What are Pooled Trusts, Who Do They Benefit, Costs, and How Do They Work? How a Pooled Trust Benefits a MassHealth Recipient

If you are or have a relative who is disabled and needs MassHealth benefits, then a pooled trust may enable you or your loved one to receive funds while remaining eligible for MassHealth.

There are certain requirements for individuals to receive MassHealth benefits. If you are above a certain income or have assets exceeding the minimum amount ($2000.00 in countable assets) then you are ineligible. However, there are ways to receive funds while remaining eligible for benefits. One is to have funds deposited into a pooled trust, also known as a self-settled or (d)(4)(C) pooled trust. This is a trust set up by a non-profit organization that invests and manages funds deposited by many individuals who are disabled. Although the funds are used for the benefit of all, each person has a sub-account that is funded by the disabled party. Consult a lawyer for pooled trusts such as Patricia Bloom-McDonald who has considerable experience in advising and setting up trusts that can protect beneficiaries of MassHealth benefits.

You can receive funds from an inheritance or an injury settlement. If you were receiving MassHealth benefits, your receipt of these funds would likely render you ineligible for further benefits until the funds were paid down. Since your costs of care are likely very high, this could result in the quick dissipation of these funds. Gifting the funds would not take away a penalty period. If you are under 65, you could set up a special needs trust, however the costs of such trusts can be high unless you are receiving a substantial settlement or inheritance (over $100,000).

But by investing these proceeds in a pooled or (d)(4)(C) trust, you or your loved one can use these funds in other ways to supplement your MassHealth benefits.

How Can Pooled Assets be Used?

For instance, you can use your pooled trust funds for the following:

  • – Pay for extra services if you are a resident at nursing home, including entertainment or special care like dental care that is not covered by MassHealth, or even for clothing
  • – Maintenance on your home using funds that are not ordinarily allowed for this purpose
  • – If at home and receiving MassHealth, for additional or special care so that you or your loved one can remain at home

The administrative costs of a pooled trust are often far less than for an individual special needs trust. The trust administrators are able to use funds for more stable investments and to have management services that would be very costly in a special needs trust.

Does MassHealth Still Get Reimbursed?

MassHealth is permitted to be reimbursed for the benefits it provided to you and may go after funds remaining in the pooled trust after your death, up to the amount of money MassHealth expended on your care. There can be a provision in the trust agreement that a certain percentage of the beneficiary’s remaining funds be retained by the trust for its mission of caring for disabled and elderly persons.

Unlike a special needs trust, a (d)(4)(C) pooled trust can be funded after the beneficiary reaches age 65.

Consult with estate planning lawyer Patricia Bloom-McDonald if you are in a situation where a (d)(4)(C) pooled trust could benefit you or a loved one. As a lawyer for pooled trusts, Attorney Bloom-McDonald can properly advise you regarding where to find reputable organizations that operate and administer pooled trusts.