What's happening
This bill allows disabled individuals to establish certain trusts for Medicaid eligibility, expanding who can create these trusts.
Why it matters
Empowers disabled individuals to set up their own Medicaid qualifying trusts,. rather than relying solely on parents, grandparents, legal guardians, or courts—giving them more autonomy over their financial planning and healthcare eligibility.
May make it easier and faster for disabled individuals to access Medicaid coverage,. since they no longer need to wait for a parent, guardian, or court to establish a trust, potentially reducing legal costs and administrative delays.
Could result in increased use of "self-settled" special needs trusts,. which protect assets while still allowing access to medical assistance, offering important financial security for people with disabilities.
Maintains Medicaid’s ability to recover costs after the beneficiary’s death,. as the state will still receive any remaining trust funds up to the amount of assistance provided, ensuring public funds are partially recouped.
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Who cares
Disabled Medicaid applicants and recipients under 65
The bill would let them establish trusts for their own benefit without having the trust assets or income counted toward Medicaid eligibility, subject to existing trust requirements.
Parents, grandparents and legal guardians of disabled people
The bill would allow disabled individuals to establish qualifying trusts themselves rather than relying on these relatives, guardians or a court to establish them.
Medicaid eligibility administrators
They would have to exclude assets and income in qualifying self-established trusts created on or after the bill’s effective date, while retaining the requirement that remaining funds repay the state for Medicaid costs upon the beneficiary’s death.
Headline styles
Protect Disabled Persons' Trusts
Plain English, a few words. Used as the page title.
Sponsors
2 Co-sponsors
History
- Substituted by A6743
- Advanced to third reading
- 2nd report cal.
- 1st report cal.899
- Reported and committed to finance
- Referred to health
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Protect Disabled Persons’ Trust Funds
Signed by Governor · Sponsor Didi Barrett
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
4779
2017-2018 Regular Sessions
IN SENATE
February 28, 2017
Introduced by Sens. HANNON, ORTT -- read twice and ordered printed, and when printed to be committed to the Committee on Health
AN ACT to amend the social services law, in relation to the eligibility of disabled persons who are applicants for or recipients of medical assistance
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Clause (iii) of subparagraph 2 of paragraph (b) of subdivision 2 of section 366 of the social services law, as added by chapter 170 of the laws of 1994, subclause (B) as amended by chapter 656 of the laws of 1997, is amended to read as follows:
(iii) Notwithstanding the provisions of clauses (i) and (ii) of this subparagraph, in the case of an applicant or recipient who is disabled, as such term is defined in section 1614(a)(3) of the federal social security act, the department must not consider as available income or resources the corpus or income of the following trusts which comply with the provisions of the regulations authorized by clause (iv) of this subparagraph: (A) a trust containing the assets of such a disabled individual which was established for the benefit of the disabled individual while such individual was under sixty-five years of age by the individual, a parent, grandparent, legal guardian, or court of competent jurisdiction, if upon the death of such individual the state will receive all amounts remaining in the trust up to the total value of all medical assistance paid on behalf of such individual; (B) and a trust containing the assets of such a disabled individual established and managed by a non-profit association which maintains separate accounts for the benefit of disabled individuals, but, for purposes of investment and management of trust funds, pools the accounts, provided that accounts in the trust fund are established solely for the benefit of individuals who are disabled as such term is defined in section 1614(a)(3) of the federal social security act by such disabled individual, a parent, grandparent, legal
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10341-01-7
S. 4779 2
guardian, or court of competent jurisdiction, and to the extent that amounts remaining in the individual's account are not retained by the trust upon the death of the individual, the state will receive all such remaining amounts up to the total value of all medical assistance paid on behalf of such individual. Notwithstanding any law to the contrary, a not-for-profit corporation may, in furtherance of and as an adjunct to its corporate purposes, act as trustee of a trust for persons with disabilities established pursuant to this subclause, provided that a trust company, as defined in subdivision seven of section one hundred-c of the banking law, acts as co-trustee.
§ 2. This act shall take effect immediately and shall apply to all trusts established on or after such effective date.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the social services law, in relation to the eligibility of disabled persons who are applicants for or recipients of medical assistance
Purpose
Provides that individuals may establish Medicaid Supplemental Needs Trusts for their own benefit, without a court order.
Summary of provisions
This legislation amends New York Social Services Law 366(b)(2)(iii) in order to harmonize State law with the new federal provisions that enable non-elderly individuals with disabilities to establish their own SNT without having to file a petition with a court.
Justification
Federal law historically provided that a special needs trust could only be established by parents, grandparents, legal guardians, or a court. Individuals wanting to set up special needs trusts for themselves were required to file a petition with a court. As part of the 21st Century Cures Act adopted in late 2016, the federal law regarding Medicaid Supplemental Needs Trusts ("SNTs") was amended to allow non-elderly individuals with disabilities to establish their own SNT without having to file a petition with a court.
Despite the federal change, New York's current law continues to be discriminatory. The Social Services Law presumes incorrectly that disabled individuals are incapable of creating a trust for their own benefit. The presumption in the current statute is that all people with disabilities lack mental capacity to create a trust is erroneous. This was corrected and eliminated from federal law during the final months of 2016. Failing to enact a state law consistent with the federal change prevents disabled individuals from enjoying the same rights and privileges as able bodied New Yorkers and imposes unnecessary legal fees and costs, court delays, and uncertainty on people who can least afford it.
Legislative history
None
Fiscal implications
Unknown
Effective date
This act shall take effect immediately, and shall apply to all trusts established on or after such effective date.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.