I am pleased to report that the Special Needs Trust Fairness Act bill, passed by the Senate in 2015, has now been passed by the House, and President Obama is expected to sign the bill shortly. What seems like common sense will now prevail when it comes to Special Needs Trusts.
By way of background: a provision enacted as part of an overhaul of Medicaid (The Omnibus Budget Reconciliation Act of 1993), allowed only a parent, grandparent, court or guardian to establish a Special Needs Trust (SNT) for a person with special needs under the age of 65, using that person’s funds.
The person themselves could not establish a SNT for their own benefit. Apparently Congress believed only incompetent individuals needed an SNT. However, blind individuals, paraplegics, and those with other debilitating conditions often require SNTs. This omission created an unnecessary and burdensome challenge for competent adults that is both time consuming and expensive. It is also a violation of civil rights.
NAELA challenged this issue in 2013, with a proposed amendment to the statute that would allow a competent individual with special needs to create a trust for themselves. The bill made it to the House and Senate but languished. In 2015, NAELA resubmitted the bill. It passed in the Senate in September 2015 and last week passed in the House. President Obama is expected to sign the bill shortly.
I am proud to be part of an organization that did not give up on this critical issue. Congratulations to my colleagues at NAELA for making a difference in the lives of special needs individuals and their families.