Rep. Glenn Thompson (R-Pa.) introduced the Special Needs Trust Fairness Act of 2013 on May 23, 2013 (H.R. 2123). According to a press release from the National Academy of Elder Law Attorneys (NAELA), the bill would allow people with disabilities to create first-party special needs trusts to hold their assets without interfering with their access to Supplemental Security Income (SSI) and Medicaid.
The bill addresses a quirk in the current law defining special needs trusts that prevents mentally competent people with disabilities from establishing so-called (d)(4)(A) trusts. As the law stands today, a first-party special needs trust must be created by a parent, grandparent, guardian or court, even if the beneficiary is going to be the person transferring the funds into the trust once it is created. This restrictive provision, which was likely the result of a drafting error, forces countless trust beneficiaries who don't have parents or grandparents, or whose parents or grandparents are unwilling or unable to help them, to petition courts to establish trusts when they are perfectly capable of creating the instruments themselves.
The bill's text is simple and straightforward. It would amend Section 1917(d)(4)(A) of the Social Security Act (42 U.S.C. 1396p(d)(4)(A)) by inserting "the individual," after "for the benefit of such individual by", thereby allowing beneficiaries to create and fund their own special needs trusts. This, according to NAELA President Gregory S. French, would "maximize client independence and self-determination." The bill's Democratic co-sponsor is Rep. Frank Pallone (D-N.J.).
In his own press release, Rep. Thompson credited State College, Pa., elder law attorney Amos Goodell with bringing this inequity to his attention. Goodell is also NAELA's public policy chair.
"In the coming weeks and months," Thompson said, "I will be engaging with disabilities advocates across the country to rally behind this common-sense measure, and working with both Democrats and Republicans in Washington to ensure this discriminatory policy does not continue.
Read the text of the bill and follow its progress here:https://www.govtrack.us/congress/bills/113/hr2123