How does the Disabled Military Child Protection Act affect me?
In December 2014, President Obama signed the Disabled Military Protection Act which allows a military parent to provide a survivor benefit for a child with a disability, and have it paid to a special needs trust for that child’s benefit. Before this was enacted, military parents of children with disabilities faced a dilemma at retirement. That dilemma was whether or not to choose the military Survivor Benefits Plan (SBP) retirement option for their children. Under prior law, this could potentially interfere with the child’s eligibility for means-tested government benefit programs such as Supplemental Security Income or Medicaid.
The new law allows the Survivor Benefits Plan to be paid to the trust for the child with disabilities. In addition, a military member can treat the child, if above 18, as an Incapacitated Dependent and this would allow him/her to be permanently eligible for military post benefits and TRICARE health benefits. Since this may be insufficient for all the help needed, the child will likely need both SSI and Medicaid as well. However, families should be careful in planning for their disabled child because if that individual’s income exceeds $2199 per month, all supported living assistance, care, and services provided under Medicaid as well as the SSI benefits will be lost.
If the Survivor Benefits Plan is paid into the Special Needs Trust, the trustee, upon the child’s death, is require to reimburse the Medicaid plans if there are any assets remaining in the Special Needs Trust at that time.
Because planning for a disabled child can be complex, we encourage you to make an appointment and we would be glad to assist you in planning for your child’s future.