What are the rules for Medicaid trusts?
In North Carolina, Medicaid trusts are legally binding arrangements set up to protect the assets of an individual with a disability. These trusts are an important part of disability planning law, as they allow individuals to set up funds for their care that are not considered assets for the purpose of calculating Medicaid eligibility. In order for trusts to qualify for Medicaid, they must meet specific criteria. The trust must be established for the sole benefit of an individual with a disability, and the assets of the trust are not allowed to be used or accessed by any other individuals. The trust must also be irrevocable, meaning that once the trust is set up, it cannot be changed or revoked. The trust also must be administered by a trustee who is qualified to manage the trust according to Medicaid rules. In addition, the trust must also specify how the income and assets of the trust will be used to provide for the care and support of the individual with a disability. Any funds that are left in the trust after the individual’s death must be used to pay back any Medicaid assistance the individual received during their lifetime. Finally, the trust must be established prior to the individual turning 65, and no contributions are allowed to be made to the trust after the individual turns 65. These rules are essential to ensure that individuals with disabilities have access to the funds they need to support themselves, while still allowing Medicaid to ensure that their resources are not being used or abused.
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