Guardianships are a process through the court by which persons are declared incapacitated to the extent that they are unable to make their own decisions regarding medical care and placement, and an individual is appointed by the court to act in their stead. Since the court regulates the guardian, this process can become a costly affair and is a much longer undertaking than a power of attorney, especially if the appointment of a particular guardian is contested.

Conservatorships are formed whenever persons are declared unable to handle their own assets. If a guardianship is granted, a conservatorship will also typically be granted. If the person who was declared incompetent by the court has assets, the court will monitor the appointed conservator and will require annual reports regarding the use of the assets by the conservator to be filed by an attorney.  In order for a guardianship or conservatorship to be set aside, the incapacitated person must petition the court to have his or her legal rights restored and must demonstrate the previously incapacitated person is no longer in need of a guardian or conservator.

A power of attorney, on the other hand, is a legal document created by an individual of sound mind to grant certain powers to their agent. The grantor of the power of attorney tailors his or her needs within this document to deal with specific financial issues or medical decisions. Additionally, the grantor can choose whether the powers take effect upon the signing of the document or at some future date.

One of the most frequently asked questions I receive regarding guardianships is when should the guardianship process be started. The process seems to run the most smoothly whenever it is initiated three months before the child who is in need of a guardian turns eighteen. This allows time for the child’s physician or psychiatrist to complete the necessary paperwork that must be submitted to the court. The physician must be recommending that the child is in need of a guardian and unable to make the necessary daily decisions to function without a guardian. If after the evaluation, a physician or psychiatrist does not feel that a guardianship is necessary, then execution of powers of attorney may be appropriate.

Whether a guardianship is appropriate or execution of a power of attorney is possible, a family should explore both options.

Competency Level Required to Execute a Power of Attorney

When should a Power of Attorney be applied?

Powers of attorney often address two distinct areas: healthcare and financial decisions. Financial powers of attorney may either be immediately effective or come into effect if the person who signed the document is no longer able to make decisions for himself or herself. Healthcare powers of attorney only become effective whenever a physician certifies that the person who granted the power is no longer able to make healthcare decisions for himself or herself.

In order for someone to sign a power of attorney, he or she must be at least eighteen years of age and able to understand the nature of the document he or she is signing.

Durable Power of Attorney

All powers of attorney should be made durable, or to remain in effect after the incapacity of the principal, unless the purpose of the document is for the agent to act for specific limited transactions. In order to enforce a power of attorney document, in essence a contract, the principal must be competent at the time the document is signed. While there is no clear dividing line between the competency and incompetency level, cases have repeatedly stated the principal must have a sufficient mental capacity to appreciate the effects of what they are agreeing to within the contract.

Revocation of Power of Attorney

It is important to understand that powers of attorney may be revoked at any time by the person who signed the document. Therefore, if an adult child does not agree with a decision that the attorney-in-fact has made, he or she may revoke the power of attorney making the document ineffective. There are many benefits of the powers of attorney because the court is not involved in the process and the documents are relatively inexpensive to have prepared by counsel; however, they are not appropriate in all cases.

Physical Conditions

An individual possessing a debilitating physical impairment which does not adversely affect their mental competency can still validly enter into a contract. Courts have stated that the physical condition of the principal is immaterial as to whether the contract is valid. Neither age, sickness, extreme distress, nor debility of body will affect the capacity to make a contract if sufficient intelligence remains to understand the transaction.

Mental Conditions

Similar to physical impairments, mental conditions due to disease does not immediately deprive an individual of the capacity to dispose of his or her property by contract until their mental illness has progressed to the point where intelligence has been lost. In other words, a person may still be capable of contracting despite such a condition as eccentricity, or old age.

Evaluating Mental Capacity at Time of Transaction

Mental capacity must be assessed at the time of the transaction, although a party’s capacity before or after the execution of a contract is the critical period of time to be considered in the inquiry as to whether the individual has met the mental capacity requirement. Hence, a contract is binding if it is entered into in a lucid interval of a person with some form of dementia. On the other hand, a contract entered into by one who is temporarily insane may be avoided.

If a person has Alzheimer’s disease or other similar dementia, this disease does not immediately render him or her wholly incompetent, and instead, it must be demonstrated that, because of the affliction, the individual was in fact incompetent at the time of the challenged transaction.

Conclusion

For an individual to execute a power of attorney, they must possess a sufficient capacity to understand the contract they are entering into. Further, powers of attorney are at all times revocable, unlike a guardianship. Nevertheless, a power of attorney can be a great resource for some individuals who have turned 18, so that family members can act on their behalf.

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In Compton, Addison, the student, received very poor grades and scored below the first percentile on standardized tests during her ninth-grade year in 2002-2003. The school counselor promoted her to tenth-grade, despite her low performance.

During the fall semester of her tenth-grade year, in 2003, Addison failed every academic subject. Addison’s mother was reluctant to have her child tested, and the School District did not require it. Instead the School District referred Addison to a third-party counselor who recommended the School District assess Addison for learning disabilities. The School District ignored this directive and promoted Addison to the eleventh-grade.

In September 2004, Addison’s mother explicitly requested an educational assessment and Individualized Education Program (IEP) meeting from the School District. The assessment took place and Addison was found eligible for special education services on January 26, 2005, which was during the spring of her eleventh-grade year.

Addison and her mother brought the claim against the school district seeking compensation for the School District’s failure to identify her needs and provide her with a free appropriate public education.

The school district argued two issues: the first is that the IDEA’s written notice procedures limit the jurisdictional scope of the due process complaint procedure and the second is that they did not receive “clear notice” of the availability of an administrative hearing in “child find” cases. The court rejected the school district’s first argument contending that the Supreme Court has already addressed this issue. The Supreme Court has stated that a conservative reading of the IDEA would leave parents without an adequate remedy if a school district fails to identify a child with disabilities. Regarding the second issue, the court additionally struck down the school district’s argument of “clear notice” finding the IDEA clearly allows complaint “with respect to any matter relating to the identification, evaluation, or educational placement of the child.”

The court’s decision in this case provides fuel for other parents to seek compensation for a school district’s failure to identify children with disabilities in the educational system.

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Care plans share information with others who take care of your child. This may include doctors, nurses, therapists, emergency medics, teachers, child care providers, respite providers, grandparents, friends, and neighbors.

An estate plan is much more than a will. An effective plan considers your personal circumstances and goals. The more important purposes of estate planning include protecting your assets during your life, planning for possible disabilities, and ensuring your wishes are carried out both during your life and after your death. Estate planning also includes planning for various health-related contingencies so your wishes are clear even if you cannot make decisions for yourself in the future. Here is a sample Care Plan for your child.

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With over 23 years of experience working as an occupational therapist, Wendy Godwin brings a unique perspective to her massage clients. She has worked in a variety of settings including psychiatry, chronic pain, hand therapy, and pediatrics. Licensed in massage therapy five years ago, she integrated this into her professional health services. Today she provides massage therapy to both adults and children, with an emphasis on special needs clients. To learn more, please contact Wendy at gwgodwin81 [at] aol [dot] com.

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Lt. Tim Snavely said the idea began with Alzheimer’s in mind, but it is open to people with a variety of conditions such as autism, geriatric diabetes, Huntington’s disease, cerebral palsy and geriatric dementia, all of which may make communication difficult.

The department is accepting voluntary information from caregivers and family members who can provide a physical description and current photograph, as well as contact information to call if a loved one is found.

Although the St. Peters program is believed to be the first of its kind among St. Louis police departments, it bears some similarities to a national registry by the Alzheimer’s Association.

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The reorganization is part of the state’s efforts to save costs. The Department of Mental Health estimates the closures of acute care units in St. Louis, Fulton, and the Southeast Missouri Mental Health Center will save the state $1.5 million in its next fiscal year. Mark Utterback, president and chief executive of Mental Health America of Eastern Missouri said the changes will eliminate an essential service to mental health-care patients who rely on this access to immediate care where they can stay long enough to stabilize. No future plans on alternative facilities are currently being discussed.

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The Capable Kids and Families’ catalog contains more than 1,700 toys and pieces of equipment to choose from and once a month, a staff member visits each family’s home to observe the children with the toys and provide suggestions for the parents about when it would be helpful to swap toys so that the child can move forward in his or her therapy. While some of these toys are specialized, others can be found at Toys “Я” Us®. The toys and equipment can be kept indefinitely until they are no longer useful for the children’s development.

The St. Louis ARC, a nonprofit agency that supports people with developmental delays launched this program in December 2009 to help parents check out educational and therapeutic toys and equipment that may be otherwise too costly for them. With enough state funding to support 50 local families, a waitlist has started for families waiting to join the program. Eligible families must live in St. Louis and have a child younger than 7 with a delay in their physical, speech, sensory, or intellectual development.

For more information about the Equipment Lending Program, please contact Jean Darnell, the Director of Capable Kids and Families at jean.darnell [at] thecommunitypartnership [dot] org or by phone at 573-368-2849.

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What is a power of attorney?

• A power of attorney appoints a person to act as an agent for the person who executes the document. An agent is authorized to act for another person to the extent that the document permits. The acts of the agent (also known as the attorney-in-fact) will legally bind the person who granted him or her the power to act.
• Powers of attorney come in a variety of forms. There are two major types of powers of attorney: financial and healthcare. These powers can be combined into one document, but are frequently separate documents.
• Financial powers of attorney can be effective immediately or become effective upon the incapacitation or disability of the person who executed the power of attorney.
• Powers of attorney can also be limited to a certain period of time or last until they are revoked by the person who executed the power of attorney.

What is a durable power of attorney?

• A durable power of attorney remains effective during such periods of time that the individual who executed the document is considered incompetent.
• A durable power of attorney must be designated as such in the title.
• Specific wording must be used for a power of attorney to last during any period of time the person who signed the document is considered incompetent.

Who can execute a power of attorney?

• A power of attorney can be executed by anyone over the age of eighteen. The person signing the power of attorney must have the ability to understand the document he or she is signing.
• In cases where a person is diagnosed with an illness that may limit his or her cognitive function, a doctor’s report stating that the person is capable of understanding the document may be required by the attorney drafting the document.

Who may be appointed as the agent under a power of attorney?

• The agent may be any adult who is competent to act. The agent is often a family member or close friend. Typically, one person is appointed as an agent with one or more persons appointed as backup agents if the first person cannot act. The agent is not required to live in the same state.
• Under Missouri law, the following persons cannot serve as the agent:
  • The individual’s attending physician or employee of the attending physician unless the individual and the agent are closely related.
  • An owner, operator or employee of a health care facility in which the individual is a resident.
  • No person or corporation licensed as a facility by the Missouri Department of Mental Health or the Missouri Department of Social Services, nor any administrator, owner, operator, manager or employee of such a facility may be appointed as an agent unless closely related.
  • No full-time judge of any court of this state and no clerk, deputy clerk or division clerk shall be appointed as agent unless closely related.
  • No one under 18 may serve as an agent.
  • No incapacitated or disabled person may serve as agent.
  • No “habitual drunkard” may serve as agent.

How can a Power of Attorney be revoked?

• The death of the individual who granted the power of attorney revokes the document.
• The individual who granted the power of attorney can revoke the power of attorney either orally or in writing. A written revocation is recommended.

If a Power of Attorney is over 10 years old is it still effective?

• Yes. It is recommended that the power of attorney be reviewed by an attorney every five years to determine if any changes in the law have occurred. For powers of attorney that were enacted before the HIPAA changes, the document may not be effective to release the necessary medical records to make an informed healthcare decision.

If a Power of Attorney grants the agent the authority to take any and all actions on behalf of the individual are there any powers that are not covered?

• Certain powers must be specifically listed in the power of attorney in order for the agent to act on the individual’s behalf. These powers are:
  • The authority to execute, amend, or revoke a trust;
  • The authority to fund a trust not created by the individual with the individual’s assets;
  • The authority to make a gift from the individual’s assets or to revoke a gift of the individual;
  • The authority to disclaim a gift or inheritance to the individual;
  • The authority to change the beneficiary or survivor interest of the individual’s assets;
  • The authority to give consent to an autopsy or postmorten exam;
  • The authority to make a gift of the individual’s body;
  • The authority to nominate a guardian or principal for the individual;
  • The authority to give consent to or decline any type of health care, medical care, treatment or procedure; or
  • The authority to direct the withholding or withdrawal of artificially supplied nutrition or hydration.
• A power of attorney may not grant the following powers:
  • The authority to make, amend, or revoke a will on behalf of the individual;
  • The authority to execute, amend, or revoke a living will declaration of the individual;
  • The authority to require the individual to take any action or refrain from any action against his or her will; or
  • The authority to take any action specifically forbidden by the individual during any period the individual is competent.

If you have been appointed as an agent under a power of attorney must you serve as agent?

• No, before serving as agent it is recommended you consult with an attorney to fully understand the duties imposed by serving.

Who should be appointed as an agent under the power of attorney?

• The choice of an agent is often difficult and should be done only in connection with consultation of legal counsel. The agent should be trustworthy and capable of understanding the nature of his or her duties.

Social Security provides a necessary financial supplement to any individual with a disability as defined under federal law. There are three types of social security available to an individual with a disability. Social Security Disability Insurance is available to those individuals who have worked at least 10 years and do not currently earn more than $980.00 a month from employment. For those individuals whose disability began before the age of 22, the work history is based upon the individual’s parent. Supplemental Security Income is available to any disabled individual who meets the “limited income and resources” test. The third benefit available under Social Security is Medicare. Medicare is a government health insurance program.

Social Security Disability Insurance

Individuals whose disability began before the age of 22 may be eligible to receive Social Security Disability Insurance (SSDI), or what people commonly refer to as “Social Security.” Typically, an individual receives SSDI based upon his or her work history and amount of prior earnings. However, an adult disabled before the age of 22 may have little or no prior earnings and would not typically qualify for SSDI.

Fortunately, an individual over the age of 18 whose disability began before the age of 22 can receive Social Security benefits based upon his or her parents’ eligibility for Social Security. Instead of basing eligibility and the amount of benefits on the disabled individual’s work history, these items are based upon the parent’s work history and prior earnings. Thus, a disabled individual may be eligible to receive Social Security even though he or she has never been able to work.

There are also restrictions on the individual’s earned income. If the individual is employed, he or she cannot earn more than $980 per month from employment or the individual will be disqualified from receiving SSDI benefits.

Supplemental Security Income

An individual may be eligible to receive Supplemental Security Income (SSI) if he or she is disabled and receives under $1,433 from wages or under $694 in income not from wages. SSI is also available to minors who have been diagnosed with a disability; however, the income and financial resources of the child’s parents or guardians will be taken into account when determining eligibility. Resources available to the family must not be over $2,000.00 with certain exclusions for the family home and vehicle.

In addition to the asset limitations, the child must satisfy the following requirements: (1) he or she has a physical or mental condition (or combination thereof) which results in “marked and severe functional limitations;” and (2) these debilitative conditions must be expected to continue for at least 12 months, or to result in death.

The Social Security Administration will review all of the information regarding the child’s disability and may ask for further medical and school records, if such records are available. Determinations of disability may take between three to five months. However, there are 50 medical conditions which will warrant immediate approval for SSI, including but not limited to: cerebral palsy, down syndrome, muscular dystrophy and severe mental retardation.

When a child turns 18, the criteria the Social Security Administration (SSA) uses in determining if that child is eligible for SSI changes. The parent or guardians’ financial status is no longer taken into account, and only the individual’s income and resources will be used in determining eligibility. Further, the SSA utilizes the adult criteria, instead of the child criteria, in determining if the individual is disabled so as to allow for SSI.

Medicare

Adults who receive SSDI benefits for more than 24 months, are automatically eligible for Medicare. An individual who is receiving the benefits will receive his or her card in the mail in the 25th month of the individual’s approval for disability benefits.

To apply for Social Security benefits, call 1-800-772-1213 or visit your local Security Office. When applying, make sure to have available the applicant’s social security number card, as well as birth certificate. If a third party is applying for social security for the disabled individual, that third party must have the individual’s social security information available as well. A parent or other family member may also apply to become the representative payee in order to receive the funds from the SSA.

Belleville East High School Hosts Inaugural Special Needs Prom

On May 16, 2009, special education students at Belleville East High School had an experience which, although common to most high school students, was a first for many of these students—Prom.

The event took six months of planning and, with the help of numerous area vendors, more than $1,400 worth of goods and services were donated. For only $20 a ticket, students were able to dine on cuisine from an area restaurant and dance the night away at the Hilton Hotel in Shiloh, Illinois.

The event was sensory-friendly for its patrons, keeping the music volume to a lower level and cutting back on the bright lights and fanfare typically found at high school proms.

Ashley Creek, a special education teacher at Belleville East, organized the prom after a step-mom of one of her students called her to suggest the idea.

Although Creek noted the hard work it took to put on the event, she believed that it will most likely become an annual event. “Every person, no matter their abilities,” said Creek, “should be able to have a Junior/Senior prom.” She has already began planning for Spring 2010.

Illinois Extends Dependent Coverage for Adult Children to Age Twenty-Six

Beginning June 1, 2009, Illinois law 215 Ill. Comp. Stat. 5/356z.12 requires all individual and group health insurance and HMO contracts to give parent policyholders the right to elect coverage for qualifying dependents up to age 26 and up to age 30 for military veteran dependents. Health coverage that is provided to state, county, and municipal employees must also meet these requirements. Enrollment in higher education is not a prerequisite for this extended coverage.

Dependents may be enrolled during the mandated 90-day enrollment period which insurance companies must provide to eligible parents. For policies that begin after June 1, 2009, the 90-day enrollment period must begin simultaneously with the start of the coverage. For existing insurance policies, the 90-day period will begin on the date the policy is amended or renewed.

It should be noted this law does not apply to insurance policies or HMO contracts which do not include dependent coverage, self-insured non-public employers, self-insured health and welfare plans and insurance policies or trusts issued in other states.

More information can be found on the State of Illinois Department of Insurance web site.

Guardianship

A guardian is an individual who is granted, by a court, the care and custody of a minor or person declared disabled or incapacitated. A conservator, on the other hand, is an individual appointed by a court to have care and control over a minor or a disabled person’s property. Although these phrases are sometimes used interchangeably, a guardian has care of an individual whereas a conservator has care of that individual’s property– a distinction with great legal importance. Therefore, it is necessary to petition a court for both guardianship and conservatorship. A conservatorship is only necessary in the event that a minor or a person declared incapacitated by the court has assets in his or her own name.

Although a guardian and conservator are frequently the same person, it is still necessary to petition a court for both guardianship and conservatorship. The appointment of guardianship and conservatorship is governed by Missouri law and is a legal process by which a probate court designates a guardian and/or conservator upon issuance of letters of guardianship or conservatorship. Because of the close relationship between guardianship and conservatorship, it is common to petition a court for conservatorship and guardianship at the same time.

Parents will be the natural guardians of their minor children if one or both of the parents are still living unless the court finds them to be unfit as guardians. Individuals, non-profit organizations or social service agencies may be appointed guardian.

The court shall make its appointment of a guardian and/or conservator in accordance with the incapacitated or disabled person’s most recent valid nomination of an eligible person qualified to serve as guardian. If there has been no such appointment, the court will appoint a family member or friend in order of statutory preference.

St. Louis Area Organizations Supporting Persons with Disabilities and Their Families

United Cerebral Palsy of Greater St. Louis

United Cerebral Palsy is a national organization serving more than 176,000 individuals with disabilities. The organization is facilitated by ambassadors who help to fulfill the organization’s mission to advance the independence, productivity and full citizenship of people with disabilities.

UCP supports the My Child Without Limits Program, which offers resources and information for families who have special needs children. Mychildwithoutlimits.org offers information regarding the understanding of Cerebral Palsy, traveling tips for families, speech therapy for those children afflicted with Cerebral Palsy and news updates.

The United Cerebral Palsy of Greater St. Louis office is located at 8645 Old Bonhomme Road, St. Louis, MO 63132-3999. They also may be reached by phone at (314) 994-1600. 

Gateway Chapter of the Autism Society of America

The Autism Society of America (ASA) is one of the nation’s largest volunteer organizations dedicated to those afflicted with Autism. The ASA provides resources and information to individuals across the entire diagnostic Autism spectrum.

While the ASA is partnered with many corporate sponsors, a partnership with AMC Theaters offers families in the St. Louis are an opportunity to watch newly released movies in an environment comfortable for autistic individuals. The Sensory Friendly Films programs shows movies with the auditorium lights turned up and the volume of the movie lowered. No previews or advertisements will be shown before the movie. Families are able to bring in their own gluten-free, casein-free snacks. While the safety of the audience is of primary consideration, audience members may also move around, dance, walk, shout or sing. Families can attend these Sensory Friendly Films locally at AMC West Olive 16, 12657 Olive St, Creve Coeur, MO 63141.

Supreme Court of the United States Decides Case in Favor of Special Needs Families

Forest Grove School District v. T.A.: a vital step towards ensuring all special needs children get the education they deserve

In June 2009, the Supreme Court decided a pivotal case for those families with special needs children in a case entitled Forest Grove School District v. T.A. The case involved the Individuals with Disabilities Education Act (IDEA), which requires States that receive federal funding to provide a “free and appropriate public education” (FAPE) for all children with disabilities.

For those children who are diagnosed to have disabilities, this FAPE will often include an “individualized education program,” (IEP) a program which brings together those individuals within the child’s educational circle—teachers, parents, assistants—and specifically targets the disabilities the student may encounter. The IEP will offer alternatives to overcome any disabilities the child may have that are hindering her ability to excel in the classroom. Actions taken as part of the child’s IEP can include extended test taking time, alternative test taking atmospheres and even a change in the test format.

In Forest Grove, the parents of T.A. sought reimbursement from the school district for tuition for the private school T.A. needed to attend so he could receive proper assistance with his disability at school. The district found T.A. to be without any disabilities, thereby claiming the IDEA was inapplicable. However, upon further examination by a private physician, T.A. was diagnosed with attention-deficit/hyperactivity disorder and other learning and memory disabilities. With this diagnosis, T.A.’s parents made the decision to place T.A. in a private school where his needs could be better met.

The school district argued that the 1997 amendments to IDEA did not require reimbursement for private school tuition when there had been no previous special-education services through the public school system. The school district claimed there were safe harbor provisions in the 1997 Amendments to IDEA which precluded the school district from being financially liable. However, the Court found that such a provision was only applicable to those schools who had correctly identified a disability and offered that child a FAPE—which the district had failed to do.

Ruling upon the case, the Supreme Court found in favor of T.A. stating that “having mandated that participating states provide a FAPE for every student, Congress could not have intended to require parents to either accept an inadequate public-school education pending adjudication of their claim or bear the cost of a private education if the court ultimately determined that the private placement was proper under the Act.”

This decision marks the continual trend in the courts towards providing individuals with disabilities the ability to thrive in their educational atmosphere.

Setback For Medicaid Payback Trusts

A Medicaid Payback Trust is a Special Needs Trust that is setup whenever a person is considered disabled under the Medicaid or Social Security Act. 42 USC § 1382c(a)(1). Often funds are received from a personal injury or other type of settlement and paid directly into the Medicaid Payback Trust. The federal government specifically allows for this type of Special Needs Trust (also known as a Supplemental Support Trust) under 42 USC 1396p(d)(4)(A), so long as all the requirements of the statute are met. The requirements include that upon the death of the beneficiary any funds remaining in the Medicaid Payback Trust are paid to reimburse Medicaid first. Any remaining funds are then paid to the beneficiaries. This Medicaid Payback Trust allows for a Medicaid recipient to have the necessary funds for purchase of necessities during the recipient’s life and allows the state to receive payment for the services it renders upon the recipient’s death.

A recent decision from the US District Court for the District of New Mexico, Hobbs ex rel. Hobbs v. Zenderman,  2009 WL 2750707 (C.A.10 (N.M.),2009), is a severe setback for the Special Needs Community . Steffan Hobbs had sued for injuries obtained in an automobile accident when he was six years old. Hobbs and his parents settled the case and agreed that $1.1 million dollars was to be put aside in “The Steffan Hobbs Medicaid Payback Trust”. The Trust purchased a one-half interest in the family’s home and paid Steffan Hobbs’ mother a monthly stipend for her care of Steffan. The family then applied for Medicaid through the State of New Mexico which found the Supplemental Support Trust to be a countable resource. The State of New Mexico found that the use of the Special Needs Trust funds for purchase of land and a family home was specifically prohibited under the state’s Medicaid policy. After exhausting his administrative appeals, Hobbs’ parents filed suit in the US District Court for the District of New Mexico alleging that the Medicaid Payback Trust had complied with the requirements of the federal law (1396p(d)(4)) and therefore could not be counted as a resource. The District Court found in favor of the State and the Hobbs’ family appealed.

The appellate court in Hobbs found that the “Medicaid statute exempting special needs trusts from requirement that state count certain trust assets as resources available to an individual when determining Medicaid eligibility did not unambiguously impose a binding obligation on the states to exempt such trusts when making eligibility determinations, but rather, left such a decision within the discretion of the states, and as such, statute could not support Medicaid claimant’s § 1983 claim against New Mexico authorities for violation of that provision. Social Security Act, § 1917(d)(4), 42 U.S.C.A. § 1396p(d)(4); 42 U.S.C.A. § 1983.”

This finding by the appellate court allows individual states to determine whether they will develop their own eligibility determinations for a Medicaid Payback Trust or even allow the Medicaid Payback Trust to be a countable resource for Medicaid purposes. The State of Missouri currently recognizes the elements set forth under the federal statute and allows for Medicaid Payback Trusts to be utilized and not count as a resource for the Medicaid Recipient. However, this could be changed by the legislature if the New Mexico decision stands.

To access the latest news and law regarding Special Needs Families please feel free to visit our blog, Beyond The Fine Print.

Planning Considerations for Children with Special Needs

Special Needs Families often need to convey more information to their other family members and friends about how to care for their child in the event that they would be unable to continue to do so. Next month, Danna McKitrick P.C. will be releasing checklists and other helpful forms that you can complete on our website and keep with your estate plan documents.

Information on the forms will include doctors, specialists, medications, daily routines, and other important information that someone would need to know about your child. This is especially helpful for non-verbal children who are unable to communicate their daily needs. The forms will be available for you to download and complete at your convenience. If you are a current client, I am happy to also keep this information in my file. You may fax, email, or mail me your completed forms.

I welcome your input on what information you would like to see included on the website. Also, if you have ideas for future topics, please do not hesitate to call or email me.

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A Special Needs Trust (also known as Supplemental Support Trust) is a legal mechanism that allows families to provide funds to relatives with special needs without interfering with their government benefits. The Missouri Division of Family Services (DFS) and the Social Security Administration analyze the special needs person’s assets annually to determine if he or she qualifies for government benefits, such as Medicaid and Supplemental Security Income.

If that person has more than $1,000-2,000 (depending on the program) in assets, he or she will be disqualified and will not receive the benefits. Most families need to maintain government benefits for family members with special needs, but also want to provide additional support.

For many years, families’ options were limited and the options available were not always beneficial to the needs of their loved ones. Some families elected to leave an inheritance to the special needs person in a lump sum amount that would automatically disqualify the recipient from government programs. Some families elected to disinherit the special needs person and hope that other family members would provide for any of his or her supplemental needs. These options did not fulfill the wishes of the families or supply adequate supplemental support for their loved ones.

In 1985, the Division of Family Services found that Bruce Tidrow, a mentally disabled individual, was not able to benefit from government programs because his parents had left him assets in a discretionary trust that exceeded the maximum allowed by the government programs. Mike McKitrick and Barbara Blee Maille, principals at Danna McKitrick P.C. in St. Louis, were two of the attorneys who appealed this decision to the Appellate Court of the Eastern District of Missouri.

Mike and Barbara argued that Bruce’s interest in the trust was not an “available resource.” Therefore, it was not his money because it was in a discretionary trust which allowed, but did not require the trustee to distribute funds to provide for Bruce’s “reasonable comfort” during the remainder of his life. The Court of Appeals agreed and found that the trust was intended to supplement and not replace Bruce’s government benefits; and because the trustee had complete control over the interest and the principal of the trust, the funds were not “available” to Bruce as to disqualify him for benefits.

In Tidow, the court solidified the legality of the Third-Party Grantor Special Needs Trusts in the state of Missouri. This type of trust can come into being before or after the death of the Grantor, but it cannot contain any assets of the beneficiary with special needs.

Missouri enacted a new Uniform Trust Code in 2005[3] that has a variety of implications on the Special Needs Trust. The new code states that Special Needs Trusts cannot be terminated by agreement by either the Grantor who set it up or by the special needs family member who will benefit from the trust. Special Needs Trusts are irrevocable, which means that once the trust is established (or upon the death of the Grantor), the only way that the money can be spent is determined by the trustee.

After the beneficiary’s death, the funds are then allocated as specified in the estate plan. As with any estate planning mechanism, the best option depends on each family’s unique situation.

Rules of the Legal Road

There are a number of provisions that must be drafted into the trust document in order for it to be considered a true special needs trust that will protect your loved one from losing government benefits. A trustee must be appointed to manage the trust and, upon the trustee’s approval, funds may be distributed to vendors or other third parties for the benefit of the person with special needs. The person with special needs cannot receive any of the funds directly. If this happens, the government benefit programs will consider that money as an asset and may disqualify him or her from receiving benefits.

Additionally, the trust must be drafted as either presently irrevocable or irrevocable upon the death of the Grantor, which prohibits the family member with special needs from selling or cashing in his or her interest in the trust, which will disqualify the beneficiary from government benefits. This list of required provisions is not conclusive and other specific language may be important to secure your financial commitment to your loved one.

Conclusion

In order to protect your family and their financial security in the future, it is important to talk to an attorney with expertise in estate planning for families with special needs members. Setting up a Third-Party Grantor Special Needs Trust greatly increases the chance that the person with special needs will remain eligible for government programs, and that funds not used during the beneficiary’s lifetime will be distributed to surviving family members.

If you have any questions or would like to set up or review your trust, please consult a qualified estate planning attorney when deciding how to provide for your loved ones. The attorneys at Danna McKitrick P.C. are prepared to help you plan for your family’s future.

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