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Pooled Advocate Trust

The Pooled Advocate Trust was first established in 2004. It permits South Dakotans with disabilities under the age of 65 to, upon approval of the Trustee, establish a sub-account with their own funds to preserve eligibility for Medicaid and/or SSI benefits. Funding a beneficiary’s sub-account does not result in "transfer penalties" for Medicaid eligibility purposes and once assets are held in a sub-account they are not considered available resources for purposes of most means-tested government benefits (e.g., Medicaid and SSI).

The trust utilizes a single "master trust agreement," eliminating the costs associated with drafting a supplemental needs trust. The trustee pools investments, generating efficiencies and additional cost savings, while maintaining separate sub-accounts for each beneficiary. Periodic accountings which detail investment returns and trust distributions are provided to each beneficiary.

The trust was drafted by Thomas E. Simmons, an Assistant Professor at the University of South Dakota School of Law. The trust has undergone periodic revisions and updates to keep pace with changes in the law. One legal innovation which has been incorporated into the trust is its "Alaska Trust" or "Domestic Asset Protection Trust" features. Those provisions help immunize trust assets from the claims of a beneficiary’s creditors, preserving a beneficiary’s sub-account for their own benefit.

When a beneficiary dies before the trustee has expended all of a beneficiary’s sub-account for his or her benefit, a Medicaid "payback" is required to the extent that the beneficiary received Medicaid long term care benefits prior to their death. Any additional funds remaining after the "payback" requirement has been satisfied are distributed to the heirs or loved ones identified in the beneficiary’s joinder agreement.

For more information call Sandy Schoenbeck in the First PREMIER Bank Trust Department at 605-357-3060.

 

Non-Deposit Investment