Posts Tagged ‘Affordable Care Act’

Two Words (“The Individual”) Make a Big Difference

DECEMBER 12, 2016 VOLUME 23 NUMBER 46
Congress may be in a historic post-election lull, but the end of the year can sometimes see surprising, bipartisan progress. With passage by the U.S. Senate of the Special Needs Trust Fairness Act (a very small part of the 21st Century Cures Act) a significant change has been introduced into the world of special needs trusts. And it all comes down to the addition of two words: “the individual”. Let us explain.

Sometimes an individual with a disability will qualify for the Supplemental Security Income (SSI), Arizona Health Care Cost Containment System (AHCCCS) or Arizona Long Term Care System (ALTCS) programs, but not be able to receive benefits because their assets exceed the $2,000 limit generally applied for all of those programs. In that case, if the individual is under age 65, they might be able to establish a special needs trust and thereby qualify for benefits.

Actually, it’s not correct to say that they could establish a special needs trust. Until passage of the law last week, the special needs trust could only be established by the individual’s parent, grandparent or guardian — or by a court. A competent individual with a disability could not establish their own trust, and often had to go through a court proceeding (at considerable additional cost) before qualifying or re-qualifying for SSI or ALTCS.

The existing law (42 United States Code section 1396p(d)(4)(A)) said that such a trust could be established by “a parent, grandparent, legal guardian of the individual, or a court”. The Special Needs Trust Fairness Act amends that provision so that it permits establishment by “the individual, a parent, grandparent, legal guardian of the individual, or a court”.

The new law will become effective immediately upon President Obama’s signature, which is anticipated in the next few days. It will have no effect on existing trusts, since they will each have been established under the old law. It will, however, sweep away thousands of pages of qualifications, refinements and interpretations about whether a trust could be established by a parent who held a power of attorney, or whether an individual with a disability could file their own guardianship petition (or seek court approval of a trust in their own names).

This simple but powerful change was promoted by the Special Needs Alliance (two of the attorneys at Fleming & Curti, PLC, are members of that national group) and the National Academy of Elder Law Attorneys (all four of our attorneys are members). It has been a key component of legislative plans for the entire advocacy community. Its adoption is welcome news.

The change is just the latest in a series of incremental improvements in the eligibility rules for SSI, ALTCS/AHCCCS and other programs like public housing assistance. Among the changes: more logical (and consistent) treatment of special needs trust distributions among the different programs, creation of the ABLE Act (“Achieving a Better Life Experience” Act) program, allowing public benefits recipients to save more than the long-time $2,000 asset limitation for eligibility, and (partly as a result of the Affordable Care Act and its expanded Medicaid programs) increasing use of tax-based language in place of more peculiar Social Security Administration definitions.

One recent court case gives a good illustration of how this most recent change will benefit people with disabilities. A young South Dakota woman’s special needs trust, established by her parents (as required by the prior law), was invalidated largely because she had signed a power of attorney naming her parents as her agents. That, according to the Social Security interpretation, meant that they acted not as parents but as their daughter’s agents — making the trust defective. The new law should put an end to that type of game-playing.

There are still many individuals who will need a court to get involved to create a special needs trust. The new law, however, should make it easier — and considerably less expensive — to set up many special needs trusts.

The Affordable Care Act and People with Disabilities

SEPTEMBER 30, 2013 VOLUME 20 NUMBER 37

The Affordable Care Act is upon us, or almost so. October 1, 2013, is usually listed as a key date for the ACA, and it is — but nothing actually changes on that date. Quite a few changes have become effective already. The changes receiving the most media attention — the availability of health care exchanges and individual insurance policies, and the related requirement that almost everyone get some sort of health insurance coverage — begin to kick in on January 1, 2014.

October 1 is important, though. That’s when the health exchanges are supposed to be available, even though customers won’t be able to secure policies for another few months after that date. That’s when we should have at least a partial answer to some of our questions, like how much ACA insurance will cost. Many, many other questions will still remain unanswered.

One question that we at Fleming & Curti think should be asked more often: what effect will the Affordable Care Act have on care of people with disabilities? Maybe the reason the question isn’t asked more often is that the answer is (as we look into our Magic 8-Ball): “Reply hazy – try again”.

There have been a few articles written about the relationship between the Affordable Care Act and patients with disabilities. The Obama Administration has a few suggestions about the benefits of the ACA for this population. The Special Needs Alliance (we love the SNA, and we are members) has written about the ACA, and individual SNA members have described the effect of the Supreme Court decision upholding the ACA, the ACA’s impact on people with special needs, and how the new health care exchanges may affect care for those with disabilities (among other topics). The National Academy of Elder Law Attorneys has provided a fair amount of information, too.

But what does it really mean? We can provide some highlights:

  • The ACA means the end of pre-existing conditions limitations. This might be a huge item. People with special needs have largely been frozen out of the health insurance market because they haven’t been able to get coverage. That should now change. People with cerebral palsy, mental illness, physical disabilities — all should be able to qualify for insurance. Coverage might be limited, or expensive, or both — but it should be available. That, of course, only works if almost everyone is insured — we will have to see how that plays out over the next few months.
  • Most patients with disabilities, frankly, will be unaffected. Most already qualify for Medicare or Medicaid — or both. They will not, in most cases, be moving to private insurance (though some undoubtedly will).
  • Family members, including caretaker family members, may suddenly qualify for health care coverage. That just might prove to be a surprisingly strong benefit for patients with disabilities.
  • Some beneficiaries of special needs trusts may be in a position to leave Medicaid plans in favor of private insurance. Some special needs trusts might even be modified to provide better benefits for the beneficiary (since continued eligibility for Medicaid might not be as important). This, of course, will depend on the size of an individual special needs trust, and the cost of insurance. But a significant number of patients may move from the public health system to private insurance coverage.

It is early still, but the ACA might be a real game-changer. We’ll keep monitoring policies as they roll out, and as the industry adapts to change.

 

 

 

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