Text: HF02354 Text: HF02356 Text: HF02300 - HF02399 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 Section 1. NEW SECTION. 634B.1 DEFINITIONS.
1 2 As used in this chapter, unless the context otherwise
1 3 requires:
1 4 1. "Person with a disability" means a person to whom one
1 5 of the following applies, prior to the creation of a trust
1 6 which otherwise qualifies as a personal needs trust for the
1 7 person's benefit:
1 8 a. Is considered to be a person with a disability under
1 9 the disability criteria specified in Title II or Title XVI of
1 10 the federal Social Security Act.
1 11 b. Has a physical or mental illness or condition which, in
1 12 the expected natural course of the illness or condition, to a
1 13 reasonable degree of medical certainty, is expected to
1 14 continue for a continuous period of twelve months or more and
1 15 substantially impairs the person's ability to provide for the
1 16 person's care or custody.
1 17 2. "Personal needs trust" means an irrevocable trust
1 18 created for the benefit of a person with a disability and
1 19 funded with income or lump sum amounts received as damages or
1 20 for any other purpose to or for the benefit of the trust
1 21 beneficiary under the terms of a settlement agreement or
1 22 judgment.
1 23 Sec. 2. NEW SECTION. 634B.2 PERSONAL NEEDS TRUST –
1 24 REQUIREMENTS.
1 25 1. A personal needs trust established in compliance with
1 26 this chapter is in keeping with the public policy of the state
1 27 and is enforceable.
1 28 2. A personal needs trust established under this chapter
1 29 shall comply with all of the following:
1 30 a. Shall be established by a parent, grandparent, legal
1 31 guardian, or spouse of the beneficiary within six months of
1 32 receipt of the initial amount under the terms of a settlement
1 33 agreement or judgment.
1 34 b. Shall be established as a discretionary trust for the
1 35 purposes of providing a supplemental source of payment of
2 1 expenses which include but are not limited to the reasonable
2 2 living expenses and basic needs of a person with a disability
2 3 only if benefits from publicly funded benefit programs are not
2 4 sufficient to provide adequately for those expenses or needs.
2 5 c. Shall contain provisions which prohibit disbursements
2 6 that would result in replacement, reduction, or substitution
2 7 of publicly funded benefits otherwise available to the
2 8 beneficiary or in rendering the beneficiary ineligible for
2 9 publicly funded benefits. The personal needs trust shall
2 10 provide for distributions only in a manner and for the
2 11 purposes that supplement or complement the benefits available
2 12 under medical assistance, state supplementary assistance, and
2 13 other publicly funded benefit programs for persons with
2 14 disabilities.
2 15 3. For the purpose of establishing eligibility of a person
2 16 as a beneficiary of a personal needs trust, disability may be
2 17 established conclusively by the written opinion of a licensed
2 18 professional who is qualified to diagnose the injury, illness,
2 19 or condition, if confirmed by the written opinion of a second
2 20 licensed professional who is also qualified to diagnose the
2 21 illness, injury, or condition.
2 22 4. The trust income and assets of a personal needs trust
2 23 are considered available to the beneficiary for medical
2 24 assistance or other public assistance program purposes to the
2 25 extent that income and assets are considered available in
2 26 accordance with the methodology applicable to a particular
2 27 program.
2 28 5. A personal needs trust is not subject to administration
2 29 in the Iowa district court sitting in probate. A trustee of a
2 30 personal needs trust may disburse both income and principal in
2 31 any amount according to the terms of the trust document,
2 32 without the supervision or approval of the court.
2 33 6. The trustee of a personal needs trust may, at the
2 34 trustee's discretion, use income and principal for expenses
2 35 associated directly with the beneficiary's disability, and for
3 1 expenses that are solely supplemental in nature to improve the
3 2 beneficiary's quality of life as determined by the trustee.
3 3 7. Following the death of the beneficiary of a personal
3 4 needs trust, the state may file a claim against the personal
3 5 needs trust for payment of any debt due and owing the
3 6 department of human services for payment of medical assistance
3 7 paid on behalf of the beneficiary.
3 8 8. A personal needs trust is not enforceable if the
3 9 beneficiary becomes a patient or resident after sixty-four
3 10 years of age in a state institution or nursing facility for
3 11 six months or more and, due to the beneficiary's medical need
3 12 for care in an institutional setting, there is no reasonable
3 13 expectation, as certified by the beneficiary's attending
3 14 physician, that the beneficiary will be discharged from the
3 15 facility. For the purposes of this subsection, a beneficiary
3 16 participating in a group residential program is not a patient
3 17 or resident of a state institution or nursing facility.
3 18 EXPLANATION
3 19 This bill provides for the establishment of personal needs
3 20 trusts which are established for the benefit of persons with
3 21 disabilities and which are funded by amounts received through
3 22 a settlement agreement or judgment. The trust is to be
3 23 established as a discretionary trust with income and assets of
3 24 the trust used only for supplementing existing funding sources
3 25 for payment of the needs of the person with a disability.
3 26 Disbursement of the funds is prohibited if the result would be
3 27 a replacement, reduction, or substitution of public funds or
3 28 would render the beneficiary ineligible for a publicly funded
3 29 benefit. Establishment of eligibility of a person as a person
3 30 with a disability may be provided by the written opinion of a
3 31 licensed professional who is qualified to diagnose the injury,
3 32 illness, or condition if the opinion is confirmed by a second
3 33 qualified person. The bill provides that the trust income and
3 34 assets are considered to be available to the beneficiary for
3 35 the purposes of determining the beneficiary's eligibility for
4 1 public programs to the extent that a particular program's
4 2 methodology requires. A personal needs trust is not subject
4 3 to administration by the probate court and the trustee may
4 4 make disbursements at the trustee's discretion, in accordance
4 5 with the terms of the trust document, for expenses associated
4 6 directly with the beneficiary's disability and for expenses
4 7 which are solely supplemental in nature if the beneficiary's
4 8 quality of life will be enhanced, without the supervision or
4 9 approval of the court. A personal needs trust is not
4 10 available to a person who is a patient or resident of a state
4 11 institution or nursing facility for six months or more after
4 12 the age of 64 if the person is not reasonably expected to be
4 13 discharged from the facility.
4 14 LSB 4112HH 76
4 15 pf/cf/24
Text: HF02354 Text: HF02356 Text: HF02300 - HF02399 Text: HF Index Bills and Amendments: General Index Bill History: General Index
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