What is a special needs trust?

If you have a child or other loved one with special needs, you may want to establish a special needs trust. A special needs trust (or supplemental needs trust) is an estate planning tool that can help you provide for the needs of a disabled individual without jeopardizing his or her eligibility for government benefits. A qualified attorney can help you establish and administer this type of trust.

Why establish a special needs trust?

Unlike other types of trusts often used in estate planning, the primary goal of a special needs trust is to provide for the needs of a disabled individual throughout his or her life.
Federal and state benefits are generally available to qualifying children and adults who have special needs. If your child qualifies for government benefits, one of your goals may be to ensure that his or her eligibility continues into the future. A special needs trust can help you attain this goal. In addition, this type of trust can provide for supplementary care and services for your loved one.

To preserve eligibility for Medicaid. Medicaid, a joint federal-state program, provides medical assistance to those who are disabled and can demonstrate financial need. Children and adults can qualify for Medicaid only if their monthly income and the value of their other assets fall below certain limits, which vary from state to state.
In determining eligibility for Medicaid, a state may count only the income and assets that are legally available to the applicant. A special needs trust restricts the beneficiary's own direct access to the assets in the trust to such an extent that the assets are not considered legally available to the beneficiary. Thus, a special needs trust can protect Medicaid eligibility because assets in the trust are uncountable.

To preserve eligibility for Supplemental Security Income (SSI). Children and adults with special needs who have limited income and resources often receive monthly benefits from Supplemental Security Income (SSI) . These cash benefits can be used for basic needs such as housing and food. But because SSI benefits are need-based, inheriting money can mean that a child with special needs will lose his or her eligibility for this benefit program. By naming a special needs trust as your beneficiary instead of your child, however, assets can be devoted to the care of your loved one. In addition, since SSI recipients are normally automatically eligible for Medicaid benefits, preserving your child's eligibility for SSI may preserve his or her eligibility for Medicaid as well.

To provide additional care and services. A special needs trust can be especially useful if you want to provide care and services necessary for your child's well-being, without supplanting Medicaid benefits. Although Medicaid pays for a number of medical costs, including hospital bills, physician services, and long-term care, it will not subsidize items and services considered nonessential. These may include health-related expenses such as eyeglasses, dental care, rehabilitation services, and home health aide services, as well as personal expenses such as transportation, computer equipment, and vacations.

Caution: To ensure that trust assets are unavailable to the disabled beneficiary, the trustee must have sole discretion over the distribution of trust income and principal. The beneficiary must have no control over the trust and no right to demand distributions from the trust. The trustee should purchase goods and services directly on the beneficiary's behalf, instead of giving the beneficiary money from the trust to purchase items needed.

What requirements must a special needs trust meet?

If the trust is intended to supplement, rather than replace, government benefits, it must be properly drafted. Although requirements vary according to state law and the type of special needs trust being established, here are some of the rules that apply to special needs trusts in general:

What types of special needs trusts are available?

Although there are many types of special needs trusts, they fall into two general categories: the third-party special needs trust (funded with assets belonging to someone other than the beneficiary) and the self-settled trust (funded with assets belonging to the beneficiary).

Third-party special needs trust. The third-party special needs trust is established with funds that belong to someone other than the disabled beneficiary. For instance, a parent or grandparent may create such a trust under a will and fund it with a gift of cash, life insurance, or another asset. Upon the death of the disabled individual, any assets that remain in the trust can be distributed to whomever has been designated; if the third-party trust is properly drafted, the state will not have to be "paid back" for long-term care services when the disabled individual dies.

Self-settled trust. A self-settled special needs trust is established with funds owned by the disabled person. For instance, a self-settled trust might be established using a personal injury award or inheritance.
One type of self-settled trust is the qualified self-funded special needs trust. This kind of trust is created for the sole benefit of a disabled individual who is under age 65 at the time the trust is established. Upon the beneficiary's death, Medicaid must be "paid back" from the trust assets for any long-term care provided. This type of trust is also known as a (d)(4)(A) trust.

Another common type of self-settled trust is the qualified pooled trust, also known as a (d)(4)(C) trust. This kind of trust is established and managed by a nonprofit organization. Separate accounts are maintained for each trust beneficiary, but funds are pooled for investment and management purposes. Upon the beneficiary's death, the nonprofit organization receives assets remaining in the trust, and will reimburse Medicaid for benefits paid to the beneficiary. In some cases, surviving family members may be entitled to receive some or all of the remaining funds.

How is a special needs trust typically funded?

In many cases, a special needs trust is established, but not funded, while the parent or other creator is alive. Upon the parent's death, his or her will transfers the disabled child's portion of an inheritance to the special needs trust. The trust (instead of the disabled child) can also be designated as the beneficiary of various assets, such as employee benefits and life insurance policies.

Typically, a special needs trust is funded using:

Although life insurance is one of the most popular funding methods (in particular, lower-cost survivorship life insurance), each method has advantages and disadvantages. To ensure that the trust is adequately funded, you'll need to estimate how much income your child is likely to need over the course of his or her lifetime.

What else should you consider?

If you're thinking about setting up a special needs trust, there are a few other points you should consider.

Selecting a trustee. A trustee is a person or institution selected to administer a trust and manage its assets. The
trustee's role is to adhere to the terms of the trust document and fulfill its objectives. You may wish to name yourself or another family member as trustee of the special needs trust, or you may wish to name an attorney, bank, or other professional trustee. There are advantages and disadvantages to each. Another option is to name a family member and a professional trustee as co-trustees.

Providing a letter of intent. If you set up a special needs trust through your will, you might also want to draft a letter of intent to describe how you want your child to be cared for after you're gone. Although it's not a legal document, it can provide important information to guardians, trustees, family members, and others involved in the care of your child. The letter may address such issues as your child's medical needs, daily routine, interests, likes and dislikes, religious practices, living arrangements, social activities, behavior management, and degree of self-sufficiency. Such a letter can prove invaluable to your child's caregivers and can also make the transition to a new living situation as smooth as possible for your child.

Informing family members: Explain to siblings or other family members why you're setting up the special needs trust. Although siblings might expect to receive equal inheritances, more resources will probably need to be set aside for the benefit of your child with special needs. Explanations and clear directions now may help avoid family conflicts later.

Working with a qualified attorney or financial professional. Special needs planning is complex and technical, and the laws that govern special needs trusts differ from state to state. To properly plan for your child's future, work with a qualified attorney or financial professional who has experience with the planning needs of families of disabled individuals. This person should also have a thorough understanding of the income, gift, and estate tax consequences that must be considered when funding and administering a special needs trust.

DISCLOSURE: The information contained in this material is being provided with the understanding that it is not intended to be interpreted as specific legal or tax advice. Neither Ameriprise Financial Services, Inc. nor any of its employees or representatives are authorized to give legal or tax advice. Individuals are encouraged to seek the guidance of their own personal legal or tax counsel. Ameriprise Financial Services, Inc. Member NASD and SIPC. 70100 Ameriprise Financial Center, Minneapolis, MN 55474
http://www.ameriprise.com/ 
 

Circle of Friends

Joshua Heisler, Age 1

Two 2 weeks ago, my 16 month old son was diagnosed with CLS. I have spent the last week reading through the on-line posts and the newsletters that Mary sent and have learned a lot about CLS.  It has helped us understand more about it and we are able to discuss CLS with family, friends and his doctors. 

For more than a year, we have seen every pediatric specialist, except a cardiologist, in the town we live in and have even been to the Children's hospital in Cincinnati(where they have a wonderful genetic doctor), where Josh was finally clinically diagnosed with CLS after a hand x-ray.  We are still waiting the final results from the blood testing.

We know that Josh has scoliosis, hip dysplasia, developmental delay (both speech and motor skills), an immune system deficiancy, tracheamalacia, laryngomalacia , possible sleep apnea (he is not on a CPAP machine yet), possible mild hearing loss and reflux (with possible aspiration).  We are continue to test his ears and are scheduled for another sleep study and impediance probe. 

He is in speech and physical therapy once a week and has Early intervention come visit him every other week, which we have been doing for almost a year.  We have seen such progress in him over the last 4 months, that we would like to do more, but are not sure what .  Does anyone have any other suggestions on ways to help Josh?  We would appreciate any suggestions you have.

Jodi and Eric Heisler

Perrysburg, OH

I have some little tips for you:

If you have to give medications, give them in applesauce, yogurt or cottage cheese.

Keep a written, updated explanation of your child's condition, abilities, likes, dislikes. Comes in very handy for new people in his life, like babysitters, therapists, day care providers, teachers, etc. Sort of like his medical history, but more personal.

Remember you are not alone, although sometimes it feels that way. If you are ever tempted to say "Why did this have to happen to us" as if it was somehow due to something you did, remember all the good things in your life as well.  I'd like you to read something which I have always felt summarized very well the feelings all of us have. –MCH

WELCOME TO HOLLAND

by Emily Perl Kingsley.

 c1987 by Emily Perl Kingsley.

   I am often asked to describe the experience of raising a child with a disability - to try to help people who have not shared that unique experience to understand it, to imagine how it would feel. It's like this......

  When you're going to have a baby, it's like planning a fabulous vacation trip - to Italy. You buy a bunch of guide books and make your wonderful plans. The Coliseum. The Michelangelo David. The gondolas in Venice. You may learn some handy phrases in Italian. It's all very exciting.

   After months of eager anticipation, the day finally arrives. You pack your bags and off you go. Several hours later, the plane lands. The stewardess comes in and says,     "Welcome to Holland."

   "Holland?!?" you say. "What do you mean Holland?? I signed up for Italy! I'm supposed to be in Italy. All my life I've dreamed of going to Italy."

   But there's been a change in the flight plan. They've landed in Holland and there you must stay.

The important thing is that they haven't taken you to a horrible, disgusting, filthy place, full of pestilence, famine and disease. It's just a different place.

   So you must go out and buy new guide books. And you must learn a whole new language. And you will meet a whole new group of people you would never have met.

   It's just a different place. It's slower-paced than Italy, less flashy than Italy. But after you've been there for a while and you catch your breath, you look around.... and you begin to notice that Holland has windmills....and Holland has tulips. Holland even has Rembrandts.

   But everyone you know is busy coming and going from Italy... and they're all bragging about what a wonderful time they had there. And for the rest of your life, you will say "Yes, that's where I was supposed to go. That's what I had planned."

   And the pain of that will never, ever, ever, ever go away... because the loss of that dream is a very very significant loss.

   But... if you spend your life mourning the fact that you didn't get to Italy, you may never be free to enjoy the very special, the very lovely things ... about Holland.

http://www.our-kids.org/Archives/Holland.html

Andy Richards, Age 19

Andy is doing well, and is looking forward to returning to school for his senior year. He's had a great summer, had a job working at the local school doing some janitorial work which he absolutely loved. He was so proud and happy when he'd get paid, and always seem to have plans for what to buy with his money.

We have an in house support person that comes in to help for 20 hours a week and that has been a god send so that I can finish college, finally, after all these years.

We are in the process of transitioning into the adult world for services which has been a tough process, I am amazed at how little service there is for adults with developmental delays, so I guess that will certainly take some adjusting to.

Overall I have to say that the whole family is doing very well and that we've all had a very busy and fun summer, hope yours was as well.

Lynn and Andy Richards

Whitefield, ME

Van Brewster, Age 24

I just caught up today on the last couple of newsletters.  When I read David & Kathy Myers question about B.J.'s purple hands and feet, I knew I had to write. My son Van Brewster has the same problem. The doctors in Jackson, MS diagnosed it about 12 years ago. 

We had gone to a baseball game at night and it was very cold. He was in a huge coat but when I looked at his hands and saw they were purplish blue, I left with him, planning to go to the emergency room.  After a few minutes in the car with the heat turned up and me rubbing his hands between mine, they turned a normal color again.

Another time, I noticed his feet were purplish black when he was inside and barefoot.  After that incident, we visited a doctor and were told he had Renauds Syndrome.  He cannot handle extreme cold or heat, and when their hands get like that, you just need to normalize the temperature of them, either rubbing them to warm them up or getting the circulation back in hands or feet or even cooling him down.  It's not dangerous or anything, just uncomfortable.  

I also wanted to tell you that Van turned 24 years old last month and he's doing great. He works at a workshop for developmentally delayed adults, MIDD Meridian.  He enjoys working, visits his Dad in Louisiana about once a month for the weekend, and when not at either of those two places, he entertains himself in his room with puzzles, games, tv and computer. 

He's a very happy person and  a joy to me and the rest of the family.  He has a brother and two sisters and lots of friends.  He talks on the phone several times a day and his one chore at home is unloading the dishwasher, which he does very well every afternoon. 

We have two different attendants for him: one brings him home from work every afternoon and helps him clean up his room and the other comes in the evening to help him with his bath and grooming.  I help him get dressed and groomed in the morning, fix his breakfast and take him to work.  All in all, I'd say we've got everything worked out pretty well. 

I expect him to always live with me and I think he's very happy here and doesn't want to go anywhere else.  If anything ever happens to me while he's alive, I'm sure his sister who is five years younger than him will take care of him. She adores him and always has.  His other two siblings love him, but this sister has the closest bond of all.   

He has not had anymore malignant melanoma in over five years and very seldom has bladder infections since they put him on a daily maintenance dose of antibiotic. He's never had the drop attacks that everyone else talks of.

When he had his surgery to put rods in his back, it went perfectly smooth - 7 days later when we took him home, he never got back in bed and was well ever after.  We've been almost too blessed to be true and every time he gets a fever or sore throat I can't help but imagine the worst because I fear that something bad will happen because we've been too lucky.  But for now, we smile everyday and thank God for the wonderful blessings he has given us! 

Van changed my life from the day he came into it, and I always count him as my best blessing of all!  I will continue to pray for all of the families and children with CLS.  I thank the parents of the adults with CLS who write in, because every time I see a letter about someone who is 30 or 40 years old, I jump for joy to know that Van can live that long!   

Mary, thank you for all that you do to keep us all in touch with each other.  God will bless and protect you and yours!

I looked up Raynaud's Syndrome, but it does not seem to entirely describe the situation for these other kids nor my son's case.  Raynaud's Syndrome is a hypersensitivity to temperature, but I've seen Davis's hands turn blue regardless of the temperature. Sometimes he will be just watching tv or playing on the floor, and I will notice that one hand is bluish. In Davis's case, it could be either a symptom of his mitral valve insufficiency or his compressed trachea. I would hope that anyone who sees this symptom does get it checked out by a doctor as the cyanosis might be an indication of a more serious underlying condition.  

Glad to hear that Van is doing so well. You are very fortunate.—MCH

Davis Illa, Age 18

Davis turned 18 this August, so his father and I have completed guardianship proceedings, and I have applied for SSI.

This spring, we discovered that Davis's spine is pushing forward between his shoulder blades (lordosis), to the point where it is crimping his trachea between his spine and his collar bone. We don't know if the condition will continue to get worse, or if it will stablize - it depends on whether he is still growing.  We investigated surgical options, but discovered that the surgery is very risky for morbidity or paralization and not guaranteed to correct the problem. We have decided not to pursue another major surgery at this time so that Davis can enjoy whatever time he has left.  Davis is still breathing fine when he is healthy, but if he catches a chest cold or the flu, he is at very high risk of pneumonia.

As a word of caution to others who have children with scoliosis, make sure that the surgeons understand that bone development in kids with CLS is about 2 years behind their age. Spinal fusions are usually done after the age of 12 because by that time, you have 90% of your spine growth already. But in a CLS kid, they are more like 11 and if they have fusion at age 12, there is still a good chance that their spine will continue to grow which causes problems like what Davis is having. The surgeons can take this into account when deciding on what hardware to use.

Ever since his last hospitalization, Davis's anxiety level has been very high and he has been having more drop episodes as a result. We is now at the maximum dose of Lamictal for his weight, and it is no longer controlling his drop episodes. His anxiety seems to be "overriding" the medication. He is especially afraid when sitting at the table to eat. We haven't been able to figure out why this is the case. I've resorted to bringing his wheelchair up a flight of stairs so that he can sit in that to eat. He seems less afraid in his wheelchair. He is also gagging and choking on his food quite a bit. It may be that the skeletal problem is also causing compression on his esophagus, I just don't know.

Davis also had a septoplasty earlier this year to correct a badly deviated septum. It is so strange to see him breathing through his nose with his mouth closed after so many years of mouth breathing. He looks like a different person. I wish I had done it earlier.

Thank you to everyone who has expressed support. It means a lot.

Anthony Smith, Age 13

We found a gentleman at UNC that did some work with the people at the Greenwood Clinic in South Carolina that is an autism research specialist and he evaluated Anthony and he falls in the mild to moderate range of autism, not just the spectrum as we had thought before.  Anthony scores were well above the cutoff for autism. Example, they have cutoff for the spectrum then cut off scores for autism. If the custoff score for autism in a particular area was a 3, he was a 6.  Another cutoff was 4 he was an 8. He is now being served in an autistic class.

Also would like to know if anyone has found meds that have helped with emotional outburst, anxiety and /or attention and focus. Also what meds kids have been on and there success and or problems they have experienced  and do all kids with CLS seem to be sensitive to behavior meds. Anthony has been on Concerta - no results. Straterra, causing him to become more agitated and increased anxiety. Prozac- caused to him to obsessively pick sore and create sore on body. Adderall caused stare sezures. Risperdial increased anxiety and causedsevere mood swings. Clonidine, extreme hyperactivity and mood swings.

We are looking for any help or ideas or combinations of meds as Anthony seems to have very sensitive to meds. Thanks in advance for your help.

Anthony does not sound like he has classic ADD, because all the normal stimulant ADD meds are having the same effect on him as they would on a person without ADD, i.e., making things worse. I would investigate how to treat the anxiety instead - if you can reduce that, I would think the ADD would get better, too. It's hard to concentrate when you are scared.  

 Here is a link to a good comparison of medications to treat anxiety, compared side-by-side:  

 http://www.healthyplace.com/Communities/Anxiety/treatment/medications_chart.asp 

Ashley Hayden, Age 20

As you may remember, my daughter, Ashley who turned 20 in July has had a very difficult time the past couple of years.  Her anxiety is quite high as well.  Her drop episodes have become so severe that she has given up walking and is even very, very uncomfortable in her wheel chair.  She often says, "this is dangerous, I am going to fall".  She has fallen out of a handicapped shower unto her face...and also off of the toilet - so I know that she really might fall (it is not just a "feeling").  We continue to try different medications but so far, they have not proven helpful.  We are taking one day at a time.  We have sure seen a decline in her abilities and it appears to us that the CLS is progressive??

Take good care and know that we appreciate your many efforts on all our behalf.

I'm having the same problem with Davis. His anxiety level started to go up last fall and hasn't come back down. I am investigating anti-anxiety meds and will discuss this with his neurologist the next time I bring Davis to see him.

Certain aspects of CLS may be progressive. There is a lot of variation among people who have it. Since there are nearly 100 mutations that can cause a clinical CLS diagnosis, we are probably dealing with a family of different disorders that resemble each other. Some may be progressive, some may not. There is still a lot we don't know. It seems that those kids who have the drop episodes do get worse over time, at least with that aspect of the condition.—MCH

Christopher Kerner, Age 4

Christopher turned 4 in Aug and is making great progress in his pre-school classes, loves getting on his little yellow school bus.

Christopher (CJ) is speaking very little and it is very tough to understand his needs, but we are learning. He does say “Ba” for bottle and “mommy”, and his favorite word is “car”.  His health seems to go up and down. He will be having his fifth set of ear tubes put in this week. He has many ear infections without them. We were just informed by our doctors that he has the beginning of scoliosis, and they want X-rays taken to see the extent. We thought this would occur at a later time. We are taking him to Children’s Hospital in Philly to see his orthopedic doctor for a checkup on his hips [Chrisopher also has hip dysplasia—MCH] and we will ask him about it. I know there is nothing we can do at the moment, but it would be nice to know what to expect. He has just started walking in the last few months and now we can't keep up with him.

One other thing is that he has not put on any weight over the last year. He has stayed at 27 lbs and has not really grown. Does this seem to be common.

J.I.P. James is credited with classifying idiopathic scoliosis according to the age of the patient at the time of diagnosis. Using his classification system, children diagnosed when they are younger than 3 years have "infantile idiopathic scoliosis". Children diagnosed at ages 3-10 years have "juvenile idiopathic scoliosis", and those older than 10 years have "adolescent idiopathic scoliosis". The younger a person is when they are diagnosed, the higher the likelihood that the curves will progress and surgery will be required. There is also a genetic component to scoliosis.   

Treatment for scoliosis is no different for CLS kids than anyone else, with one important exception; bone growth in CLS is delayed by up to two years behind chronological age. The surgeon must take this into account when deciding when to perform surgery and what type of hardware to use.

For more information, here is a link to a very in-depth article on scoliosis: http://www.emedicine.com/orthoped/topic504.htm

As for the weight, this varies a lot among CLS kids. The majority seem to have a problem with gaining too much weight. Some, like my son, have a hard time gaining weight. Since there are so many mutations that cause a clinical diagnosis of CLS, there may be different conditions that we currently collect under the name "Coffin-Lowry".—MCH 

Thanks for Caring!

The following families or individuals have recently made generous donations to the Coffin-Lowry Syndrome Foundation:

James & Susan Ochs

Toledo, OH

Send your donations to:  

Coffin-Lowry Syndrome Foundation

c/o Mary Hoffman

3045 255th Ave SE

Sammamish, WA 98075 

(U.S. Funds, please)

For a donation of $50 or more, you will receive a set of five beautiful hand-made greeting cards like the one below. The cards are made with exotic papers and mizuhiki cord embellishments. No two are exactly alike. Click here for full-color samples.