Social Security Changes Its Position on Reimbursements
Moorestown, NJ (Law Firm Newswire) March 26, 2012 - The Special Needs Task Force worked with Social Security to change how it reimburses third parties.
Historically, the Social Security Administration (SSA) permitted parents or other family members of disabled beneficiaries of special needs trusts to buy items for the beneficiary and be reimbursed from the special needs trust. Of course, the family members were required to keep receipts and records of these purchases and furnish them to the trustee. Items might include clothing and other relatively small items that were easier for the parent to pick up and pay for than to request a distribution from the trustee directly to the provider of the goods or services.
In the spring of 2012, the SSA stated that such items of reimbursement were “unearned income” to the trust beneficiary. This had the effect of reducing the SSI payment to the trust beneficiary dollar-for-dollar and, if the reimbursement items exceeded the maximum federal benefit rate (2013 rate is $710 per month for an individual), then the SSI payment was lost. If the trust beneficiary’s Medicaid was linked to SSI, then Medicaid was lost as well.
On May 21, 2012, SSA contended that it was “clarifying” the Program Operating Manual System (POMS) and began reducing and eliminating benefits of the disabled. It is the document that Social Security eligibility workers look to for guidance. While technically, the POMS do not have the force of law, they are given great deference by the courts and are followed scrupulously by eligibility workers. The effect of this clarification by SSA was chaos for trust beneficiaries with disabilities, as well as parents and trustees.
"In response, an advocacy group was assembled, led by the Special Needs Alliance," stated Thomas D. Begley, Jr., New Jersey estate planning attorney and founding president of the Special Needs Alliance. "The Task Force held a series of meetings with SSA and was able to convince SSA that the policy enunciated in the spring made little sense and worked a hardship on all involved."
On February 8, 2013, the POMS were changed, authorizing a special needs trust to reimburse a third party, such as a parent or other family member, for expenditures made on behalf of the special needs trust beneficiary with disabilities. Such distributions for reimbursement are no longer considered unearned income. The changes are found at POM SI 01120.200.E.1.d and POMS SI 01120.201.I.1.f.
This change brings a sigh of relief to trust lawyers, beneficiaries and trustees alike. The Task Force continues to work with SSA in identifying primary issues such as this and advocate for the clients it serves.
To learn more about Begley Law Group call 1.800.533.7227 or visit www.begleylawgroup.com.
Begley Law Group, P.C.
509 S. Lenola Road, Building 7
Moorestown, NJ 08057
- THE FUTURE OF THE LEGAL PROFESSION
by Thomas D. Begley, Jr., CELA ABA Commission The American Bar Association has appointed a Commission on the future legal services. Legal services are expensive and are beyond the reach of many poor and even middle class individuals. Technology is becoming a game-changer and non-legal entities are engaged in providing legal services. The ABA Commission is holding a series of grassroots meetings to gather information and propose new approaches for the delivery of legal services. The Commission will look at data regarding what percentage of a lawyer’s time is actually spent practicing law as opposed to administrative, marketing, fundraising, etc. [...]
- PERSONAL INJURY SETTLEMENTS: HOUSING FOR PLAINTIFFS WITH DISABILITIES
by Thomas D. Begley, Jr., CELA Introduction Housing for an individual with disabilities is a major concern. The purchase of a residence is a very important decision involving a number of factors. This is particularly true where the individual is receiving means-tested public benefits such as Supplemental Security Income (SSI) and Medicaid. If there is a special needs trust involved, the SSI and State Medicaid Regulations must be carefully considered. Selecting the Right Home Often, a home must be made handicap accessible. In selecting a home, care must be taken to ensure that the home can be adapted for the [...]
- YOU HAVE JUST BEEN DIAGNOSED WITH EARLY ALZHEIMER’S: NOW WHAT?
by Thomas D. Begley, Jr., CELA Background on Alzheimer’s According to the American Alzheimer’s Association, Alzheimer’s disease is a progressive brain disorder that damages and eventually destroys brain cells, leading to memory loss and changes in thinking and other brain functions. It usually develops slowly and gradually gets worse as brain function declines and brain cells eventually wither and die. Ultimately, Alzheimer’s is fatal and currently, there is no cure. An estimated 5.3 million Americans of all ages have Alzheimer’s disease in 2015. Thirty-six percent are age 85 or older, 43% are between 75 and 84, 16% are between 65 [...]
See other news sources publishing this article. BETA | Tags: new jersey elder law, new jersey elder law attorney, new jersey estate planning, new jersey estate planning attorney, new jersey estate planning lawyer, New Jersey personal injury settlement consultant, New Jersey Special Needs attorney, New Jersey Special Needs Lawyer, New Jersey Special Needs planning, new jersey veterans law, nj elder, nj estate planning, nj estate planning attorney