SB516: relative to special needs trusts.

SB 516-FN - AS INTRODUCED

2004 SESSION

04-3239

05/09

SENATE BILL 516-FN

AN ACT relative to special needs trusts.

SPONSORS: Sen. Below, Dist 5; Sen. Larsen, Dist 15; Sen. Gatsas, Dist 16; Sen. Flanders, Dist 7; Sen. Estabrook, Dist 21; Rep. Patten, Carr 7; Rep. O'Neil, Rock 85; Rep. Wall, Straf 72; Rep. Kathleen Taylor, Straf 70; Rep. Fields, Hills 58

COMMITTEE: Judiciary

ANALYSIS

This bill excludes special needs trusts from income eligibility decisions for public assistance unless federal law permits their inclusion, and then only to the extent that the funds are used for support and maintenance, and are not used for administrative, medical, or educational expenses and exceed a specified amount.

This bill is a request of the joint legislative committee on administrative rules.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

04-3239

05/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Four

AN ACT relative to special needs trusts.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Paragraph; Public Assistance to the Blind, Aged, or Disabled Persons, and to Dependent Children; Eligibility for Assistance; Special Needs Trusts. Amend RSA 167:4 by inserting after paragraph IV the following new paragraph:

V. With regard to determining countable income when determining eligibility for all categories of public financial and medical assistance, the department shall not treat funds disbursed from special needs trusts, created by third parties or described in section 1917(d)(4)(A) and (C) of the Social Security Act, 42 U.S.C. section 1396p(d)(4)(A) and (C), to or for the benefit of the individual being qualified as countable unearned income to the individual unless and only to the extent that federal law otherwise so permits, and then for not more than the amount that such funds are used for support and maintenance, as determined by applicable federal law and regulations, plus the amount that such funds disbursed over the course of a calendar year for other than payment for the administrative costs of the trust or for the individual's medical or educational expenses, including the cost of special appliances, equipment, environmental modifications, and services to accommodate the individual's disabilities, exceed an amount equal to twice the federal poverty guideline for that individual. Funds expended by a special needs trust to purchase or maintain assets owned by the special needs trust shall not be considered as countable income to the individual. If disbursements from a special needs trust to or for the benefit of the individual exceed the amount permitted for eligibility established by the department pursuant to this paragraph, the individual shall be deemed ineligible for such assistance starting in the month following such determination of ineligibility.

2 Effective Date. This act shall take effect 60 days after its passage.

LBAO

04-3239

Revised 1/13/04

SB 516 FISCAL NOTE

AN ACT relative to special needs trusts.

FISCAL IMPACT:

The Department of Health and Human Services stated this bill will increase state revenue and expenditures and county expenditures by an indeterminable amount in FY 2005 and in each year thereafter. There will be no fiscal impact on county and local revenue or local expenditures.

METHODOLOGY:

The Department made the following assumptions:

· Financial assistance will be available to individuals with trusts who under current law are ineligible for medical assistance for an average of three months of the year.

· Discretionary spending from these trusts would increase depleting the trust assets sooner and limiting the state's ability to recover Medicaid expenditures.

· The number of individuals impacted by this bill can not be determined, but the Department is aware of at least 284 individuals.

· This bill will be effective July 1, 2004.

· The average monthly Aid to the Permanently and Totally Disabled (APTD) grant is $150.57, and the average monthly Medicaid expenditure for APTD recipients is $1,663. Counties are responsible for 50% of the APTD grants.

· Based on the known cases, the Department identified the following cost estimates which are not adjusted for inflation, but do consider caseload growth:

FY 2005 FY 2006 FY 2007

State Revenue

(federal and county reimbursement) $1,636,745 $4,537,552 $4,646,366

State Expenditures (3,273,490) (9,075,104) (9,292,733)

Net State Impact $1,636,745) ($4,537,552) ($4,646,367)

County Expenditures

(County share of financial grants) (359,561) (376,726) (385,760)

Net County Impact ($ 359,561) ($ 376,726) ($ 385,760)

In addition to the costs identified above, the Department expects an indeterminable increase in expenditures for administration, rulemaking, system and policy changes, and printing.