General Pooled Trust Questions
What is a pooled trust?
A pooled SNT, is a special type of irrevocable trust where a not-for-profit trustee agrees to manage assets for the benefit of a person with a disability. This allows individuals to gain and maintain financial eligibility for means-tested government benefits, including Medicaid and Supplemental Security Income (SSI).
Separate sub-accounts are maintained for each beneficiary, however, funds are pooled for investment and management purposes.
Funds deposited into the trust can then be used to pay for life-enhancing items and services that a person’s benefits do not provide.
Are pooled trusts legal?
Yes. Federal and New York statute permit the use of pooled trusts by persons with disabilities to protect income and assets while preserving a person’s financial eligibility to receive means-tested government benefits. In New York, pooled trusts are administered by non-profit organizations and a financial institution serves as co-trustee.
NYSARC Community Trusts are qualifying pooled supplemental needs trusts authorized by 42 U.S.C. § 1396p (d)(4)(C), and available to people with disabilities of any age.
Reference: Section 1917 (d)(4)(C)(i) of the Social Security Act and NY Social Services Law § 366(2)(b)(2)(b)(2)(iii)
Why should I join a pooled trust?
Pooled trusts allow you to qualify for Medicaid home care and other community services if your income is too high, but you need that money to pay your monthly living expenses.
You might also join a pooled trust to protect excess income or assets to maintain your financial eligibility for Medicaid and/or Supplemental Security Income (SSI) benefits. The financial limits to be eligible for these programs can be quite low. For example, a single person on SSI can never have more than $2,000 in their name.
You might choose a pooled trust in these situations if you could benefit from working with a professional trustee who knows the rules of Medicaid and SSI. Or if you are receiving a modest sum of money and you want the benefits and cost-savings from pooling your funds with others.
Who is eligible?
You can participate in a pooled trust with NYSARC Trust Services if you are a New York resident who is disabled as defined by Social Security Law Section 1614(A)(3) [42 USC §1382C(A)(3)]. This includes people with disabilities and adults over age 65 who are experiencing disabling chronic health conditions.
NYSARC Community Trusts are qualifying pooled supplemental needs trusts authorized by 42 U.S.C. § 1396p (d)(4)(C), and available to people with disabilities of any age.
How does it work?
Funds deposited into the trust, become the property of the trust so that this money is no longer considered when calculating your financial eligibility for means-tested benefits. NYSARC will administer the account and distribute funds upon your request when provided with required documentation to purchase eligible items and services that are for your primary benefit.
The trust will pay third parties such as a licensed business or to reimburse an individual for making a purchase on your behalf. The trust cannot reimburse the trust beneficiary, their spouse, or, in some cases, a person’s Legal Guardian. For examples of eligible expenses and purchases, read the applicable Information and Procedures.
Learn more about How It Works.
Do the funds roll over from month-to-month?
Yes, under current New York State Medicaid law the funds in a trust account are not required to be spent every month. Any funds that you do not use, will simply roll over to the next month to be used for eligible expenses and purchases at a future date.
Can the trust be cancelled if I no longer need it?
Yes, if you no longer need the trust you can close your account by notifying NYSARC and spending the available funds on eligible expenses during your lifetime. A pooled trust is irrevocable in order to protect a person’s financial eligibility for benefits. So the funds cannot simply be returned to you. If you have questions, contact customer service at (518) 439-8323.
What if I move out of New York State?
If you move out of state, you will still be able to utilize the funds in your trust account. Depending on the benefit rules in the new state, NYSARC may continue to provide the same services it provides to residents of New York. However, there is no guarantee that this trust account will protect your eligibility for means-tested benefits in another state. To continue receiving benefits in the new state, you must consult the applicable state laws.
NYSARC Trust Services specializes in understanding how to protect financial eligibility for means-tested government benefits in New York. If you decide to move and it is determined that NYSARC is no longer the best program to serve you, we will do our best to assist you in finding an alternative option in the new state. While expenses are not always required, any associated costs will be charged to the trust account.
How are the funds invested?
The assets in certain trust accounts may be invested. Trust funds are invested according to the Trust investment policy, which is administered by the co-Trustee, a financial institution and approved by NYSARC.
NYSARC’s co-trustee Key Bank has more than 190 years of trust administration and wealth management experience. Each sub-trust account owns a pro-rata share of the investments, which are subject to market fluctuations.
Which trust is right for me?
Visit Our Trusts for more information about each of our trust programs or review the Trust Comparison Chart. If you have questions, please contact us and we will gladly help you determine the best trust for you or your loved one.
How to get the most benefit from a trust?
Our staff is here to help you utilize trust funds to purchase appropriate, life-enhancing items and services. To get the most benefit from a trust, we recommend that you make regular disbursement requests and contact us with any questions you have about what the trust can pay for. Also, keep in contact with us so that we are aware of life changing events that may affect a trust.
What happens to the money in a pooled trust when the person dies?
According to Federal policy, a first party pooled trust must close upon the beneficiary’s death. Any funds in the account are typically retained by NYSARC to support other people with disabilities served by Chapters of The Arc New York. If NYSARC did not retain the funds, that money would go to repay the State(s) who provided care to the individual up to the amount of any Medicaid lien/s.
For Community Trust III accounts, if the balance in the account is greater than your outstanding Medicaid lien/s, NYSARC will repay the lien and retain a percentage of the balance before distributing the remaining amount as directed in your Joinder Agreement.
For third party trusts, remaining funds are distributed according to the donor’s wishes as indicated on the Joinder Agreement, will, or trust document. Contact us with questions at (518) 439-8323.
How do I join the Trust?
How much money do I need to establish a trust?
A minimum of $300 is required to establish most of our first party pooled trust programs. Other trust programs require larger initial deposits. See the applicable fee schedule or reference the Trust Comparison Chart for more information.
The one-time enrollment fee and the first month’s administrative fee will be deducted from your initial deposit in the month the account is established.
How do I establish a NYSARC Pooled Trust?
The beneficiary, donor, or authorized representative must submit a complete, signed and notarized Joinder Agreement (trust application) with the required supporting documents and minimum opening deposit. For detailed instructions, visit Join the Trust.
We are here to help guide you through the enrollment process. Please call customer service at (518) 439-8323 for assistance.
How quickly can I open a trust?
Applications are generally processed within 5 business days. We understand the need to open a trust quickly. Most of our trusts can be opened within 48 hours. To expedite trust approvals, contact us as early as possible and we will work with you to get an account set up as quickly as possible.
Do I need an attorney?
We encourage you to consult with an attorney or other professional before making a decision. However, you are not required to use an attorney to complete the Joinder Agreement and depending on your situation, you may not need to pay an attorney to join a pooled trust.
For third party trusts, you should work with an attorney to fund a trust through your will or estate plan to ensure it meets the donor’s needs and the requirements of applicable state law. You should also consult with a tax professional before making any changes to your beneficiary designations.
What does the trust cost?
There is a one time, non-refundable enrollment fee to establish a trust. Monthly fees are charged according to the current fee schedule. The one-time enrollment fee and the first month’s administrative fee will be deducted from your initial deposit in the month the account is established. See Our Trusts for more information and use the applicable Fee Calculator to estimate the monthly cost of your trust account.
Our monthly fees cover all trust activity with no hidden fees or annual renewal fees. This low fee structure keeps costs down so that you can get the most benefit from your trust. For more details, contact us! We are happy to go over the specific fees for the trust you are interested in.
How do I deposit funds into my trust account?
You can schedule monthly electronic deposits from your bank account and establish a trust account with a one-time electronic deposit.
You can also make deposits by mailing a check to the address on your deposit slip.
How do I set up electronic deposits?
Complete the Electronic Deposit form and attach a voided check so that we can verify your bank account information. You can use this form to set up recurring monthly deposits of your Medicaid spend-down or structured settlement payments and to establish an account with a one-time electronic deposit.
For monthly deposits, the trust will pull the funds from your bank account on the day you choose. One-time deposits are typically processed within 5 business days from the date of receipt.
How do I request a change in my monthly electronic deposit?
Your deposit may change from time to time. Simply submit a completed Electronic Deposit form to request a change to your scheduled deposit. Please allow ample time for us to process your request.
How do I deposit by check?
Make checks payable to NYSARC, Inc. Community Trust fbo Beneficiary’s Name.
Mail the check with a deposit slip to the address listed on that form. ONLY send deposit checks to this address. Deposit slips are provided to you once you establish an account and can also be downloaded from the Online Portal.
When funding a new account, complete the New Account Deposit Slip. Please note, that this address is different than the address to submit a Joinder Agreement.
What are some common sources of funding?
Common Sources of Funding Include:
- Excess monthly income for Medicaid spend-down
- Excess resources as a lump sum or structured payments
- Assets from a third-party donor – typically funded through estate plan
A trust may help protect sources of income that put you over the Medicaid monthly income limit, such as Social Security Retirement Income (SSA), Social Security Disability Income (SSDI), Social Security Survivor Benefits, pension, alimony, structured settlement payments or other types of monthly income.
A trust can also protect lump sum assets such as a direct inheritance, settlement proceeds, retroactive benefit payments, and resources accrued from wages, Disabled Adult Child (DAC) benefits and other monetary gifts.
Third Party Funds
A third-party trust can protect funds from a third party donor on behalf of a person with a disability. Most accounts are funded through the Donor’s will, estate plan, life insurance policy, or employee benefit.
Submitting Disbursement Requests
How to make disbursement requests?
To use trust funds, you must complete a Disbursement Request Form and attach the required supporting documentation for that expense. Disbursement Request Forms are provided upon account establishment, and can be downloaded from our Online Portal.
You can also schedule fixed recurring expenses like rent/mortgage, to be paid automatically each month. Complete the Automatic Payment form and attach the required supporting documentation for our office to review.
For more details, visit How It Works.
What can my pooled trust pay for?
Trust funds can be used for a wide range of items, services, and life-enhancing expenses that are for the primary benefit of the trust beneficiary.
The goal of the trust is to help our beneficiaries maintain financial eligibility for the services they receive through means-tested government benefits. Therefore, the trust must follow the rules outlined by Medicaid and other relevant government agencies when considering payments from the trust account.
A trust could pay for monthly living expenses including rent and utilities, uncovered medical expenses, adaptive equipment, travel, recreation and more.
For a detailed list of eligible and prohibited requests, please see the Information and Procedures document for your trust program and visit How It Works.
How do I track the activity in my account?
Account beneficiaries and their authorized contacts can register for our Online Portal to manage a trust account 24/7. You can stay up to date on all trust activity, submit requests, download VOD reports, access monthly bank statements and more.
Our knowledgeable customer service team is dedicated to helping you manage your account with ease. If you ever have a question or concern, don’t hesitate to call us! Our customer service hours are 8:30 a.m. to 5 p.m. Monday – Friday. If you call after business hours, you can connect to our automated phone line by dialing 8.
What happens to the money in an account when the Beneficiary dies?
According to Federal law, a pooled trust terminates upon the death of the Beneficiary. Any funds remaining in the trust at that time must be retained by the trust to further its mission or be paid back to the State(s) that provided Medicaid services in an amount equal to any lien.
However, we also offer trust programs that allow any funds, or a portion of the funds, that remain in a trust account upon the death of a Beneficiary to be distributed as designated within your trust agreement. If you have questions about the trust you are considering, give us a call (518) 439-8323.
Can the trust pay for funeral expenses?
Upon the beneficiary’s death, the sub-trust account must close and no further payments can be made from the account including funeral expenses.
However, the trust can pay towards a Medicaid irrevocable pre-need funeral arrangement during the lifetime of the beneficiary. This agreement can be set up by the funeral home and submitted to the trust to be paid automatically each month by filling out an Automatic Payment Application.
Rules regarding funeral expenses may be different for third party trust funds, so please review the Information and Procedures document for more information.
Third Party Trust Questions
How do I establish a third party pooled trust?
To establish a Third Party Community Trust, the Donor must complete the Joinder Agreement (JA) during your lifetime to share your vision for the trust and help us get to know your loved one. You will need to submit a signed and notarized Joinder Agreement, supporting documentation and a one time, non-refundable enrollment fee.
Please refer to the Information and Procedures document for detailed instructions to establish an account. We encourage the Donor to meet with an attorney to create or update your family’s estate plan, wills, titling of assets, and Beneficiary designations on insurance policies and retirement plans.
How to establish a NYSARC Unrestricted Fund?
The Beneficiary must have a diagnosis of an intellectual or other developmental disability in order for the
Grantor to be eligible to establish an account with the NYSARC Trust Unrestricted Fund.
You should consult with an attorney. NYSARC must review and approve the will or trust document. Please contact us to discuss the next steps.
How to fund a Third Party Community Trust?
At the time the trust is funded, the minimum initial deposit is $10,000. You do not need to fund the trust immediately. Most trust accounts are funded through the Donor’s will, estate plan, life insurance policy, or employee benefit. The trust can also be funded during your lifetime by a gift, bequest, or inheritance.
It is also helpful to notify family members and others about your loved one’s supplemental needs trust account, so that they may also direct funds to the trust account rather than leaving them to the individual directly.
Do I need to appoint a trustee?
No, one of the benefits of working with NYSARC Trust Services is that you do not have to select a trustee. NYSARC serves as the trustee and administers the account. A financial institution serves as co-trustee to manage trust investments.
The NYSARC, Inc. Executive Committee appoints a Management Board of Trustees who volunteer their time and expertise working with our executive staff and financial managers to maximize both your investment and the legal protections a trust can offer. Many of our trustees have loved ones with disabilities, so they bring compassion and deep personal understanding of the challenges people with disabilities and their families face every day.
How are funds in a Third Party Pooled Trust distributed at the beneficiary's death?
Upon the death of the trust beneficiary, NYSARC will distribute any funds that remain in the trust account according to the Donor’s wishes as indicated on the Joinder Agreement. This is a third party trust, so there is no requirement to payback Medicaid.
The primary Donor who established the account is the only person who can designate residual beneficiaries and may make updates periodically during their lifetime.
How are funds in a NYSARC Unrestricted Trust distributed at the beneficiary's death?
Upon the death of the trust beneficiary, the first $25,000 is transferred to NYSARC’s Exempt Fund to support the Arc New York Corporate Guardianship Program, which currently provides services to hundreds of people with intellectual and developmental disabilities who would otherwise have no legal guardian.
The remaining balance is distributed as outlined in the trust document.