SUPPLEMENTAL NEEDS TRUST

A Supplemental Needs Trust is a special kind of trust that holds assets for the benefit of someone who is receiving Medicaid benefits. It is comprised of money that is not a resource of the Medicaid recipient. It is a third-party trust, instead of a first-party trust.

Care must be taken in the establishment and management of the Supplemental Needs Trust. The distributions from the trust must be wholly discretionary and not mandatory. The Trustee must take into account all other sources of income and assets each month before deciding to pay money out of the Trust.

The payments cannot be used to pay for basic needs, such as food and shelter. Payments made for these ordinary needs are seen as a substitute for benefit payments and will affect eligibility.

The trust may be used broadly for expenses. It may pay for uncovered medical bills; medical, educational, vocational, and other professional services; special educational opportunities; or entertainment. The expenditures from the trust must made to supplement (rather than replace) other benefits.


If you or your loved one is considering a Supplemental Needs Trust, consult one of the experienced attorneys at Abendroth Russell Barnett Law Firm to assist you in the process.

 

 

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