SR 01-33 Dated 12/01
Also known as Trusts for Disabled Individuals, there are two separate types of these trusts: those established by a parent, grandparent, guardian, or court, and those established and managed by a non-profit organization. They are not counted as a resource when they meet the conditions noted below.
1. A trust containing the assets of an individual under age 65 who has been determined disabled by DHHS or the Social Security Administration (SSA) is not counted in determining eligibility for medical assistance if:
• a parent, grandparent, legal guardian of the individual, or a court established the trust for the benefit of the individual; and
• the trust contains a provision that upon the individual’s death, DHHS will receive all amounts remaining in the trust, up to an amount equal to the total amount of medical assistance paid on behalf of the individual.
After the individual turns 65, the trust is still not counted as a resource. However, any addition or augmentation of the trust after that date is treated as a transfer of assets for less than fair market value.
2. A trust containing the assets of an individual of any age who has been determined disabled by DHHS or SSA and which meets all of the following conditions is not counted in determining eligibility for medical assistance:
• the trust is established and managed by a non-profit organization;
• a separate account is maintained for each beneficiary of the trust, even though the trust pools the funds in these accounts;
• accounts in the trust are established by the individual, parent, grandparent, legal guardian of the individual, or by a court solely for the benefit of individuals who are disabled; and
• to the extent that any amount remaining in the beneficiary’s account upon the death of the beneficiary are not retained by the trust, any remaining funds in the account are paid to DHHS up to the amount remaining in the fund or equal to the total amount of medical assistance paid on behalf of the beneficiary.
Treatment: Excluded resource if the above conditions are met. If the trust does not meet the conditions above, see Trusts Using the Assets of the Individual or Spouse or Trusts Using the Assets of Other Parties, whichever is appropriate.