WHEN YOUR CHILD WITH SPECIAL NEEDS TURNS 18

As any parent of an adolescent knows, a child's transition into adulthood presents extraordinary opportunities for growth, reflection and responsibility. The child with special needs faces all of these changes along with the added challenges brought on by her individual disability. It's not unusual for a child with special needs to have a specialized set of caregivers and support organizations in place to guide her through these complicated years.

However, at some point in their child's early adolescence, most families suddenly realize that the services and programs that they rely on to care for the child will soon disappear and be replaced by radically different benefits, most of which abruptly come into play once their son or daughter leaves the public education system, which often provides the bulk of the child's care and daily structure. This may happen at any time between age 18 and 23, depending on the state and the child's particular needs. Managing this transition from juvenile services to adult care presents one of the greatest difficulties and sources of stress for parents of children with special needs.

Broadly speaking, children with special needs and their families usually deal with five interconnected types of transitions between the ages of 14 and 25:

Financial Support

The financial planning steps a family takes when their child turns 18 establish the foundation for the child's support and well being for the rest of their life.

Most special needs planning begins with a look into whether a child needs and qualifies for Supplemental Security Income (SSI) for support. SSI is a means based program for people with disabilities and provides a limited monthly cash benefit of about $700 a month, the exact amount depending on the state and whether the beneficiary receives housing or income from other sources. In and of itself, this payment may or may not mean much for a child's financial future (although for poorer families or individuals it may), but SSI eligibility also comes with a much more important benefit -- access to Medicaid. For this reason alone many families, especially those with children who have major medical expenses, pursue SSI benefits despite the program's severe income and asset limits. SSI can also be the ticket into vocational training and group housing services.

Once a child reaches age 18, she qualifies for SSI based on her own income and assets. In order to receive benefits, the child must meet the government's disability standard, have less than $2,000 in assets and receive minimal income. Each dollar of unearned income (including any direct payments of cash to a beneficiary, along with additional reductions for in-kind payment for food and shelter) and every two dollars of earned income reduces a beneficiary's base SSI award by one dollar. If the SSI benefit reaches zero because of this reduction, SSI coverage ends. Despite these restrictions, an SSI beneficiary needs only a $1 award in order to retain her Medicaid benefits, so careful planning in this realm carries great rewards.

A child who became disabled before reaching 22 years of age can also collect Social Security Disability Insurance (SSDI) based on a parent's work record if either of his parents has worked enough quarters to collect Social Security and is already receiving Social Security benefits or has passed away. Under SSDI, the "adult disabled child" of the Social Security beneficiary receives a monthly benefit check, as long as he doesn't perform substantial work, defined as earning more than $940 a month. After receiving SSDI for two years, the adult disabled child also begins to receive Medicare, a substantial benefit.

Often, adults who became disabled as children receive SSI benefits until their parents retire, at which point they transition to SSDI, which is usually preferred both because it may offer a higher monthly benefit and the beneficiary no longer needs to be concerned about SSI's strict rules on other sources of income and savings. On the other hand, the switch to SSDI can be problematic if it means that the adult child loses eligibility for Medicaid or other programs.

If a child has more than $2,000 in assets when he reaches age 18, rendering him ineligible for SSI, a parent, grandparent or court has the power to create a special trust, known as a "(d)(4)(A)" or "first-party supplemental needs" trust to hold his savings. Any assets held by the trust do not count against the $2,000 asset limit for SSI allowing him to qualify. One requirement of such trusts is that when the beneficiary passes away, any funds remaining in the trust must be used to reimburse the state for medical care the trust beneficiary received during his life. Because of this payback provision, planners often encourage trustees to pay for a child's supplemental needs from a (d)(4)(A) trust before using other assets, in order to limit the state's collection later on.

Finally, many families also create additional trusts known as "third-party" supplemental needs trusts. As long as families fund these trusts with their own assets (never with their child's funds) and give the trustee complete discretion to distribute the funds for a beneficiary's care, the funds held in the trust will not count as the child's assets. Furthermore, these trusts do not have to contain a payback provision, allowing families to place significant amounts of money into the trust without worrying that the government will receive a large portion later on. The trusts can then provide a child with special needs with services and care he may not receive from other sources throughout his life.

Decision Making

Parents accustomed to making most decisions for their child with special needs confront a dilemma when their child reaches the age of majority. In most states, children obtain decision making authority upon turning 18, and this rule applies to everyone, regardless of their disability status. What to do once a child reaches 18 depends on her capacity for making informed choices as an adult.

If a child cannot make her own decisions regarding personal or financial matters, the must likely path for parents is to petition for guardianship. This process involves hiring an attorney and providing proof of the child's legal incapacity. At the conclusion of the process, if the petitioning parent proves her case, the court declares that the child is incapable of making decisions on her own and appoints the parent as guardian. Following appointment, the guardian must make periodic accountings to the court, reducing the risk to the child but also slightly decreasing parental control of their child's actions. Courts typically require that guardians ask for court approval before making any large-scale decisions regarding a ward's finances or living situation.

Alternatives to guardianship exist that can help avoid the cost and red tape of guardianship. So long as the 18-year-old understands, she may execute a durable power of attorney giving an agent the power to make many financial decisions and create a health care proxy designating an agent to make health care decisions. These tools, in tandem, are usually enough to prevent a parent from having to resort to guardianship if their child's decision making ability becomes more limited later in life.

Education and Work

According to the National Collaborative on Workforce and Disability, one-quarter of all adults with disabilities work at either a full- or part-time job. Some of the remaining three-quarters are unable to work at all due to their disability, but a large number of disabled adults who aren't employed don't have a job because they lack the skills necessary for gainful employment. Several federal laws address this situation with the goal of providing vocational education to a wider segment of the population with disabilities.

The Individuals with Disabilities Education Act (IDEA) mandates that special education plans begin transition planning when a child turns 14. At this point, a written transition plan must be incorporated into a child's Individual Education Plan, outlining the steps a school will take to help a child with special needs acquire skills necessary for an eventual move into the work force. By the time the child turns 16, the special education team must steer the child towards development programs keyed towards the child's individual vocational preferences. The law also mandates periodic measurement of the child's progress to ensure that he receives attention from the proper vocational advocates.

Once a child reaches 18 and receives either SSI or SSDI payments, the Social Security Administration (SSA) offers several programs to encourage him to work. The best-known program, the Ticket to Work Plan, is a somewhat complicated program designed to offer beneficiaries a way to begin a career without having to worry about losing their SSI or SSDI benefits.

Under the program, any month that a beneficiary earns more than $670 counts as a month of "trial work." If during any 60-month period a beneficiary has nine months where he earns more than this $670 limit, the trial period ends. After the end of the trial period, a beneficiary does not receive an SSDI payment in any month where he makes "substantial earnings" of more than $940. For three years after the end of the trial period a beneficiary can immediately regain benefits if he falls below the substantial earning level and still has a disability. Also, a beneficiary receiving Medicare because of participation in SSDI can continue to receive free Medicare Part A services for up to four and a half years following the end of the trial period. While complicated, these rules make an SSDI beneficiary's transition into the workforce slightly less burdensome than if benefits immediately ended.

As noted above, SSI beneficiaries must conform to very strict income and asset limits. Often, beneficiaries who could hold a job do not pursue one because they are worried that they will lose their SSI benefits once they earn too much. While this is certainly a concern, the benefits of employment may outweigh the loss of SSI. Furthermore, the government provides specific incentives for SSI beneficiaries to work. For instance, if a person with disabilities is under 22 and at school or in a vocational training program, $1,550 of his monthly income does not count against his SSI benefit, up to a yearly limit of $6,240.

The Social Security Administration also offers the PASS (Plan for Achieving Self Support) program for SSI beneficiaries who would like to work. Under this program, a beneficiary presents the SSA with a detailed plan for obtaining a specific type of employment. Once the SSA approves the plan, a beneficiary sets aside income and assets towards achieving their goal without having those funds count against their benefit. Funds can be used for things like child care, transportation, books and supplies, and additional education and training.

Many programs are available for people with special needs to seek employment if they would like to do so. Unfortunately, the rules for most of these programs are complicated and the SSA is often not very good at explaining them. Parental attention and planning well before a child turns 18, usually with the assistance of local vocational agencies and qualified attorneys, , offers the best chance for successfully navigating the maze of educational and employment opportunities.

Medical Coverage

Depending on her specific special needs, a child turning 18 could require significant health care or require no immediate coverage. Some parents have health insurance that covers their child with special needs if the child is still living at home due to significant disability. However, each health insurance company's definition of a disability may or may not match the SSA's, the insurer may not offer coverage for the specific drugs or services the child requires, or it may not offer coverage for adult children with disabilities at all, making it all the more important to review the family insurance policy to determine what further coverage a child's condition requires.

If a parent's private insurance is not going to provide the coverage their child needs and the child will not receive coverage through employment, then he must seek Medicare or Medicaid coverage. As explained above, access to SSI automatically qualifies a beneficiary for Medicaid, and SSDI recipients begin receiving Medicare two years after beginning to receive SSDI payments.

These are not the only ways to obtain government-funded health care. Individual states may offer Medicaid to adults with disabilities who meet different income or asset requirements. Furthermore, some states offer working adults with disabilities discounted health insurance or access to supplemental insurance that may improve upon the benefits provided by an employer.

Housing

One of the most difficult hurdles for families of children with special needs is the question of where the child will live. Will she stay with her parents, go to college, live on her own, or move to a group home? Will she be able to support herself, need support from her parents or require subsidized housing?

Families may grapple with these tough decisions at the time a child reaches adulthood or at a later time when living at home with parents is no longer appropriate or no longer possible. Whenever this transition occurs, it requires careful planning and extensive research about the options available in the particular community. Advance planning is important so that this vital transition does not occur under the sudden pressure of a parent's illness or death.

Conclusion

The transition to adulthood can be difficult for anyone, but doubly or triply so for an individual with special needs. In addition to the emotional and developmental challenges it brings, it means huge transitions in terms of benefits programs, education, day-to-day structure, medical coverage and residential choices. Fortunately, with proper planning and assistance from non-profit organizations that work with individuals with special needs and from professionals in the field, these transitions can be smooth and open up new opportunities to individuals with special needs and their families.

Harry S. Margolis practices elder law and special needs planning in Massachusetts and is a co-founder of the Academy of Special Needs Planners.

Eric Prichard is a freelance writer who focuses on special needs and elder law. He is also a licensed Massachusetts attorney.

-From: “What to Do When Your Child Turns 18” Margolis & Bloom Articles, retrieved 9/16/08 from http://www.elderlawanswers.com/wsb-sliced/Article.asp?ID=7132&section=6&FirmID=794&Template=8 .

 

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