Medicaid’s Hand (Continued from page 44)
disabled beneficiaries is well established. Where the plaintiff (or other individual) is permanently disabled, he or she can use eith er an individual special needs payback trust, if under age 65, under 42 U.S.C. § 1396p (d)(4)(A), or a pooled special needs trust, under 42 U.S.C. § 1396p(d)(4)(c),7
such as the Wesley
Vinner Memorial Trust (http://www. dcsafe
horizons.org/), the only one now operat ing in Maryland and D.C. With a few limited (thought some potentially significant) exceptions, there are virtu- ally no limits imposed by Maryland or D.C. Medicaid on what the funds can be
7
Funds in a pooled special needs trust ac- count are exempt, for SSI and Medicaid eligibility purposes, although funding such a trust may not be for individuals aged 65 and older, and so may result in a period of ineligibility of five years or more for SSI or Medicaid long term care.
spent on, as opposed to the trustee’s in- dependent fiduciary concern to preserve funds if possible for the beneficiary’s lifetime. There are only two significant impacts: First, distributions directly to the beneficiary are income for SSI and Medicaid purposes and will result in dollar for dollar reductions in benefits. Second, payment by a trustee for food or shelter constitutes income to the SSI beneficiary which results in a reduction of his or her SSI benefit by one-third of the Federal benefit rate ($637 per month in 2007, so that the reduction is $213). The trustee can pay any liability of a beneficiary, e.g., credit card payments; at worst, as noted, payments are treated as food or shelter. But the SNT presents unique recovery
issues of its own. Both individual and pooled income
special needs trust require that Medicaid programs be reimbursed for whatever they have paid for an individual’s care, following the trust beneficiary’s death, to the extent of trust assets, before any
20 years. 150 experts. 30,000 cases.
Sports and Recreation
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• Playground and recreation equipment: defects, age
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maintenance procedures 8 Engineers, Architects, Scientists & Fire Investigators 800-813-6736
www.robsonforensic.com 46 Trial Reporter
The other differences are administrative, e.g., an individual SNT must be created by a parent, grandparent, or court, while a competent but disabled individual can establish his or her own pooled income trust account.
Fall 2008
heir, legatee or remainderman can get any distribution. Unlike with estate claims, there is no scope or time limits on services which can be the subject of repayment; nor is there any causal con- nection between the injury, if any, giving rise to the disability and the services that may be recovered for, as with subroga- tion liens. The difference between the pooled income trust and the individual trust, so far as recovery is concerned,8
is
that no payback is required to the extent the trust retains funds. Where payback is required, some
attorneys are developing strategies for minimizing the amount exposed to payback; these are drawn from estate tax strategies such as family limited partnerships and the like where the cash available at the time payback is required is significantly reduced, permitting the FLP managing partner to negotiate any repayment on potentially quite favor- able terms.
Effective Responses To Anticipated Claims
Each State Medicaid program has an
office for pursing subrogation and estate recovery claims. It is that office that will file the claim, where appropriate, and it is that office that will generate the detailed list of services and costs upon which the claim is based. The three kinds of Medicaid claims – subrogation, estate recovery and special needs trust remain- ders – have similarities and differences. All of course require that the services actually be provided to the client/dece- dent, but subrogation requires a causal relationship between the tort and the incurred medical expense, while estate recovery and SNT remainder claims do not. There is relief from estate recovery obligations if there is a surviving spouse or young or disabled child, or the ser-
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