Magazine article The Exceptional Parent

The Future of Special Needs Trusts

Magazine article The Exceptional Parent

The Future of Special Needs Trusts

Article excerpt

The Special Needs Alliance articles in EP magazine have dealt with many aspects of planning for special needs children. The advice has been practical and discussed some of the many considerations involved in the special needs trust. Readers have learned about tax implications, choice of trustees, maintaining government benefits, and many other important factors you must consider.

This article reflects one person's view of the possible future of Special Needs Trusts and their utilization. No one really knows how the future will play out, but it is important to look at the implications of current events on how we can serve and care for our special children in the coming years.

The Uncertain Future of Public Benefits

One of the most important reasons to set up a Special Needs Trust is to qualify the beneficiary for public benefits. Will those benefits be available 10 or 15 years from now? Will our current system be able to pay public benefits for health care costs for individuals who have assets that could be used to pay for services privately? In other words, will the government look to Special Needs Trusts to pay for care before government benefits become available?

In my home state of Florida, the size of the Medicaid budget has now surpassed the education budget. When new public benefit programs are proposed or additional funding is requested for current programs, state legislators, whether Republican or Democrat, are quick to point out their concerns for the long-term viability of these programs.

Three Looming Crises

I believe that the confluence of three crises illustrates the scope of challenges we face in the near future. It is not necessary to do much analysis to understand that we are in a crisis that is likely to get worse rather than better. There is a much longer list of needs and health problems, but each of the following three crises is enough to change the public benefits paradigm in the United States.

First: The first crisis is the continued growth of Alzheimer's disease with an aging population. The Alzheimer's Association predicts that Alzheimer's disease alone will break the public benefits system unless a cure or effective treatment is found within the next 10 years.

Second: The second crisis is the terrifying rise and cost of autism and related disorders. Dr. William M. McMahon, MD, presented a program titled, Working with Families and Individuals with Autistic Traits or Asperger's Syndrome, at the 2006 NAELA Advanced Elder Law Institute in November 2006. Dr. McMahon related that autism prevalence has gone from 4 per ten thousand a few years ago to 1.3 per thousand today, and the prevalence continues to rise. Lifetime direct and indirect costs to treat and care for a child with autism exceed 3.2 million dollars. If the rate of growth in autism continues to rise or even remains constant, it is enough to break our public benefits system.

Third: The third crisis is the aging of the baby boomers. If this age wave needs, wants, and expects the level of care currently provided by Medicare and Medicaid, we will have costs rising at a rate most citizens and politicians are likely to find unacceptable. Federal Reserve Chairman, Ben S. Bernanke, has cautioned the country, saying in a speech on October 4, 2006 that ". …

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