MassHealth has proposed massive changes to its regulations governing who will qualify for long-term care benefits, both in the community (at home) and in nursing home settings. These changes are likely to adversely affect many Massachusetts seniors and their caregivers. One particular change that could affect many of our clients is a proposal to limit transfers to a pooled disability trust (also known as a (d)(4)(C) trust).
Federal and Massachusetts laws permit individuals with disabilities to transfer assets into a pooled trust account, to be used solely for the benefit of the individual receiving Supplemental Security Income (SSI) and/or MassHealth/Medicaid benefits. The funds in the pooled trust accounts are not counted toward the usual asset limits when determining program eligibility. An applicant for MassHealth who owns more than the allowed $2,000 in countable assets could transfer any funds above the $2,000 into a pooled trust account thus qualifying for the benefit. However, when a person places funds into a pooled trust, the pooled trust account agreement must include what are called payback provisions. This means that if any funds remain in the account at the beneficiary’s death, the remaining funds must first be used to reimburse the state for MassHealth expenditures made on the beneficiary’s behalf.
What is a Pooled Trust?
A pooled trust is managed by a non-profit organization for any number of beneficiaries. Prior to the enactment of these new regulations, disabled individuals could put money into a pooled trust account at any age without incurring any transfer penalty. A transfer penalty is a period of time when MassaHealth will not pay for a person’s long-term care costs (at home or in a nursing home) because the person transferred or gifted something in a manner not allowed under the regulations. However, under the proposed regulations, beginning as early as January 1, 2018, MassHealth will impose a transfer penalty on any transfers of funds into a (d)(4)(C )/Pooled Trust for the benefit of anyone age 65 or older. This significant change bars most seniors from transferring money into a (d)(4)( C) Trust in order to reduce assets and thereby qualify for long-term MassHealth services. This will particularly impact seniors, who own a home and need long-term care services.
What does this mean to you? Are you or a loved one considering entering into a long-term care facility or applying for Community MassHealth in the not-too-distant future? You may want to consider creating a (d)(4)(C) trust immediately. January 1, 2018 is only 5 short days away.
Benefits of a Pooled Trust
How can a pooled trust benefit you or your loved one? What types of expenses can be paid from a pooled trust?
- Payments for extra services for nursing home residents, whether they are health aides, special medical care or equipment, or entertainment;
- Payments for geriatric care management services to make sure that the resident gets appropriate and necessary care;
- Payments to maintain or repair the MassHealth recipient’s home such as snow shoveling, grass cutting, insurance, taxes, roof repairs, etc. Remember when a senior is receiving MassHealth benefits (at home or in the nursing home), the person may only have up to $2,000 in assets outside of the pooled trust. This is often not enough money to fund expenses related to home ownership;
- Payments for additional home care, helping to keep beneficiaries at home rather than having to move to a nursing home. The amount of services paid for home care by MassHealth is often not enough. The $2,000 MassHealth asset limit, often does not leave the recipient enough savings from which to pay for additional care. A pooled trust account can hold additional savings. These funds can be used to supplement the care paid for by MassHealth, hopefully enabling the person to live at home for longer
Does this sound like your loved one’s circumstance? Call our office immediately to see how we can help. Know someone in your life who will be adversely affected by regulation changes? Please call your state legislators today and tell them to allow seniors over 65 to be able to transfer assets to a (D)(4)(C) Trust (Pooled Trust).
This article was inspired by Margolis & Bloom article entitled MassHealth Seeking to Limit Use of Pooled Trusts.