In his testimony before the Subcommittee, Richard Courtney made it very clear with his statement that the original legislation that led to the creation of Special Needs Trusts, the Omnibus Budget Reconciliation Act of 1993, was flawed. He said the law "included a drafting oversight that seems to assume that a person with disabilities lacks the requisite mental capacity to enter into a contract… We believe it was … not the intent of Congress to deny a basic right to individuals with disabilities."
In its report on the testimony, The (Jackson, MS) Clarion-Ledger's "Courtney testifies before Congress on behalf of persons with disabilities," said that, at present, special needs trusts funded with assets of an individual with disabilities must be created for that individual by his or her parent, grandparent, legal guardian or a court. Because of this requirement, adults with no living parents or grandparents and no guardian are forced to petition the court to create a special needs trust.
Courtney based his remarks on both his professional experience as a special needs and elder law attorney, as well as his experience as the father of a daughter with cerebral palsy and learning disabilities. Speaking of daughter Melanie, he noted that she needs and is receiving attendant care under a Medicaid waiver program. Because the cost of her care and services is expensive, she must rely on programs such as Medicaid, as do many persons with disabilities.
Right now the law says that she can't create her own trust if she were to receive an inheritance or settlement—so she could forfeit her Medicaid waiver benefits that pay her attendant each day for a few hours.
An SNT would allow Melanie to pay for additional health care that's not covered by Medicaid, in addition to basics like clothing, transportation, and furniture.
Talk with an elder law and special needs attorney if you have questions about SNTs.
For more information visit my Wichita KS Estate Planning Attorney website
Reference: The (Jackson, MS) Clarion-Ledger (October 18, 2015) "Courtney testifies before Congress on behalf of persons with disabilities"