The Pooled Trust as an Asset Conservation/Medicaid Planning Tool
Our office has found many occasions for bringing up the possible use of a pooled trust as a sensible strategy for nursing home residents (or others) or their family members to consider. The threshold issue is that public entitlement programs only are accessible where individuals meet the asset and income (as well as categorical eligibility) requirements of the program being applied for.
Often the client has modest liquid assets (say under $100,000, or so), and a homestead. The average private cost of nursing care in Illinois was recently said to be around $6,000 a month (or years). Thus, this “nestegg” would dwindle down to nothing within a matter of months, in most cases, without some form of legal intervention.
One such intervention might be the so-called pooled trust. This is now in existence with at least four organizations, as follows:
- DayOne Reliance, Inc.
- c/o Bonnie McCrary
- 1551 E. Fabyan Parkway
- Geneva, IL 60134
- (630) 208-5555
- Illinois Disability Association
- c/o Howard S. Berk, Executive Director
- c/o U.S. Trust, Bank of America Private Wealth Management
- 231 South LaSalle Street
- IL1-231-13-39
- Chicago, IL 60604
- (312) 332-4622
- Life'sPlan, Inc.
- c/o Scott Nixon
- 2801 Finley Road
- Downers Grove, IL 60515
- (630) 628-7189
- Options For Living
- c/o Jeffrey Schmidt
- 2580 Foxfield Road
- Suite 201
- St. Charles, IL 60174
- (630) 444-2939
The concept is that the client can sign a joinder agreement (or similar agreement), file an application for Medicaid SSI, or other needs based benefits immediately, and not have to “spend down” to the standard $2,000 nonexempt asset amount. This may be done by the client, by an agent using a durable power of attorney for property, or a court appointed guardian. Unlike other so-called disability trusts, a person over the age of 65 may go into a pooled trust and still not be denied Medicaid eligibility. The Illinois Administrative Code and written policy of the Department of Human Services/Department of Public Aid, and the Federal Medicaid statute clearly supports the use of such a trust.
The benefit is that Medicaid does not pay for non-medical items, and strictly limits the medical items that the program will reimburse. The trust would be just such a source of payment.