Medical Assistance Pooled Special Needs Trusts
A POOLED TRUST is an arrangement by which a non-profit association, as trustee, holds property for the benefit of another person (the beneficiary). Iowa law refers to these trusts in Iowa Code 633C.1 as a type of Medical Assistance Special Needs Trusts. They are also known as Pooled Trusts, or d4C Trusts as they were statutorily created by federal law at 42 USC 1396p(d)(4)(C).
When to Use
Pooled Trusts are established for Medicaid applicants or members who are disabled to care for the special needs of a beneficiary. Often, Pooled Trusts are set up after a legal settlement of a personal injury case or medical malpractice action. Pooled Trusts may also be used for inheritances, gifts, or other resources.
Requirements for a Pooled Trust
- the trust must be irrevocable
- established for the beneficiary by the beneficiary, or by a parent, grandparent, legal guardian, or a court
- created with the assets of a disabled person
- the State of Iowa must be the residual beneficiary of the trust
- the trustee must be a non-profit association
Responsibility of Non-Profit Association
The non-profit association must be approved to set up Pooled Trusts and then maintain a separate account for each beneficiary. The non-profit association may pool the accounts for purposes of investment and management, and must invoke jurisdiction over the trust in the Iowa District Court.
Reimbursement to the State
Reimbursement must include up to all Medical Assistance provided and not just the Medical Assistance provided during the term of the trust, after any amounts retained by the trust.
Submitting a Pooled Trust for Approval
The trust should be sent to the Department of Health and Human Services caseworker for the beneficiary who will send the trust document to the Medicaid Trust Program for review, approval, or denial.
Yearly reports showing the monthly and total yearly income placed in the trust and the monthly and total yearly expenditures may be sent to the Medicaid Trust Program at the address below for review, and must be filed with the Iowa Disctrict Court as required by law.
Report Upon Death
Upon death of the beneficiary or other termination of the trust, the trustee is responsible for winding up the affairs of the trust and should send notice of the termination, and reason for termination, to the Medicaid Trust Program at the address below.
At the termination of the trust by death or otherwise, payment of the money left in the trust after any amount retained by the trustee must be paid to "Iowa Department of Health and Human Services" up to the amount of all medical Assistance paid on behalf of the beneficiary. Payments should be mailed to:
Medicaid Trust Program
PO Box 36565
Des Moines IA 50315