supplemental Security Income (SSI) Medicaid BCMH
Section 8 or other subsidized housing
TANF/Food stamps
Utility assistance

11. SUPPLEMENTAL SECURITY INCOME
Income stream for disabled person to provide food and shelter
Countable resources < $2,000
Income levels
Deeming

12. MEDICAID Federal/state program
Administered by county Job and Family Services offices
Countable resources < $1,500
Provides health coverage to those otherwise uninsurable
Waiver programs provide home health care

13. EXCLUDED RESOURCES: Home if legal ownership interest One vehicle
Burial plot
Irrevocable prepaid burial plan
Household goods and personal effects

14. DEEMING OF INCOME AND RESOURCES
Parents to child under age 18
Spouse to spouse
No deeming for waiver or institutional Medicaid
Important to understand. If we do a special needs trust for a child or spouse and allocate funds to other family members for consortium or loss of services claims, the disabled individual can lose benefits because of the funds received by the other family members
Often one child is disabled but all the other family members are on Healthy Family Medicaid

15. VALUE OF BENEFITS SSI - $603/month Medicaid
medical/hospital care
prescriptions
basic dental/vision
residential/institutional
HCBS Waiver- up to $14,400 per month

16. WHEN TO CONSIDER THE SNT:
Person w/ disability is receiving assets such as a personal injury settlement
Person with assets becomes severely disabled
Not appropriate for welfare-based Medicaid benefits

17. SPECIAL NEEDS TRUST Established by
parent
grandparent
guardian
court
For beneficiary - disabled, under 65
Payback provision

18. POOLED TRUST LIKE SNT EXCEPT: can be established by disabled person
can be over 65
managed by non-profit association
assets pooled for investment
individual accounts maintained
no payback if assets remain in the trust

19. POOLED TRUST $5000 minimum Use when: No parents, grandparents or court
Small settlement
No family member to serve as trustee

20. POOLED TRUSTS IN OHIO CFMF/Fifth Third Bank
Ohio Community Pooled Trust
Ohio Pooled Trust

21. ALTERNATIVES TO SNT Over 65 can’t use SNT Pooled trust (for now)
Allocation to other claims
Structured settlements
Traditional Medicaid planning techniques
Transfers
Purchase of exempt assets

22. MEDICARE AND MEDICAID SUBROGATION ISSUES

23. GENERALLY Verify benefits
Notify early to be aware of subrogation amount
Medicare usually will not start for 29 months after the injury
Ensure expenses are result of the injury in question

24. MEDICAID Information form and release www.ohiotort.com
Notify and involve in mediation or hearing to approve settlement
Lien cannot be totally rolled over into a special needs trust
No provision for procurement costs

25. MEDICAID Negotiation with estate recovery office yields best results
Bob Byrne
(614)

26. MEDICARE MSP for Oho – Administar Federal
Reduction for pro rata share of procurement costs
Repayment within 60 days of receipt of settlement
Waiver/compromise

27. STRUCTURED SETTLEMENTS

28. COMMON PROBLEMS WITH STRUCTURES
Too little cash up front
Immediate needs
Corporate fiduciary
Estate taxes
No attention to benefits received by others in household
Special Needs Trust issues

29. PROBATE APPROVAL Minor Incompetent Fees Special Needs Trust
If an attorney fee in a malpractice action exceeds the limits on damages for non-economic loss set forth in statute
medical, dental, optometric, chiropractic
Must make application to Probate court of county in which civil action brought or settlement entered