To set up a special needs trust for Parkinson's care, have an elder-law attorney draft an irrevocable trust and fund it correctly. A special needs trust is a legal account that pays for extra care without counting as the disabled person's own assets.
The trustee then uses the money only for supplemental needs. Parkinson's care often mixes covered medical care with daily supports. The trust fills the second gap while leaving SSI and Medicaid in place.
Medical information disclaimer: This article is for general educational purposes only and does not provide medical advice, diagnosis, or treatment. Always consult a physician or other qualified health professional about symptoms, medications, tests, or treatment decisions.
Table of Contents
- Choose the funding source first
- Check first-party age and creation rules
- Draft it to protect benefits
- How should the trustee pay?
- Report the trust and coordinate care
Choose the funding source first
Families should first choose the funding source. Third-party trusts use family money for a disabled beneficiary, while first-party trusts use the beneficiary's own assets like backpay or settlements.
That choice controls what happens later. First-party trusts must include a Medicaid payback provision requiring remaining funds at death to reimburse the state, while third-party trusts have no payback and leftovers can pass to heirs, according to PLAN of MA and RI in its guide to setting up a special needs trust.
- Use a third-party trust for gifts, savings, or inheritance from parents or relatives.
- Use a first-party trust for the person's own backpay, settlement, or savings.
Check first-party age and creation rules
A first-party trust under 42 U.S.C. §1396p(d)(4)(A) is exempt only if the beneficiary is under 65 and disabled under Social Security rules, created by a parent, grandparent, guardian or court, and for sole benefit, according to SSA in its POMS rules for first-party trusts. Those four tests all must fit.
The age limit matters for Parkinson's planning. A person who already meets disability rules but is 65 or older cannot use this exempt form. Families in that case often use a third-party trust instead.
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Draft it to protect benefits
Have an elder-law or special-needs attorney draft the trust as irrevocable with trustee discretion. SSA counts the trust as a resource if the beneficiary can revoke it or direct principal for food or shelter.
That detail protects eligibility. According to the Social Security Administration in its SSI resource guide, SSI denies payment when countable resources exceed $2,000 for an individual or $3,000 for a couple at month's start. Proper wording keeps trust principal outside that count.
How should the trustee pay?
Instruct the trustee to pay vendors directly and avoid direct cash to the beneficiary. Cash counts as unearned income and shelter payments count as in-kind support that reduces SSI.
Direct payment is simple in practice. The trustee pays the home aide agency, pharmacy, van service, or landlord. The beneficiary never holds the cash.
Report the trust and coordinate care
Report the trust to SSA and the state Medicaid agency at application and redetermination. Beneficiaries agree to disclose financial changes when accepting SSI or Medicaid.
Use trust funds for supplemental Parkinson's needs — aide hours, therapies, equipment, respite, transportation — while Medicaid, veterans benefits or long-term-care insurance cover covered care. Bring the signed trust papers to each benefits interview and keep vendor receipts with trustee records.
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