Pooled Trusts

What is a Pooled Trust?
In a pooled trust the resources of many beneficiaries are combined and managed by a non-profit association. Unlike individual disability trusts, which may be created only for those under age 65, pooled trusts may be for beneficiaries of any age and may be created by the beneficiary herself. In addition, at the beneficiary’s death the state does not have to be repaid for its Medicaid expenses on her behalf as long as the funds are retained in the trust for the benefit of other disabled beneficiaries.

Should I create a Pooled Trust for my family member with a disability?
Some government benefits such as SSI and Medicaid are given based on income and assets. If a person receiving this type of government funding directly receives money or other assets through a gift or inheritance, these benefits can be lost. When this occurs, the person must spend the assets until they are below the asset limit and then re-apply for benefits. Because people with developmental disabilities often have high medical and housing expenses, the additional money is spent very quickly.

A gift put into a pooled trust rather than given to an individual can avoid the loss of benefits. The gift can then be used for assistive technology that insurance does not cover, personal needs, recreation, and other resources that improve the person’s quality of life.

How do I create a Pooled Trust?
Work with an estate-planning attorney, and appoint someone you know and trust as trustee. You may serve as trustee of your family member’s finances, but in the event of your death, the trustee will begin managing and supervising the finances. You can provide detailed instructions to direct your trustees’ activities, which legally must be followed.