There are various different circumstances that can exist within a family. For example, there may be a child that you love who has special needs. The desire to provide for the child within your estate plan may be there, but you may be concerned about eligibility for Medi-Cal coverage.
Before we proceed, let’s provide some background information about Medi-Cal for those who may not know the facts. The Medicaid program is in place to provide a health care insurance safety net for people of all ages who have very limited financial resources. The program is jointly administered by the state government along with each respective state government. In California this program is called Medi-Cal.
Children with special needs often rely heavily on Medi-Cal, because care and treatment can be very expensive. For example, a lifetime of care for someone with autism can cost millions of dollars. Since the program is only available to people with financial need, an improvement in financial status can cause a loss of eligibility. This could take place if you were to leave a significant direct inheritance to a child with special needs who is enrolled in the Medi-Cal program.
If you are fully aware of the possible loss of benefits, you may decide that you have no choice but to disinherit the child to preserve Medi-Cal eligibility. However, there is an estate planning solution that can be implemented under these circumstances. A special needs trust can provide the answer.
Here’s how it works. You create a trust document, and you fund the trust. The beneficiary would be the child with special needs that you want to provide for, and you would name a trustee to administer the trust.
There are certain things that the Medi-Cal program will not cover, and the trustee can use assets in the trust to satisfy these unmet needs. As long as everything is done in accordance with the Medi-Cal rules and regulations, these expenditures would do nothing to impact ongoing eligibility for coverage.
A special needs trust can provide a solution if you want to make things more comfortable for a child with a disability.
Special Needs Planning Report
This blog post was intended to provide a brief overview. If you would like to obtain more comprehensive information about the way that you can use a special needs trust to help out a child with a disability, download our in-depth special report.
This report is being offered to our readers on a complimentary basis at the present time, and you should certainly download your copy if you have a child with special needs in your family.
To get your copy of the report, visit this page and follow the simple instructions: Free Report on Special Needs Planning.
Special Needs Planning Consultation
If you want to explore your options for Special Needs Planning or are ready to proceed with the planning, we would be happy to assist. To schedule an appointment, simply call our office at (916) 437-3500.
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