New York Estate Planning & Elder Law Blog
Pooled Trusts Eligibility
Pooled Trusts are a type of trust applicable to those individuals who are seeking public assistance benefits, such as Medicaid, to become eligible financially by setting aside funds in a trust for additional needs. The trust allows its beneficiaries to preserve a specified amount of money in a trust to pay for supplemental care not covered by public assistance programs. For the elderly, many need public benefits assistance as they continue to age but do not qualify based on higher income. In these situations, a pooled income trust will benefit an elderly person by allowing them to continue their lifestyle, which is usually seeking to stay in the home, while also obtaining homecare services and paying for what their budget requires.
New York Medicaid Rules
While under Medicaid, applicants must meet factors such as disability, sometimes a specified age, and a specific monthly financial income, in New York, Medicaid rules allow those who meet the disability requirement, but have too much monthly income, to deposit the remaining funds in excess of those required to meet Medicaid standards, into a pooled income trust. The beneficiary then submits their monthly bills and expenses to the trust fund, run by a non-profit organization, who pays the bills from the trust. These non-profit organizations deduct a small fee for providing the services, which can be found by contacting any of these agencies in the state.
Limitations
There are some limitations on the expenses paid from pooled trusts however. The trust must be established only for the beneficiary, by either a parent, grandparent, legal guardian, beneficiary or by the Court. The bills that are paid out of the trust are only those household or maintenance bills, other medical bills generally do not qualify, Medicaid is assumed to cover the medical expenses needed by the beneficiary. Some other examples of items paid for from a pooled trust are: taxes, utilities and insurance, rental expenses, attorney and guardian fees, entertainment and traveling expenses, and qualified medical procedures.
Additionally, the bills paid out of the pooled trust must name the recipient, they cannot be in another family member’s name. In the event of death, the balance of the trust when the beneficiary passes will then become trust property, meaning that if there are accumulated bills for the household that have not been submitted to the pooled trust, they then become ineligible. Thus, it is important to keep up with bills as always.