A special needs trust holds funds for a person with disabilities so that assets do not count toward eligibility limits for Medicaid and Supplemental Security Income. Distributions supplement rather than replace public benefits.
First-party trusts funded with the beneficiary's own settlement proceeds must generally be established before age sixty-five and include Medicaid payback provisions.
Alternative Names:
Supplemental Needs Trust, SNT
Why it Matters?
Without a trust, a settlement can terminate the benefits that fund a disabled claimant's ongoing care, leaving them worse off than before. Because these structures must be established at settlement, planning has to occur during negotiation rather than after. Defense counsel should expect the issue in catastrophic cases and build the timeline for it into the settlement schedule alongside lien resolution and Medicare analysis.
Frequently Confused with
Related terms
Frequently asked questions
Why is a special needs trust necessary?
What is a Medicaid payback provision?
