The Social Security Administration (SSA) has issued new policy interpretations in 2014 that affect Special Needs Trusts (trusts created for a disabled person in which the assets held in the trusts are not counted as a resource which would have otherwise resulted in the loss of various Medicaid programs coverage).

Some of the new policy interpretations are as follows:

  • Payments to Family Members as Caregivers.  The SSA has determined a Special Needs Trust (SNT) can only pay for family members for caregivers services to a beneficiary if the caregiver is “medically trained” – which means educated to the same level as what would be required if a third party was hired.  There are some 40 hour Medicaid certified courses for certain levels of care that would constitute the family member being properly educated.
  •  Payment to Family Members for Travel to Visit Beneficiary.  In 2012, SSA amended their regulations to prohibit a trust from paying for travel of family members (not skilled health care professionals) to visit the beneficiary since it is not for the sole benefit of the beneficiary.  As of 1/1/14, this example was deleted so it is questionable whether a family member could be reimbursed travel expenses.
  • Payment to Family Members to Accompany Beneficiary on Vacation.  Similar to the logic in the preceding paragraph, payment to a family member to accompany beneficiary on vacation is a potential violation of the sole benefit rule.  However, a skilled health care professional could have his or her travel paid by the trust when the beneficiary requires such care.
  •  UTMA Accounts.  If a minor’s funds are placed in a Uniform Transfers to Minors Act account, then SSA will treat this as if it was self-settled and the resources would count since the UTMA doesn’t have a payback provision as is required by first party SNT.  However, if it is funded with someone else’s assets, then it will not be treated as a resource or asset of the beneficiary (and no payback provision is required).


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