Pooled Trusts and How to Find Them

Medicaid and SSI law permit "(d)(4)(C)" or "pooled trusts" for beneficiaries with special needs. Such trusts pool the resources of many beneficiaries, and those resources are managed by a non-profit association.

Becoming part of a pooled trust may have advantages, depending on the situation. Pooling trust resources can reduce administrative fees, increase the total funds available for investment, and permit access to better investment opportunities. In addition, 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. But bear in mind that those over age 65 receiving Medicaid or SSI who make transfers to the trust will incur a transfer penalty.

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. (At least, that's what the federal law says; some states require reimbursement under all circumstances.)

Pooled trusts are available in most states. For the Academy of Special Needs Planners' list of pooled trusts around the nation, click here.