Patti's Blog - Advocate for Elders, People with Disabilities and Their Families

New Maryland Law Specifically Allows Transfers into Pooled Trusts by Those Over 65

Excerpt from The Academy of Special Needs Planners:

The Maryland legislature has responded to the Department of Mental Health and Hygiene's attempt to limit the use of pooled trusts by passing a law that officially encourages the use of special needs trusts by people with disabilities, prohibits the Department from setting limits on the amount of money a person with disabilities can transfer into a pooled trust, and bars the Department from assessing a transfer penalty if a person who is over 65 transfers his assets into a pooled trust. The law, which was signed by Governor Martin O'Malley on May 19, 2011, will also prevent any state agency that provides services to people with disabilities from adopting regulations that are more stringent than existing federal law, regulations or policies with regard to the treatment of special needs trusts.

According to Maryland elder law attorney Jason Frank, the bill had its genesis when harsh regulations were proposed in January that would have, among other provisions, capped the accounts that could be transferred into (d)(4)(C) trusts at $100,000, barred the use of trust funds -- both ((d)(4)(A) and (C) -- for food and shelter and eliminated 65+ Medicaid enrollees from utilizing (d)(4)(C) trusts. (Federal law allows trustees to purchase food and shelter with trust funds, subject to the presumed maximum value rule.)

"We were able to get the sympathetic ears of two legislators in each House and they agreed to sponsor the bill," Mr. Frank told ASNP. "The regs were withdrawn, with every intention of bringing them back in substantially the same form. Meanwhile, the bill passed, with only one substantive amendment, without opposition in both Houses. I don't know whether it simply passed under the radar of the MA folks or not. They didn't even appear at the first hearing, just sent a letter opposing it."

Federal Court Remands Pooled Trust Case to State Court

Excerpt from Academy of Special Needs Planners: (click for entire article)

A federal court rules that it lacks jurisdiction to hear a case in which the state of North Dakota is attempting to recover funds a Medicaid applicant transferred to a Florida pooled trust, holding that federal Medicaid law does not completely preempt state law in this area. North Dakota Department of Human Services v. Center for Special Needs Trust Administration (D.N.D., No. 1:09-CV-077, Jan. 6, 2011).

In November, 2007, Allen Kemmet, a 78-year-old nursing home resident from Bismark, North Dakota, entered into a pooled trust joinder agreement with the Center for Special Needs Trust Administration, a Florida non-profit organization. Pursuant to the agreement, Mr. Kemmet transferred $54,450 into a pooled trust account with the Center. In January 2008, Mr. Kemmet filed a Medicaid application, which the county Medicaid agency approved, in part because it misread the application and believed that Mr. Kemmet was 54 years old.