A Pooled Special Needs Trust is an asset protection strategy which is specifically for aged and disabled Floridians for. Provisions for Pooled Trusts were established pursuant to Federal Law, 42 U.S.C. §1396p(d)(4)(C) to help the elderly and persons with disabilities who want to set aside funds legally and ethically while maintaining eligibility for public benefits such as Medicaid and Social Security Disability. The funds placed in a Pooled Special Needs Trust are used to improve quality of life and pay for life enrichment items or necessities that are not covered by other programs. The use of a Pooled Trust allows the individual (Trust Beneficiary) to deposit an unlimited amount of their own money in the Pooled Trust , keep their government benefits and still benefit from the assets held in the Trust.

What is a Pooled Trust or (d)(4)(c) Trust?

While there are several types of Special Needs Trusts, a Pooled Trust is a self-settled trust that is funded with the assets of the Individual (Trust Beneficiary) who is of any age and is determined to be disabled.* see definition of disability

A Pooled Trust is considered an exempt resource by means tested government programs and will not be subject to a transfer penalty if it meets these statutory requirements:

  1. The Trust is established and maintained by a non-profit association.
  2. The Trust is funded with assets and/ or income which belong to the Individual (Trust Beneficiary).
  3. The Trust account may be established by the Individual or a person legally qualified to act on behalf of that individual such as a power of attorney or legal guardian, a parent, grandparent, or a court.
  4. A separate account is maintained for each beneficiary of the Trust for prudent investment and management purposes. The Trust funds may be pooled into one account.
  5. To the extent that any funds remaining at death are not retained by the Trust, the state must be reimbursed for the amount of medical assistance paid by the state for the benefit of the individual.
  6. The Pooled Trust Agreement must be Irrevocable.

Who May Benefit From A Pooled Special Needs Trust?

The Person for who the money is being managed is called the Trust Beneficiary.

Examples of Trust Beneficiaries:

  • Ÿ Persons with disabilities under age 65 * see definition of disability below
  • Ÿ Elderly Persons over 65 (who are not on or applying for SSI)
  • Ÿ Persons living in Nursing Homes, Assisted Living Facilities or at Home with care givers.
  • Ÿ Persons on Medicaid or Social Security Disability Programs or other Programs
  • Ÿ Persons who receive court settlements or inheritances that would otherwise disqualify them from public benefits.

Definition of Disability

 *Disability is defined at 42 U.S.C. § 1382c(a)(3).  The definition of disabled is extensive. In summary an individual is defined as disabled if “he / she is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve month.”   The statute requires that the physical or mental impairment be so severe that not only can the individual not do his/her previous work but “cannot, considering his age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy.”

 Who Determines Disability Status?

Government AgencyProgramInformation and Documents To Be Submitted
Social Security Administration
SSDI or SSINames and Addresses of all treatment providers, dates of treatments, List of medications, medical records from every provider, Details of your physical limitations in your daily activities, Unpaid medical bills, Signed CF-ES 2514 form
(Authorization to Disclose)
Department of Disability Determinations (DDD)Community MEDS-AD, Medically Needy, and Retroactive Medicaid for SSISame as above
District Medical Review Team (DMRT)Nursing Home Medicaid ( ICP: Institutional Care Program), OSS
(Optional State Supplementation) and HCBS ( Home and Community Based Services)
Same as above

How Does One Join the A Pooled Trust ?

 Every Pooled Special Needs Trust is established by a Master Trust document which outlines the purpose and guidelines of the Trust. This Trust is not signed or altered by the Trust Beneficiary. It remains the same for every member.

Disabled individuals who wish to join the Trust will first complete and sign the Joinder Agreement. The Joinder Agreement is specific to each Individual and it is where intentions are written with regard to expenses, payments, Beneficiary Advocates, financial arrangements after death, etc.

Competent Individuals shall sign their own Joinder Agreements and deposit income and / or assets which are their own. Once an individual joins the pooled Trust they are referred to as the Trust Beneficiary. If the intended Trust Beneficiary is incompetent or unable to sign, someone with the legal authority to act on their behalf, as described in the federal statute, may complete and sign the Joinder Agreement.

The Trustee then opens an individual sub–account with the bank holding the Pooled Trust funds. The Trust Beneficiary or their legal representative may then deposit the Trust Beneficiary’s income and/ or assets into the Trust. Income can be directly deposited to the sub-account.

Once the account is established and funded, the Trustee will pay the Trust Beneficiary’s authorized monthly bills and other expenses as required from the Trust. The Trust Beneficiary or their Beneficiary Advocate may make written requests for allowable expenses to be paid, as needed. All payments made from the Trust must be for goods or services outlined in the Joinder agreement and /or for the betterment of the quality of life for the Trust Beneficiary.

Legal Advice:

A Pooled Trust is not a law firm or legal service and its Principals and employees may not interpret the Master Trust or Joinder agreement for anyone or determine if it will meet an individual’s government benefit needs. Since a trust is a legal instrument, we recommend seeking the advice of an attorney.  You are invited to call our law firm, and speak to Attorney Ryan Smoller to determine if this strategy would work for you toll free at 888-552-7512.

The Laws and Regulations that Govern Special Needs Trusts:

  • Federal Statute – 42 U.S.C 1396
  • Federal Policy – POMS
  • State Statute – F.S.736 Trust Code
  • Administrative Regulations Administrative Regulations – FAC
  • State Policy – Florida Medicaid Manual

How May The Trust Funds May Be Used ?

Pooled Trust funds may only be used for the care and benefit of the Trust Beneficiary.

Funds may be used to pay bills for certain living expenses, utilities, medical expenses, and other quality of life purchases and services. Examples of services and products which may be paid by the Trust are:

  • Private Home Health Care Services ** see exceptions
  • Private Health Insurance Premiums
  • Legal fees
  • Guardianship fees
  • Care Management services
  • Nursing Home or Assisted Living private room rate differentials
  • Long Term Care Insurance Premiums
  • Rehabilitation Services and Equipment (not covered by other benefits)
  • Out of Pocket medical and dental expenses not covered by govt. benefits
  • Transportation to / from appointments and events
  • Vehicle Purchase and Maintenance expenses
  • Dietary Supplements
  • Food & Shelter (rent, mortgage, utilities, etc.)**
  • Maintenance of items used to support the Beneficiary (house, vehicle, car)
  • Events, Travel, Trips to see family or enhance quality of life
  • Purchase of goods and services that add pleasure to life (furniture, Decorations , telephones and service, television, entertainment, memberships)

How Can the Trust Funds Not Be Used

Pooled Trust funds are only for the Trust Beneficiary. Funds are not authorized for:

  • Ÿ Gifts to others
  • Ÿ Support of others
  • Ÿ Charitable Donations during the lifetime of the Trust Beneficiary

Who May Determine How the Money is Used?

In order to meet statutory requirements, the Trust must be managed by a bonafide non- profit organization. The Directors of the trust serve may serve as a trustee for their member.

The Individual and/ or their Beneficiary Advocate(s) designated on the Joinder Agreement may make requests for services and products to be paid from the Trust. The ultimate decision regarding payment rests solely with the Trustee.  Payment is made directly to the vendor.

Self determination and quality of life is at the core of any successful program serving the elderly and disabled. The Pooled Trust Joinder Agreement includes provisions for the Trust Beneficiary and their designated Beneficiary Advocate(s) to list the anticipated expenses and uses for the Trust funds. Any questions or concerns regarding uses for the funds may be addressed prior to the establishment of the Trust and the Joinder Agreement may be customized to meet the needs of the Trust Beneficiary within statutory guidelines.

Are Financial Reports Statements Available?

The Pooled Trust provides financial statements to each Trust Beneficiary and their Beneficiary Advocates. Separate sub-accounts are created to document their income and expenses.

What Happens if an Individual Beneficiary Utilizes All of the Money in their Pooled Trust Account.?

Many Pooled Trust services do not require a minimum deposit to join the Trust, it is very possible for Trust Beneficiaries to deposit a small amount of money and use it all within their lifetime. When the money is gone, the sub account will be closed. If a future deposit is anticipated, the account will be held open with a minimum balance.

What Happens to the Funds After the Death of the Trust Beneficiary?

 A Pooled Trust, by law, is a Medicaid “pay back” trust. If the Trust Beneficiary received medical services paid for by Medicaid, the Trust must first “pay back” Medicaid for the medical portion of the services delivered. If there are funds left after Medicaid is reimbursed, designated heirs may receive the remaining funds. If the Trust Beneficiary never received medical services from Medicaid, no pay back to Medicaid is required.

Medicaid Payback requirements can be avoided if the following arrangements are entered into the Joinder Agreement when the trust is established:

  • ŸThe funds may be retained in the Trust as a charitable contribution to help other Pooled Trust members.
  • ŸThe funds may be deposited into an individual Pooled Trust account for a specific person who is also a member of the Pooled Trust.
  • ŸThe funds may be donated to a registered charity.

What Does It Cost To Join A Pooled Trust.

Pooled Trusts are a cost effective alternative to costly Individual Trust Services for which many banks require a minimum deposit of one million dollars. Most Pooled Trust’s have no minimum deposit and offer low, one time administrative fees to open an account. It is customary for Pooled Trusts to charge monthly service fees to cover the cost of money management, check writing, and accounting. Once a beneficiary has passed away, a termination fee may cover the cost of managing the medicaid recovery process and any disbursements to beneficiaries. Prior to joining a Pooled Trust, it is recommended to have your attorney read the Joinder Agreement.

** When a government program or insurance is already paying for medical, food or housing expenses, additional payments made by the Trust could disqualify the Trust Beneficiary for program benefits. There can be no duplication of services.