What is an SNT?

What is a Special Needs Trust? Public benefits provide a safety net to people who are unable to provide for their own care and maintenance due to circumstances beyond their control, such as catastrophic accidents or illnesses. No one wants to be on public benefits. Most of the people who do depend on public benefit programs do so because they require long-term care and medical expenses. However, public benefits provide limited programs. Government funding is not limitless. These programs’ limits create a need to maximize recipients’ private funds while maintaining access to public benefits in order to improve the quality of life of disabled persons or their dependents.

Special Needs Trusts, aka Supplemental Needs Trusts, can be used when a person knows that he or she will become unable to continue the care and support of a dependant. The individual may be a parent of a disabled adult or child who is dependent upon the parent for financial support or care. Or, the person may be concerned that a spouse will be left destitute when that individual is no longer able to work and provide for the spouse. A Special Needs Trust enables qualification for public benefits while preserving assets for the use and benefit of others, such as spouses and disabled dependants.

Who needs a Special Needs Trust? People who have been injured or diagnosed with a chronic debilitating disease worry they will become dependent upon public benefits in order to live. A Special Needs Trust may preserve assets for use to improve the quality of their lives.

At times, disabled individuals sue defendants to recover damages for illness or injury, and their litigation attorneys seek to maintain the proceeds from personal injury suits in the face of staggering medical care costs. In these cases, medical expenses incurred by a plaintiff in a tort suit may force the disabled person to exhaust all personal resources and cause the person to seek public benefits such as Medicaid to help pay for necessary treatment. During the pendency of the litigation all costs of treatment will be covered by the Medicaid program. However, upon the receipt of the settlement/award, the client will lose Medicaid eligibility, and proceeds from the settlement may consumed by huge medical expenses.

In the scenarios above, the ultimate goal of the special needs trust planning is to lawfully secure ‘extras’ while maintaining Medicaid eligibility directly or by qualifying for Supplemental Security Income benefits.

Why is SSI important? SSI is a key to the more important benefits of the Medicaid program. Texas is one of 31 states known as "1634" states. This is the section of the Social Security Act that authorizes Texas to provide Medicaid eligibility to any recipient of SSI benefits. 42 U.S.C. sec. 1383c. A disabled person qualifying for SSI is said to be a “categorically needy” person and as such automatically qualifies for Medicaid benefits in the community. The determination of eligibility for SSI is made by the Social Security Administration and upon receiving eligibility for SSI the applicant is likewise eligible for Medicaid.

Who can help? For more information on Special Needs Trusts attorneys, consult: the National Academy of Elder Law Attorneys at http://www.naela.org/ and the Academy of Special Needs Planners at http://www.specialneedsplanners.com/aboutus.asp