Tuesday, August 7, 2012
OBRA SPECIAL NEEDS POOLED TRUSTS and IL State Senate Bill 2840
We at ProbateSharks continue to have concerns about OBRA Special Needs Pooled Trusts. OBRA Trusts were created to allow people who have special needs to qualify for Medicaid by depositing their money into these trusts. The intention of these trusts was to preserve estates of disabled people by allowing them to qualify for public aid nursing homes while preserving their estate for their special needs.
Unfortunately, these trusts are being abused by certain guardians in Cook County. Elderly disabled people with large estates are being targeted for guardianships through unscrupulous methods including: Illegal removal of Powers of Attorney, deceit of the elderly by owners of guardianship companies, and inaccurate medical reports being submitted into court records to make the elderly appear to be disabled with dementia. Once the rich elderly disabled person becomes a ward of the court, the unscrupulous guardians place the wards' estates into OBRA trusts, place the ward into for-profit Medicaid-funded nursing homes, and then deplete the estate through guardian fees, care management fees, and attorneys fees.
In other words, OBRA Trusts are being used by some to financially exploit the elderly disabled while profits are obtained for the guardians, attorneys, case managers, and for-profit nursing home owners. This is being done at the expense of the wards, and the taxpayers in the state of Illinois.
In June of this year, Governor Quinn signed Senate bill 2840, which became Public Act 97-0689.It is called the Save Medicaid Access and Resources Together (SMART) Act. Its impact is anything but friendly to Illinois seniors, especiallly those who are wards of the 18th floor of the Daley Center.
Unlike the January 1st rules changes, which were driven by federal laws, these new rules changes are almost entirely due to the well-known Illinois budget problems. The new law cuts $1.6 billion from the Medicaid budget, primarily by modifying eligibility requirements and benefits.
The biggest change made by SMART is the elimination of Pooled Payback trusts (also called OBRA d(4)(c) special needs trusts) in Medicaid planning for those over the age of 65, UNLESS THEY ARE WARDS OF THE STATE OR PUBLIC GUARDIAN!!!
Previously, a senior could place their assets into a pooled payback trust and qualify for Medicaid immediately. In exchange, when the senior passed away, their trust would be required to reimburse the State of Illinois for whatever Medicaid had spent on the senior (the “payback” part of the trust name). One significant benefit of the pooled payback trusts to seniors was that payback happened at the Medicaid rates (what the State of Illinois pays nursing homes), which usually offered a substantial discount over the nursing home’s private pay rates.
Individuals over the age of 65 will no longer be able to participate in OBRA pooled trusts, unless they are a ward of the State or County Public Guardian!
We not only feel that bill 2840 will negatively impact senior citizens who need it, we at ProbateSharks are appalled that those who unethically profit from OBRAs (guardians, attorneys, case managers, and owners of for-profit Medicaid nursing homes) will be allowed to continue their modus operandi for financially exploiting the elderly disabled wards of the 18th floor of the Daley Center in Cook County, Illinois.
We at ProbateSharks are also concerned because those with Powers of Attorneys (POA) in place may now be encouraged to go through guardianship proceedings so they may qualify for an OBRA trust. This unnecessary switch from a POA will result in the total elimination of all rights of the disabled once the guardianship is established, and will serve to further drum up business for the unethical bottom-feeding attorneys, judges, guardians, care managers, and nursing home owners who make a profit through expensive guardianships which deplete entire estates of the elderly disabled wards.
We encourage you to contact your legislators to also express your concerns. You can search for your representatives here:
Your ProbateSharks Advocates for the Elderly Disabled in Cook County
Posted by Probate Shark at 8:15 AM