y into a revocable or irrevocable trust within the lookback period. If the property is returned to the applicant, no penalty will be imposed.Transfer penalties imposed upon an applicant’s eligibility can be devastating to not just the applicant but to the skilled nursing facility providing the care to the applicant. With time and effort, it is possible to demonstrate to the Medicaid agency that a penalty is unwarranted. The whole process, unfortunately, is very burdensome and regularly falls to the nursing facility staff or their hired consultants because of the diminished cognitive function of their elderly residents. If you are well-versed in the arguments discussed above, you can successfully reduce or eliminate transfer penalties imposed upon residents at your skilled nursing facility.1 Kaiser Family Foundation: A Look at Nursing Facility Characteristics Between 2015 and 2024, https://www.kff.org/medicaid/issue-brief/a-look-at-nursing-facility-characteristics.2 42 U.S.C. § 1396p.3 42 U.S.C. § 1396p(a)(2)(A).4 42 U.S.C. § 1396p(a)(2)(B).5 42 U.S.C. § 1396p(a)(2)(C).6 42 U.S.C. § 1396p(c)(2)(A)(iv).7 42 U.S.C. § 1396p(c)(2)(C).

One of the more relevant aspects of the law to estate and special needs planning is found in Section 5007 of the Act, which is called “Fairness in Medicaid Supplemental Needs Trusts.” The purpose of this section is to amend 42 U.S.C. Section 1396p d(4)(a) to add the words “the individual” to the list of persons who may establish a first party or self-settled special needs trust (SNT) for a disabled individual. In 1993 Congress enacted the Omnibus Budget Reconciliation Act of 1993 (commonly referred to as OBRA 93).

First-party special needs trusts enable disabled individuals to set aside their funds to pay for supplemental care while enabling those individuals to remain eligible for government benefits. See 42 U.S.C. § 1396p(d)(4)(A). Following suit, the New Jersey Supreme Court has long recognized special needs trusts as effective asset protection tools which can be used “to plan for the future of a disabled minor or adult . . .” SeeSaccone v. Board of Trustees of Police and Firemen’s Retirement System, 219 N.J. 369, 383 (2014).

While ABLE accounts are a new tool in an experienced Special Needs Planner’s arsenal, they are not anticipated to replace or significantly change traditional planning for individuals with special needs loved ones given their funding limits and the “payback” associated with their use. Similar to a first-party funded Special Needs Trusts under 42 U.S.C.§ 1396p(d)(4)(A), State Medicaid Agencies are “creditors” of ABLE accounts upon termination up to the extent of certain MA benefits paid. Such payback can be avoided by gifting into third-party funded common-law Supplemental Needs Trusts under Pennsylvania law.

ick (R-Marietta) and the Children and Families Committee met on Tuesday, taking up only one bill:HB 499,authored by Representative Bill Hitchens (R-Rincon), amends Article 1 of Chapter 6 of Title 19 regarding alimony and child support to authorize support and insurance policies for dependent adult children. It establishes a legal proceeding to bring an action to establish support for a dependent adult child, who may bring the action, and a time frame during which such proceedings may be brought. The court is allowed, in its discretion, to direct either or both parents to provide financial assistance in the form of support to a dependent adult child. Support ordered after a dependent adult child reaches 18 years of age is required to be paid only to the dependent adult child or his or her appointed guardian advocate, guardian, or agent under a durable power of attorney; provided, however, that the court in its discretion, may irrevocably assign the support to a special needs trust (per 42 U.S.C. 1396p(d)(4)(A) or 1396p(d)(4)(C) for the benefit of the dependent adult child by the dependent adult child, his or her agent under a durable power of attorney, the court, a parent or grandparent, a guardian, or a guardian advocate who has been delegated those rights in order to maintain the dependent adult child’s means-based government benefits. It is not to be paid to the family support registry. Representative Hitchens indicated that the reason for this bill was personal to him due to a friend’s situation with a disabled adult child. The legislation cleared the committee in the form of a new substitute, LC 57 0117S, receiving a DO PASS recommendation.House Ways and Means CommitteeChairman Shaw Blackmon (R-Bonaire) called the House Committee to order Tuesday to discuss the following:HB 1375, authored by Representative Yasmin Neal (D-Jonesboro), amends Code Section 48-8-3 regarding capital outlay funds. The measure seeks to add construction material for education projects to the list of state sales

Paragraph 1.2 of the trust agreement described that the purpose of the trust was to make assets available to “supplement the quality of life of [Talonda] while she is alive.” That paragraph also provided that the trust was intended to qualify as a trust for a disabled person for purposes of 42 USC 1396p(d)(4)(A) and therefore be exempt from Medicaid cost recovery liens.Over time, Talonda experienced a remarkable recovery from her brain injury. Her recovery was such that she was able to graduate from high school and university, obtain gainful employment, marry and handle her own financial affairs.

These transactions include:The payment, delivery, deposit, or retention of funds or property.The sale, mortgage, lease, or other transfer of property.The entry into an annuity contract, a contract for life care, a deposit contract, or a contract for training and education.The establishment, funding, or addition to a suitable trust, including, but not limited to, a trust for the benefit of the minor or incompetent person pursuant to 42 U.S.C. § 1396p(d)(4).The establishment, funding, or administration of an ABLE account, as defined in section 529A of the Internal Revenue Code.If the Clerk of Superior Court finds that there is no reason for an ongoing guardianship and that no formal and permanent guardianship is needed to serve the best interest of the minor or incompetent person, then the clerk may approve of a single transaction or protective arrangement without the appointment of a guardian. The clerk has the discretion to appoint a temporary guardian to be discharged upon completion of the transaction arrangement, impose bonding requirements and/or mandate an additional report or account upon completion of the ordered transaction or protective arrangement.

If these requirements are satisfied, and assuming that the Medicaid applicant is otherwise eligible for Medicaid, the annuity contract cannot be treated as a countable asset and the annuity purchase cannot result in the imposition of any Medicaid penalty period. See 42 U.S.C. 1396p(c)(1)(G); Carlini v. Velez, 947 F.Supp.2d 842 (D.N.J. 2013).Similar rules apply for a qualified Medicaid-compliant annuity contract.Here is an illustration of why the Medicaid compliant annuity purchase can be a powerful strategy to retitle a couple’s assets and preserve funds for the healthy spouse to remain for years in the family home.Example.

Anyone with income in excess of the $2,199.00 will now be required to establish a Qualified Income Trust (“QIT” or “Miller Trust”). QITs are authorized by 42 U.S.C. § 1396p(d)(4)(B) and the requirements for a QIT to be valid in Ohio are set forth in Ohio Administrative Code § 5160:1-6-03.2. Pursuant to the OAC, a QIT must be valid under the laws of the state of Ohio, and meet the following requirements: 1.

On December 14, 2016, President Obama signed the Special Needs Trust Fairness Act into law amended federal law to enable disabled individuals to establish their own first-party payback Special Needs Trusts under 42 U.S.C. § 1396p(d)(4)(A). Prior to the passage of the Special Needs Fairness Act, federal law required disabled adults who were capable of handling their own affairs (and thus without legal guardians) to rely upon their parents, their grandparents or the courts to establish a first-party funded non-pooled payback Special Needs Trusts for their benefit.