What is a pooled income trust?
A pooled income trust, also commonly called a pooled trust, is a kind of Supplemental Needs Trust (SNT) created for disabled individuals. The funds in the trust can be used for their supplemental needs without disqualifying the individual for Medicaid eligibility. Hence, the disabled individual can get Medicaid benefits to cover their healthcare costs while the pooled income trust funds will cover their supplemental needs.
Basically speaking, a pooled income trust works by allowing disabled individuals to qualify for Medicaid without having to “spend down” their assets (using up assets to reduce the size below the asset limit in order to qualify for Medicaid).
Why having a pooled income trust is important in Brooklyn
An individual can become disabled at any time in their life, possibly due to accident or age. One might also have a child with special needs. But Long-term care and health care costs are very high. It becomes a problem for disabled individuals to get quality care without having their hard-earned assets or those of their loved ones drained by the cost.
However, there is Community Medicaid to cater for your long term care, but it is only available to citizens whose estates worth less than $15,900 and earn below $884 monthly.
Take for instance someone suffers personal injury, becomes disabled, and wins a court verdict of a million dollars. Or possibly, your loved ones bequeath assets to you so you can get quality care due to your disability. But as it is, you now own above the Medicaid limit (informally called a surplus or spend-down). That means you would not qualify for Medicaid, and then your money will be drained by your home care costs.
To avoid that, many Brooklyn residents look towards Medicaid “spend down”, which means, spending the “surplus” assets so that what’s left is below the Medicaid limit.
However, not everyone would want to spend their money wastefully because they wish to qualify for Medicaid benefits. So what other way is there? The answer: Pooled Income Trust!
What is the money kept in a pooled income trust spent on?
Funds in a pooled income trust are used to pay the bills of the disabled individual. Money is deposited into the account of the Pooled income trust’s member, and the money will then be used to pay bills – such as rent – on behalf of that member. An employee working at the pooled income trust will make the payment on behalf of the member.
If any bill is recurring one, they may set up an automatic payment so that the bills are paid quickly as at when due.
Note that you cannot withdraw cash from a pooled income trust. When the disabled person passes away, what’s left of their asset must remain in the trust. This is why it is a wise idea to ensure you used it all during your lifetime to settle all the bills you have rather than letting them accumulate for your survivors.
Who is allowed to use a pooled income trust to qualify for Medicaid in Brooklyn?
People who are recognized by the state of Brooklyn or social security as disabled can used pooled income trust to qualify for Medicaid. For those who have not been previously identified as disabled, these ones would have to submit a document ascertaining their disability alongside their pooled income trust for Medicaid approval.
Note that people who already require home care services are regarded as disabled.
Typically, pooled income trusts are run by non-profit organizations for the benefit of disabled individuals.
Do I only need to transfer assets into the Pooled income trust once?
Notably, Medicaid eligibility is determined on a monthly basis. You may be eligible this month but become ineligible next month because you later earn more than you are earning now. That is why you have to continue transferring your surplus assets into the pooled income trust continually.
Get expert help
You may need to get professional help from a social worker or lawyer to submit your pooled income trust application to Medicaid. If you have more questions about pooled income trust and Medicaid eligibility, our elder law attorneys are ready to assist you
Give us a call.
